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Despite coming in the results predicted, eBay stock fell 11 per cent yesterday.

Why? The online auction monopoly reported great numbers: gross income rose 44 per cent to $935.8m and net income rose from $157m a year ago to $226m. The revenue figure exceeded analysts' consensus estimate of $934m. eBay also rewarded investors with a two-for-one stock split. However, Wall Street had expected profits a penny higher per share, and also punished the company for a less bullish outlook than the one it wanted to hear. Analysts cited the company's high stock price as a measure of expectations - it's quadrupled since 2003.

Over fiscal year 2004, eBay earned $3.27bn, up from $2.17bn in 2003. The company expects the coming year to gross between $4.25bn and $4.35bn, while Wall Street analysts' high end expectation is $4.5bn. PayPal continues to be a nice little earner, taking in over $200m. Most of eBay's growth is now outside the United States, and the company has earmarked $200m to crack the Chinese market.

Stock fell 11 per cent to $91 in after hours trading. ®

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