Net Income up Double Digits in 2011 on Record Revenue
eBay Tightens Range on Three-Year Outlook Reflecting Increased
Confidence
SAN JOSE, Calif.--(BUSINESS WIRE)--
eBay Inc., a global commerce platform and payments leader (NASDAQ:EBAY),
today reported that revenue for the fourth quarter ended December
31, 2011, increased 35% to $3.4 billion, compared to the same period of
2010. The company reported fourth quarter net income on a GAAP basis of
$2.0 billion, or $1.51 per diluted share, and non-GAAP net income of
$788.6 million, or $0.60 per diluted share. The year-over-year increase
in the fourth quarter GAAP earnings per diluted share was driven
primarily by a gain on the sale of the company's remaining investment in
Skype. The year-over-year increase in the fourth quarter non-GAAP
earnings per diluted share was driven primarily by strong top-line
growth and improved productivity partially offset by a higher tax rate.
For the full year, revenue increased 27% to $11.7 billion, compared to
2010. The company generated net income on a GAAP basis of $3.2 billion,
or $2.46 per diluted share, and non-GAAP net income of $2.7 billion, or
$2.03 per diluted share.
"We had a strong fourth quarter finish to an excellent year, increasing
our confidence in our three-year outlook," said eBay Inc. President and
CEO John Donahoe. "Across eBay, PayPal, GSI and X.commerce, we have a
robust portfolio of global commerce platforms and innovative mobile,
local and social commerce technology assets. We are well-positioned to
compete in the emerging new retail environment, and to help retailers of
all sizes grow and engage their customers anytime, anywhere. We are a
different eBay today, no longer just an ecommerce leader but a stronger,
more diverse global commerce company shaping the future of shopping and
payments."
The company's PayPal business continued to expand its leadership
position in global payments. PayPal ended the quarter with 106.3 million
active registered accounts, a 13% increase year over year. On average,
PayPal added a million new accounts every month in 2011. PayPal revenue
for the quarter increased 28% year over year driven primarily by
continued merchant and consumer adoption as well as increased
penetration on eBay. In the fourth quarter, revenue from PayPal's
international markets exceeded revenue from the U.S. for the first time,
reflecting the company's strong global footprint and growth in emerging
markets. PayPal's net total payment volume (TPV) grew 24% to $33.4
billion in the fourth quarter of 2011. The company's mobile payment
volume reached $4.0 billion in 2011, more than five times the mobile
payment volume in the prior year, as more consumers used their
smartphones and tablets to pay online.
The company's Marketplaces business also delivered strong fourth quarter
performance. Marketplaces revenue for the quarter was up 16% year over
year, due primarily to increased buying and selling on our platforms and
growth from acquisitions. Gross merchandise volume (GMV), excluding
vehicles, increased 10% to $16.5 billion with sold items up 11% globally
year over year. U.S. GMV, excluding vehicles, increased 10% year over
year, reflecting the success of eBay's tailored shopping experiences,
the strong results delivered by eBay's top-rated sellers and the
benefits of site enhancements. International GMV, excluding vehicles,
increased 9% year over year, driven primarily by stable growth in Europe
and improved performance in Asia. eBay mobile reached a record $5
billion transacted through mobile devices during 2011 as increased
adoption of eBay's mobile apps and product innovation drove deeper
customer engagement across all platforms.
The company's GSI business, which was acquired in the second quarter of
2011, contributed $363.6 million in revenue for the fourth quarter. GSI
generated $1.4 billion in global ecommerce (GeC) merchandise sales
during the quarter, driven by strong performance by top merchants, where
same store sales grew 26% year over year, outpacing ecommerce growth
rates in the fourth quarter.
Fourth Quarter and Full Year 2011 Financial Highlights (presented in
millions, except per share data and percentages)
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Fourth Quarter
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Full Year
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2011
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2010
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Change
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2011
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2010
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Change
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GAAP
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Net revenue
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$
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3,380
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$
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2,495
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$
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885
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35
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%
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$
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11,652
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$
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9,156
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$
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2,496
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27
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%
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Net income
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$
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1,980
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$
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559
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$
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1,421
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254
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%
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$
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3,229
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$
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1,801
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$
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1,428
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79
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%
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Earnings per diluted share
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$
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1.51
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$
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0.42
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$
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1.09
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260
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%
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$
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2.46
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$
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1.36
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$
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1.10
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81
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%
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Non-GAAP
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Net income
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$
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789
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$
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684
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$
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105
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15
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%
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$
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2,667
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$
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2,299
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$
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368
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16
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%
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Earnings per diluted share
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$
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0.60
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$
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0.52
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$
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0.08
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15
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%
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$
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2.03
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$
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1.73
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$
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0.30
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17
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%
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Fourth Quarter
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Full Year
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2011
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2010
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Change
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2011
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2010
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Change
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Business Units
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Payments
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Net revenue
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$
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1,240
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$
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971
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$
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269
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28
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%
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$
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4,412
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$
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3,436
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$
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976
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28
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%
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Net total payment volume
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$
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33,372
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$
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26,866
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$
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6,506
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24
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%
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$
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118,758
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$
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91,956
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$
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26,802
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29
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%
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Merchant Services
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$
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21,959
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$
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16,982
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$
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4,977
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29
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%
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$
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77,700
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$
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57,232
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$
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20,468
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36
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%
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On eBay
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$
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11,413
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$
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9,884
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$
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1,529
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15
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%
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$
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41,058
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$
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34,724
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$
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6,334
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18
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%
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Marketplaces
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Net revenue
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$
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1,772
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$
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1,524
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$
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248
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16
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%
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$
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6,642
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$
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5,721
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$
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921
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16
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%
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Gross merchandise volume (excl. vehicles)
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$
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16,490
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$
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15,039
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$
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1,451
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10
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%
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$
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60,332
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$
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53,532
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$
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6,800
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13
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%
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U.S.
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$
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6,157
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$
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5,584
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$
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573
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10
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%
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$
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22,866
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$
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20,416
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$
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2,450
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12
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%
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International
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$
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10,333
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$
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9,455
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$
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878
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9
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%
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$
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37,466
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$
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33,116
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$
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4,350
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13
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%
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GSI
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Net revenue**
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$
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364
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$
|
—
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$
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364
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N/A
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|
|
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$
|
590
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|
|
$
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—
|
|
|
|
$
|
590
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N/A
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GeC Merchandise Sales
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$
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1,362
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|
|
$
|
—
|
|
|
|
$
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1,362
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|
N/A
|
|
|
|
$
|
2,046
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|
|
$
|
—
|
|
|
|
$
|
2,046
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N/A
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** Full year 2011 results reflect net revenue attributable to the GSI
segment for the period from June 17, 2011 (the date that the acquisition
was completed) through December 31, 2011.
