eBay Inc. announced its sales forecast for the fourth quarter of the fiscal year, which missed initial analysts projections. The lower forecast comes as a result of the fact that the U.S.-based company is still recovering after it was hurt by a security breach, which affected customer growth.
The company made an official statement, revealing that its fourth-quarter revenue is expected to be in the range from $4.85 billion to $4.95 billion. eBay Inc. also stated that its profit before certain items will be between 88 and 91 cents per share. In comparison, the analysts expectations pointed to $5.16-billion sales and a profit of 91 cents a share.
The Chief Executive Officer of the company, Mr. John Donahoe, said in the statement, cited by the Financial Times: “Its growth is neither what we wanted nor what we expected.” As reported by CNet, Mr. Donahoe told analysts in a phone call after the company released its announcement: “Were going to try to do whats right for both businesses. The goal is to set each of these business up to succeed.”
The downward revision of the companys forecast comes amid fierce rivalry on the market and at a moment, when the company has just officially announced that it has decided to spin its PayPal unit off over the next year. Both the PayPal payments processing division and the companys core e-commerce business are to become independent and separately listed companies.
In addition, in May 2014 the company revealed that hackers managed to access some customers information on its e-commerce website after a data breach. The company is also facing difficulties, fighting with some search algorithms of Google, which are considered to have affected its ability to attract the attention of the worlds largest search engines users.
eBay Inc. was 0.69% down to close at $50.24 per share yesterday, marking a one-year decrease of 6.91%. The company is valued at $62.79 billion. According to CNN Money, the 37 analysts offering 12-month price forecasts for eBay Inc. have a median target of $62.00, with a high estimate of $68.00 and a low estimate of $50.00. The median estimate represents a +23.41% increase from the last price of $50.24.
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