Online retail site EBay has forecast 2010 results above expectations after posting double-digit revenue growth in PayPal and its main online market division.
The company, which is in the midst of a turnaround as it battles Amazon.com and other retailers, also beat Wall Street profit estimates in its closely watched Christmas quarter.
EBay, which connects buyers and sellers over the internet, has been overhauling its main marketplaces division to increase transactions on its site. Revenue rose at an annual rate of 15% at that business during the last quarter of 2009.
Gross merchandise volume, which measures the total value of goods sold on eBay, rose 24%. That marked a huge improvement over the negative trends seen earlier in 2009.
EBay said it expected full-year 2010 adjusted earnings of $1.63 to $1.68 per share on revenue of $8.8 billion to $9.1 billion. That was above the $1.60 per share expected, on average, by Wall Street analysts.
PayPal, its web payments business, which represents more than a third of overall revenue, saw a 28% revenue rise in Q4.
Gains in marketplaces, which includes Shopping.com, StubHub and other e-commerce businesses, were driven by more sold items and more goods purchased for fixed prices, rather than in an auction format.
The company has sought to increase selection, enhance security and make it easier to buyers and sellers to conduct transactions on the site. A lower tax rate and a stronger US dollar also helped results in the quarter.
Fourth-quarter net profit was $1.4 billion, or $1.02 per share, up from $367m, or 29 cents per share, a year earlier. Revenue rose 11% in the US and 21% internationally.
EBay sold the bulk of its Skype internet telephone arm, deemed a bad fit with the company, for about $1.9 billion in November to an investor group. EBay retains a 30% stake in Skype.
But legal costs related to Skype, together with costs from the acquisition of Korean e-commerce site GMarket, sent operating margins down. They fell to 7.6% in the quarter from 22.3% a year earlier.