Other Selected Financial Results
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Operating margin — GAAP operating margin decreased to 22.3% for the
fourth quarter of 2011 compared to 23.7% for the same period last
year. Non-GAAP operating margin decreased to 28.7% for the quarter,
compared to 29.5% for the same period last year. The decrease in
non-GAAP operating margin was due primarily to the impact of
acquisitions and business mix. All three business segment margins
increased during the fourth quarter of 2011 with Marketplaces,
Payments and GSI generating segment margins of 40.6%, 24.7% and 21.4%,
respectively, compared to 38.5%, 19.5% and 2.8%, respectively, in the
third quarter of 2011.
-
Taxes — The GAAP effective tax rate for the fourth quarter of 2011 was
19%, compared to 5% for the fourth quarter of 2010. For the fourth
quarter of 2011, the non-GAAP effective tax rate was 20% compared to
8% for the fourth quarter of 2010. The increase in the effective tax
rate was due primarily to the settlement of uncertain tax positions in
the fourth quarter of 2010.
-
Cash flow — The company generated $982 million of operating cash flow
and $691 million of free cash flow during the fourth quarter.
-
Stock repurchase program — The company repurchased approximately $250
million of its common stock in the fourth quarter.
-
Cash and cash equivalents and non-equity investments — The company's
cash and cash equivalents and non-equity investments portfolio totaled
$7.5 billion at December 31, 2011, compared to $7.8 billion at
December 31, 2010.
Business Outlook
-
First quarter 2012 — eBay expects net revenues in the range of $3,050
- $3,150 million with GAAP earnings per diluted share in the range of
$0.37 - $0.38 and non-GAAP earnings per diluted share in the range of
$0.50 - $0.51.
-
Full year 2012 — eBay expects net revenues in the range of $13,700 -
$14,000 million with GAAP earnings per diluted share in the range of
$1.76 - $1.81 and non-GAAP earnings per diluted share in the range of
$2.25 - $2.30.
Quarterly Conference Call
eBay will host a conference call to discuss fourth quarter and full year
2011 results at 2:00 p.m. Pacific Time today. 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 http://investors.ebayinc.com.
In addition, an archive of the webcast will be accessible for 90 days
through the same link.
About eBay Inc.
Founded in 1995 in San Jose, Calif., eBay Inc. (NASDAQ:EBAY) is a global
commerce platform and payments leader. We do so through eBay, the
world's largest online marketplace, which allows users to buy and sell
in nearly every country on earth; through PayPal, which enables
individuals and businesses to securely, easily and quickly send and
receive online payments; and through GSI, which facilitates ecommerce,
multichannel retailing and digital marketing for global enterprises.
X.commerce brings together the technology assets and developer
communities of eBay, PayPal and Magento, an ecommerce platform, to
support eBay Inc.'s mission of enabling commerce. We also reach millions
through specialized marketplaces such as StubHub, the world's largest
ticket marketplace, and eBay classifieds sites, which together have a
presence in more than 1,000 cities around the world. For more
information about the company and its global portfolio of online brands,
visit www.ebayinc.com.
Non-GAAP Financial Measures
This press release includes the following financial measures defined as
"non-GAAP financial measures" by the Securities and Exchange Commission,
or SEC: non-GAAP net income, non-GAAP earnings per diluted share,
non-GAAP operating margin, non-GAAP effective tax rate and free cash
flow. 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 or as a
substitute for the financial information prepared and presented in
accordance with generally accepted accounting principles. For a
reconciliation of these non-GAAP financial measures 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," "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.
Forward-Looking Statements
This press release contains forward-looking statements relating to,
among other things, the future performance of eBay 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
expected financial results for the first quarter and full year 2012, the
company's three-year outlook and the future growth in the Payments,
Marketplaces and GSI businesses. The company's actual results could
differ materially from those predicted or implied and reported results
should not be considered as an indication of future performance. Factors
that could cause or contribute to such differences include, but are not
limited to: changes in political, business and economic conditions,
including any European economic downturn or crisis and any conditions
that affect ecommerce growth; fluctuations in foreign currency exchange
rates; the company's ability to profitably integrate, manage and grow
businesses that have been acquired recently or may be acquired in the
future, including GSI; the company's need to increasingly achieve growth
from its existing users, particularly in its more established markets;
the company's ability to deal with the increasingly competitive
ecommerce environment, including competition for its sellers from other
trading sites and other means of selling, and competition for its buyers
from other merchants, online and offline; 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
effect of management changes and business initiatives; the company's
need and ability to manage other regulatory, tax and litigation risks as
its services are offered in more jurisdictions and applicable laws
become more restrictive; any changes the company may make to its product
offerings; the competitive, regulatory, credit card association-related
and other risks specific to PayPal and Bill Me Later, especially as
PayPal continues to expand geographically and grow its open platform
initiative and as new laws and regulations related to financial services
companies come into effect; the company's ability to timely upgrade and
develop its systems, infrastructure and customer service capabilities,
including GSI's v.11 initiative, at reasonable cost; and the company's
ability to maintain site stability and performance on all of its sites
while adding new products and features in a timely fashion. 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 http://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 release, which are based on information available to the company on
the date hereof. eBay assumes no obligation to update such statements.
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eBay Inc.
