NEW YORK -- EBay (EBAY) said Wednesday that earnings and revenue grew in the last three months of 2013, driven by a strong holiday season for its e-commerce site and its fast-growing payments business, PayPal.

The company also said it has received a notice from activist investor Carl Icahn seeking a spinoff of PayPal. EBay said the billionaire investor has nominated two of his employees to the company's board and now owns a stake of 0.82 percent in the San Jose-based company.

Shares of eBay rose $2.61, or 4.8 percent, to $57.02 in extended trading.

But eBay said it has looked into a split and does not believe it is best for shareholders.

"Payment is part of commerce, and as part of eBay, PayPal drives commerce innovation in payments at global scale, creating value for consumers, merchants and shareholders," eBay said in a statement.

PayPal, which eBay bought for $1.3 billion in late 2002, is now growing faster than the company's core marketplaces business. Payments revenue of $1.84 billion accounted for about 41 percent of the quarter's total revenue. Recently, PayPal has been expanding into brick-and-mortar stores from serving solely as an online payments service.

Overall, eBay earned $850 million, or 65 cents per share, in the October-December period. That's up 13 percent from $751 million, or 57 cents per share, a year earlier.


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Adjusted earnings were 81 cents per share, beating analysts' expectations by a penny.

Revenue grew 13 percent to $4.53 billion from $3.99 billion. Analysts surveyed by FactSet had expected revenue of $4.55 billion.

For the current quarter, which ends in March, eBay is forecasting adjusted earnings of 65 cents to 67 cents per share on revenue of $4.15 billion to $4.25 billion per share.

Analysts were expecting higher earnings of 72 cents per share on revenue of $4.3 billion.