eBay's Profit Slips but Beats Estimates - TheStreet

Online auction site


(EBAY) - Get Report

beat analysts' sales and profit estimates in its second-quarter


, despite slumping sales from its core Marketplaces business.

Revenue from Marketplaces, which includes eBay, Shopping.com, StubHub, Kijiji and a number of other e-commerce sites, plunged 14% compared to the prior year's quarter. eBay blamed this on the stronger dollar and challenging macroeconomic conditions, similar to the 18% decline the division experienced in the prior quarter.

The company's shares nonetheless rose in extended trading, climbing 58 cents, or 2.98%, to $20.03, likely boosted by eBay's revenue and earnings beat.

eBay's overall sales came in at $2.1 billion, a $97.7 million decrease on the prior year's quarter, but just above analysts' estimate of $1.99 billion. Year-over-year revenue growth in the firm's PayPal and Skype businesses, however, was offset by the Marketplaces division and the effects of the strengthening dollar.

The San Jose, Calif.-based firm earned 25 cents a share on net income of $327.3 million, down from 35 cents a share and $460 million in the prior year's quarter. On a non-GAAP basis, eBay earned 37 cents a share on net income of $479 million, down from 43 cents a share and $568 million in the same period last year. Analysts surveyed by Thomson Reuters had forecast earnings of 36 cents a share.

"We drove solid second-quarter results, with strong momentum and market share gains at PayPal and continued stabilization in our core eBay business," said eBay CEO John Donahoe in a statement released Wednesday after market close. "I'm pleased with our pace, our progress and our performance."

The buzz that once surrounded eBay may have


in recent months, although


(GOOG) - Get Report







Q2 numbers have raised expectations about Internet spending.

eBay's rival


(AMZN) - Get Report



its own second-quarter results later this week, adding more color to online consumer spending patterns.

For the third quarter, eBay expects revenue between $2.05 billion and $2.15 billion, slightly above analysts' estimate of $2 billion. On a non-GAAP basis, the firm predicts earnings between 34 cents a share and 36 cents a share, in line with analysts' estimate of 35 cents a share.