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Unaudited Condensed Consolidated Balance Sheet
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|
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|
|
December 31,
2011
|
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December 31,
2010
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(In thousands)
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ASSETS
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Current assets:
|
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|
|
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Cash and cash equivalents
|
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$
|
4,691,101
|
|
$
|
5,577,411
|
|
Short-term investments
|
|
|
1,238,301
|
|
|
1,045,403
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|
Accounts receivable, net
|
|
|
681,593
|
|
|
454,366
|
|
Loans and interest receivable, net
|
|
|
1,501,473
|
|
|
956,189
|
|
Funds receivable and customer accounts
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|
|
3,967,550
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|
|
2,550,731
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Other current assets
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|
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581,436
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|
|
481,238
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|
Total current assets
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|
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12,661,454
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|
|
11,065,338
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Long-term investments
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|
|
2,452,763
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|
|
2,492,012
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|
Property and equipment, net
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|
|
1,986,216
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|
|
1,523,333
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Goodwill
|
|
|
8,364,989
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|
|
6,193,163
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Intangible assets, net
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|
|
1,406,380
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|
|
540,711
|
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Other assets
|
|
|
448,416
|
|
|
189,205
|
|
Total assets
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|
$
|
27,320,218
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|
$
|
22,003,762
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LIABILITIES AND STOCKHOLDERS' EQUITY
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|
|
|
|
Current liabilities:
|
|
|
|
|
|
Short-term debt
|
|
$
|
564,601
|
|
$
|
300,000
|
|
Accounts payable
|
|
|
283,102
|
|
|
184,963
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|
Funds payable and amounts due to customers
|
|
|
3,967,550
|
|
|
2,550,731
|
|
Accrued expenses and other current liabilities
|
|
|
1,510,836
|
|
|
1,343,888
|
|
Deferred revenue
|
|
|
110,429
|
|
|
96,464
|
|
Income taxes payable
|
|
|
297,686
|
|
|
40,468
|
|
Total current liabilities
|
|
|
6,734,204
|
|
|
4,516,514
|
|
Deferred and other tax liabilities, net
|
|
|
1,072,951
|
|
|
645,457
|
|
Long-term debt
|
|
|
1,525,047
|
|
|
1,494,227
|
|
Other liabilities
|
|
|
58,137
|
|
|
45,385
|
|
Total liabilities
|
|
|
9,390,339
|
|
|
6,701,583
|
|
|
|
|
|
|
|
Total stockholders' equity
|
|
|
17,929,879
|
|
|
15,302,179
|
|
Total liabilities and stockholders' equity
|
|
$
|
27,320,218
|
|
$
|
22,003,762
|
|
|
|
eBay Inc.
|
|
Unaudited Condensed Consolidated Statement of Income
|
|
|
|
|
|
|
|
|
|
Three Months Ended December 31,
|
|
Year Ended December 31,
|
|
|
|
2011
|
|
2010
|
|
2011
|
|
2010
|
|
|
|
(In thousands, except per share amounts)
|
|
|
|
|
|
Net revenues (2)
|
|
$
|
3,380,010
|
|
|
$
|
2,495,350
|
|
|
$
|
11,651,654
|
|
|
$
|
9,156,274
|
|
|
Cost of net revenues (1)
|
|
1,034,432
|
|
|
702,473
|
|
|
3,460,184
|
|
|
2,564,667
|
|
|
Gross profit
|
|
2,345,578
|
|
|
1,792,877
|
|
|
8,191,470
|
|
|
6,591,607
|
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
Sales and marketing (1)
|
|
671,822
|
|
|
538,765
|
|
|
2,435,048
|
|
|
1,946,815
|
|
|
Product development (1)
|
|
344,250
|
|
|
246,175
|
|
|
1,235,171
|
|
|
908,434
|
|
|
General and administrative (1)
|
|
345,987
|
|
|
278,878
|
|
|
1,364,221
|
|
|
1,079,383
|
|
|
Provision for transaction and loan losses
|
|
145,015
|
|
|
96,215
|
|
|
516,656
|
|
|
392,240
|
|
|
Amortization of acquired intangible assets
|
|
85,396
|
|
|
41,623
|
|
|
267,374
|
|
|
189,727
|
|
|
Restructuring
|
|
(7
|
)
|
|
1,000
|
|
|
(489
|
)
|
|
21,437
|
|
|
Total operating expenses
|
|
1,592,463
|
|
|
1,202,656
|
|
|
5,817,981
|
|
|
4,538,036
|
|
|
Income from operations (2)
|
|
753,115
|
|
|
590,221
|
|
|
2,373,489
|
|
|
2,053,571
|
|
|
Interest and other income (expense), net
|
|
1,682,086
|
|
|
(2,816
|
)
|
|
1,536,557
|
|
|
44,876
|
|
|
Income before income taxes
|
|
2,435,201
|
|
|
587,405
|
|
|
3,910,046
|
|
|
2,098,447
|
|
|
Provision for income taxes
|
|
(455,589
|
)
|
|
(28,218
|
)
|
|
(680,659
|
)
|
|
(297,486
|
)
|
|
Net income
|
|
$
|
1,979,612
|
|
|
$
|
559,187
|
|
|
$
|
3,229,387
|
|
|
$
|
1,800,961
|
|
|
Net income per share:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
1.54
|
|
|
$
|
0.43
|
|
|
$
|
2.50
|
|
|
$
|
1.38
|
|
|
Diluted
|
|
$
|
1.51
|
|
|
$
|
0.42
|
|
|
$
|
2.46
|
|
|
$
|
1.36
|
|
|
Weighted average shares:
|
|
|
|
|
|
|
|
|
|
Basic
|
|
1,288,525
|
|
|
1,302,239
|
|
|
1,292,775
|
|
|
1,305,593
|
|
|
Diluted
|
|
1,308,467
|
|
|
1,325,659
|
|
|
1,312,950
|
|
|
1,327,417
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Includes stock-based compensation as follows:
|
|
|
|
|
|
|
|
|
|
Cost of net revenues
|
|
$
|
13,287
|
|
|
$
|
12,648
|
|
|
$
|
55,924
|
|
|
$
|
48,764
|
|
|
Sales and marketing
|
|
31,430
|
|
|
26,178
|
|
|
131,800
|
|
|
106,208
|
|
|
Product development
|
|
31,913
|
|
|
25,457
|
|
|
122,691
|
|
|
101,001
|
|
|
General and administrative
|
|
34,626
|
|
|
29,377
|
|
|
146,773
|
|
|
125,519
|
|
|
|
|
$
|
111,256
|
|
|
$
|
93,660
|
|
|
$
|
457,188
|
|
|
$
|
381,492
|
|
(2) For the three-month period ended December 31, 2011, foreign currency
movements relative to the U.S. dollar, including the impact of any
effective hedging activities, negatively impacted net revenues by
approximately $11.7 million and positively impacted operating income by
approximately $1.2 million compared to the same period of the prior
year. For the year ended 2011, foreign currency movements relative to
the U.S. dollar, including the impact of any effective hedging
activities, positively impacted net revenues by approximately $202.4
million and positively impacted operating income by approximately $63.2
million compared to the same period of the prior year.
|
|
|
eBay Inc.
