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Laptop sales fuel 76% quarterly profit surge at eBay

Other gainers linked to Utah include Siebel, Honeywell

Brisk sales of laptops and other back-to-school gear, as well as gangbuster growth in England and South Korea, helped eBay Inc.'s profit surge more than 76 percent from the same period last year.

Squeaking past Wall Street's expectations, the online auction giant announced third-quarter earnings Wednesday of $182.35 million, or 27 cents per share, compared with $103.25 million, or 16 cents per share, in the same period of 2003.

Excluding special items, eBay, which has operations in Utah, earned $194.97 million, or 28 cents per share, up from $118.33 million, or 18 cents per share, in the third quarter of 2003. Analysts expected the company, based in San Jose, Calif., to earn 27 cents per share, excluding special items, on total sales of $779.74 million.

For the three months ended Sept. 30, the company reported revenue of $805.88 million, up 52 percent from the same period last year.

EBay's transaction revenue in the United States last quarter was $330.6 million, up 29 percent from the same quarter of 2003. International transaction revenue in the same period surged 82 percent, to $282.3 million.

The company — considered one of the most financially conservative in Silicon Valley — boosted its outlook for the rest of the year. EBay expects 2004 sales as high as $3.25 billion, $65 million higher than its previous outlook.

EBay executives said they were optimistic about the fourth quarter, despite nagging technical glitches at the lucrative PayPal payment transaction division. PayPal, which has more than 50 million user accounts worldwide, experienced at least five days of intermittent outages earlier this month, after technicians tried to upgrade software architecture.

Several other companies based in Utah or with ties to the state also reported quarterly earnings Wednesday.

Nature's Sunshine

Provo-based Nature's Sunshine Products Inc. reported net income of $4.6 million, or 29 cents per share, for the quarter ended Sept. 30. That compares with a net loss of $600,000, or 4 cents per share, for the same period a year ago.

The prior-year quarter included $2.2 million in pre-tax expenses related to costs associated with a realignment program.

Net sales revenue was a company-record $83.6 million, up from $63.5 million a year earlier.

For the first nine months of 2004, the company reported net income of $12.4 million, or 81 cents per share, on revenue of $240.1 million. That compares with income of $2.2 million, or 15 cents per share, on revenue of $189.7 million during the first nine months of 2003.

The company makes and markets direct-sales herbal products, vitamins and related products.

The company's stock rose 18 cents Wednesday to close at $14.97. During the past year, the price has ranged from $7.61 to $16.

Convergys Corp.

Cincinnati-based Convergys Corp., which has about 8,300 workers at six call centers in Utah, said Wednesday that its earnings fell by a third in the third quarter and that it will eliminate 250 management jobs worldwide through voluntary departures or layoffs.

For the three months ending Sept. 30, the billing, customer care and employee care services company earned $30.1 million, or 21 cents per share, a penny less than the forecast of Wall Street analysts surveyed by Thomson First Call. A year ago, Convergys earned $45.5 million, or 31 cents a share.

Overall revenues increased 12 percent to $639.9 million from $570.7 million a year ago. But operating income lagged, reflecting increased investment and startup costs related to large clients. The figure was also hurt by the weak U.S. dollar.

The number of layoffs needed will be determined after Convergys sees how many managers accept the early buyouts, spokesman John Pratt said. Most of the cuts will be completed by March 31.

Convergys plans to take a pretax charge of $15 million to $20 million against its fourth-quarter earnings. The savings in 2005 from the cuts are expected to exceed the charge, Convergys officials said.

Honeywell International

Aerospace and high-tech manufacturer Honeywell International Inc., which has an automotive filter plant in Clearfield, reported an 8 percent increase in third-quarter profits Wednesday, helped by double-digit sales growth in three of its four divisions. The results met Wall Street expectations but failed to impress investors.

The Morris Township-based company reported profits of $372 million, or 43 cents per share, for the three months ending Sept. 30. That compares with $344 million, or 40 cents per share, in the same period a year ago.

The most recent quarter's profits matched the forecast of analysts surveyed by Thomson First Call.

Shares in Honeywell closed down $1.64, or 4.6 percent, at $33.80 on the New York Stock Exchange — near the middle of their 52-week range of $28.17 to $38.46.

Siebel Systems

Siebel Systems Inc., the world's largest maker of customer-service software, had a third-quarter profit of $19.4 million as the company curbed costs amid declining sales.

Net income was 4 cents a share, after a net loss of $59.3 million, or 12 cents, a year earlier, said the company, which is based in San Mateo, Calif., and has about 200 workers in Utah. Sales dropped 1.4 percent to $317.1 million from $321.4 million, the 13th-straight decline.

Chief executive Michael Lawrie pared operating costs by 37 percent from a year earlier. He's targeting small and medium- sized businesses to stem the sales slump as his company gets squeezed by competitors such as SAP AG. Lawrie also plans to let customers modify Siebel's software in addition to selling pre-packaged applications.

Cadence Design

Cadence Design Systems Inc., the world's second-largest maker of semiconductor-design software by annual sales, had a third-quarter profit as sales climbed 12 percent.

Profit was $19.6 million, or 7 cents a share, compared with a net loss of $14.5 million, or 5 cents, a year earlier, said the company, which is based in San Jose, Calif., and has operations in Sandy. Sales rose to $301.6 million from $268.8 million.

Cadence expects earnings of 16 to 18 cents a share in the current quarter on sales of $335 million to $345 million.

Shares fell 12 cents to $12.04 in New York Stock Exchange composite trading. The stock has shed 33 percent this year.


Contributing: The Associated Press; Bloomberg News