- Revenue of $2.4 billion, down
9% on an as-reported basis and down 6% on an FX-Neutral
basis
- Gross Merchandise Volume of $18.5 billion, down 18% on an as-reported basis
and down 14% on an FX-Neutral basis
- GAAP and Non-GAAP EPS per diluted share of
$(0.96) and $0.99, respectively, on a continuing operations
basis
- GAAP and Non-GAAP operating margin of 21.7% and
28.7%, respectively
- Returned over $1.4
billion to shareholders in Q2, including approximately
$1.3 billion of share repurchases and
$121 million paid in cash
dividends
SAN
JOSE, Calif., August 3,
2022 /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 second
quarter ended June 30, 2022.
"Once again I am pleased to report another strong quarter. Our
team delivered better than expected financial results across the
board while continuing to make significant progress on our
long-term initiatives," said Jamie
Iannone, Chief Executive Officer of eBay. "Our focus
category strategy is working, and payments and advertising are
driving further growth. eBay is in a stronger position today than
it was when we entered the pandemic. Despite rising inflation, and
an uncertain macro environment, we remain on track to deliver on
our 2022 commitments."
Second Quarter Financial
Highlights
- Revenue was $2.4 billion, down 9%
on an as-reported basis and down 6% on a foreign exchange (FX)
neutral basis.
- Gross merchandise volume (GMV) was $18.5
billion, down 18% on an as-reported basis and down 14% on an
FX-Neutral basis.
- GAAP net loss from continuing operations was $536 million, or $(0.96) per diluted share primarily driven by the
change in fair value of our equity investments.
- Non-GAAP net income from continuing operations was $554 million, or $0.99 per diluted share.
- GAAP and Non-GAAP operating margin of 21.7% and 28.7%,
respectively.
- Generated $577 million of
operating cash flow and $466 million
of free cash flow from continuing operations.
- Sold a portion of our shares in Kakao Bank for $242 million and a portion of our shares in Adyen
for $129 million.
- Returned over $1.4 billion to
shareholders, including approximately $1.3
billion of share repurchases and $121
million paid in cash dividends.
Business Highlights
- eBay joined an investment consortium led by The Chernin Group
(TCG), which made a strategic investment in Funko. As part of this
investment, Funko and eBay are entering into a commercial agreement
under which eBay will become the preferred secondary marketplace
for Funko, and the companies will partner on creating exclusive
product releases.
- eBay acquired KnownOrigin, a non-fungible token (NFT)
marketplace that provides artists a place to create unique,
authentic, digital collectibles, in the form of NFTs. An early
pioneer in the NFT space, KnownOrigin's innovative technology and
talented team, together with eBay's reach and reputation, will
empower a new wave of NFT creators, sellers and buyers.
- eBay announced it is taking steps to close GittiGidiyor, the
company's marketplace business in Turkey. The company regularly reviews its
business operations globally and made this strategic decision based
on the ongoing dynamics in the market. While the closure of
GittiGidiyor will not have a material impact on eBay's revenue and
operating income going forward, there are approximately 3 million
active buyers included in the company's Q2 active buyer count from
the Turkish marketplace.
Revenue Initiatives
- eBay's first party advertising products, primarily driven by
Promoted Listings, delivered $232
million of revenue in the second quarter, up 2% on an
as-reported basis and up 6% on an FX-Neutral basis.
- The company's total advertising offerings generated
approximately $275 million in revenue
in the second quarter, representing roughly 1.5% of GMV.
- The company expanded its Buyer FX program to include additional
payment options, allowing more flexibility for eBay buyers to
purchase in the currency of their choice and further reducing
transactional friction for customers.
- During the quarter, eBay rolled out Klarna invoicing and
installment payment methods to buyers in Germany.
Tech-Led Reimagination of the Platform
- The company opened the eBay vault, a state-of-the-art facility
and digital marketplace for collectors. The vault is now open for
single, graded trading cards and graded, pack-pulled autograph
cards for $500+, enabling collectors to streamline and secure their
assets. The eBay vault is the latest in a series of significant
innovations eBay has introduced to its enthusiasts, bringing
together physical and digital capabilities that makes collecting
more advanced than ever.