|
|
Unaudited Condensed Consolidated Statement of Cash Flows
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended December 31,
|
|
Year Ended December 31,
|
|
|
|
2011
|
|
2010
|
|
2011
|
|
2010
|
|
|
|
(In thousands)
|
|
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
1,979,612
|
|
|
$
|
559,187
|
|
|
$3,229,387
|
|
|
$
|
1,800,961
|
|
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for transaction and loan losses
|
|
|
145,015
|
|
|
|
96,215
|
|
|
516,656
|
|
|
|
392,240
|
|
|
Depreciation and amortization
|
|
|
272,553
|
|
|
|
192,288
|
|
|
939,953
|
|
|
|
762,465
|
|
|
Stock-based compensation
|
|
|
111,256
|
|
|
|
93,660
|
|
|
457,188
|
|
|
|
381,492
|
|
|
Investment gains, net
|
|
|
(1,667,630
|
)
|
|
|
—
|
|
|
(1,484,529
|
)
|
|
|
—
|
|
|
Changes in assets and liabilities, net of acquisition effects
|
|
|
141,454
|
|
|
|
(87,345
|
)
|
|
(384,981
|
)
|
|
|
(591,398
|
)
|
|
Net cash provided by operating activities
|
|
|
982,260
|
|
|
|
854,005
|
|
|
3,273,674
|
|
|
|
2,745,760
|
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchases of property and equipment, net
|
|
|
(291,647
|
)
|
|
|
(197,467
|
)
|
|
(963,498
|
)
|
|
|
(723,912
|
)
|
|
Changes in principal loans receivable, net
|
|
|
(332,411
|
)
|
|
|
(241,486
|
)
|
|
(586,508
|
)
|
|
|
(379,730
|
)
|
|
Purchases of investments
|
|
|
(406,584
|
)
|
|
|
(620,872
|
)
|
|
(2,290,183
|
)
|
|
|
(2,643,514
|
)
|
|
Maturities and sales of investments
|
|
|
298,472
|
|
|
|
252,684
|
|
|
1,596,064
|
|
|
|
1,436,207
|
|
|
Acquisitions, net of cash acquired
|
|
|
(67,933
|
)
|
|
|
(83,568
|
)
|
|
(3,223,055
|
)
|
|
|
(90,568
|
)
|
|
Proceeds from the sale of Skype
|
|
|
2,269,146
|
|
|
|
—
|
|
|
2,269,146
|
|
|
|
—
|
|
|
Repayment of Skype note receivable
|
|
|
—
|
|
|
|
—
|
|
|
—
|
|
|
|
125,000
|
|
|
Other
|
|
|
(7,010
|
)
|
|
|
(1,029
|
)
|
|
(108,828
|
)
|
|
|
(5,953
|
)
|
|
Net cash provided by (used in) investing activities
|
|
|
1,462,033
|
|
|
|
(891,738
|
)
|
|
(3,306,862
|
)
|
|
|
(2,282,470
|
)
|
|
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from issuance of common stock
|
|
|
54,490
|
|
|
|
116,675
|
|
|
242,210
|
|
|
|
235,527
|
|
|
Repurchases of common stock
|
|
|
(249,854
|
)
|
|
|
(413,406
|
)
|
|
(1,063,986
|
)
|
|
|
(711,068
|
)
|
|
Excess tax benefits from stock-based compensation
|
|
|
14,224
|
|
|
|
15,242
|
|
|
79,681
|
|
|
|
41,891
|
|
|
Tax withholdings related to net share settlements of restricted
stock awards and units
|
|
|
(16,871
|
)
|
|
|
(13,721
|
)
|
|
(147,130
|
)
|
|
|
(120,646
|
)
|
|
Net borrowings (repayments) under commercial paper program
|
|
|
(450,000
|
)
|
|
|
300,000
|
|
|
250,000
|
|
|
|
300,000
|
|
|
Proceeds from issuance of long-term debt
|
|
|
—
|
|
|
|
1,488,702
|
|
|
—
|
|
|
|
1,488,702
|
|
|
Repayment of acquired debt
|
|
|
—
|
|
|
|
—
|
|
|
(199,271
|
)
|
|
|
—
|
|
|
Funds receivable and customer accounts
|
|
|
(672,441
|
)
|
|
|
(57,875
|
)
|
|
(1,368,501
|
)
|
|
|
(392,786
|
)
|
|
Funds payable and amounts due to customers
|
|
|
672,441
|
|
|
|
57,875
|
|
|
1,368,501
|
|
|
|
392,786
|
|
|
Net cash provided by (used in) financing activities
|
|
|
(648,011
|
)
|
|
|
1,493,492
|
|
|
(838,496
|
)
|
|
|
1,234,406
|
|
|
Effect of exchange rate changes on cash and cash equivalents
|
|
|
(104,131
|
)
|
|
|
(59,255
|
)
|
|
(14,626
|
)
|
|
|
(120,103
|
)
|
|
Net (decrease) increase in cash and cash equivalents
|
|
|
1,692,151
|
|
|
|
1,396,504
|
|
|
(886,310
|
)
|
|
|
1,577,593
|
|
|
Cash and cash equivalents at beginning of period
|
|
|
2,998,950
|
|
|
|
4,180,907
|
|
|
5,577,411
|
|
|
|
3,999,818
|
|
|
Cash and cash equivalents at end of period
|
|
$
|
4,691,101
|
|
|
$
|
5,577,411
|
|
|
$
|
4,691,101
|
|
|
|
$
|
5,577,411
|
|
|
|
|
eBay Inc.
