SAN JOSE, Calif., April 29, 2020 /PRNewswire/ -- eBay
Inc. (Nasdaq: EBAY), a global commerce leader that connects
millions of buyers and sellers around the world, today reported
financial results for its first quarter ended March 31,
2020.
"During these unprecedented times, I am extremely proud of how
our team has come together to support one another, our buyers and
sellers, our communities and the business," said Scott Schenkel, eBay Inc. "As we look at Q1, I
am pleased that we delivered on all of our commitments for the
quarter, with key metrics such as Buyers, GMV and Revenue
performing at or better than our expectations. Over the past
several months, we have remained focused and clear-eyed about the
strategic direction of the company and have driven substantial
changes to position the business for sustainable and profitable
long-term growth."
"I appreciate the team's hard work in the first quarter and
their efforts to maintain focus amid so many factors affecting the
business and the industry," said Jamie
Iannone, Chief Executive Officer of eBay Inc. "I'm thrilled
to return to eBay this week as CEO and I look forward to building
on the positive momentum in the business, continuing to evolve the
Company's strategy and maximizing value for our shareholders."
COVID-19 Response and Business Impacts
- We believe our strong balance sheet, stable cash flows, low
capital intensity and disciplined capital management approach gives
us the strength and flexibility to adapt to this tough economic
environment and to enable investment in our sellers and
customers.
- As the COVID-19 pandemic continues, our priority is the safety
and well-being of our employees, customers and communities. To that
effect, we have taken immediate action to support our
stakeholders.
- Nearly all global employees are working from home. In mainland
China, Taiwan and Korea we are now managing a
staggered return to the office.
- eBay Foundation has donated over $3.0
million in grants to nonprofits around the world, along with
$500,000 in support to Silicon Valley
Strong.
- Through eBay for Charity, we are matching up to $1.0 million in contributions made by U.S.
customers who donate a portion of sales to Feeding America, Direct
Relief and Opportunity Fund.
- In the U.K., we announced a partnership with the National
Health Service (NHS), the Department for Health and Social Care and
others to pilot a new platform to supply primary care and social
care providers with access to personal protective equipment for
free at the point of order from NHS Supply Chain.
- We have implemented measures designed to ensure our platform
remains safe and trusted for buyers, removing or blocking over 15
million listings to date globally that make false health claims or
offer products at inflated prices, in line with price gouging
rules.
- We have offered to defer fees for hundreds of thousands of eBay
sellers to support their cash flow needs, provided eBay Store
subscribers with up to 100,000 extra listings for free and
implemented additional protections for Seller Performance
Standards.
- eBay has helped launch and grow hundreds of thousands of small
businesses, and now we've created Up & Running to accelerate
the start-up time frame for Main Street retailers opening online
stores amid the pandemic.
- From the start of the quarter through mid-March our underlying
business performance was better than our expectations.
- Since mid-March, our Marketplace platforms have experienced
strength in key metrics - traffic, buyer acquisition, conversion,
sold items and GMV - due to ongoing shelter-in-place dynamics in
many countries. The Marketplace platforms have also experienced
improved acquisition of small business sellers. This strength has
continued into April.
- Our Classifieds platforms have been adversely impacted by
recent auto dealer closures in many international markets, lower
traffic to horizontal classifieds sites around the world due to
social distancing requirements and lower advertising revenues. This
pressure has continued into April.
- The impacts seen in both platforms to date could continue while
shelter-in-place guidelines remain active, and it is difficult to
predict what may result as shelter-in-place guidelines are eased
and lifted and how global consumer demand and seller inventory may
evolve over time.
- Our capital allocation strategy and key tenets and targets have
not changed.
First Quarter Financial Highlights
- Revenue was $2.4 billion, down 2%
on an as-reported basis and up 1% on a foreign exchange (FX)
neutral basis.
- Active buyers grew by 2%, for a total of 174 million global
active buyers.
- Gross merchandise volume (GMV) was $21.3
billion, down 1% on an as-reported basis and remaining flat
on a FX-Neutral basis.
- Marketplace platforms delivered $2.1
billion of revenue, down 1% on an as-reported basis and up
1% on a FX-Neutral basis.
- Classifieds platforms delivered revenue of $248 million, down 3% on an as-reported basis and
remaining flat on a FX-Neutral basis.
- GAAP net income from continuing operations was $485 million, or $0.64 per diluted share.
- Non-GAAP net income from continuing operations was $586 million, or $0.77 per diluted share.
- Generated $702 million of
operating cash flow and $604 million
of free cash flow from continuing operations.
- Announced pricing of $1.0 billion
senior unsecured notes offering on March 4,
2020, with the intention of using proceeds from the offering
to repay maturities coming due this year.
Business Highlights
- Following a comprehensive CEO search, on April 13, 2020, eBay announced that its Board of
Directors appointed Jamie Iannone as
Chief Executive Officer, effective April 27,
2020. Mr. Iannone was also appointed as a member of the
Board, effective as of April 27,
2020.
- eBay's transition to managed payments continues to build
momentum, processing over $3.0
billion of GMV for over 32,000 sellers. The service will be
available in several new markets this July, including in the U.K.,
which was announced in February, and most recently announced in
Canada and Australia.
