EBay’s profit up; outlook disappoints

EBay Inc. said Wednesday that its second-quarter profit jumped 22%, as the online auction company enjoyed strong growth in its e-commerce sites and its PayPal payments service.

But EBay’s outlook for the current quarter was softer than analysts had been forecasting, and the auction company’s shares fell more than 6% in after-hours trading. The stock had gained $1.21, or 4.5%, in regular trading to $28.10.

The San Jose company reported earnings of $460 million, or 35 cents a share, compared with $376 million, or 27 cents, a year earlier. Excluding certain items, EBay earned 43 cents a share.

That beat Wall Street’s forecast for 41 cents.

EBay’s revenue rose 20% to $2.20 billion. Analysts polled by Thomson Financial had been looking for $2.17 billion in revenue.

Revenue from EBay’s marketplaces segment, which includes EBay, Shopping.com, StubHub and other e-commerce websites, increased 13% to $1.46 billion.

Sharper growth came from PayPal, whose revenue rose 32% to $602 million. Revenue from its online telecommunications service, Skype, rose 51% to $130 million.

Listings on EBay’s site climbed 19% to 667 million during the quarter, but the company’s number of active users – an important measure of how well the company is attracting new buyers and sellers – rose only 1.4% to 84.5 million.

EBay expects third-quarter earnings of 30 cents to 32 cents a share, or 39 cents to 41 cents a share on an adjusted basis, and $2.10 billion to $2.15 billion in revenue.

Analysts were expecting better: adjusted earnings of 41 cents a share on $2.18 billion in revenue.

Sales in China lift Yum Brands

Yum Brands Inc., owner of the Pizza Hut, Taco Bell and KFC chains, said second-quarter profit rose 4.7% on higher sales in China.

Net income increased to $224 million, or 45 cents a share, from $214 million, or 39 cents, a year earlier, the Louisville, Ky., company said. Sales rose 12% to $2.7 billion.

But shares of Yum fell almost $2, or more than 5%, in after-hours trading amid concerns that rising food costs would hurt margins. Before the announcement, the shares rose $1.01, or 2.9%, to $36.47.

Humira boosts Abbott’s results

Abbott Laboratories’ second-quarter profit rose 34% as its top-selling product, anti-inflammatory medicine Humira, was approved for new uses.

Net income jumped to $1.32 billion, or 85 cents a share, from $988.7 million, or 63 cents, a year earlier, the Abbott Park, Ill., company said.

Earnings adjusted for items that include the end of a joint venture beat analysts’ estimates, and Abbott raised its 2008 profit forecast.

Revenue increased 15% to $7.31 billion, also beating analysts’ estimates.

Abbott shares fell 88 cents, or 1.5%, to $56.97.

Gannett revenue declines sharply

Gannett Co., the nation’s largest newspaper publisher, reported a 36% drop in second-quarter earnings as the newspaper industry’s woes caused a sharp decline in revenue.

The McLean, Va., company reported profit of $233 million, or $1.02 a share, compared with $366 million, or $1.56, in the year-earlier quarter.

Gannett shares dropped 78 cents, or 4.5%, to $16.57.

The publisher of the nation’s largest newspaper, USA Today, and 84 other dailies sold several papers in the year-ago quarter that added 32 cents a share to earnings. Excluding the sale, profit fell 18%.

Quarterly revenue fell 10% to $1.72 billion.

From Times Wire Services