SAN JOSE, Calif., Oct. 28,
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 third quarter
ended September 30, 2020.
"I'm pleased with the third quarter results," said Jamie Iannone, Chief Executive Officer at eBay
Inc. "On an apples to apples basis, we delivered results that
exceeded expectations on both the top and bottom lines. Our third
quarter performance reflects the strength of our newly focused
strategy coupled with the enormous untapped potential of our
marketplace. As we continue our multi-year journey to become the
best global marketplace to buy and sell, I am proud of the progress
our team is making toward our tech-led reimagination."
Third Quarter Marketplace Financial Highlights
- Annual active buyers grew by 5%, for a total of 183 million
global active buyers.
- Gross merchandise volume (GMV) was $25.0
billion, up 22% on an as-reported basis and up 21% on a
foreign exchange (FX) neutral basis, year-over-year.
- Revenue was $2.6 billion, up 25%
on both an as-reported basis and an FX-Neutral basis.
- GAAP net income from continuing operations was $621 million, or $0.88 per diluted share.
- Non-GAAP net income from continuing operations was $604 million, or $0.85 per diluted share.
- Generated $716 million of
operating cash flow and $584 million
of free cash flow from continuing operations.
- In early July, completed the $3.0
billion accelerated share repurchase plan announced in
February, at an average price per share of $40.77.
- Repaid $500 million of 3.250%
senior fixed rate notes due 2020, and redeemed the remaining
outstanding balance of $421 million
on our 2.875% senior fixed rate notes due in 2021.
Background on the Presentation of Results
On July 20, 2020, the company
announced it entered into a definitive agreement to transfer its
Classifieds business to Adevinta and has since determined that the
business meets the discontinued operations accounting criteria.
To aid in the comparison to previously provided financial
guidance, below are revised versions of the July 28, 2020 guidance metrics, reflecting the
exclusion of the Classifieds business.
|
Q3
2020
|
In billions,
except per share data
|
July 28, 2020
Guidance
|
Classifieds
Impact
|
Implied
Guidance
excl. Classifieds
|
Revenue
|
$2.64 -
$2.71
|
$(0.26)
|
$2.38 -
$2.45
|
|
|
|
|
GAAP
EPS
|
$0.58 -
$0.64
|
$(0.10)
|
$0.48 -
$0.54
|
|
|
|
|
Non-GAAP
EPS
|
$0.81 -
$0.87
|
$(0.13)
|
$0.68 -
$0.74
|
|
FY
2020
|
In billions,
except per share data
|
July 28, 2020
Guidance
|
Classifieds
Impact
|
Implied
Guidance
excl. Classifieds
|
Revenue
|
$10.56 -
$10.75
|
$(0.97)
|
$9.59 -
$9.78
|
|
|
|
|
GAAP
EPS
|
$2.85 -
$3.00
|
$(0.34)
|
$2.51 -
$2.66
|
|
|
|
|
Non-GAAP
EPS
|
$3.47 -
$3.59
|
$(0.43)
|
$3.04 -
$3.16
|
Business Highlights
- The company remains on track to complete the transfer of its
Classifieds business to Adevinta in Q1 2021, subject to regulatory
approvals.
- eBay continues to scale its management of payments globally,
exiting the quarter with more than 340,000 sellers migrated. During
the quarter, over 20% of on-platform volume was processed through
managed payments. The company announced the Q1 2021 expansion plans
to France, Italy and Spain, along with enablement for eBay for
Charity sellers in the U.S. and U.K. to leverage the new
experience.
- Promoted Listings delivered $186
million of revenue in Q3, up 79% on an as-reported basis and
up 77% on an FX-Neutral basis.
- In building its trusted marketplace for sellers, the company
launched authentication on all watches sold over $2,000 in the U.S. with the new "Authenticity
Guarantee" service and quickly followed with plans to expand this
service in one of its highest-profile categories: sneakers. The
sneakers authentication program, launched in October with the most
popular sneaker styles and brands, will scale to include all
collectible sneakers over $100 by
early 2021.
- The company also launched a new destination that features
Certified Refurbished products direct from the world's most popular
brands. In addition to great savings, all Certified Refurbished
purchases include a two-year warranty, eBay money back guarantee
and hassle-free 30-day returns.
