BUSINESS BRIEFS
eBay shares drop amid low forecast for 4th quarter
Associated Press
NEW YORK — eBay Inc. posted a third-quarter profit that beat analyst forecasts yesterday, but its lower-than-expected fourth-quarter forecast indicated the online auction site operator is not immune from the slowing economy.
The San Jose, Calif.-based company's shares fell 54 cents, or 3.8 percent, in after-hours trading, after finishing regular trading down $2.41, or 13.6 percent, at $15.33.
eBay earned $492 million, or 38 cents per share, in the quarter that ended Sept. 30.
In the year-ago period, eBay reported a loss of $936 million, or 69 cents per share, stemming from charges to its Skype telecommunications unit.
Excluding one-time items, eBay earned 46 cents per share — five cents higher than analysts polled by Thomson Reuters expected.
JPMORGAN, WELLS PROFITS TAKE A DIVE
NEW YORK — In the midst of one of the nation's worst credit crises, JPMorgan Chase & Co. and Wells Fargo & Co. managed to report better-than-expected third-quarter results yesterday.
But even two of the country's strongest banks proved they are not immune to the widespread credit problems plaguing their peers.
Both banks reported sharp declines in profit as they took hits on investments and increased their credit reserves to prepare for troubles ahead. But given the waning economy and the current shake-up in the markets, the credit problems did not come as a surprise to most analysts.
While many remain cautious of the worsening economy, analysts generally viewed the results as positive.
DELTA, AMERICAN SET TO SCALE BACK
ATLANTA — Executives said yesterday as Delta Air Lines reported a third-quarter loss and American Airlines' parent posted a small profit that travelers have not seen the last of capacity cuts and fees for services that were once free.
Atlanta-based Delta will scale back international growth plans in the coming months and is prepared to cut more domestic capacity if needed to weather the global financial crisis that has intensified in recent weeks, executives said.
American, a unit of Fort Worth, Texas-based AMR Corp., will cut capacity again next year by 6 percent.
The move could help push fares higher if other airlines go along.
Despite the economic downturn, fees and higher fares for the most part have not abated.
OIL DIPS BELOW $75 A BARREL
NEW YORK — Oil prices closed below $75 a barrel for the first time in nearly 14 months yesterday after OPEC, fearing that a severe global economic slowdown is unavoidable, slashed its 2009 petroleum demand forecast.
Another bad day on Wall Street also pressured oil prices, which have tumbled a staggering 49 percent since soaring to an all-time high $147.27 on July 11. The Dow Jones industrial average plunged 733 points.
Light, sweet crude for November delivery fell $4.09, or 5.2 percent, to settle at $74.54 a barrel on the New York Mercantile Exchange.
It was crude's lowest settlement prices since Aug. 31, 2007.
GM CAMPAIGN PLUGS FINANCING
DETROIT — With October auto sales expected to fall short of September's 15-year low, General Motors Corp. is launching a campaign this week to reach people who have stopped looking for cars out of fear that they can't get a loan.
Many banks and finance companies, including GM's own GMAC Financial Services, have tightened credit standards because they can't borrow money to lend, or they're reluctant to lend and risk defaults.
GM will promote its financing options with radio, newspaper and digital advertising starting tomorrow and running through Nov. 3.