- Through a strategic partnership with Professional Sports
Authenticator (PSA), eBay expanded its Authenticity Guarantee
program for trading cards to include graded trading cards sold on
eBay for $500+.
- eBay also expanded its Authenticity Guarantee program for
sneakers and handbags to Australia
and the U.K. In Australia, the
company also hosted eBay's Museum of Authentics which showcased a
collection of rare sneakers, and partnered with Afterpay's
Australian Fashion Week to engage influencers and highlight the
marketplace's authentication services for luxury handbags.
- In April, eBay Motors held the first ever New York Auto Parts
Show, designed to demonstrate how car enthusiasts can build, fix or
maintain their dream car. In the face of unprecedented supply chain
challenges, the show debuted a line of "Re-Concept cars" assembled
in partnership with some of the industry's top builders and biggest
stars, demonstrating the best 'new' car on the road can start with
one that already exists.
- In April, the company expanded its eBay Refurbished program
across multiple condition grades for tablets, smartwatches,
laptops, desktops and more. Hundreds of thousands of items will be
added to the program this year, enabling eBay to meet consumer
needs at every price point, without sacrificing quality and trust.
The expansion included the launch of eBay Refurbished in
Canada, giving buyers access to
like-new products ranging from moderate wear to pristine condition,
all backed by a one- or two-year warranty.
- The company piloted eBay Live beta, a dedicated shopping
platform that gives people a new way to browse and buy products in
a live, interactive environment. The new beta technology combines
entertainment with instant purchasing on one of the world's largest
marketplaces.
- eBay collaborated with Snapchat to create a quick, easy way to
share eBay listings to Snapchat right from the eBay app. With just
a few taps, users can create a Snapchat-ready design with listing
details, an image and a clickable link back to the eBay
listing.
- eBay announced a partnership with U.K. reality show
Love Island, and is now the show's
first ever pre-loved fashion partner.
Impact
- eBay published its 2021 Impact Report detailing progress toward
its 2025 and 2030 economic empowerment and sustainability goals.
For the first time, the company also released its methodology for
calculating the environmental and financial benefits of keeping
products in circulation, preventing them from immediate disposal to
landfill or incineration.
- eBay released its sixth annual Diversity, Equity and Inclusion
(DE&I) Report outlining how the company has remained committed,
open and transparent, acknowledging both the wins and the areas in
need of improvement.
- eBay, in partnership with GLIDE, hosted its 21st and grand
finale Power of One Charity Auction Lunch with Warren Buffett. The auction made history with a
record-breaking bid of over $19
million, bringing the total funds raised to more than
$53 million over almost two decades
to support GLIDE's transformative programs and services that lift
people out of poverty, hunger and homelessness.
- eBay for Charity contributed nearly $56
million globally during the quarter, up 52%
year-over-year.
- Through the company's matching gifts program, the eBay
Foundation matched over $0.5 million
in employee donations and volunteer time to causes and communities
around the world.
- During the quarter, eBay received three Women's Choice Awards
as a Best Company for Diversity, Best Company for Women and Best
Company for Millennials. The company was also recognized as one of
LinkedIn's Top Companies in Retail, and received the Early Talent
Award by Handshake, recognizing eBay's early career program.
Second Quarter 2022
Financial Highlights (presented in millions, except per share data
and percentages)
|
|
|
Second
Quarter
|
|
|
|
2022
|
2021
|
Change
|
eBay
Inc.
|
|
|
|
|
Net
revenues
|
$ 2,422
|
$ 2,668
|
$
(246)
|
(9) %
|
GAAP – Continuing
Operations
|
|
|
|
|
Income (loss) from
continuing operations
|
$
(536)
|
$
294
|
$
(830)
|
**
|
Earnings (loss) per
diluted share from continuing operations
|
$ (0.96)
|
$ 0.43
|
$ (1.39)
|
**
|
Non-GAAP –
Continuing Operations
|
|
|
|
|
Net income
|
$
554
|
$
675
|
$
(121)
|
(18) %
|
Earnings per diluted
share
|
$ 0.99
|
$ 0.99
|
$
—
|
— %
|
Other Selected Financial and Operational Results
- Operating margin – GAAP operating margin decreased to 21.7% for
the second quarter of 2022, compared to 27.4% for the same period
last year. Non-GAAP operating margin decreased to 28.7% in the
second quarter of 2022, compared to 32.8% for the same period last
year.
