eBay Inc.'s (EBAY) stock experienced a significant plunge of 10.44% in pre-market trading on Thursday, February 27, 2025, after the e-commerce giant provided weaker-than-expected revenue guidance for the first quarter of 2025, overshadowing its better-than-anticipated fourth-quarter earnings results.

In the fourth quarter of 2024, eBay reported a strong performance, with gross merchandise volume (GMV) growing by 2.1% year-over-year to $19.3 billion. This growth was driven by continued momentum in the company's focused categories, such as trading cards, motors and accessories, and luxury items.

However, eBay's guidance for the first quarter of 2025 fell short of analyst expectations, causing concerns among investors. The company forecasted first-quarter revenue in the range of $2.52 billion to $2.56 billion, lower than the analysts' average estimate of $2.59 billion.

This disappointing guidance was attributed to several factors, including the elimination of seller fees for the consumer-to-consumer (C2C) initiative in the UK, macroeconomic challenges, and the potential impact of tariffs on demand and consumer elasticity. Additionally, eBay faced headwinds from the UK C2C initiative, which temporarily impacted the company's take rate (the percentage of GMV that eBay keeps as revenue).

Despite the positive performance in the fourth quarter, the weaker-than-expected revenue guidance for the current quarter overshadowed eBay's accomplishments, leading to a significant sell-off in the company's stock during the pre-market trading session.