- In Q1, Promoted Listings delivered $137
million of revenue, up 109% on an as-reported basis and up
111% on a FX-Neutral basis. Nearly 1.2 million sellers promoted
more than 310 million listings in the quarter.
- Seller Initiated Offers scaled to over 1.5 million per day
driven by increased adoption and item eligibility.
- Introduced a new feature, "Image Clean-Up," available in all
markets, that uses computer vision technology to create a more
consistent-looking buyer experience and is more effective in Google
Shopping for both Android and iOS. Since launch, more than one
third of sellers are using this new tool.
- eBay's Retail Revival program launched in Austin, Texas, with adaptations of the
program, "Export Revival," also launching globally in Athens, Greece.
- eBay continues to explore potential value-creating alternatives
for its Classifieds business, is holding active discussions with
multiple parties, and anticipates having an update by the middle of
the year.
- The company completed the sale of StubHub to viagogo on
February 13, 2020, for $4.1 billion in proceeds, with net proceeds of
$3.2 billion net of income taxes of
$900 million, subject to working
capital adjustments.
First Quarter 2020
Financial Highlights (presented in millions, except per share data
and percentages)
|
|
First
Quarter
|
|
|
|
2020
|
2019
|
Change
|
eBay
Inc.
|
|
|
|
|
Net
revenues
|
$2,374
|
$2,413
|
$(39)
|
(2)%
|
GAAP - Continuing
Operations
|
|
|
|
|
Income (loss) from
continuing operations
|
$485
|
$516
|
$(31)
|
(6)%
|
Earnings (loss) per
diluted share from continuing operations
|
$0.64
|
$0.57
|
$0.07
|
12%
|
Non-GAAP -
Continuing Operations
|
|
|
|
|
Net income
|
$586
|
$590
|
$(4)
|
(1)%
|
Earnings per diluted
share
|
$0.77
|
$0.65
|
$0.12
|
19%
|
Other Selected Financial and Operational Results
- Operating margin – GAAP operating margin increased to 26.5% for
the first quarter of 2020, compared to 24.6% for the same period
last year. Non-GAAP operating margin decreased to 31.5% in the
first quarter of 2020, compared to 31.6% for the same period last
year.
- Taxes – The GAAP effective tax rate for continuing operations
for the first quarter of 2020 was 23.2%, compared to 21.3% for the
first quarter of 2019. The non-GAAP effective tax rate for
continuing operations for the first quarter of 2020 was 16.4%,
compared to 17.0% for the first quarter of 2019.
- Cash flow – The company generated $702
million of operating cash flow from continuing operations
and $604 million of free cash flow
during the first quarter of 2020.
- Capital returns – The company repurchased approximately
$4.0 billion of its common stock, or
approximately 98 million shares, in the first quarter of 2020. The
company's total repurchase authorization remaining as of
March 31, 2020 was $3.2 billion. The company also paid cash
dividends of $114 million during the
first quarter of 2020.
- Cash and cash equivalents and non-equity investments – The
company's cash and cash equivalents and non-equity investments
portfolio totaled $5.2 billion as of
March 31, 2020.
Business Outlook
- Second quarter 2020 — The company expects net revenue between
$2.38 billion and $2.48 billion, representing Organic FX-Neutral
growth of 2% - 6%, with GAAP earnings per diluted share from
continuing operations in the range of $0.50 - $0.57 and
non-GAAP earnings per diluted share from continuing operations in
the range of $0.73 - $0.80.
- Full year 2020 — The company expects net revenue between
$9.56 billion and $9.76 billion, representing Organic FX-Neutral
growth of 1% - 3%, with GAAP earnings per diluted share from
continuing operations in the range of $2.20 - $2.30 and
non-GAAP earnings per diluted share from continuing operations in
the range of $3.00 - $3.10.
- Given the dynamic environment, we are not revising our full
year revenue and EPS estimates. This guidance reflects management's
expectations for operational performance and the impacts seen in
both of our Marketplaces and Classifieds platforms to date, but
given the uncertainty surrounding the extent and duration of the
impact of the COVID-19 pandemic, it is difficult to predict what
may result as shelter-in-place guidelines are eased and lifted and
how global consumer demand, the effects of COVID-19 on the general
economy, seller inventory and advertising spending may evolve over
time.
Capital Allocation
- Distributed $4.0 billion in the
form of share buybacks and repurchased nearly 98 million shares,
inclusive of an accelerated share repurchase plan that will be
completed later this year.
- eBay's Board of Directors has declared a cash dividend of
$0.16 per share of the company's
common stock. The dividend is payable on June 19, 2020 to stockholders of record as of
June 1, 2020.
Quarterly Conference Call and Webcast
eBay Inc. will host a conference call to discuss first quarter
2020 results at 3:00 p.m. Pacific Time today. Investors and
participants can access the call by dialing (866) 211-3115 in the
U.S. and (647) 689-6602 internationally. The passcode for the
conference line is 8787339. A live webcast of the conference call,
together with a slide presentation that includes supplemental
financial information and reconciliations of certain non-GAAP
measures to their nearest comparable GAAP measures, can be accessed
through the company's Investor Relations website at
https://investors.ebayinc.com. In addition, an archive of the
webcast will be accessible for at least three months through the
same link.
eBay Inc. uses its Investor Relations website at
https://investors.ebayinc.com as a means of disclosing material
non-public information and for complying with its disclosure
obligations under Regulation FD. Accordingly, investors should
monitor this website, in addition to following our press releases,
SEC filings, public conference calls and webcasts.