- Taxes – The GAAP effective tax rate for continuing operations
for the second quarter of 2022 was 26.3%, compared to 26.6% for the
second quarter of 2021. The non-GAAP effective tax rate for
continuing operations for the second quarter of 2022 was
16.5%(1).
- Cash flow – The company generated $577
million of operating cash flow and $466 million of free cash flow from continuing
operations during the second quarter of 2022.
- Capital returns – The company repurchased approximately
$1.3 billion of its common stock, or
roughly 25 million shares, in the second quarter of 2022. The
company's total repurchase authorization remaining as of
June 30, 2022 was $3.4 billion. The company also paid cash
dividends of $121 million during the
second quarter of 2022.
- Cash and cash equivalents and non-equity investments – The
company's cash and cash equivalents and non-equity investments
portfolio totaled $4.5 billion as of
June 30, 2022.
Business Outlook
eBay is providing the following guidance for continuing
operations for the third quarter and full year 2022.
In billions, except
per share data and percentages
|
Q3 2022
Guidance
|
Full Year 2022
Guidance
|
Revenue
|
$2.29 -
$2.37
|
$9.6 - $9.9
|
Organic FX-Neutral
Y/Y Growth
|
(5)% -
(2)%
|
(6)% -
(3)%
|
|
|
|
Diluted GAAP
EPS
|
$0.63 -
$0.69
|
$(1.98) -
$(1.83)
|
|
|
|
Diluted Non-GAAP
EPS
|
$0.89 -
$0.95
|
$3.95 -
$4.10
|
Dividend Declaration
- eBay's Board of Directors has declared a cash dividend of
$0.22 per share of the company's
common stock. The dividend is payable on September 16, 2022 to stockholders of record as
of September 1, 2022.
(1) We use a non-GAAP tax rate for evaluating our
operating results. Based on our current long-term projections, we
are using a non-GAAP tax rate of 16.5%. This non-GAAP tax rate
could change for various reasons including significant changes in
our geographic earnings mix or fundamental tax law changes in major
jurisdictions in which we operate.
Quarterly Conference Call and
Webcast
eBay Inc. will host a conference call to discuss second quarter
2022 results at 2:00 p.m. Pacific Time today. Investors and
participants can access the call by dialing (888) 655-9638 in the
U.S. and (289) 514-2913 internationally. The passcode for the
conference line is 7435074. 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 more than 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 2021, eBay enabled over $87
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 third quarter and full year 2022 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 and
share repurchases. 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, including impacts from the ongoing war in Ukraine, 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; 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
|
|
|
June 30,
2022
|
|
December 31,
2021
|
|
(In millions)
|
ASSETS
|
|
|
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
$
1,742
|
|
$
1,379
|
Short-term
investments
|
1,483
|
|
5,944
|
Customer accounts and
funds receivable
|
605
|
|
681
|
Other current
assets
|
1,237
|
|
1,107
|
Total current
assets
|
5,067
|
|
9,111
|
Long-term