|
|
Unaudited Summary of Consolidated Net Revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Revenues by Type
|
|
Three Months Ended
|
|
|
|
December 31,
|
|
September 30,
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
|
|
|
2011
|
|
2011
|
|
2011
|
|
2011
|
|
2010
|
|
Net transaction revenues
|
|
(In thousands, except percentages)
|
|
Marketplaces
|
|
$
|
1,443,253
|
|
|
$
|
1,353,660
|
|
|
$
|
1,349,640
|
|
|
$
|
1,284,755
|
|
|
$
|
1,259,179
|
|
|
Current quarter vs prior quarter
|
|
|
7
|
%
|
|
|
—
|
%
|
|
|
5
|
%
|
|
|
2
|
%
|
|
|
6
|
%
|
|
Current quarter vs prior year quarter
|
|
|
15
|
%
|
|
|
14
|
%
|
|
|
14
|
%
|
|
|
10
|
%
|
|
|
3
|
%
|
|
Percent of Marketplaces revenue from international
|
|
|
57
|
%
|
|
|
56
|
%
|
|
|
56
|
%
|
|
|
56
|
%
|
|
|
57
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Payments
|
|
|
1,156,659
|
|
|
|
1,032,816
|
|
|
|
991,118
|
|
|
|
942,709
|
|
|
|
926,161
|
|
|
Current quarter vs prior quarter
|
|
|
12
|
%
|
|
|
4
|
%
|
|
|
5
|
%
|
|
|
2
|
%
|
|
|
16
|
%
|
|
Current quarter vs prior year quarter
|
|
|
25
|
%
|
|
|
29
|
%
|
|
|
29
|
%
|
|
|
23
|
%
|
|
|
22
|
%
|
|
Percent of Payments revenue from international
|
|
|
55
|
%
|
|
|
53
|
%
|
|
|
52
|
%
|
|
|
50
|
%
|
|
|
51
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GSI (1)
|
|
|
295,155
|
|
|
|
148,444
|
|
|
|
16,060
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
Current quarter vs prior quarter
|
|
|
99
|
%
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
|
|
|
|
|
Percent of GSI revenue from international
|
|
|
3
|
%
|
|
|
3
|
%
|
|
|
5
|
%
|
|
|
|
|
|
|
|
Total net transaction revenues
|
|
|
2,895,067
|
|
|
|
2,534,920
|
|
|
|
2,356,818
|
|
|
|
2,227,464
|
|
|
|
2,185,340
|
|
|
Current quarter vs prior quarter
|
|
|
14
|
%
|
|
|
8
|
%
|
|
|
6
|
%
|
|
|
2
|
%
|
|
|
10
|
%
|
|
Current quarter vs prior year quarter
|
|
|
32
|
%
|
|
|
28
|
%
|
|
|
21
|
%
|
|
|
15
|
%
|
|
|
5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Marketing services and other revenues
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Marketplaces
|
|
|
328,910
|
|
|
|
299,246
|
|
|
|
313,799
|
|
|
|
268,507
|
|
|
|
264,996
|
|
|
Current quarter vs prior quarter
|
|
|
10
|
%
|
|
|
(5
|
)%
|
|
|
17
|
%
|
|
|
1
|
%
|
|
|
17
|
%
|
|
Current quarter vs prior year quarter
|
|
|
24
|
%
|
|
|
33
|
%
|
|
|
45
|
%
|
|
|
26
|
%
|
|
|
9
|
%
|
|
Percent of Marketplaces revenue from international
|
|
|
72
|
%
|
|
|
74
|
%
|
|
|
74
|
%
|
|
|
74
|
%
|
|
|
69
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Payments
|
|
|
82,931
|
|
|
|
74,386
|
|
|
|
81,878
|
|
|
|
49,638
|
|
|
|
45,014
|
|
|
Current quarter vs prior quarter
|
|
|
11
|
%
|
|
|
(9
|
)%
|
|
|
65
|
%
|
|
|
10
|
%
|
|
|
12
|
%
|
|
Current quarter vs prior year quarter
|
|
|
84
|
%
|
|
|
84
|
%
|
|
|
77
|
%
|
|
|
16
|
%
|
|
|
17
|
%
|
|
Percent of Payments revenue from international
|
|
|
17
|
%
|
|
|
9
|
%
|
|
|
6
|
%
|
|
|
9
|
%
|
|
|
10
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GSI (1)
|
|
|
68,452
|
|
|
|
54,174
|
|
|
|
7,779
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
Current quarter vs prior quarter
|
|
|
26
|
%
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
|
|
|
|
|
Percent of GSI revenue from international
|
|
|
—
|
%
|
|
|
—
|
%
|
|
|
—
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate and other
|
|
|
4,650
|
|
|
|
3,035
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
|
N/A
|
|
|
Total marketing services and other revenues
|
|
|
484,943
|
|
|
|
430,841
|
|
|
|
403,456
|
|
|
|
318,145
|
|
|
|
310,010
|
|
|
Current quarter vs prior quarter
|
|
|
13
|
%
|
|
|
7
|
%
|
|
|
27
|
%
|
|
|
3
|
%
|
|
|
17
|
%
|
|
Current quarter vs prior year quarter
|
|
|
56
|
%
|
|
|
62
|
%
|
|
|
54
|
%
|
|
|
24
|
%
|
|
|
7
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total net revenues
|
|
$
|
3,380,010
|
|
|
$
|
2,965,761
|
|
|
$
|
2,760,274
|
|
|
$
|
2,545,609
|
|
|
$
|
2,495,350
|
|
|
Current quarter vs prior quarter
|
|
|
14
|
%
|
|
|
7
|
%
|
|
|
8
|
%
|
|
|
2
|
%
|
|
|
11
|
%
|
|
Current quarter vs prior year quarter
|
|
|
35
|
%
|
|
|
32
|
%
|
|
|
25
|
%
|
|
|
16
|
%
|
|
|
5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Revenues by Geography (2)
|
|
Three Months Ended
|
|
|
|
December 31,
|
|
September 30,
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
|
|
|
2011
|
|
2011
|
|
2011
|
|
2011
|
|
2010
|
|
|
|
(In thousands, except percentages)
|
|
U.S. net revenues
|
|
$
|
1,665,476
|
|
|
$
|
1,427,811
|
|
|
$
|
1,249,303
|
|
|
$
|
1,141,051
|
|
|
$
|
1,119,642
|
|
|
Current quarter vs prior quarter
|
|
|
17
|
%
|
|
|
14
|
%
|
|
|
9
|
%
|
|
|
2
|
%
|
|
|
6
|
%
|
|
Current quarter vs prior year quarter
|
|
|
49
|
%
|
|
|
35
|
%
|
|
|
21
|
%
|
|
|
14
|
%
|
|
|
7
|
%
|
|
Percent of total
|
|
|
49
|
%
|
|
|
48
|
%
|
|
|
45
|
%
|
|
|
45
|
%
|
|
|
45
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
International net revenues
|
|
|
1,714,534
|
|
|
|
1,537,950
|
|
|
|
1,510,971
|
|
|
|
1,404,558
|
|
|
|
1,375,708
|
|
|
Current quarter vs prior quarter
|
|
|
11
|
%
|
|
|
2
|
%
|
|
|
8
|
%
|
|
|
2
|
%
|
|
|
15
|
%
|
|
Current quarter vs prior year quarter
|
|
|
25
|
%
|
|
|
29
|
%
|
|
|
28
|
%
|
|
|
18
|
%
|
|
|
4
|
%
|
|
Percent of total
|
|
|
51
|
%
|
|
|
52
|
%
|
|
|
55
|
%
|
|
|
55
|
%
|
|
|
55
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total net revenues
|
|
$
|
3,380,010
|
|
|
$
|
2,965,761
|
|
|
$
|
2,760,274
|
|
|
$
|
2,545,609
|
|
|
$
|
2,495,350
|
|
|
Current quarter vs prior quarter
|
|
|
14
|
%
|
|
|
7
|
%
|
|
|
8
|
%
|
|
|
2
|
%
|
|
|
11
|
%
|
|
Current quarter vs prior year quarter
|
|
|
35
|
%
|
|
|
32
|
%
|
|
|
25
|
%
|
|
|
16
|
%
|
|
|
5
|
%
|
(1) Net revenue attributable to the GSI segment for the three months
ended June 30, 2011, reflects net revenues for the period from June 17,
2011 (the date that the acquisition was completed) to June 30, 2011.
