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Last Updated: Thursday, 22 April, 2004, 05:35 GMT 06:35 UK
Profits soar ahead 92% at eBay
eBay's headquarters in San Jose, California
eBay blitzed TV with advertising before Christmas
Internet auctioneer eBay has nearly doubled its first-quarter profits, raking in $200.1m (113m), up 92% from $104.2m in the same period of 2003.

The soaring profits came from higher sales as customers won during pre-Christmas promotions stayed loyal.

Chief executive Meg Whitman said e-commerce was now "more mainstream" and eBay had become "a prime shopping destination for almost every item."

Sales rose 59% to $756.2m, easily topping Wall Street forecasts.

Winning customers

eBay pushed itself hard at US shoppers ahead of the Christmas and New Year sales season, with a blizzard of TV and newspaper advertising.

The huge boost in first quarter sales suggests that the strategy paid off, convincing growing numbers of people of the convenience of online shopping.

"We're increasingly the primary shopping destination for almost any item," said eBay chief financial officer Rajiv Dutta.

The company's own sales targets were breached, as it had predicted first quarter revenues of $700m.

The consensus forecast among analysts was for sales of $717m.

eBay said its PayPal electronic payment unit had also contributed to its success.

It had charged higher fees to sellers, and expanded PayPal.

Analysts reacted positively to the financial results. "It's extremely solid," said Safa Rashtchy of Piper Jaffrey.

Asian hopes

eBay said its sales figures had benefited from the weak US dollar, to the tune of about $11m.

It also announced it intends to expand its business in Asia, particularly China where it owns online auctioneer Eachnet.

E-commerce is still under-developed in China, though China's official Internet Network information centre is predicting nation-wide online sales totalling $16bn in 2005.

Eachnet believes its site is a popular marketing outlet for aspiring Chinese entrepreneurs taking their first step into business.

eBay raised its fully year 2004 forecast by $150m to $3.15bn.

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