Shares of online auction giant eBay (EBAY) sank more than 4% in Thursday morning trading after the company signaled that it expects a weak holiday shopping season.
During the third quarter, eBay earnings totaled $689 million, up from $597 million during the same time last year. Adjusted EPS of 64 cents slightly topped Wall Street estimates, the Wall Street Journal notes.
Despite the good news, the company’s CFO said eBay has noticed “a pretty rapid deceleration in the market,” which suggested a cautious outlook for the holidays. CEO John Donahoe noted that retail sales were headed lower during the third quarter and that recent political squabbles in Washington had increased uncertainty.
The company recorded $3.89 billion in quarterly revenue, with its online marketplace generating $2.03 billion. That matched analysts’ forecasts.
Its online payment service, PayPal continued to perform well, with revenue rising 19% during the quarter. The service saw its number of users rise 4% compared to the prior quarter to 137.4 million. Ebay acquired PayPal for $1.5 billion more than a decade ago.