Net revenue dropped 59 per cent year on year to $559.2m, the firm said yesterday, following massive gains from selling internet phone service Skype in the same quarter last year. Underlying earnings rose 24 per cent.
On an adjusted basis, eBay earned 52 cents per share, surpassing the 47 cents expected by analysts.
Its shares rose five per cent in after-hours trading.
eBay had 94.5m active users in the fourth quarter of 2010, up five per cent on last year, with particularly strong growth in the UK, US and Germany that was partially offset by sluggish trading in China and Korea.
PayPal also performed well, with a 28 per cent jump in the number of payments to 421.1m in the three months to the end of December.
Users of the eBay website made $15bn-worth of transactions, excluding vehicles, in the quarter with more than $9bn coming from outside the United States.
Vehicle sales worth nearly $2bn took place on eBay during the quarter.
“We are driving strong global growth at PayPal and strengthening our core eBay business,” said chief executive John Donahoe.
“And we are innovating quickly in areas such as mobile, which is helping to position us at the forefront of trends shaping the future of shopping and payments.”
The company is hoping to prove to shareholders that improvements to its site and user experience, including lower upfront fees and daily deals, is encouraging traffic and delivering more consistent sales.
eBay said it predicts stable global interest rates and market growth, and expects revenue growth of between 12 and 16 per cent in the coming year.