NEW YORK (CNN/Money) - ebay shares soared in after-hours trading Wednesday after the company beat second-quarter earnings and revenue forecasts for the period on the back of strong results from its key U.S. and German markets.

The world's biggest online auction company posted net income of $291.6 million, or 21 cents a share, up from $190.4 million, or 14 cents a share, a year ago.

eBay (Research) reported earnings of $307.2 million, or 22 cents a share, excluding one-time items. Analysts, on average, had expected a profit of 18 cents a share, according to earnings tracker First Call.

Sales for the period jumped 40 percent to $1.08 billion, slightly higher than analyst expectations.

Shares of the San Jose, Calif.-based company soared 12 percent in after-hours trading on INET to $39 after closing down 50 cents to $34.87 during regular trading Wednesday. Shares of eBay have fallen about 40 percent year-to-date after the company rattled investors in January when it missed profit estimates and saw growth slowing in the U.S. market.

ebay's news also buoyed shares of Google (Research) and Yahoo! (Research) after-hours trading.

"eBay achieved remarkable results in Q2," Meg Whitman, eBay president and CEO, said in a statement. "Excellent momentum in the U.S. and Germany, as well as at PayPal, all helped deliver an impressive jump in revenues and profit."

Germany has been a particular sore spot for eBay where the company has struggled with slowing growth.

"Much to everyone's surprise, eBay seems to have had a much better quarter across several crossover categories," said Derek Brown, analyst with Pacific Growth Equities.

"We'll be looking to see exactly what changed and whether this surprise momentum is sustainable," he added.

"Apparently the average selling price [of items on eBay] was good last quarter. That certainly would have helped with profits," said Safa Rashtchy, analyst with Piper Jaffray.

ebay was expected to host a conference call with analysts following its earnings results.

The company also upped its outlook for the rest of the year.

ebay now expects total revenue for 2005 to fall in the range of $4.3 billion to $4.4 billion. Analysts, on average, expect the company to post revenue of $4.3 billion for the quarter.

Excluding certain items, eBay expects full-year earnings of 82 cents or 83 cents per share, above the current analyst estimate of 79 cents.

ebay said it saw registered users increase 38 percent to 157.3 million in the quarter.

U.S. net transaction revenues rose 27 percent year-over-year to $423.6 million. Revenues from its international operations rose a stronger 51 percent year-over-year to $418.8 million.

Revenue from PayPal, eBay's online payment unit, rose 51 percent to $243.9 million. The total dollar volume of payments initiated through the PayPal system was a record $6.5 billion, a 49 percent increase from the $4.4 billion reported for the same period a year ago.