About eBay
eBay Inc. (Nasdaq: EBAY) is a global commerce leader including
the Marketplace and Classifieds platforms. Collectively, we connect
millions of buyers and sellers around the world, empowering people
and creating opportunity for all. Founded in 1995 in San Jose, California, eBay is one of the
world's largest and most vibrant marketplaces for discovering great
value and unique selection. In 2019, eBay enabled $86 billion of gross merchandise volume. For more
information about the company and its global portfolio of online
brands, visit www.ebayinc.com.
Presentation
All growth rates represent year-over-year comparisons, except as
otherwise noted. All amounts in tables are presented in U.S.
dollars, rounded to the nearest million, except as otherwise noted.
As a result, certain amounts may not sum or recalculate using the
rounded dollar amounts provided.
Non-GAAP Financial Measures
This press release includes the following financial measures
defined as "non-GAAP financial measures" by the Securities and
Exchange Commission (SEC): non-GAAP net income, non-GAAP earnings
per diluted share, non-GAAP operating margin, non-GAAP effective
tax rate, free cash flow and FX-Neutral basis. These non-GAAP
financial measures are presented on a continuing operations basis.
These measures may be different from non-GAAP financial measures
used by other companies. The presentation of this financial
information, which is not prepared under any comprehensive set of
accounting rules or principles, is not intended to be considered in
isolation of, or as a substitute for, the financial information
prepared and presented in accordance with generally accepted
accounting principles (GAAP). For a reconciliation of these
non-GAAP financial measures, except for figures in this press
release presented on a "FX-Neutral basis", to the nearest
comparable GAAP measures, see "Business Outlook,"
"Non-GAAP Measures of Financial Performance," "Reconciliation
of GAAP Operating Margin to Non-GAAP Operating Margin,"
"Reconciliation of GAAP Net Income to Non-GAAP Net Income
and Reconciliation of GAAP Effective Tax Rate to
Non-GAAP Effective Tax Rate" and "Reconciliation of Operating
Cash Flow to Free Cash Flow" included in this press release. For
figures in this press release reported "on a FX-Neutral basis", we
calculate the year-over-year impact of foreign currency movements
using prior period foreign currency rates applied to current year
transactional currency amounts. We define organic FX-Neutral
revenue growth as reported revenue growth, excluding incremental
revenue from acquisitions or dispositions for the twelve-month
period following such acquisitions or dispositions and foreign
exchange rate effects.
Forward-Looking Statements
This press release contains forward-looking statements relating
to, among other things, the future performance of eBay Inc. and its
consolidated subsidiaries that are based on the company's current
expectations, forecasts and assumptions and involve risks and
uncertainties. These statements include, but are not limited to,
statements regarding the future performance of eBay Inc. and its
consolidated subsidiaries, including expected financial results for
the second quarter and full year 2020 and the future growth in its
business, the effects of COVID-19 on our business and operations
and our ability to respond to such effects, operating efficiency
and margins, reinvestments, dividends, share repurchases, and the
expected timing of the announcements regarding the company's
strategic portfolio review. Actual results could differ materially
from those predicted or implied and reported results should not be
considered as an indication of future performance. Other factors
that could cause or contribute to such differences include, but are
not limited to: changes in political, business and economic
conditions, the duration of the COVID-19 pandemic and the effects
of COVID-19 on our business and operations and on the general
economy, including effects on our sellers and customers, any
regional or general economic downturn or crisis and any conditions
that affect ecommerce growth or cross-border trade; the company's
ability to realize expected growth opportunities in payments
intermediation and advertising; the outcome of the strategic
portfolio review; fluctuations in foreign currency exchange rates;
the company's need to successfully react to the increasing
importance of mobile commerce and the increasing social aspect of
commerce; an increasingly competitive environment for its business;
changes to the company's capital allocation, including the timing,
declaration, amount and payment of any future dividends or levels
of the company's share repurchases, or management of operating
cash; the company's ability to increase operating efficiency to
drive margin improvements and enable reinvestments; the company's
ability to manage its indebtedness, including managing exposure to
interest rates and maintaining its credit ratings; the company's
need to manage an increasingly large enterprise with a broad range
of businesses of varying degrees of maturity and in many different
geographies; the ability to successfully intermediate payments on
our marketplace platform; the company's need and ability to
manage regulatory, tax, data security and litigation risks; whether
the operational, marketing and strategic benefits of the separation
of the eBay and PayPal businesses can be achieved; the company's
ability to timely upgrade and develop its technology systems,
infrastructure and customer service capabilities at reasonable cost
while maintaining site stability and performance and adding new
products and features; and the company's ability to integrate,
manage and grow businesses that have been acquired or may be
acquired in the future.
The forward-looking statements in this release do not include
the potential impact of any acquisitions or divestitures that may
be announced and/or completed after the date hereof.
