EBay chief executive Meg Whitman is to retire.

Whitman has headed the online auction company since 1998. Ebay president John Donahoe, who Whitman recruited to the auction arm of the business in 2005, is expected to take over.

Following the news, eBay's shares fell US$1.20 (61p) to US$27.3 (£13.9), a drop of 4.2 per cent on the Nasdaq stock market composite trading.

It is also expected that the retailer’s fourth-quarter results – to be released later today (January 23) – may fall slightly short of analysts’ expectations.

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