(2) Revenues are attributed to U.S. and international geographies
primarily based upon the country in which the seller, payment recipient,
customer, website that displays advertising, or other service provider,
as the case may be, is located.
|
|
|
eBay Inc.
|
|
Unaudited Payments Supplemental Operating Data
|
|
|
|
|
|
Three Months Ended
|
|
|
|
December 31,
|
|
September 30,
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
|
|
|
2011
|
|
2011
|
|
2011
|
|
2011
|
|
2010
|
|
|
|
(In millions, except percentages)
|
|
Active registered accounts (1)
|
|
|
106.3
|
|
|
|
103.0
|
|
|
|
100.3
|
|
|
|
97.7
|
|
|
|
94.4
|
|
|
Current quarter vs prior quarter
|
|
|
3
|
%
|
|
|
3
|
%
|
|
|
3
|
%
|
|
|
3
|
%
|
|
|
4
|
%
|
|
Current quarter vs prior year quarter
|
|
|
13
|
%
|
|
|
14
|
%
|
|
|
15
|
%
|
|
|
16
|
%
|
|
|
17
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net number of payments (2)
|
|
|
548.1
|
|
|
|
459.2
|
|
|
|
432.0
|
|
|
|
424.6
|
|
|
|
421.1
|
|
|
Current quarter vs prior quarter
|
|
|
19
|
%
|
|
|
6
|
%
|
|
|
2
|
%
|
|
|
1
|
%
|
|
|
18
|
%
|
|
Current quarter vs prior year quarter
|
|
|
30
|
%
|
|
|
29
|
%
|
|
|
29
|
%
|
|
|
26
|
%
|
|
|
28
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net total payment volume (3)
|
|
$
|
33,372
|
|
|
$
|
29,282
|
|
|
$
|
28,742
|
|
|
$
|
27,362
|
|
|
$
|
26,866
|
|
|
Current quarter vs prior quarter
|
|
|
14
|
%
|
|
|
2
|
%
|
|
|
5
|
%
|
|
|
2
|
%
|
|
|
20
|
%
|
|
Current quarter vs prior year quarter
|
|
|
24
|
%
|
|
|
31
|
%
|
|
|
34
|
%
|
|
|
28
|
%
|
|
|
26
|
%
|
|
Merchant Services net total payment volume as % of net total
payment volume
|
|
|
66
|
%
|
|
|
66
|
%
|
|
|
66
|
%
|
|
|
64
|
%
|
|
|
63
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Transaction rates
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Take rate
|
|
|
3.71
|
%
|
|
|
3.78
|
%
|
|
|
3.73
|
%
|
|
|
3.63
|
%
|
|
|
3.61
|
%
|
|
Transaction expense
|
|
|
1.04
|
%
|
|
|
1.14
|
%
|
|
|
1.11
|
%
|
|
|
1.11
|
%
|
|
|
1.11
|
%
|
|
Loss rate
|
|
|
0.27
|
%
|
|
|
0.31
|
%
|
|
|
0.25
|
%
|
|
|
0.21
|
%
|
|
|
0.20
|
%
|
|
Transaction margin (4)
|
|
|
64.8
|
%
|
|
|
61.5
|
%
|
|
|
63.6
|
%
|
|
|
63.7
|
%
|
|
|
63.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loan portfolio rates
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Risk adjusted margin (5)
|
|
|
16.9
|
%
|
|
|
18.0
|
%
|
|
|
16.5
|
%
|
|
|
14.7
|
%
|
|
|
14.4
|
%
|
|
Net charge-off rate (6)
|
|
|
4.4
|
%
|
|
|
4.3
|
%
|
|
|
4.4
|
%
|
|
|
4.9
|
%
|
|
|
6.1
|
%
|
|
90-day delinquency rate (7)
|
|
|
2.4
|
%
|
|
|
2.6
|
%
|
|
|
2.2
|
%
|
|
|
2.2
|
%
|
|
|
2.4
|
%
|
(1) All registered accounts that successfully sent or received at least
one payment or payment reversal through the PayPal system or Bill Me
Later accounts that are currently able to transact and that received a
statement within the last 12 months.
(2) Number of payments, net of payment reversals, successfully completed
through our Payments networks and Zong, excluding PayPal's payments
gateway business, and on Bill Me Later accounts during the quarter.
(3) Total dollar volume of payments, net of payment reversals,
successfully completed through our Payments networks and Zong, excluding
PayPal's payment gateway business, and on Bill Me Later accounts during
the period.
(4) Transaction Margin calculation has been adjusted to include total
revenues (including revenue from credit) less transaction expense
(including credit cost of funds) less transaction loss (including credit
loan losses), divided by global take rate (based on global total
revenues divided by total TPV).
(5) The risk adjusted margin represents the annualized ratio of Bill Me
Later revenue, excluding contra-revenue incentives to customers or
merchants, less cost of funds, and less net credit and fraud losses
relative to average loans receivable for the quarter.
(6) Net charge-off rate represents the annualized ratio of Bill Me Later
net credit losses relative to average loans receivable for the quarter.
