EBay last night forecast quarterly revenue and profit for the crucial Christmas shopping season largely below market estimates, sending its shares down 8% in extended trading.
Ebay faces overwhelming competition from Amazon.com and brick-and-mortar retailers that are fast beefing up their online presence.
Ebay has revamped its platform to offer a bigger selection of products and more brands and to require sellers to give more details on products to attract younger shoppers.
The company said it had 165 million active buyers on the site, just missing analysts' estimate of 166.5 million, according to research firm FactSet StreetAccount.
The company has made investments to improve the platform's inventory management.
EBay is also ramping up marketing spending to attract more millennial shoppers and to rebrand itself as a shopping platform, which analysts say will pressure profits.
The company forecast revenue of $2.36 billion to $2.41 billion and adjusted profit from continuing operations of 52-54 cents per share for the current quarter.
Analysts on average were expecting revenue of $2.4 billion and earnings of 54 cents per share, according to Thomson Reuters I/B/E/S.
The company said its revenue rose 5.6% to $2.22 billion in the third quarter, beating the average analyst estimate of $2.19 billion.
Net income fell to $413m, or 36 cents per share, in the quarter ended September 30 from $539m, or 45 cents per share, a year earlier.
Excluding items, Ebay earned 45 cents per share, beating the average estimate of 44 cents.