More information about factors that could affect the company's
operating results is included under the captions "Risk Factors" and
"Management's Discussion and Analysis of Financial Condition and
Results of Operations" in the company's most recent Annual Report
on Form 10-K and subsequent quarterly reports on
Form 10-Q, copies of which may be obtained by visiting the
company's Investor Relations website at
https://investors.ebayinc.com or the SEC's website at www.sec.gov.
Undue reliance should not be placed on the forward-looking
statements in this press release, which are based on information
available to the company on the date hereof. The company assumes no
obligation to update such statements.
eBay
Inc.
|
Unaudited
Condensed Consolidated Balance Sheet
|
|
|
March
31,
2020
|
|
December
31,
2019
|
|
(In millions)
|
|
|
ASSETS
|
|
|
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
$
|
880
|
|
|
$
|
923
|
|
Short-term
investments
|
3,550
|
|
|
1,850
|
|
Accounts receivable,
net of allowance for doubtful accounts of $127 and $100
|
635
|
|
|
691
|
|
Other current
assets
|
1,183
|
|
|
1,101
|
|
Current assets of
discontinued operations
|
—
|
|
|
141
|
|
Total current
assets
|
6,248
|
|
|
4,706
|
|
Long-term
investments
|
1,077
|
|
|
1,305
|
|
Property and
equipment, net
|
1,409
|
|
|
1,484
|
|
Goodwill
|
4,850
|
|
|
4,929
|
|
Intangible assets,
net
|
50
|
|
|
62
|
|
Operating lease
right-of-use assets
|
598
|
|
|
599
|
|
Deferred tax
assets
|
4,287
|
|
|
4,369
|
|
Other
assets
|
410
|
|
|
414
|
|
Long-term assets of
discontinued operations
|
—
|
|
|
306
|
|
Total
assets
|
$
|
18,929
|
|
|
$
|
18,174
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
Current
liabilities:
|
|
|
|
Short-term
debt
|
$
|
1,015
|
|
|
$
|
1,022
|
|
Accounts
payable
|
268
|
|
|
251
|
|
Accrued expenses and
other current liabilities
|
2,175
|
|
|
2,189
|
|
Deferred
revenue
|
108
|
|
|
135
|
|
Income taxes
payable
|
1,107
|
|
|
210
|
|
Current liabilities of
discontinued operations
|
—
|
|
|
259
|
|
Total current
liabilities
|
4,673
|
|
|
4,066
|
|
Operating lease
liabilities
|
456
|
|
|
472
|
|
Deferred tax
liabilities
|
2,619
|
|
|
2,646
|
|
Long-term
debt
|
7,724
|
|
|
6,738
|
|
Other
liabilities
|
1,342
|
|
|
1,356
|
|
Long-term liabilities
of discontinued operations
|
—
|
|
|
26
|
|
Total
liabilities
|
16,814
|
|
|
15,304
|
|
|
|
|
|
Total stockholders'
equity
|
2,115
|
|
|
2,870
|
|
Total liabilities and
stockholders' equity
|
$
|
18,929
|
|
|
$
|
18,174
|
|
eBay
Inc.
|
Unaudited
Condensed Consolidated Statement of Income
|
|
|
Three Months
Ended
March
31,
|
|
2020
|
|
2019
|
|
(In millions,
except per share amounts)
|
Net
revenues
|
$
|
2,374
|
|
|
$
|
2,413
|
|
Cost of net revenues
(1)
|
526
|
|
|
539
|
|
Gross
profit
|
1,848
|
|
|
1,874
|
|
Operating
expenses:
|
|
|
|
Sales and marketing
(1)
|
607
|
|
|
647
|
|
Product development
(1)
|
267
|
|
|
272
|
|
General and
administrative (1)
|
234
|
|
|
284
|
|
Provision for
transaction losses
|
102
|
|
|
67
|
|
Amortization of
acquired intangible assets
|
9
|
|
|
11
|
|
Total operating
expenses
|
1,219
|
|
|
1,281
|
|
Income from
operations
|
629
|
|
|
593
|
|
Interest and other,
net
|
2
|
|
|
64
|
|
Income from
continuing operations before income taxes
|
631
|
|
|
657
|
|
Income tax
provision
|
(146)
|
|
|
(141)
|
|
Income from
continuing operations
|
$
|
485
|
|
|
$
|
516
|
|
Income (loss) from
discontinued operations, net of income taxes
|
2,927
|
|
|
2
|
|
Net income
|
$
|
3,412
|
|
|
$
|
518
|
|
|
|
|
|
Income per share -
basic:
|
|
|
|
Continuing
operations
|
$
|
0.64
|
|
|
$
|
0.58
|
|
Discontinued
operations
|
3.89
|
|
|
—
|
|
Net income per share
- basic
|
$
|
4.53
|
|
|
$
|
0.58
|
|
|
|
|
|
Income per share -
diluted:
|
|
|
|
Continuing
operations
|
$
|
0.64
|
|
|
$
|
0.57
|
|
Discontinued
operations
|
3.87
|
|
|
—
|
|
Net income per share
- diluted
|
$
|
4.51
|
|
|
$
|
0.57
|
|
|
|
|
|
Weighted average
shares:
|
|
|
|
Basic
|
753
|
|
|
900
|
|
Diluted
|
757
|
|
|
908
|
|
|
|
|
|
(1) Includes
stock-based compensation as follows:
|
|
|
|
Cost of net
revenues
|
$
|
10
|
|
|
$
|
12
|
|
Sales and
marketing
|
20
|
|
|
21
|
|
Product
development
|
39
|
|
|
42
|
|
General and
administrative
|
31
|
|
|
37
|
|
|
$
|
100
|
|
|
$
|
112
|
|
eBay
Inc.
