eBay Stock Plunges After Q1 Results, Q2 Outlook Below Consensus

eBay Inc EBAY reported a first-quarter revenue decline of 6% year-over-year to $2.48 billion and -5.9% on a foreign exchange neutral basis, beating the consensus of $2.46 billion.

Gross Merchandise Volume of $19.4 billion, down 20% on an as-reported basis and down 17% on an FX-Neutral basis.

Adjusted EPS was $1.05 beat the consensus of $1.03.

The gross margin contracted by 478 bps to 72.3%. The operating income was $692 million, and the margin was 27.9%, down 400 bps.

eBay returned $1.4 billion to shareholders in Q1, including $1.25 billion of share repurchases and $129 million paid in cash dividends.

The company generated $629 million of operating cash flow and $546 million of free cash flow from continuing operations in Q1. The company's cash and cash equivalents and non-equity investments portfolio totaled $6.3 billion as of March 31, 2022.

Dividend: eBay declared a cash dividend of $0.22 per share of the company's common stock. The dividend is payable on June 17, 2022, to stockholders of record as of June 1, 2022.

2Q22 Outlook: eBay expects revenues of $2.35 billion - $2.40 billion, vs. consensus of $2.54 billion. It expects EPS of $0.61 - $0.65 and Adjusted EPS of $0.87 - $0.91, falling short of $1.01 consensus.

FY22 Guidance: eBay expects revenues of $9.6 billion - $9.9 billion vs. a consensus of $10.4 billion. It expects EPS of $(0.25) - $(0.05) and Adjusted EPS of $3.90 - $4.10, vs. consensus of $4.34.

Price Action: EBAY shares are trading lower by 6.16% at $51.07 during the post-market session on Wednesday.