- The company announced a new collaboration with UPS in the U.S.
that provides sellers with more options to support their
businesses. Additionally, eBay is supporting seller profitability
during the upcoming holiday season by working with carriers on its
platform to eliminate peak season shipping surcharges.
- In the U.K. and Australia, the
company launched Virtual Tracking Number to substantially increase
package tracking and provide buyers and sellers with ease and
confidence.
- Keeping with its commitment to be the platform of choice for
sellers, the company further integrated Terapeak's capabilities
into other areas of Seller Hub, including in the listing flow and
in active listings. Additionally, Terapeak's capabilities were
expanded to include searching and filtering of Item Specifics,
better aligning results with what sellers are searching for.
- The company launched new features like Time Away, which allows
sellers to update their listings and protect their on-time delivery
record while they are on vacation and provide buyers with more
accurate shipping estimates; Great Price Signal to highlight
competitively priced items from trusted sellers; and expanded
seller features, like the ability for buyers to counter Seller
Initiated Offers, into other markets including France, Italy
and Spain.
- Further underscoring eBay's commitment to sustainability, the
company joined the EPA's Green Power Partnership, ranking 14th on
its Top 30 Tech & Telecom list.
- eBay Foundation reached its $1
million Kiva lending goal to support global untapped
entrepreneurs through an employee micro-lending initiative and
matching funds from the Foundation.
- During the quarter, eBay for Charity began working alongside
international artists through a campaign called Artists Band
Together, helping to raise funds for organizations that work to
increase voter turnout for the upcoming U.S. elections.
Third Quarter 2020
Financial Highlights (presented in millions, except per share data
and percentages)
|
|
Third
Quarter
|
|
|
|
2020
|
2019
|
Change
|
eBay
Inc.
|
|
|
|
|
Net
revenues
|
$2,606
|
$2,083
|
$523
|
25%
|
GAAP - Continuing
Operations
|
|
|
|
|
Income (loss) from
continuing operations
|
$621
|
$210
|
$411
|
196%
|
Earnings (loss) per
diluted share from continuing operations
|
$0.88
|
$0.25
|
$0.63
|
250%
|
Non-GAAP -
Continuing Operations
|
|
|
|
|
Net income
|
$604
|
$435
|
$169
|
39%
|
Earnings per diluted
share
|
$0.85
|
$0.52
|
$0.33
|
64%
|
Other Selected Financial and Operational Results
- Operating margin – GAAP operating margin increased to 26.1% for
the third quarter of 2020, compared to 19.6% for the same period
last year. Non-GAAP operating margin increased to 30.7% in the
third quarter of 2020, compared to 26.7% for the same period last
year.
- Taxes – The GAAP effective tax rate for continuing operations
for the third quarter of 2020 was 19.8%, compared to 21.2% for the
third quarter of 2019. The non-GAAP effective tax rate for
continuing operations for the third quarter of 2020 was 14.1%,
compared to 15.6% for the third quarter of 2019.
- Cash flow – The company generated $716
million of operating cash flow from continuing operations
and $584 million of free cash flow
during the third quarter of 2020.
- Capital returns – The company repurchased approximately
$700 million of its common stock, or
approximately 18 million shares, in the third quarter of 2020. The
company's total repurchase authorization remaining as of
September 30, 2020 was $2.5 billion. The company also paid cash
dividends of $111 million during the
third quarter of 2020.
- Cash and cash equivalents and non-equity investments – The
company's cash and cash equivalents and non-equity investments
portfolio totaled $4.1 billion as of
September 30, 2020.
Business Outlook
Based on the company's improved revenue and earnings outlook for
Q4 and full year 2020, eBay has raised its full year guidance for
continuing operations.