|
Unaudited
Condensed Consolidated Statement of Cash Flows
|
|
|
Three Months
Ended
March
31,
|
|
2020
|
|
2019
|
|
(In
millions)
|
Cash flows from
operating activities:
|
|
|
|
Net income
|
$
|
3,412
|
|
|
$
|
518
|
|
(Income) loss from
discontinued operations, net of income taxes
|
(2,927)
|
|
|
(2)
|
|
Adjustments:
|
|
|
|
Provision for
transaction losses
|
102
|
|
|
67
|
|
Depreciation and
amortization
|
147
|
|
|
162
|
|
Stock-based
compensation
|
100
|
|
|
112
|
|
(Gain) loss on
investments, net
|
(38)
|
|
|
1
|
|
Deferred income
taxes
|
52
|
|
|
21
|
|
Change in fair value
of warrant
|
(12)
|
|
|
(113)
|
|
Changes in assets and
liabilities, net of acquisition effects
|
(134)
|
|
|
(194)
|
|
Net cash provided by
continuing operating activities
|
702
|
|
|
572
|
|
Net cash used in
discontinued operating activities
|
(110)
|
|
|
(22)
|
|
Net cash provided by
operating activities
|
592
|
|
|
550
|
|
Cash flows from
investing activities:
|
|
|
|
Purchases of property
and equipment
|
(98)
|
|
|
(180)
|
|
Purchases of
investments
|
(10,705)
|
|
|
(11,915)
|
|
Maturities and sales
of investments
|
9,195
|
|
|
12,747
|
|
Acquisitions, net of
cash acquired
|
—
|
|
|
(93)
|
|
Other
|
39
|
|
|
12
|
|
Net cash provided by
(used in) continuing investing activities
|
(1,569)
|
|
|
571
|
|
Net cash provided by
(used in) discontinued investing activities
|
4,075
|
|
|
(13)
|
|
Net cash provided by
(used in) investing activities
|
2,506
|
|
|
558
|
|
Cash flows from
financing activities:
|
|
|
|
Proceeds from issuance
of common stock
|
5
|
|
|
5
|
|
Repurchases of common
stock
|
(3,997)
|
|
|
(1,431)
|
|
Payments for taxes
related to net share settlements of restricted stock units and
awards
|
(40)
|
|
|
(54)
|
|
Payments for
dividends
|
(114)
|
|
|
(125)
|
|
Proceeds from issuance
of long-term debt, net
|
994
|
|
|
—
|
|
Other
|
(9)
|
|
|
—
|
|
Net cash used in
financing activities
|
(3,161)
|
|
|
(1,605)
|
|
Effect of exchange
rate changes on cash, cash equivalents and restricted
cash
|
(34)
|
|
|
(10)
|
|
Net increase
(decrease) in cash, cash equivalents and restricted cash
|
(97)
|
|
|
(507)
|
|
Cash, cash
equivalents and restricted cash at beginning of period
|
996
|
|
|
2,219
|
|
Cash, cash
equivalents and restricted cash at end of period
|
899
|
|
|
1,712
|
|
Less: Cash, cash
equivalents and restricted cash of discontinued
operations
|
—
|
|
|
31
|
|
Cash, cash
equivalents and restricted cash of continuing operations at end of
period
|
$
|
899
|
|
|
$
|
1,681
|
|
eBay
Inc.
|
Unaudited Summary
of Consolidated Net Revenues
|
|
|
Three Months
Ended
|
|
March
31,
2020
|
|
December
31,
2019
|
|
September
30,
2019
|
|
June
30,
2019
|
|
March
31,
2019
|
|
(In millions,
except percentages)
|
Net Revenues by
Type:
|
|
|
|
|
|
|
|
|
|
Net transaction
revenues:
|
|
|
|
|
|
|
|
|
|
Marketplace
(1)
|
$
|
1,900
|
|
|
$
|
1,977
|
|
|
$
|
1,829
|
|
|
$
|
1,887
|
|
|
$
|
1,885
|
|
Current
quarter vs prior year quarter
|
1
|
%
|
|
—
|
%
|
|
1
|
%
|
|
3
|
%
|
|
5
|
%
|
Percent from
international
|
62
|
%
|
|
64
|
%
|
|
63
|
%
|
|
63
|
%
|
|
62
|
%
|
|
|
|
|
|
|
|
|
|
|
Marketing services
and other revenues:
|
|
|
|
|
|
|
|
|
|
Marketplace
|
230
|
|
|
259
|
|
|
254
|
|
|
270
|
|
|
277
|
|
Current
quarter vs prior year quarter
|
(17)
|
%
|
|
(18)
|
%
|
|
(16)
|
%
|
|
(9)
|
%
|
|
(11)
|
%
|
Percent from
international
|
53
|
%
|
|
52
|
%
|
|
53
|
%
|
|
56
|
%
|
|
54
|
%
|
Classifieds
|
248
|
|
|
269
|
|
|
265
|
|
|
271
|
|
|
256
|
|
Current
quarter vs prior year quarter
|
(3)
|
%
|
|
3
|
%
|
|
4
|
%
|
|
5
|
%
|
|
4
|
%
|
Percent from
international
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
Elimination of