investments
|
2,146
|
|
2,575
|
Property and equipment,
net
|
1,173
|
|
1,236
|
Goodwill
|
4,113
|
|
4,178
|
Operating lease
right-of-use assets
|
541
|
|
289
|
Deferred tax
assets
|
3,227
|
|
3,255
|
Equity investment in
Adevinta
|
2,919
|
|
5,391
|
Other assets
|
467
|
|
591
|
Total
assets
|
$
19,653
|
|
$
26,626
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
Current
liabilities:
|
|
|
|
Short-term
debt
|
$
1,149
|
|
$
1,355
|
Accounts
payable
|
249
|
|
262
|
Customer accounts and
funds payable
|
604
|
|
707
|
Accrued expenses and
other current liabilities
|
1,735
|
|
1,927
|
Income taxes
payable
|
235
|
|
371
|
Total current
liabilities
|
3,972
|
|
4,622
|
Operating lease
liabilities
|
448
|
|
200
|
Deferred tax
liabilities
|
2,400
|
|
3,116
|
Long-term
debt
|
6,579
|
|
7,727
|
Other
liabilities
|
1,011
|
|
1,183
|
Total
liabilities
|
14,410
|
|
16,848
|
Total stockholders'
equity
|
5,243
|
|
9,778
|
Total liabilities and
stockholders' equity
|
$
19,653
|
|
$
26,626
|
eBay
Inc. Unaudited Condensed Consolidated Statement of
Income
|
|
|
Three Months
Ended
June
30,
|
|
Six Months
Ended
June
30,
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
|
(In millions, except
per share amounts)
|
Net revenues
|
$
2,422
|
|
$
2,668
|
|
$
4,905
|
|
$
5,306
|
Cost of net revenues
(1)
|
663
|
|
672
|
|
1,352
|
|
1,278
|
Gross
profit
|
1,759
|
|
1,996
|
|
3,553
|
|
4,028
|
Operating
expenses:
|
|
|
|
|
|
|
|
Sales and marketing
(1)
|
566
|
|
559
|
|
1,044
|
|
1,105
|
Product development
(1)
|
344
|
|
350
|
|
645
|
|
654
|
General and
administrative (1)
|
237
|
|
250
|
|
463
|
|
496
|
Provision for
transaction losses
|
86
|
|
103
|
|
182
|
|
191
|
Amortization of
acquired intangible assets
|
1
|
|
2
|
|
2
|
|
9
|
Total operating
expenses
|
1,234
|
|
1,264
|
|
2,336
|
|
2,455
|
Income from
operations
|
525
|
|
732
|
|
1,217
|
|
1,573
|
Gain (loss) on equity
investments and warrant, net
|
(1,221)
|
|
(273)
|
|
(3,512)
|
|
(309)
|
Interest and other,
net
|
(31)
|
|
(58)
|
|
(81)
|
|
(139)
|
Income (loss) from
continuing operations before income taxes
|
(727)
|
|
401
|
|
(2,376)
|
|
1,125
|
Income tax benefit
(provision)
|
191
|
|
(107)
|
|
501
|
|
(263)
|
Income (loss) from
continuing operations
|
(536)
|
|
294
|
|
(1,875)
|
|
862
|
Income (loss) from
discontinued operations, net of income taxes
|
5
|
|
10,440
|
|
3
|
|
10,513
|
Net income
(loss)
|
$
(531)
|
|
$
10,734
|
|
$
(1,872)
|
|
$
11,375
|
|
|
|
|
|
|
|
|
Income (loss) per share
– basic:
|
|
|
|
|
|
|
|
Continuing
operations
|
$
(0.96)
|
|
$
0.44
|
|
$
(3.28)
|
|
$
1.27
|
Discontinued
operations
|
0.01
|
|
15.48
|
|
0.01
|
|
15.52
|
Net income (loss) per
share – basic
|
$
(0.95)
|
|
$
15.92
|
|
$
(3.27)
|
|
$
16.79
|
|
|
|
|
|
|
|
|
Income (loss) per share
– diluted:
|
|
|
|
|
|
|
|
Continuing
operations
|
$
(0.96)
|
|
$
0.43
|
|
$
(3.28)
|
|
$
1.25
|
Discontinued
operations
|
0.01
|
|
15.25
|
|
0.01
|
|
15.27
|
Net income (loss) per
share – diluted
|
$
(0.95)
|
|
$
15.68
|
|
$
(3.27)
|
|
$
16.52
|
|
|
|
|
|
|
|
|
Weighted average
shares:
|
|
|
|
|
|
|
|
Basic
|
556
|
|
674
|
|
571
|
|
678
|
Diluted
|
556
|
|
685
|
|
571
|
|