In billions,
except per share data and percentages
|
Q4 2020
Guidance
|
Revenue
|
$2.64 -
$2.71
|
Organic FX-Neutral
Y/Y Growth
|
19 -
22%
|
|
|
GAAP
EPS
|
$0.58 -
$0.64
|
|
|
Non-GAAP
EPS
|
$0.78 -
$0.84
|
|
FY
2020
|
In billions,
except per share data and percentages
|
Prior Implied
Guidance
excl. Classifieds
July 28,
2020
|
Current
Guidance
October 28,
2020
|
Revenue
|
$9.59 -
$9.78
|
$10.04 -
$10.11
|
Organic FX-Neutral
Y/Y Growth
|
14 -
16%
|
19 -
20%
|
|
|
|
GAAP
EPS
|
$2.51 -
$2.66
|
$3.00 -
$3.06
|
|
|
|
Non-GAAP
EPS
|
$3.04 -
$3.16
|
$3.34 -
$3.40
|
Capital Allocation
- 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 December 18, 2020 to stockholders of record as of
December 1, 2020.
Quarterly Conference Call and Webcast
eBay Inc. will host a conference call to discuss third quarter
2020 results at 2:00 p.m. Pacific Time today. Investors and
participants can access the call by dialing (833) 350-1438 in the
U.S. and (647) 689-6641 internationally. The passcode for the
conference line is 7665786. 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 that
connects millions of buyers and sellers in 190 markets around the
world. We exist to enable economic opportunity for individuals,
entrepreneurs, businesses and organizations of all sizes. 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. References to "revenue" refer to
"net revenues" as reported in the company's consolidated statement
of income.
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 an "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 an 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 management's vision for the
future of eBay and our ability to accomplish our vision, expected
financial results for the fourth 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 closing of the announced transaction with
Adevinta ASA (the "Transaction"), the potential benefits of the
Transaction and the impact of the Transaction on future results.
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
e-commerce growth or cross-border trade; the company's ability to
realize expected growth opportunities in payments intermediation
and advertising; 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 a 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; the company's ability to integrate, manage
and grow businesses that have been acquired or may be acquired in
the future; the possibility that regulatory and other approvals and
conditions to the Transaction are not received or satisfied on a
timely basis or at all; the possibility that eBay may not fully
realize the projected benefits of the Transaction; changes in the
anticipated timing for closing the Transaction; business disruption
during the pendency of or following the Transaction; diversion of
management time on Transaction-related issues; the reaction of
customers and other persons to the Transaction; and other events
that could adversely impact the completion of the Transaction,
including COVID-19 and industry or economic conditions outside of
our control.
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.
Company
News:
|
https://www.ebayinc.com/stories/news/
|
Investor Relations
website:
|
https://investors.ebayinc.com
|
eBay
Inc.
|
Unaudited
Condensed Consolidated Balance Sheet
|
|
|
September
30,
2020
|
|
December
31,
2019
|
|
(In millions)
|
|
|
ASSETS
|
|
|
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
$
|
963
|
|
|
$
|
901
|
|
Short-term
investments
|
2,697
|
|
|
1,850
|
|
Accounts receivable,
net of allowance for doubtful accounts of $105 and $82
|
477
|
|
|
555
|
|
Other current
assets
|
1,486
|
|
|
1,064
|
|
Current assets of
discontinued operations
|
—
|
|
|
141
|
|
Current assets held
for sale
|
1,116
|
|
|
195
|
|
Total current
assets
|
6,739
|
|
|
4,706
|
|
Long-term
investments
|
663
|
|
|
1,275
|
|
Property and
equipment, net
|
1,301
|
|
|
1,460
|
|
Goodwill
|
4,537
|
|
|
4,533
|
|
Intangible assets,
net
|
19
|
|
|
39
|
|
Operating lease
right-of-use assets
|
499
|
|
|
583
|
|
Deferred tax
assets
|
3,749
|
|
|
3,980
|
|
Other
assets
|
914
|
|
|
414
|
|
Long-term assets of
discontinued operations
|
—
|
|
|
306
|
|
Long-term assets held
for sale
|
—
|
|
|
878
|
|
Total
assets
|
$
|
18,421
|
|
|
$
|
18,174
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
Current
liabilities:
|
|
|
|
Short-term
debt
|
$
|
17
|
|
|
$
|
1,020
|
|
Accounts
payable
|
307
|
|
|
229
|
|
Accrued expenses and
other current liabilities
|
2,536
|
|
|
2,097
|
|
Deferred
revenue
|
105
|
|
|
129
|
|
Income taxes
payable
|
379
|
|
|
169
|
|
Current liabilities of
discontinued operations
|
—
|
|
|
259
|
|
Current liabilities
held for sale
|
496
|
|
|
163
|
|
Total current
liabilities
|
3,840
|
|
|
4,066
|
|
Operating lease
liabilities
|
379
|
|
|
461
|
|
Deferred tax
liabilities
|
2,280
|
|
|
2,355
|
|
Long-term
debt
|
7,738
|
|
|
6,738
|
|
Other
liabilities
|
1,264
|
|
|
1,353
|
|
Long-term liabilities
of discontinued operations
|
—
|
|
|
26
|
|
Long-term liabilities
held for sale
|
—
|
|
|
305
|
|
Total
liabilities
|
15,501
|
|
|
15,304
|
|
|
|
|
|
Total stockholders'
equity
|
2,920
|
|
|
2,870
|
|
Total liabilities and
stockholders' equity
|
$
|
18,421
|
|
|
$
|
18,174
|
|
eBay
Inc.