intersegment revenue
|
(4)
|
|
|
(5)
|
|
|
(5)
|
|
|
(5)
|
|
|
(5)
|
|
Total marketing
services and other revenues
|
474
|
|
|
523
|
|
|
514
|
|
|
536
|
|
|
528
|
|
Current
quarter vs prior year quarter
|
(10)
|
%
|
|
(9)
|
%
|
|
(8)
|
%
|
|
(4)
|
%
|
|
(5)
|
%
|
Percent from
international
|
77
|
%
|
|
76
|
%
|
|
76
|
%
|
|
78
|
%
|
|
76
|
%
|
Total net revenues
(2)
|
$
|
2,374
|
|
|
$
|
2,500
|
|
|
$
|
2,343
|
|
|
$
|
2,423
|
|
|
$
|
2,413
|
|
Current
quarter vs prior year quarter
|
(2)
|
%
|
|
(2)
|
%
|
|
(1)
|
%
|
|
1
|
%
|
|
3
|
%
|
|
|
|
|
|
|
|
|
|
|
(1) Hedge
gain/(loss)
|
$
|
—
|
|
|
$
|
29
|
|
|
$
|
19
|
|
|
$
|
13
|
|
|
$
|
20
|
|
(2) Foreign currency
impact
|
$
|
(41)
|
|
|
$
|
(14)
|
|
|
$
|
(42)
|
|
|
$
|
(85)
|
|
|
$
|
(67)
|
|
eBay
Inc.
|
Unaudited
Supplemental Operating Data
|
|
|
Three Months
Ended
|
|
March
31,
2020
|
|
December
31,
2019
|
|
September
30,
2019
|
|
June
30,
2019
|
|
March
31,
2019
|
|
(In millions,
except percentages)
|
Active Buyers
(1)
|
174
|
|
|
174
|
|
|
174
|
|
|
173
|
|
|
171
|
|
Current quarter vs
prior year quarter
|
2
|
%
|
|
2
|
%
|
|
4
|
%
|
|
4
|
%
|
|
4
|
%
|
|
|
|
|
|
|
|
|
|
|
Gross Merchandise
Volume (2)
|
|
|
|
|
|
|
|
|
|
U.S.
|
$
|
7,631
|
|
|
$
|
7,694
|
|
|
$
|
7,334
|
|
|
$
|
7,789
|
|
|
$
|
7,925
|
|
Current
quarter vs prior year quarter
|
(4)
|
%
|
|
(9)
|
%
|
|
(6)
|
%
|
|
(6)
|
%
|
|
(7)
|
%
|
International
|
$
|
13,628
|
|
|
$
|
14,272
|
|
|
$
|
13,155
|
|
|
$
|
13,695
|
|
|
$
|
13,646
|
|
Current
quarter vs prior year quarter
|
—
|
%
|
|
(4)
|
%
|
|
(4)
|
%
|
|
(4)
|
%
|
|
(3)
|
%
|
Total
GMV
|
$
|
21,259
|
|
|
$
|
21,966
|
|
|
$
|
20,489
|
|
|
$
|
21,484
|
|
|
$
|
21,571
|
|
Current
quarter vs prior year quarter
|
(1)
|
%
|
|
(5)
|
%
|
|
(5)
|
%
|
|
(5)
|
%
|
|
(4)
|
%
|
|
|
(1)
|
All buyers who
successfully closed a transaction on our Marketplace platform
within the previous 12-month period. Buyers may register more than
once, and as a result, may have more than one account.
|
(2)
|
Total value of all
successfully closed transactions between users on our Marketplace
platform during the period regardless of whether the buyer and
seller actually consummated the transaction. We believe that GMV
provides a useful measure of the overall volume of closed
transactions that flow through our Marketplace platform in a given
period, notwithstanding the inclusion in GMV of closed transactions
that are not ultimately consummated.
|
eBay Inc.
Business Outlook
The guidance figures provided below and elsewhere in this
press release are forward-looking statements, reflect a number of
estimates, assumptions and other uncertainties, and are approximate
in nature because the company's future performance is difficult to
predict. Such guidance is based on information available on the
date of this press release, and the company assumes no obligation
to update it.
The company's future performance involves risks and
uncertainties, and the company's actual results could differ
materially from the information below and elsewhere in this press
release. Some of the factors that could affect the company's
operating results are set forth under the caption "Forward-Looking
Statements" above in this press release. More information about
factors that could affect the company's operating results is
included under the captions "Risk Factors" and "Management's
Discussion and Analysis of Financial Condition and Results of
Operations" in its most recent annual report on Form 10-K and
subsequent quarterly reports on Form 10-Q, copies of which may
be obtained by visiting eBay's investor relations website at
https://investors.ebayinc.com or the SEC's website at
www.sec.gov.
eBay
Inc.
