Auction site eBay reported positive financial results for the first quarter, with performance exceeding the market’s expectations by over 40 per cent.

The buoyant results were fuelled by expansion of eBay’s payments processing service PayPal, internet telephony provider Skype and its global classifieds business.

Group revenue for Q1 2008 amounted to $2.19bn (£1.1bn), up $424m (£214m) from the same period last year, with net profit of $460m (£232m).

PayPal experienced growth driven by its increasing presence for transactions in currencies other than the US dollar. Quarterly net revenue for the payments service rose by 32 per cent year-on-year, totalling $582m (£293m).

And Skype also had a good trading quarter, with revenue of $126m (£63.5m), a 61 per cent year-on-year boost.

“The results reflect the strength provided by our diverse portfolio of businesses,” said eBay’s president and chief executive John Donahoe.

“Our stability and growth continues to give us the confidence to make innovative changes to our products to keep customers engaged,” he said.