|
Unaudited
Condensed Consolidated Statement of Income
|
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
(In millions,
except per share amounts)
|
Net
revenues
|
$
|
2,606
|
|
|
$
|
2,083
|
|
|
$
|
7,403
|
|
|
$
|
6,400
|
|
Cost of net revenues
(1)
|
656
|
|
|
530
|
|
|
1,731
|
|
|
1,580
|
|
Gross
profit
|
1,950
|
|
|
1,553
|
|
|
5,672
|
|
|
4,820
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
Sales and marketing
(1)
|
660
|
|
|
577
|
|
|
1,835
|
|
|
1,731
|
|
Product development
(1)
|
287
|
|
|
243
|
|
|
788
|
|
|
735
|
|
General and
administrative (1)
|
258
|
|
|
250
|
|
|
750
|
|
|
756
|
|
Provision for
transaction losses
|
60
|
|
|
68
|
|
|
245
|
|
|
194
|
|
Amortization of
acquired intangible assets
|
6
|
|
|
7
|
|
|
20
|
|
|
21
|
|
Total operating
expenses
|
1,271
|
|
|
1,145
|
|
|
3,638
|
|
|
3,437
|
|
Income from
operations
|
679
|
|
|
408
|
|
|
2,034
|
|
|
1,383
|
|
Interest and other,
net
|
95
|
|
|
(142)
|
|
|
277
|
|
|
(128)
|
|
Income from
continuing operations before income taxes
|
774
|
|
|
266
|
|
|
2,311
|
|
|
1,255
|
|
Income tax
provision
|
(153)
|
|
|
(56)
|
|
|
(550)
|
|
|
(208)
|
|
Income from
continuing operations
|
$
|
621
|
|
|
$
|
210
|
|
|
$
|
1,761
|
|
|
$
|
1,047
|
|
Income from
discontinued operations, net of income taxes
|
43
|
|
|
100
|
|
|
3,061
|
|
|
183
|
|
Net income
|
$
|
664
|
|
|
$
|
310
|
|
|
$
|
4,822
|
|
|
$
|
1,230
|
|
|
|
|
|
|
|
|
|
Income per share -
basic:
|
|
|
|
|
|
|
|
Continuing
operations
|
$
|
0.89
|
|
|
$
|
0.25
|
|
|
$
|
2.46
|
|
|
$
|
1.21
|
|
Discontinued
operations
|
0.06
|
|
|
0.12
|
|
|
4.26
|
|
|
0.22
|
|
Net income per share
- basic
|
$
|
0.95
|
|
|
$
|
0.37
|
|
|
$
|
6.72
|
|
|
$
|
1.43
|
|
|
|
|
|
|
|
|
|
Income per share -
diluted:
|
|
|
|
|
|
|
|
Continuing
operations
|
$
|
0.88
|
|
|
$
|
0.25
|
|
|
$
|
2.43
|
|
|
$
|
1.20
|
|
Discontinued
operations
|
0.06
|
|
|
0.12
|
|
|
4.22
|
|
|
0.22
|
|
Net income per share
- diluted
|
$
|
0.94
|
|
|
$
|
0.37
|
|
|
$
|
6.65
|
|
|
$
|
1.42
|
|
|
|
|
|
|
|
|
|
Weighted average
shares:
|
|
|
|
|
|
|
|
Basic
|
696
|
|
|
830
|
|
|
717
|
|
|
863
|
|
Diluted
|
708
|
|
|
837
|
|
|
725
|
|
|
870
|
|
|
|
|
|
|
|
|
|
(1) Includes
stock-based compensation as follows:
|
|
|
|
|
|
|
|
Cost of net
revenues
|
$
|
11
|
|
|
$
|
11
|
|
|
$
|
32
|
|
|
$
|
35
|
|
Sales and
marketing
|
24
|
|
|
19
|
|
|
60
|
|
|
56
|
|
Product
development
|
38
|
|
|
41
|
|
|
116
|
|
|
127
|
|
General and
administrative
|
40
|
|
|
26
|
|
|
103
|
|
|
103
|
|
|
$
|
113
|
|
|
$
|
97
|
|
|
$
|
311
|
|
|
$
|
321
|
|
eBay
Inc.