689
|
|
|
|
|
|
|
|
|
(1) Includes
stock-based compensation as follows:
|
|
|
|
|
|
|
|
Cost of net
revenues
|
$
13
|
|
$
13
|
|
$
25
|
|
$
23
|
Sales and
marketing
|
20
|
|
25
|
|
40
|
|
45
|
Product
development
|
62
|
|
55
|
|
107
|
|
97
|
General and
administrative
|
42
|
|
42
|
|
76
|
|
73
|
|
$
137
|
|
$
135
|
|
$
248
|
|
$
238
|
eBay
Inc. Unaudited Condensed Consolidated Statement of Cash
Flows
|
|
|
Three Months
Ended
June
30,
|
|
Six Months
Ended
June
30,
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
|
(In
millions)
|
Cash flows from
operating activities:
|
|
|
|
|
|
|
|
Net income
(loss)
|
$
(531)
|
|
$
10,734
|
|
$
(1,872)
|
|
$
11,375
|
(Income) loss from
discontinued operations, net of income taxes
|
(5)
|
|
(10,440)
|
|
(3)
|
|
(10,513)
|
Adjustments:
|
|
|
|
|
|
|
|
Provision for
transaction losses
|
86
|
|
103
|
|
182
|
|
191
|
Depreciation and
amortization
|
113
|
|
127
|
|
231
|
|
261
|
Stock-based
compensation
|
137
|
|
135
|
|
248
|
|
238
|
Loss (gain) on
investments and other, net
|
1
|
|
(43)
|
|
7
|
|
(44)
|
Deferred income
taxes
|
(319)
|
|
3
|
|
(695)
|
|
106
|
Change in fair value
of warrant
|
104
|
|
(108)
|
|
219
|
|
(72)
|
Change in fair value
of equity investment in Adevinta
|
829
|
|
422
|
|
2,472
|
|
422
|
Change in fair value
of equity investment in Gmarket
|
77
|
|
—
|
|
259
|
|
—
|
Unrealized change in
fair value of equity investment in KakaoBank
|
105
|
|
—
|
|
196
|
|
—
|
Unrealized change in
fair value of equity investment in Adyen
|
38
|
|
—
|
|
118
|
|
—
|
Realized change in
fair value of shares sold in Adyen
|
1
|
|
—
|
|
167
|
|
—
|
Realized change in
fair value of shares sold in KakaoBank
|
67
|
|
—
|
|
75
|
|
—
|
Loss on extinguishment
of debt
|
—
|
|
—
|
|
—
|
|
10
|
Changes in assets and
liabilities, net of acquisition effects
|
(126)
|
|
76
|
|
(398)
|
|
(17)
|
Net cash provided by
continuing operating activities
|
577
|
|
1,009
|
|
1,206
|
|
1,957
|
Net cash provided by
(used in) discontinued operating activities
|
(349)
|
|
58
|
|
(365)
|
|
152
|
Net cash provided by
operating activities
|
228
|
|
1,067
|
|
841
|
|
2,109
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
Purchases of property
and equipment
|
(111)
|
|
(99)
|
|
(194)
|
|
(182)
|
Purchases of
investments
|
(4,671)
|
|
(6,252)
|
|
(10,146)
|
|
(9,676)
|
Maturities and sales
of investments
|
6,354
|
|
2,993
|
|
13,181
|
|
6,765
|
Proceeds from the sale
of shares in Adyen
|
207
|
|
—
|
|
680
|
|
—
|
Proceeds from the sale
of shares in KakaoBank
|
260
|
|
—
|
|
287
|
|
—
|
Other
|
(47)
|
|
2
|
|
(44)
|
|
4
|
Net cash provided by
(used in) continuing investing activities
|
1,992
|
|
(3,356)
|
|
3,764
|
|
(3,089)
|
Net cash provided by
(used in) discontinued investing activities
|
—
|
|
2,446
|
|
—
|
|
2,444
|
Net cash provided by
(used in) investing activities
|
1,992
|
|
(910)
|
|
3,764
|
|
(645)
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
Proceeds from issuance
of common stock
|
54
|
|
57
|
|
55
|
|
57
|
Repurchases of common
stock
|
(1,473)
|
|
(1,429)
|
|
(2,542)
|
|
(1,733)
|
Payments for taxes
related to net share settlements of restricted stock units and