(7) 90-day delinquency rate is the ratio of Bill Me Later end of period
account balances that have missed three or more consecutive payments
relative to total ending loan receivables.
|
|
|
eBay Inc.
|
|
Unaudited eBay Marketplaces Supplemental Operating Data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
December 31,
|
|
September 30,
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
|
|
|
2011
|
|
2011
|
|
2011
|
|
2011
|
|
2010
|
|
|
|
(In millions, except percentages)
|
|
Active Users (1)
|
|
|
100.4
|
|
|
|
98.7
|
|
|
|
97.2
|
|
|
|
95.9
|
|
|
|
94.5
|
|
|
Current quarter vs prior quarter
|
|
|
2
|
%
|
|
|
2
|
%
|
|
|
1
|
%
|
|
|
1
|
%
|
|
|
1
|
%
|
|
Current quarter vs prior year quarter
|
|
|
6
|
%
|
|
|
6
|
%
|
|
|
6
|
%
|
|
|
5
|
%
|
|
|
5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross Merchandise Volume (excluding vehicles) (2)
|
|
$
|
16,490
|
|
|
$
|
14,666
|
|
|
$
|
14,680
|
|
|
$
|
14,496
|
|
|
$
|
15,039
|
|
|
Current quarter vs prior quarter
|
|
|
12
|
%
|
|
|
—
|
%
|
|
|
1
|
%
|
|
|
(4
|
)%
|
|
|
19
|
%
|
|
Current quarter vs prior year quarter
|
|
|
10
|
%
|
|
|
16
|
%
|
|
|
17
|
%
|
|
|
8
|
%
|
|
|
6
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Vehicles Gross Merchandise Volume (3)
|
|
$
|
1,864
|
|
|
$
|
2,149
|
|
|
$
|
2,238
|
|
|
$
|
2,050
|
|
|
$
|
1,920
|
|
|
Current quarter vs prior quarter
|
|
|
(13
|
)%
|
|
|
(4
|
)%
|
|
|
9
|
%
|
|
|
7
|
%
|
|
|
(11
|
)%
|
|
Current quarter vs prior year quarter
|
|
|
(3
|
)%
|
|
|
—
|
%
|
|
|
2
|
%
|
|
|
1
|
%
|
|
|
(8
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fixed Price Trading (4) as % of total gross merchandise volume
|
|
|
64
|
%
|
|
|
63
|
%
|
|
|
62
|
%
|
|
|
61
|
%
|
|
|
62
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
eBay's classifieds websites and Shopping.com are not included in these
metrics.
(1) All users, excluding users of Half.com, StubHub, and our Korean
subsidiaries (Gmarket and eBay Auction Co.), who bid on, bought, listed
or sold an item within the previous 12-month period. Users may register
more than once, and as a result, may have more than one account.
(2) Total value of all successfully closed items between users on eBay
Marketplaces trading platforms during the quarter, regardless of whether
the buyer and seller actually consummated the transaction, excluding
vehicles gross merchandise volume.
(3) Total value of all successfully closed vehicle transactions between
users on eBay Marketplaces trading platforms during the quarter,
regardless of whether the buyer and seller actually consummated the
transaction.
(4) Primarily, total gross merchandise volume related to eBay's "Buy It
Now" feature on eBay Marketplaces trading platforms relative to total
gross merchandise volume during the quarter.
|
|
|
eBay Inc.
|
|
Unaudited GSI Supplemental Operating Data
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
December 31,
|
|
September 30,
|
|
June 30,
|
|
March 31,
|
|
December 31,
|
|
|
|
2011
|
|
2011
|
|
2011 (1)
|
|
2011
|
|
2010
|
|
|
|
(In millions, except percentages)
|
|
GeC Merchandise Sales (2)
|
|
$
|
1,362
|
|
$
|
608
|
|
$
|
76
|
|
N/A
|
|
N/A
|
(1) Reflects the period from June 17, 2011 (the date that the
acquisition was completed) to June 30, 2011.
(2) Represents the retail value of all sales transactions, inclusive of
freight charges and net of allowance for returns and discounts, which
flow through the GSI ecommerce services platform, whether we record the
full amount of such transaction as a product sale or a percentage of
such transaction as a service fee.
eBay Inc.
Business Outlook
(In Millions,
Except Per Share Amounts)
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 eBay's future performance is difficult to predict. Such guidance
is based on information available on the date of this press release, and
eBay assumes no obligation to update it.
eBay'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 eBay'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 the company's
investor relations website at http://investors.ebayinc.com
or the SEC's website at www.sec.gov.
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
March 31, 2012
|
|
(In millions, except per share amounts)
|
|
GAAP
|
|
Non-GAAP (a)
|
|
Net Revenue
|
|
$3,050 - $3,150
|
|
$3,050 - $3,150
|
|
Diluted EPS
|
|
$0.37 - $0.38
|
|
$0.50 - $0.51
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Twelve Months Ended
|
|
|
|
December 31, 2012
|
|
(In millions, except per share amounts)
|
|
GAAP
|
|
Non-GAAP (b)
|
|
Net Revenue
|
|
$13,700 - $14,000
|
|
$13,700 - $14,000
|
|
Diluted EPS
|
|
$1.76 - $1.81
|
|
$2.25 - $2.30
|
(a) Estimated non-GAAP amounts above for the three months ending March
31, 2012, reflect adjustments that exclude the estimated amortization of
acquired intangible assets of approximately $95-$105 million, estimated
stock-based compensation expense and employer payroll taxes on
stock-based compensation expense of approximately $140-$150 million and
the accretion of a note receivable of approximately $5 million as well
as the related tax impact.
(b) Estimated non-GAAP amounts above for the twelve months ending
December 31, 2012, reflect adjustments that exclude the estimated
amortization of acquired intangible assets of approximately $390-$410
million, estimated stock-based compensation expense and employer payroll
taxes on stock-based compensation expense of approximately $570-$625
million and the accretion of a note receivable of approximately $20
million as well as the related tax impact.
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, eBay 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, and free cash flow.
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 eBay's results of operations
as determined in accordance with GAAP. These measures should only be
used to evaluate eBay'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 can be found in the tables included in
this press release.
These non-GAAP measures are provided to enhance investors' overall
understanding of the company's current financial performance and the
company's 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 eBay 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,
eBay'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, significant gains or losses from the
disposal/acquisition of a business, restructuring-related charges and
the income taxes associated with the foregoing. In addition to the
corresponding GAAP measures, eBay's management also uses the foregoing
non-GAAP measures in reviewing the financial results of eBay.
eBay 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. This expense consists of
expenses for stock options, restricted stock and employee stock
purchases. eBay excludes stock-based compensation expenses from its
non-GAAP measures primarily because they are non-cash expenses that
management does not believe are reflective of ongoing operating results.
eBay also excludes its proportionate share of Skype's stock-based
compensation expense.