|
Unaudited
Condensed Consolidated Statement of Cash Flows
|
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
(In
millions)
|
Cash flows from
operating activities:
|
|
|
|
|
|
|
|
Net income
|
$
|
664
|
|
|
$
|
310
|
|
|
$
|
4,822
|
|
|
$
|
1,230
|
|
(Income) loss from
discontinued operations, net of income taxes
|
(43)
|
|
|
(100)
|
|
|
(3,061)
|
|
|
(183)
|
|
Adjustments:
|
|
|
|
|
|
|
|
Provision for
transaction losses
|
60
|
|
|
68
|
|
|
245
|
|
|
194
|
|
Depreciation and
amortization
|
163
|
|
|
159
|
|
|
471
|
|
|
474
|
|
Stock-based
compensation
|
113
|
|
|
97
|
|
|
311
|
|
|
321
|
|
(Gain) loss on sale of
business
|
—
|
|
|
52
|
|
|
—
|
|
|
52
|
|
(Gain) loss on
investments, net
|
(1)
|
|
|
—
|
|
|
1
|
|
|
1
|
|
Deferred income
taxes
|
70
|
|
|
(1)
|
|
|
169
|
|
|
(22)
|
|
Change in fair value
of warrant
|
(191)
|
|
|
49
|
|
|
(496)
|
|
|
(56)
|
|
Changes in assets and
liabilities, net of acquisition effects
|
(119)
|
|
|
167
|
|
|
(199)
|
|
|
(122)
|
|
Net cash provided by
continuing operating activities
|
716
|
|
|
801
|
|
|
2,263
|
|
|
1,889
|
|
Net cash provided by
(used in) discontinued operating activities
|
(611)
|
|
|
208
|
|
|
(602)
|
|
|
414
|
|
Net cash provided by
operating activities
|
105
|
|
|
1,009
|
|
|
1,661
|
|
|
2,303
|
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
Purchases of property
and equipment
|
(132)
|
|
|
(92)
|
|
|
(326)
|
|
|
(394)
|
|
Purchases of
investments
|
(7,224)
|
|
|
(13,223)
|
|
|
(28,897)
|
|
|
(37,390)
|
|
Maturities and sales
of investments
|
9,074
|
|
|
14,656
|
|
|
28,740
|
|
|
40,483
|
|
Equity investment in
Paytm Mall
|
—
|
|
|
(160)
|
|
|
—
|
|
|
(160)
|
|
Other
|
—
|
|
|
(34)
|
|
|
39
|
|
|
15
|
|
Net cash provided by
(used in) continuing investing activities
|
1,718
|
|
|
1,147
|
|
|
(444)
|
|
|
2,554
|
|
Net cash provided by
(used in) discontinued investing activities
|
(7)
|
|
|
(4)
|
|
|
4,024
|
|
|
(125)
|
|
Net cash provided by
investing activities
|
1,711
|
|
|
1,143
|
|
|
3,580
|
|
|
2,429
|
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
Proceeds from issuance
of common stock
|
5
|
|
|
4
|
|
|
55
|
|
|
59
|
|
Repurchases of common
stock
|
(680)
|
|
|
(1,022)
|
|
|
(4,710)
|
|
|
(3,971)
|
|
Payments for taxes
related to net share settlements of restricted stock units and
awards
|
(48)
|
|
|
(43)
|
|
|
(131)
|
|
|
(162)
|
|
Payments for
dividends
|
(111)
|
|
|
(115)
|
|
|
(337)
|
|
|
(360)
|
|
Proceeds from issuance
of long-term debt, net
|
—
|
|
|
—
|
|
|
1,765
|
|
|
—
|
|
Repayment of