awards
|
(37)
|
|
(108)
|
|
(98)
|
|
(128)
|
Payments for
dividends
|
(121)
|
|
(121)
|
|
(250)
|
|
(243)
|
Proceeds from issuance
of long-term debt, net
|
—
|
|
2,482
|
|
—
|
|
2,482
|
Repayment of
debt
|
(605)
|
|
—
|
|
(1,355)
|
|
(1,156)
|
Net borrowings under
commercial paper program
|
—
|
|
(400)
|
|
—
|
|
—
|
Net funds receivable
and payable activity
|
(48)
|
|
(67)
|
|
8
|
|
30
|
Other
|
—
|
|
2
|
|
—
|
|
6
|
Net cash provided by
(used in) continuing financing activities
|
(2,230)
|
|
416
|
|
(4,182)
|
|
(685)
|
Net cash provided by
(used in) discontinued financing activities
|
—
|
|
6
|
|
—
|
|
(62)
|
Net cash provided by
(used in) financing activities
|
(2,230)
|
|
422
|
|
(4,182)
|
|
(747)
|
Effect of exchange rate
changes on cash, cash equivalents and restricted cash
|
(39)
|
|
6
|
|
(57)
|
|
(5)
|
Net increase (decrease)
in cash, cash equivalents and restricted cash
|
(49)
|
|
585
|
|
366
|
|
712
|
Cash, cash equivalents
and restricted cash at beginning of period
|
1,821
|
|
1,721
|
|
1,406
|
|
1,594
|
Cash, cash equivalents
and restricted cash at end of period
|
$
1,772
|
|
$
2,306
|
|
$1,772
|
|
$2,306
|
Less: Cash, cash
equivalents and restricted cash of discontinued
operations
|
—
|
|
162
|
|
—
|
|
162
|
Cash, cash equivalents
and restricted cash of continuing operations at end of
period
|
$
1,772
|
|
$
2,144
|
|
$
1,772
|
|
$
2,144
|
eBay
Inc. Unaudited Summary of Consolidated Net
Revenues
|
|
|
Three Months
Ended
|
|
June 30,
2022
|
|
March 31,
2022
|
|
December 31,
2021
|
|
September
30,
2021
|
|
June 30,
2021
|
|
(In millions, except
percentages)
|
Net Revenues by
Type:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net transaction
revenues (1)
|
$
2,297
|
|
$
2,355
|
|
$
2,450
|
|
$
2,350
|
|
$
2,496
|
Current quarter vs
prior year quarter
|
(8) %
|
|
(5) %
|
|
6 %
|
|
12 %
|
|
14 %
|
Percent from
international
|
52 %
|
|
52 %
|
|
54 %
|
|
54 %
|
|
53 %
|
|
|
|
|
|
|
|
|
|
|
Marketing services and
other revenues
|
125
|
|
128
|
|
163
|
|
151
|
|
172
|
Current quarter vs
prior year quarter
|
(27) %
|
|
(21) %
|
|
(4) %
|
|
(6) %
|
|
13 %
|
Percent from
international
|
25 %
|
|
24 %
|
|
23 %
|
|
24 %
|
|
25 %
|
|
|
|
|
|
|
|
|
|
|
Total net revenues
(2)
|
$
2,422
|
|
$
2,483
|
|
$
2,613
|
|
$
2,501
|
|
$
2,668
|
Current quarter vs
prior year quarter
|
(9) %
|
|
(6) %
|
|
5 %
|
|
11 %
|
|
14 %
|
|
|
|
|
|
|
|
|
|
|
(1) Hedge
gain/(loss)
|
$
9
|
|
$
6
|
|
$
—
|
|
$
(19)
|
|
$
(18)
|
(2) Foreign currency
impact
|
$
(95)
|
|
$
(58)
|
|
$
7
|
|
$
32
|
|
$
95
|
eBay
Inc. Unaudited Supplemental Operating Data
|
|
|
Three Months
Ended
|
|
June 30,
2022
|
|
March 31,
2022
|
|
December 31,
2021
|
|
September
30,
2021
|
|
June 30,
2021
|
|
(In millions, except
percentages)
|
Active Buyers
(1)
|
138
|
|
142
|
|
147
|
|
152
|
|
156
|
Current quarter vs
prior year quarter
|
(12) %
|
|
(13) %
|
|
(9) %
|
|
(5) %
|
|
(2) %
|
Active buyers
excluding GittiGidiyor
|
135
|
|
138
|
|
143
|
|
148
|
|
151
|
Current quarter vs
prior year quarter
|
(11) %
|
|
(12) %
|
|
(8) %
|
|
(4) %
|
|
(1) %
|
|
|
|
|
|
|
|
|
|
|
Gross Merchandise
Volume (2)
|
|
|
|
|
|
|
|
|
|
U.S.
