eBay executives affirm aggressive long-term growth targets
Tuesday, October 30th 2001, 12:00 am
By: News On 6
SANTA CLARA, Calif. (AP) _ Shares of eBay Inc. fell on Wall Street even though the trading Web site's executives affirmed their aggressive long-term growth targets at their annual meeting with financial analysts.
Chief executive Meg Whitman told the analysts Monday that she was even more confident than she was last year that eBay's revenue can reach $3 billion by 2005. One reason is that the company's 24 international sites are not yet as profitable as eBay expects they will be in coming years.
``We are really proud of the foundation we have built,'' Whitman said. ``It was in 2001 that eBay really hit its stride.''
The chief financial officer, Rajiv Dutta, said he expects revenue to grow about 50 percent next year, to between $1.05 billion and $1.10 billion, with earnings per share of 70 cents to 73 cents.
The average estimate on Wall Street was for earnings of 73 cents per share next year, excluding charges, on $1.03 billion in revenue, according to Thomson Financial/First Call.
EBay shares fell $4.48, nearly 8 percent, to $52.52 on the Nasdaq Stock Market. The shares were down to $52.26 in the after-hours session.
Merrill Lynch analyst Henry Blodget wrote in a research report that he expected the stock to move lower because the company's earnings estimates fell short of the Wall Street consensus. But he pointed out that eBay historically has exceeded its goals, and he said he was maintaining his 2002 estimate of 85 cents per share.
Executives said they will push to make eBay a more mainstream shopping option, encouraging people to make the site their first choice for Web commerce rather than a place to turn mainly for hard-to-find items.
They said they would concentrate on increasing auctions and fixed-price sales in key categories such as automobiles, computers and real estate.
In hopes of becoming a ``major player'' with a ``well-lit showroom'' for online auto sales, eBay will soon add a short-term warranty to cars bought on the site and make it easier for buyers to have roving mechanics certify cars, said Simon Rothman, head of eBay Motors.
San Jose-based eBay already had said it would combine its separate Half.com site into eBay.com in the coming months to increase its listings of items at set prices. Executives said Monday that Half.com will be renamed eBay Express Buys.