debt
|
(932)
|
|
|
(1,550)
|
|
|
(1,771)
|
|
|
(1,550)
|
|
Other
|
(7)
|
|
|
1
|
|
|
(12)
|
|
|
1
|
|
Net cash used in
continuing financing activities
|
(1,773)
|
|
|
(2,725)
|
|
|
(5,141)
|
|
|
(5,983)
|
|
Net cash used in
discontinued financing activities
|
—
|
|
|
—
|
|
|
(2)
|
|
|
—
|
|
Net cash used in
financing activities
|
(1,773)
|
|
|
(2,725)
|
|
|
(5,143)
|
|
|
(5,983)
|
|
Effect of exchange
rate changes on cash, cash equivalents and restricted
cash
|
51
|
|
|
(39)
|
|
|
25
|
|
|
(59)
|
|
Net increase
(decrease) in cash, cash equivalents and restricted cash
|
94
|
|
|
(612)
|
|
|
123
|
|
|
(1,310)
|
|
Cash, cash
equivalents and restricted cash at beginning of period
|
1,025
|
|
|
1,521
|
|
|
996
|
|
|
2,219
|
|
Cash, cash
equivalents and restricted cash at end of period
|
1,119
|
|
|
909
|
|
|
1,119
|
|
|
909
|
|
Less: Cash and cash
equivalents and restricted cash of held for sale
business
|
30
|
|
|
41
|
|
|
30
|
|
|
41
|
|
Less: Cash, cash
equivalents and restricted cash of discontinued
operations
|
—
|
|
|
23
|
|
|
—
|
|
|
23
|
|
Cash, cash
equivalents and restricted cash of continuing operations at end of
period
|
$
|
1,089
|
|
|
$
|
845
|
|
|
$
|
1,089
|
|
|
$
|
845
|
|
eBay
Inc.
|
Unaudited Summary
of Consolidated Net Revenues
|
|
|
Three Months
Ended
|
|
September
30,
2020
|
|
June
30,
2020
|
|
March
31,
2020
|
|
December
31,
2019
|
|
September
30,
2019
|
|
(In millions,
except percentages)
|
Net Revenues by
Type:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net transaction
revenues
|
$
|
2,355
|
|
|
$
|
2,447
|
|
|
$
|
1,900
|
|
|
$
|
1,977
|
|
|
$
|
1,829
|
|
Current quarter vs
prior year quarter
|
29
|
%
|
|
30
|
%
|
|
1
|
%
|
|
—
|
%
|
|
1
|
%
|
Percent from
international
|
59
|
%
|
|
60
|
%
|
|
62
|
%
|
|
64
|
%
|
|
63
|
%
|
|
|
|
|
|
|
|
|
|
|
Marketing services
and other revenues
|
251
|
|
|
221
|
|
|
229
|
|
|
259
|
|
|
254
|
|
Current quarter vs
prior year quarter
|
(1)
|
%
|
|
(18)
|
%
|
|
(17)
|
%
|
|
(19)
|
%
|
|
(17)
|
%
|
Percent from
international
|
55
|
%
|
|
50
|
%
|
|
52
|
%
|
|
51
|
%
|
|
52
|
%
|
|
|
|
|
|
|
|
|
|
|
Total net revenues
(2)
|
$
|
2,606
|
|
|
$
|
2,668
|
|
|
$
|
2,129
|
|
|
$
|
2,236
|
|
|
$
|
2,083
|
|
Current quarter vs
prior year quarter
|
25
|
%
|
|
24
|
%
|
|
(1)
|
%
|
|
(3)
|
%
|
|
(1)
|
%
|
|
|
|
|
|
|
|
|
|
|
(1) Hedge
gain/(loss)
|
$
|
6
|
|
|
$
|
17
|
|
|
$
|
—
|
|
|
$
|
29
|
|
|
$
|
19
|
|
(2) Foreign currency
impact
|
$
|
31
|
|
|
$
|
(40)
|
|
|
$
|
(35)
|
|
|
$
|
(5)
|
|
|
$
|
(32)
|
|
eBay
Inc.
