eBay Inc (NASDAQ:EBAY) provided a sales outlook for the third quarter that is lower than the estimates of Wall Street analyst as the e-commerce company experienced difficulty in attracting more users due to a data breach. The changes implemented to the search engine of Google Inc (NASDAQ:GOOG) (NASDAQ:GOOGL) also impacted its business outlook.
For the third quarter, eBay Inc (NASDAQ:EBAY) forecasted that it will be able to achieve revenue in the range of $4.3 billion to $4.4 billion. The e-commerce company expected its non-GAAP earnings between $0.65 and $0.67 per share.
Analysts estimated that eBay Inc (NASDAQ:EBAY) will be able to deliver $4.42 billion in revenue and $0.70 in earnings per share for the third quarter based on data compiled by Bloomberg.
BGC Partners analyst Collin Gillis commented that investors expected the e-commerce company to face challenges. He said, “I think investors expected headwinds. It’s not symptomatic of the business — that the wheels are coming off.”
During the quarter, eBay Inc (NASDAQ:EBAY) encountered new challenges while CEO John Donahoe was strengthening its competitiveness against Amazon.com, Inc. (NASDAQ:AMZN) and other competitors.
The company’s database with encrypted passwords and other non-financial data has been compromised due to a cyberattack, and encouraged its millions of registered users to change their passwords. In addition, Google Inc (NASDAQ:GOOG) (NASDAQ:GOOGL) decided to use a different search software, which reduced traffic from potential shoppers to its website.
eBay Inc (NASDAQ:EBAY) reported that its sales increased 13% to $4.37 billion for the second quarter, which fell short of the $4.39 billion consensus estimate. The e-commerce company posted Non-GAAP earnings of $0.69 per share, one cent higher than the $0.68 per share expected by analysts.
In a statement, Donahoe said, “PayPal generated another strong quarter while eBay’s growth was hampered by its global password reset for all users. We continued our momentum in the four competitive commerce battlegrounds of mobile, local, global and data.”
“You take a couple of body blows. You get back up and you fight,” said Donahoe in an interview. According to him, the company invested in targeted marketing to attract users to return to its service. He express confidence that eBay Inc (NASDAQ:EBAY) will recover from the data breach and search engine problems. He added, “We’re still working on ways to continue to grow our core EBay business. Commerce is not a winner-take-all market.”
The stock price of eBay Inc (NYSE:EBAY) closed $50.70 per share, down by 0.23%. During the extended hours trading, the shares of the e-commerce company climbed 1.46% to $51.44 per share.