E-commerce firm eBay forecast first-quarter revenue below Wall Street estimates on Wednesday, signaling weak demand for products such as collector’s items and refurbished goods, sending its shares down 7 per cent in extended trading.
High interest rates and persistent inflation have hampered U.S. consumer spending for two years, leading to sluggish demand for non-essential items such as collectibles and luxury accessories.
The e-commerce company has been pressurized by decreasing advertising revenue, and combined with increased marketing investments it is facing sluggish profit growth.
It sees first-quarter adjusted earnings between $1.32 and $1.36 per share, the midpoint of which is above estimates of $1.33.
The company expects revenue in the range of $2.52 billion to $2.56 billion for the first quarter, compared with analysts’ average estimate of $2.59 billion according to data compiled by LSEG.
EBay expects gross merchandise volume, a key industry metric that denotes the total value of goods and services sold on the marketplace, between $18.3 billion and $18.6 billion for the quarter, below estimates of $18.8 billion.