|
Unaudited
Supplemental Operating Data
|
|
|
Three Months
Ended
|
|
September
30,
2020
|
|
June
30,
2020
|
|
March
31,
2020
|
|
December
31,
2019
|
|
September
30,
2019
|
|
(In millions,
except percentages)
|
Active Buyers
(1)
|
183
|
|
|
182
|
|
|
174
|
|
|
174
|
|
|
174
|
|
Current quarter vs
prior year quarter
|
5
|
%
|
|
5
|
%
|
|
2
|
%
|
|
2
|
%
|
|
4
|
%
|
|
|
|
|
|
|
|
|
|
|
Gross Merchandise
Volume (2)
|
|
|
|
|
|
|
|
|
|
U.S.
|
$
|
9,790
|
|
|
$
|
10,489
|
|
|
$
|
7,631
|
|
|
$
|
7,694
|
|
|
$
|
7,334
|
|
Current quarter vs
prior year quarter
|
33
|
%
|
|
35
|
%
|
|
(4)
|
%
|
|
(9)
|
%
|
|
(6)
|
%
|
International
|
$
|
15,259
|
|
|
$
|
16,646
|
|
|
$
|
13,628
|
|
|
$
|
14,272
|
|
|
$
|
13,155
|
|
Current quarter vs
prior year quarter
|
16
|
%
|
|
22
|
%
|
|
—
|
%
|
|
(4)
|
%
|
|
(4)
|
%
|
Total
GMV
|
$
|
25,049
|
|
|
$
|
27,135
|
|
|
$
|
21,259
|
|
|
$
|
21,966
|
|
|
$
|
20,489
|
|
Current quarter vs
prior year quarter
|
22
|
%
|
|
26
|
%
|
|
(1)
|
%
|
|
(5)
|
%
|
|
(5)
|
%
|
|
(1)
|
All buyers who
successfully closed a transaction on our platforms 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 platforms
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 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. Revenue guidance is provided on an FX-Neutral basis and
excludes incremental revenue from acquisitions or dispositions for
the twelve-month period following such acquisitions or
dispositions. 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
|
|
December 31,
2020
|
(In billions,
except per share amounts)
|
GAAP
|
|
Non-GAAP
(a)
|
Net
Revenue
|
$2.64 -
$2.71
|
|
$2.64 -
$2.71
|
Diluted EPS from
continuing operations
|
$0.58 -
$0.64
|
|
$0.78 -
$0.84
|
|
|
|
|
|
Twelve Months
Ending
|
|
December 31,
2020
|
(In billions,
except per share amounts)
|
GAAP
|
|
Non-GAAP
(b)
|
Net
Revenue
|
$10.04 -
$10.11
|
|
$10.04 -
$10.11
|
Diluted EPS from
continuing operations
|
$3.00 -
$3.06
|
|
$3.34 -
$3.40
|
|
|
|
|
(a) Estimated
non-GAAP amounts above for the three months ending December 31,
2020 reflect adjustments that exclude the estimated amortization of
acquired intangible assets of approximately $5 - $10 million,
estimated stock-based compensation expense and associated employer
payroll tax expense of approximately $110 - $120 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 $50
- $60 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 $25 - $30 million,
estimated stock-based compensation expense and associated employer
payroll tax expense of approximately $430 - $440 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 $170
- $180 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 an
"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 an "FX-Neutral basis", can be found in
the tables included in this press release. For figures in this
press release reported "on an 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
September
30,
|
|
Nine Months
Ended
September
30,
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
(In millions,
except percentages)
|
GAAP operating
income
|
$
|
679
|
|
|
$
|
408