|
$
8,982
|
|
$
9,335
|
|
$
9,724
|
|
$
9,312
|
|
$
10,332
|
Current quarter vs
prior year quarter
|
(13) %
|
|
(14) %
|
|
(2) %
|
|
(8) %
|
|
(6) %
|
International
|
$
9,567
|
|
$
10,074
|
|
$
11,002
|
|
$
10,613
|
|
$
12,255
|
Current quarter vs
prior year quarter
|
(22) %
|
|
(24) %
|
|
(16) %
|
|
(11) %
|
|
(7) %
|
Total
GMV
|
$
18,549
|
|
$
19,409
|
|
$
20,726
|
|
$
19,925
|
|
$
22,587
|
Current quarter vs
prior year quarter
|
(18) %
|
|
(20) %
|
|
(10) %
|
|
(10) %
|
|
(7) %
|
|
|
(1)
|
All buyers who paid for
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)
|
Gross Merchandise
Volume consists of the total value of all paid transactions between
users on our platforms during the applicable period inclusive of
shipping fees and taxes.
|
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
|
|
September 30,
2022
|
(In billions, except
per share amounts)
|
GAAP
|
|
Non-GAAP
(a)
|
Net
Revenue
|
$2.29 -
$2.37
|
|
$2.29 -
$2.37
|
Diluted EPS from
continuing operations
|
$0.63 -
$0.69
|
|
$0.89 -
$0.95
|
|
|
|
|
|
Twelve Months
Ending
|
|
December 31,
2022
|
(In billions, except
per share amounts)
|
GAAP
|
|
Non-GAAP
(b)
|
Net
Revenue
|
$9.6 - $9.9
|
|
$9.6 - $9.9
|
Diluted EPS from
continuing operations
|
$(1.98) -
$(1.83)
|
|
$3.95 -
$4.10
|
|
|
|
|
(a) Estimated non-GAAP
amounts above for the three months ending September 30, 2022
reflect adjustments that exclude estimated stock-based compensation
expense and associated employer payroll tax expense of
approximately $130 - $140 million and estimated adjustment between
our GAAP and non-GAAP tax rate of approximately $25 - $35 million.
The estimated GAAP diluted EPS above does not assume any gains or
losses on our equity investments.
|
|
|
|
|
(b) Estimated non-GAAP
amounts above for the twelve months ending December 31, 2022
reflect adjustments that exclude the estimated amortization of
acquired intangible assets of approximately $2 - $5 million,
estimated stock-based compensation expense and associated employer
payroll tax expense of approximately $525 - $545 million and
estimated adjustment between our GAAP and non-GAAP tax rate of
approximately $80 - $100 million. The estimated GAAP diluted EPS
above does not assume any future gains or losses on our equity
investments.
|
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 including changes in fair value, changes in
foreign currency exchange rates and the impact of any related
foreign exchange derivative instruments, 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 vesting of restricted stock by
employees and the timing and size of stock option exercises, 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. These amounts include changes in
fair value and the related change in foreign currency exchange
rates of equity securities with readily determinable fair values,
globally.
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.
Income tax effects and
adjustments. We use a non-GAAP tax rate for evaluating our
operating results. Based on our current long-term projections, we
are using a non-GAAP tax rate of 16.5%. This non-GAAP tax rate
could change for various reasons including significant changes in
our geographic earnings mix or fundamental tax law changes in major
jurisdictions in which we operate.
