(Reuters) - EBay Inc on Tuesday forecast March quarter revenue below Wall Street estimates after reporting disappointing growth in the sales volume on its platform during the key holiday quarter, overshadowing news of its first-ever dividend.

FILE PHOTO - An eBay logo is projected onto white boxes in this illustration picture taken in Warsaw, January 21, 2014. REUTERS/Kacper Pempel/File Photo

Shares of the online marketplace were down 1 percent in after-hours trading, reversing course after an initial jump following eBay’s move to pay a quarterly dividend of 14 cents per share.

The lackluster forecast comes as San Jose, California-based eBay faces demands from two prominent activist shareholders to sell some divisions and restructure others amid fierce competition with Amazon.com Inc and other online retailers.

EBay said consumer spending in December, a normally busy shopping period, was slow despite more buyers using its platform.

Chief Executive Officer Devin Wenig also predicted more near-term pressure on eBay’s gross merchandise volume (GMV) - the value of all products sold on its websites - as the company reduced some marketing spending. He said he was confident, however, the company would boost GMV in the long run and benefit from new ad sales and a payments initiative.

“We believe that the actions we’re taking in ‘19 will set us up well,” he said on a conference call with analysts.

EBay forecast revenue of $2.55 billion to $2.60 billion for the current quarter, compared with analysts’ target of $2.66 billion, according to IBES data from Refinitiv.

GMV overall rose just 1 percent in the December quarter and also missed analysts’ estimates, while it dipped 1 percent in the United States.

Still, results for the final quarter of 2018 showed eBay’s sales had climbed 6.3 percent year-over-year to $2.88 billion, exceeding Wall Street’s estimates.

A multi-year effort by eBay to make its platform simpler to users, by introducing grouped listings, personal recommendations and an easier-to-use payment process is helping attract shoppers.

EBay had 179 million active buyers at the end of the December quarter, about 2 million more than the previous quarter.

The company also announced an increase to its share buybacks by $4 billion, reflecting the influence of eBay’s activist investors, said Tom Forte, an analyst at D.A. Davidson.

“The hope for eBay, in my opinion, is their ability to supplement the marketplace with advertising and a growing payments business, but I think the core marketplace is still a challenged business,” he said.

EBay’s quarterly profit from continuing operations reached $763 million, compared with a loss of $2.6 billion a year earlier, when eBay recorded a one-time expense of more than $3 billion.