EBay last night forecast second-quarter profit that fell short of analysts' estimates, as it spends heavily on revamping and marketing its e-commerce platform amid stiff competition from much larger rival Amazon.
California-based eBay has been making changes to its platform to lure more shoppers as well as better compete with Amazon.
That has meant a shift away from online auctions toward fixed-price sales and product landing pages, which are easier to navigate than the dozens of listings sellers would generate for a single good.
EBay has also increased its marketing spending, running a rare TV campaign ahead of last year's Christmas shopping period.
The company said its sales and marketing costs climbed 4.5% to $562m in the first quarter ended March 31, while product development expenses jumped 16.3% to $278m.
The company's profit in the second quarter would be affected by "increased investment to drive improved user experiences and to market our brand," eBay's finance chief Scott Schenkel said.
EBay said it expects second-quarter adjusted profit of 43 to 45 cents per share.
Analysts on average were expecting a profit of 47 cents per share, according to Thomson Reuters.
The company, however, stuck to its earlier forecast for full-year adjusted profit of $1.98 to $2.03 per share, expecting more growth in the second half of 2017.
EBay said gross merchandise volume - the total value of all goods sold on its websites - rose 2.4% to $20.95 billion in the first quarter.
But the result fell short of analysts' average estimate of $21.06 billion.
The company's net income rose to $1.04 billion, or 94 cents per share in the quarter, from $482m, or 41 cents per share, a year earlier.
Excluding one-time items, the company said it earned 49 cents per share, beating analysts' average expectation of 48 cents per share.
Revenue rose 3.7% to $2.22 billion. Analysts on average had expected $2.21 billion.