EBay beats Q4 earnings estimates, but investors hit the sell button on lukewarm guidance

Shares of eBay sank 8% in after-hours trading after the giant online marketplace delivered a lukewarm forecast for the first quarter. On paper, eBay’s fourth quarter looked solid: adjusted earnings per share came in at $1.25, topping Wall Street expectations of $1.20. Meanwhile, revenue grew a modest 1% to $2.58 billion, but was still in line with estimates. Gross merchandise volume — a key metric for the company — also rose 4% to $19.3 billion, surpassing analyst expectations of $19.0 billion.

But a strong past performance wasn’t enough to ease fears of what’s ahead. EBay’s revenue forecast for the current quarter came in between $2.52 billion and $2.56 billion, falling short of analysts’ $2.59 billion projection.

Investors have watched eBay’s marketplace closely as it deals with slowing GMV growth and shrinking margins. EBay has been navigating a shift in consumer spending as demand cools for collectibles and refurbished goods. Before the post-earnings drop, eBay’s stock had risen about 57% in the past year.