eBay's Outlook: Bah-Humbug

(Updated from Wednesday with Thursday's stock movement and additional insight on the company's performance.)

SAN FRANCISCO (TheStreet) -- eBay(EBAY Quote) shares are tumbling, a day after the e-retailer said it isn't bidding on a happy holiday.

Shares of eBay are sinking 4.1% to $23.95 in morning trading, as investors appear disappointed about its fourth-quarter outlook -- one that landed at the low end of Wall Street's consensus.

During the quarter, the company earned $350 million, or 27 cents a share, down 29% from $492 million, or 38 cents in the year-ago period.

On an adjusted basis, earnings came in at 38 cents a share, a penny more than analysts expected.

Revenue rose 5% to $2.2 billion, its first year-over-year gain in 12 months. The company saw strength from its PayPal business, which posted revenue growth of 15% to $688.1 million.

eBay has been experiencing pressure as traditional retailers like Wal-Mart Stores(WMT Quote) and Sears(SHLD Quote) enter the online market place.

Looking ahead, the company predicts fourth-quarter earnings in the range of 38 cents to 40 cents a share. Wall Street is calling for earnings of 40 cents.

Rival Amazon.com(AMZN Quote) is set to release its quarterly results after the close on Thursday.

-- Reported by Jeanine Poggi in New York

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