EBay issued sales and profit forecasts that fell short of analysts' estimates ahead of the key Christmas shopping season, citing "dramatically decelerating US e-commerce growth."
Fourth-quarter sales will be $4.5 billion to $4.6 billion, the operator of the largest online marketplace said in a statement last night.
Analysts on average were projecting revenue of $4.64 billion, according to data compiled by Bloomberg.
EBay forecast profit excluding some items of 79 cents to 81 cents a share for the period, below analysts' prediction of 83 cents.
The outlook raises red flags about what is typically EBay's biggest quarter, when consumers gravitate online to shop for Christmas. US online retail spending growth has slowed, climbing 13% in July and August from a year ago, compared with 16% in the second quarter, according to ComScore.
"The thing that's causing us the most angst is what we believe is a dramatically decelerating US e-commerce growth rate from the second quarter," EBay's chief financial officer Bob Swan said on a conference call after results.
"In a relatively short period of time, we've seen a pretty rapid deceleration in the market," he added.
The deceleration in sales may stall a turnaround of the Internet marketplace led by chief executive John Donahoe, who has shifted the company from auctions to payments and fixed-price goods.
"We are not expecting any improvement in the fourth quarter from what we experienced over the last eight to 10 weeks," Swan said of the US e-commerce market. "We have a cautious outlook for the holiday season."
The company reiterated that it is predicting 2013 revenue and profit to be at the lower end of full-year guidance as it increases spending on its enterprise business and a PayPal free-shipping promotion.
EBay usually rolls out a round of promotions for the Christmas shopping season, working with retailers like to arm store associates with tablets and create kiosks to help consumers navigate stores more quickly and efficiently.
EBay faces tough competition from Seattle-based Amazon.com., the world's largest e-commerce company. Amazon garnered 40% of its second-quarter revenue from third-party sellers, its own marketplace that competes directly with EBay.
For the third quarter, eBay said its revenue rose 14% to $3.89 billion from $3.4 billion a year earlier. Net income increased 15% to $689m from $597m a year earlier.
Revenue in EBay's marketplaces business, which includes auctions and fixed-price sales, climbed 12% to $2.03 billion in the latest quarter.
EBay has shifted focus to mobile, redesigning its mobile site and digital wallet. More than 35% of new users in the third quarter came from smartphones or tablets.
At online-payments unit PayPal, revenue rose 19% to $1.62 billion in the third quarter. PayPal's take rate, or the commission it takes from each transaction, fell to 3.7% in the third quarter from 3.9% the same time last year.
Last month, EBay agreed to buy Braintree, a mobile-payments company that helps startups like room-rental service Airbnb and cab-calling application Uber, for $800m in cash. Braintree projects payments volume of $12 billion this year, adding to $20 billion PayPal expects to process over the same period.
The deal is EBay's biggest since March 2011, when it acquired GSI Commerce for $2.4 billion, a company that hosts retailers' websites and offers marketing services to customers.