FILE PHOTO – An eBay logo is projected onto white boxes in this illustration picture taken in Warsaw, January 21, 2014. REUTERS/Kacper Pempel/File Photo
(Reuters) – Ebay Inc will begin paying a dividend, it announced on Tuesday, while also reporting better-than-expected sales and profit for the fourth quarter as it benefits from a rise in online shopping.
EBay’s shares rose 4 percent in after-hours trading after the online retailer set a quarterly dividend of 14 cents per share and announced an increase to its share buyback program of $4 billion.
EBay’s results for the final quarter of 2018 showed sales had risen 6.3 percent year-over-year to $2.88 billion, exceeding Wall Street’s average estimate of $2.66 billion, according to IBES data from Refinitiv.
The results and dividend come as eBay faces increased calls from two high-profile shareholders — Elliott Management and Starboard Value — to sell some divisions and restructure others.
A multi-year effort by eBay to make its platform simpler to user, by introducing grouped listings, personal recommendations and an easier-to-use payment process is helping yield results for the San Jose, California-based e-commerce company.
EBay said quarterly net income from continuing operations reached $763 million or 80 cents per share, compared with a loss of $2.6 billion or $2.51 per share, a year earlier, when it recorded a one-time tax-related expense of more than $3 billion.
Excluding one-time items, the company earned 71 cents per share, beating analysts’ average estimate of 68 cents.
Reporting by Sai Sachin Ravikumar