|
|
|
$
|
2,034
|
|
|
$
|
1,383
|
|
Stock-based
compensation expense and related employer payroll taxes
|
115
|
|
|
100
|
|
|
319
|
|
|
333
|
|
Amortization of
acquired intangible assets within cost of net revenues
|
—
|
|
|
1
|
|
|
1
|
|
|
5
|
|
Amortization of
acquired intangible assets within operating expenses
|
6
|
|
|
7
|
|
|
20
|
|
|
21
|
|
Other significant
gains, losses or charges
|
(1)
|
|
|
41
|
|
|
39
|
|
|
80
|
|
Total non-GAAP
operating income adjustments
|
120
|
|
|
149
|
|
|
379
|
|
|
439
|
|
Non-GAAP operating
income
|
$
|
799
|
|
|
$
|
557
|
|
|
$
|
2,413
|
|
|
$
|
1,822
|
|
Non-GAAP operating
margin
|
30.7
|
%
|
|
26.7
|
%
|
|
32.6
|
%
|
|
28.5
|
%
|
Reconciliation of
GAAP Net Income to Non-GAAP Net Income and
|
GAAP Effective Tax
Rate to Non-GAAP Effective Tax Rate*
|
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
(In millions,
except per share amounts and percentages)
|
GAAP income from
continuing operations before income taxes
|
$
|
774
|
|
|
$
|
266
|
|
|
$
|
2,311
|
|
|
$
|
1,255
|
|
GAAP provision for
income taxes
|
(153)
|
|
|
(56)
|
|
|
(550)
|
|
|
(208)
|
|
GAAP net income from
continuing operations
|
$
|
621
|
|
|
$
|
210
|
|
|
$
|
1,761
|
|
|
$
|
1,047
|
|
Non-GAAP adjustments
to net income from continuing operations:
|
|
|
|
|
|
|
|
Non-GAAP operating
income from continuing operations adjustments (see table
above)
|
120
|
|
|
149
|
|
|
379
|
|
|
439
|
|
(Gain) loss on
investments and sale of business
|
—
|
|
|
52
|
|
|
3
|
|
|
52
|
|
Change in fair market
value of warrant
|
(191)
|
|
|
49
|
|
|
(496)
|
|
|
(56)
|
|
Tax effect of non-GAAP
adjustments
|
54
|
|
|
(25)
|
|
|
205
|
|
|
(61)
|
|
Non-GAAP net income
from continuing operations
|
$
|
604
|
|
|
$
|
435
|
|
|
$
|
1,852
|
|
|
$
|
1,421
|
|
|
|
|
|
|
|
|
|
Diluted net income
from continuing operations per share:
|
|
|
|
|
|
|
|
GAAP
|
$
|
0.88
|
|
|
$
|
0.25
|
|
|
$
|
2.43
|
|
|
$
|
1.20
|
|
Non-GAAP
|
$
|
0.85
|
|
|
$
|
0.52
|
|
|
$
|
2.55
|
|
|
$
|
1.63
|
|
Shares used in GAAP
and non-GAAP diluted net income per-share calculation
|
708
|
|
|
837
|
|
|
725
|
|
|
870
|
|
|
|
|
|
|
|
|
|
GAAP effective tax
rate - Continuing operations
|
19.8
|
%
|
|
21.2
|
%
|
|
23.8
|
%
|
|
16.6
|
%
|
Tax effect of
non-GAAP adjustments to net income from continuing
operations
|
(5.7)
|
%
|
|
(5.6)
|
%
|
|
(8.1)
|
%
|
|
(0.7)
|
%
|
Non-GAAP effective
tax rate - Continuing operations
|
14.1
|
%
|
|
15.6
|
%
|
|
15.7
|
%
|
|
15.9
|
%
|
|
*Presented on a
continuing operations basis
|
|
Reconciliation of
Operating Cash Flow to Free Cash Flow*
|
|
|
Three Months
Ended
September
30,
|
|
Nine Months
Ended
September
30,
|
|
2020
|
|
2019
|
|
2020
|
|
2019
|
|
(In
millions)
|
Net cash provided by
continuing operating activities
|
$
|
716
|
|
|
$
|
801
|
|
|
$
|
2,263
|
|
|
$
|
1,889
|
|
Less: Purchases of
property and equipment
|
(132)
|
|
|
(92)
|
|
|
(326)
|
|
|
(394)
|
|
Free cash
flow
|
$
|
584
|
|
|
$
|
709
|
|
|
$
|
1,937
|
|
|
$
|
1,495
|
|
|
|
*Presented on a
continuing operations basis
|
|
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SOURCE eBay Inc.