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 Income to Non-GAAP
Operating Income*
|
|
|
Three Months
Ended
June 30,
|
|
Six Months
Ended
June 30,
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
|
(In millions, except
percentages)
|
GAAP operating
income
|
$
525
|
|
$
732
|
|
$
1,217
|
|
$
1,573
|
Stock-based
compensation expense and related employer payroll taxes
|
140
|
|
140
|
|
257
|
|
244
|
Amortization of
acquired intangible assets within operating expenses
|
1
|
|
2
|
|
2
|
|
9
|
Other significant
gains, losses or charges
|
28
|
|
2
|
|
23
|
|
35
|
Total non-GAAP
operating income adjustments
|
169
|
|
144
|
|
282
|
|
288
|
Non-GAAP operating
income
|
$
694
|
|
$
876
|
|
$
1,499
|
|
$
1,861
|
Non-GAAP operating
margin
|
28.7 %
|
|
32.8 %
|
|
30.6 %
|
|
35.1 %
|
*Presented on a continuing
operations basis
Reconciliation of
GAAP Net Income to Non-GAAP Net
Income and GAAP Effective Tax Rate to Non-GAAP
Effective Tax Rate*
|
|
|
Three Months
Ended
June 30,
|
|
Six Months
Ended
June 30,
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
|
(In millions, except
per share amounts and percentages)
|
GAAP income (loss) from
continuing operations before income taxes
|
$
(727)
|
|
$
401
|
|
$
(2,376)
|
|
$
1,125
|
GAAP (provision)
benefit for income taxes
|
191
|
|
(107)
|
|
501
|
|
(263)
|
GAAP net income (loss)
from continuing operations
|
$
(536)
|
|
$
294
|
|
$
(1,875)
|
|
$
862
|
Non-GAAP adjustments to
net income (loss) from continuing operations:
|
|
|
|
|
|
|
|
Non-GAAP operating
income from continuing operations adjustments (see table
above)
|
$
169
|
|
$
144
|
|
$
282
|
|
$
288
|
Loss on
investments
|
288
|
|
(41)
|
|
815
|
|
(41)
|
Change in fair market
value of warrant
|
104
|
|
(108)
|
|
219
|
|
(72)
|
Change in fair value
of equity investment in Adevinta
|
829
|
|
422
|
|
2,472
|
|
422
|
Income tax effects and
adjustments
|
(300)
|
|
(36)
|
|
(734)
|
|
(36)
|
Non-GAAP net income
from continuing operations
|
$
554
|
|
$
675
|
|
$
1,179
|
|
$
1,423
|
|
|
|
|
|
|
|
|
Diluted net income
(loss) from continuing operations per share:
|
|
|
|
|
|
|
|
GAAP
|
$
(0.96)
|
|
$
0.43
|
|
$
(3.28)
|
|
$
1.25
|
Non-GAAP
|
$
0.99
|
|
$
0.99
|
|
$
2.04
|
|
$
2.07
|
Shares used in GAAP
diluted net income (loss) per-share calculation
|
556
|
|
685
|
|
571
|
|
689
|
Shares used in non-GAAP
diluted net income per-share calculation
|
561
|
|
685
|
|
577
|
|
689
|
|
|
|
|
|
|
|
|
GAAP effective tax rate
– Continuing operations
|
26.3 %
|
|
26.6 %
|
|
21.1 %
|
|
23.4 %
|
Income tax effects and
adjustments to net income (loss) from continuing
operations
|
(9.8) %
|
|
(9.1) %
|
|
(4.6) %
|
|
(6.0) %
|
Non-GAAP effective tax
rate – Continuing operations
|
16.5 %
|
|
17.5 %
|
|
16.5 %
|
|
17.4 %
|
|
|
*
|
Presented on a
continuing operations basis
|
Reconciliation of
Operating Cash Flow to Free Cash Flow*
|
|
|
Three Months
Ended
June 30,
|
|
Six Months
Ended
June 30,
|
|
2022
|
|
2021
|
|
2022
|
|
2021
|
|
(In
millions)
|
Net cash provided by
continuing operating activities
|
$
577
|
|
$
1,009
|
|
$
1,206
|
|
$
1,957
|
Less: Purchases of
property and equipment
|
(111)
|
|
(99)
|
|
(194)
|
|
(182)
|
Free cash
flow
|
$
466
|
|
$
910
|
|
$
1,012
|
|
$
1,775
|
|
|
*
|
Presented on a
continuing operations basis
|
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SOURCE eBay Inc.