|
|
|
|
Three Months
Ending
|
|
June 30,
2020
|
(In billions,
except per share amounts)
|
GAAP
|
|
Non-GAAP
(a)
|
Net
Revenue
|
$2.38 -
$2.48
|
|
$2.38 -
$2.48
|
Diluted EPS from
continuing operations
|
$0.50 -
$0.57
|
|
$0.73 -
$0.80
|
|
|
|
|
|
Twelve Months
Ending
|
|
December 31,
2020
|
(In billions,
except per share amounts)
|
GAAP
|
|
Non-GAAP
(b)
|
Net
Revenue
|
$9.56 -
$9.76
|
|
$9.56 -
$9.76
|
Diluted EPS from
continuing operations
|
$2.20 -
$2.30
|
|
$3.00 -
$3.10
|
|
(a)
|
Estimated
non-GAAP amounts above for the three months ending June 30, 2020
reflect adjustments that exclude the estimated amortization of
acquired intangible assets of approximately $8 - $13 million,
estimated stock-based compensation expense and associated employer
payroll tax expense of approximately $125 - $135 million and an
adjustment that excludes the net deferred tax impact related to the
step-up in the tax basis of intangible assets of approximately $35
- $45 million.
|
(b)
|
Estimated
non-GAAP amounts above for the twelve months ending December 31,
2020 reflect adjustments that exclude the estimated amortization of
acquired intangible assets of approximately $40 - $50 million,
estimated stock-based compensation expense and associated employer
payroll tax expense of approximately $480 - $500 million and an
adjustment that excludes the net deferred tax impact related to the
step-up in the tax basis of intangible assets of approximately $140
- $160 million.
|
eBay Inc.
Non-GAAP Measures of
Financial Performance
To supplement the company's condensed consolidated financial
statements presented in accordance with generally accepted
accounting principles, or GAAP, the company uses non-GAAP measures
of certain components of financial performance. These non-GAAP
measures include non-GAAP net income, non-GAAP earnings per diluted
share, non-GAAP operating margin, non-GAAP effective tax rate, free
cash flow and figures in this press release presented on a
"FX-Neutral basis". These non-GAAP financial measures are presented
on a continuing operations basis.
These non-GAAP measures are not in accordance with, or an
alternative to, measures prepared in accordance with GAAP and may
be different from non-GAAP measures used by other companies. In
addition, these non-GAAP measures are not based on any
comprehensive set of accounting rules or principles. Non-GAAP
measures have limitations in that they do not reflect all of the
amounts associated with the company's results of operations as
determined in accordance with GAAP. These measures should only be
used to evaluate the company's results of operations in conjunction
with the corresponding GAAP measures.
Reconciliation to the nearest GAAP measure of all non-GAAP
measures included in this press release, except for figures in this
press release presented on a "FX-Neutral basis", can be found in
the tables included in this press release. For figures in this
press release reported "on a FX-Neutral basis", the company
calculates the year-over-year impact of foreign currency movements
using prior period foreign currency rates applied to current year
transactional currency amounts. The company defines organic
FX-Neutral revenue growth as reported revenue growth, excluding
incremental revenue from acquisitions or dispositions for the
twelve-month period following such acquisitions or dispositions and
foreign exchange rate effects.
These non-GAAP measures are provided to enhance investors'
overall understanding of the company's current financial
performance and its prospects for the future. Specifically, the
company believes the non-GAAP measures provide useful information
to both management and investors by excluding certain expenses,
gains and losses, or net purchases of property and equipment, as
the case may be, that may not be indicative of its core operating
results and business outlook. In addition, because the company has
historically reported certain non-GAAP results to investors, the
company believes that the inclusion of non-GAAP measures provides
consistency in the company's financial reporting.
For its internal budgeting process, and as discussed further
below, the company's management uses financial measures that do not
include stock-based compensation expense, employer payroll taxes on
stock-based compensation, amortization or impairment of acquired
intangible assets, impairment of goodwill, amortization of deferred
tax assets associated with the realignment of its legal structure
and related foreign exchange effects, significant gains or losses
from the disposal/acquisition of a business, certain gains and
losses on investments, gains or losses associated with a warrant
agreement that the company entered into with Adyen,
restructuring-related charges and the income taxes associated with
the foregoing. In addition to the corresponding GAAP measures, the
company's management also uses the foregoing non-GAAP measures in
reviewing the financial results of the company.
The company excludes the following items from non-GAAP net
income, non-GAAP earnings per diluted share, non-GAAP operating
margin and non-GAAP effective tax rate:
Stock-based compensation
expense and related employer payroll taxes. This expense
consists of expenses for stock options, restricted stock and
employee stock purchases. The company excludes stock-based
compensation expense from its non-GAAP measures primarily because
they are non-cash expenses that management does not believe are
reflective of ongoing operating results. The related employer
payroll taxes are dependent on the company's stock price and the
timing and size of exercises by employees of their stock options
and the vesting of their restricted stock, over which management
has limited to no control, and as such management does not believe
it correlates to the company's operation of the business.
Amortization or impairment of
acquired intangible assets, impairment of goodwill, certain
amortization of deferred tax assets and related foreign exchange
effects, significant gains or losses and transaction expenses from
the acquisition or disposal of a business and certain gains or
losses on investments. The company incurs amortization or
impairment of acquired intangible assets and goodwill in connection
with acquisitions and may incur significant gains or losses from
the acquisition or disposal of a business and therefore excludes
these amounts from its non-GAAP measures. The company also excludes
certain gains and losses on investments. The company excludes the
non-cash amortization of deferred tax assets associated with the
realignment of its legal structure, which is not reduced by the
effects of the Tax Cuts and Jobs Act, and related foreign exchange
effects. The company excludes these items because management does
not believe they correlate to the ongoing operating results of the
company's business.
