Palo Alto, July 25: Ebay Inc. on Thursday posted a quarterly profit that more than doubled on significantly higher revenues, raised its full-year forecast and announced a 2-for-1 stock split. The online auctioneer also said it would pay $10 million to settle allegations that its PayPal online payment violated the law by providing services to online gambling merchants. Ebay said such activities were discontinued following its purchase of PayPal in October 2002.
Ebay shares fell sharply in after-hours trade following the release of the company's earnings, which did not outpace expectations as much as in some earlier quarters amid concern that the stock has become overvalued during its recent rally.
"Expectations, unofficial ones, tend to get much higher," said Deutsche Bank analyst Jeetil Patel.
"I don't think this was disappointing at all. It gives the stock some room to breathe and come back," Safa Rashtchy, an analyst at U.S. Bancorp Piper Jaffray said, following Ebay's share drop from a 52-week high of $115.74 on the Nasdaq to around $110 in after-hours trade. Bureau Report