Restructuring. These
charges consist of expenses for employee severance and other exit
and disposal costs. The company excludes significant restructuring
charges primarily because management does not believe they are
reflective of ongoing operating results.
Other certain significant
gains, losses, or charges that are not indicative of the company's
core operating results. These are significant gains, losses, or
charges during a period that are the result of isolated events or
transactions which have not occurred frequently in the past and are
not expected to occur regularly or be repeated in the
future. The company excludes these amounts from its results
primarily because management does not believe they are indicative
of its current or ongoing operating results.
Change in fair market value of
warrant. These are gains or losses associated with a
warrant agreement that the company entered into with Adyen, which
are attributable to changes in fair value during the period.
Tax effect of non-GAAP
adjustments. This amount is used to present stock-based
compensation and the other amounts described above on an after-tax
basis consistent with the presentation of non-GAAP net income.
In addition to the non-GAAP measures discussed above, the
company also uses free cash flow. Free cash flow represents
operating cash flows less purchases of property and equipment. The
company considers free cash flow to be a liquidity measure that
provides useful information to management and investors about the
amount of cash generated by the business after the purchases of
property, buildings, and equipment, which can then be used to,
among other things, invest in the company's business, make
strategic acquisitions, repurchase stock and pay dividends. A
limitation of the utility of free cash flow as a measure of
financial performance is that it does not represent the total
increase or decrease in the company's cash balance for the period.
eBay
Inc.
|
Reconciliation of
GAAP Operating Margin to Non-GAAP Operating
Margin
|
|
|
Three Months
Ended
March
31,
|
|
2020
|
|
2019
|
|
(In millions,
except percentages)
|
GAAP operating
income
|
$
|
629
|
|
|
$
|
593
|
|
Stock-based
compensation expense and related employer payroll taxes
|
101
|
|
|
117
|
|
Amortization of
acquired intangible assets within cost of net revenues
|
1
|
|
|
2
|
|
Amortization of
acquired intangible assets within operating expenses
|
9
|
|
|
11
|
|
Other significant
gains, losses or charges
|
8
|
|
|
38
|
|
Total non-GAAP
operating income adjustments
|
119
|
|
|
168
|
|
Non-GAAP operating
income
|
$
|
748
|
|
|
$
|
761
|
|
Non-GAAP operating
margin
|
31.5
|
%
|
|
31.6
|
%
|
Reconciliation of
GAAP Net Income to Non-GAAP Net Income and
|
GAAP Effective Tax
Rate to Non-GAAP Effective Tax Rate*
|
|
|
Three Months
Ended
March
31,
|
|
2020
|
|
2019
|
|
(In millions,
except per share amounts and
percentages)
|
GAAP income from
continuing operations before income taxes
|
$
|
631
|
|
|
$
|
657
|
|
GAAP provision for
income taxes
|
(146)
|
|
|
(141)
|
|
GAAP net income from
continuing operations
|
$
|
485
|
|
|
$
|
516
|
|
Non-GAAP adjustments
to net income from continuing operations:
|
|
|
|
Non-GAAP operating
income from continuing operations adjustments (see table
above)
|
119
|
|
|
168
|
|
(Gain) loss on
investments and sale of business
|
(37)
|
|
|
—
|
|
Change in fair market
value of warrant
|
(12)
|
|
|
(113)
|
|
Tax effect of non-GAAP
adjustments
|
31
|
|
|
19
|
|
Non-GAAP net income
from continuing operations
|
$
|
586
|
|
|
$
|
590
|
|
|
|
|
|
Diluted net income
from continuing operations per share:
|
|
|
|
GAAP
|
$
|
0.64
|
|
|
$
|
0.57
|
|
Non-GAAP
|
$
|
0.77
|
|
|
$
|
0.65
|
|
Shares used in GAAP
and non-GAAP diluted net income per-share calculation
|
757
|
|
|
908
|
|
|
|
|
|
GAAP effective tax
rate - Continuing operations
|
23.2
|
%
|
|
21.3
|
%
|
Tax effect of
non-GAAP adjustments to net income from continuing
operations
|
(6.8)
|
%
|
|
(4.3)
|
%
|
Non-GAAP effective
tax rate - Continuing operations
|
16.4
|
%
|
|
17.0
|
%
|
|
*Presented on a
continuing operations basis
|
Reconciliation of
Operating Cash Flow to Free Cash Flow*
|
|
|
Three Months
Ended
March
31,
|
|
|
2020
|
|
2019
|
|
|
(In
millions)
|
Net cash provided by
continuing operating activities
|
$
|
702
|
|
|
$
|
572
|
|
|
Less: Purchases of
property and equipment
|
(98)
|
|
|
(180)
|
|
|
Free cash
flow
|
$
|
604
|
|
|
$
|
392
|
|
|
|
*Presented on a
continuing operations basis
|
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SOURCE eBay Inc.