Employer payroll taxes on stock-based compensation. This amount
is dependent on eBay'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 eBay's operation of the
business.
Amortization or impairment of acquired intangible assets, impairment
of goodwill and significant gains or losses and transaction expenses
from the acquisition or disposal of a business. eBay 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. eBay also excludes its
proportionate share of Skype's amortization of acquired intangibles
expense. eBay also settled a legal exposure in conjunction with the
acquisition of a business and excludes this settlement payment. In
addition, eBay's results are also impacted by hedge transactions related
to unique movements of cash from significant business acquisitions or
dispositions. eBay excludes the impact of the accretion of a note
receivable associated with the disposal of certain businesses. eBay
excludes these items because management does not believe they correlate
to the ongoing operating results of eBay's business.
Restructuring. These charges consist of expenses for employee
severance and other exit and disposal costs. eBay excludes restructuring
charges primarily because management does not believe they are
reflective of ongoing operating results.
Income taxes associated with certain non-GAAP entries. 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, eBay also uses
free cash flow. Free cash flow represents operating cash flows less net
purchases of property and equipment. eBay 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 eBay's business, make strategic
acquisitions, and repurchase stock. 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
|
|
Year Ended
|
|
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
|
|
2011
|
|
2010
|
|
2011
|
|
2010
|
|
|
|
(In thousands, except percentages)
|
|
GAAP operating income
|
|
$
|
753,115
|
|
|
$
|
590,221
|
|
|
$
|
2,373,489
|
|
|
$
|
2,053,571
|
|
|
Stock-based compensation expense
|
|
|
111,256
|
|
|
|
93,660
|
|
|
|
457,188
|
|
|
|
381,492
|
|
|
Employer payroll taxes on stock-based compensation
|
|
|
1,167
|
|
|
|
1,565
|
|
|
|
17,334
|
|
|
|
13,845
|
|
|
Acquisition related transaction expenses
|
|
|
793
|
|
|
|
—
|
|
|
|
58,070
|
|
|
|
—
|
|
|
Amortization of acquired intangible assets within cost of net
revenues
|
|
|
19,781
|
|
|
|
8,660
|
|
|
|
61,039
|
|
|
|
40,156
|
|
|
Amortization of acquired intangible assets within operating expenses
|
|
|
85,396
|
|
|
|
41,623
|
|
|
|
267,374
|
|
|
|
189,727
|
|
|
Restructuring
|
|
|
(7
|
)
|
|
|
1,000
|
|
|
|
(489
|
)
|
|
|
21,437
|
|
|
Non-GAAP operating income
|
|
$
|
971,501
|
|
|
$
|
736,729
|
|
|
$
|
3,234,005
|
|
|
$
|
2,700,228
|
|
|
Non-GAAP operating margin
|
|
|
28.7
|
%
|
|
|
29.5
|
%
|
|
|
27.8
|
%
|
|
|
29.5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP Net Income to Non-GAAP Net Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Year Ended
|
|
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
|
|
2011
|
|
2010
|
|
2011
|
|
2010
|
|
|
|
(In thousands, except per share amounts)
|
|
GAAP net income
|
|
$
|
1,979,612
|
|
|
$
|
559,187
|
|
|
$
|
3,229,387
|
|
|
$
|
1,800,961
|
|
|
Stock-based compensation expense
|
|
|
111,256
|
|
|
|
93,660
|
|
|
|
457,188
|
|
|
|
381,492
|
|
|
Employer payroll taxes on stock-based compensation
|
|
|
1,167
|
|
|
|
1,565
|
|
|
|
17,334
|
|
|
|
13,845
|
|
|
Acquisition related transaction expense
|
|
|
793
|
|
|
|
—
|
|
|
|
58,070
|
|
|
|
—
|
|
|
Amortization of acquired intangible assets within cost of net
revenues
|
|
|
19,781
|
|
|
|
8,660
|
|
|
|
61,039
|
|
|
|
40,156
|
|
|
Amortization of acquired intangible assets within operating expenses
|
|
|
85,396
|
|
|
|
41,623
|
|
|
|
267,374
|
|
|
|
189,727
|
|
|
Restructuring
|
|
|
(7
|
)
|
|
|
1,000
|
|
|
|
(489
|
)
|
|
|
21,437
|
|
|
Amortization of intangibles and stock-based compensation for Skype
|
|
|
—
|
|
|
|
12,636
|
|
|
|
43,098
|
|
|
|
35,809
|
|
|
Gain from the acquisition of a business
|
|
|
—
|
|
|
|
—
|
|
|
|
(73,400
|
)
|
|
|
—
|
|
|
Accretion of note receivable
|
|
|
(4,321
|
)
|
|
|
—
|
|
|
|
(8,270
|
)
|
|
|
—
|
|
|
Sale of Skype and transaction related items
|
|
|
(1,664,079
|
)
|
|
|
—
|
|
|
|
(1,664,079
|
)
|
|
|
18,048
|
|
|
Loss on divested business
|
|
|
—
|
|
|
|
—
|
|
|
|
256,501
|
|
|
|
—
|
|
|
Income taxes associated with certain non-GAAP entries
|
|
|
259,024
|
|
|
|
(34,546
|
)
|
|
|
23,006
|
|
|
|
(202,759
|
)
|
|
Non-GAAP net income
|
|
$
|
788,622
|
|
|
$
|
683,785
|
|
|
$
|
2,666,759
|
|
|
$
|
2,298,716
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted net income per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP
|
|
$
|
1.51
|
|
|
$
|
0.42
|
|
|
$
|
2.46
|
|
|
$
|
1.36
|
|
|
Non-GAAP
|
|
$
|
0.60
|
|
|
$
|
0.52
|
|
|
$
|
2.03
|
|
|
$
|
1.73
|
|
|
Shares used in GAAP and non-GAAP diluted net income per-share
calculation
|
|
|
1,308,467
|
|
|
|
1,325,659
|
|
|
|
1,312,950
|
|
|
|
1,327,417
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of GAAP Effective Tax Rate to Non-GAAP Effective
Tax Rate
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Year Ended
|
|
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
|
|
2011
|
|
2010
|
|
2011
|
|
2010
|
|
|
|
(In thousands, except percentages)
|
|
GAAP provision for income taxes (a)
|
|
$
|
455,589
|
|
|
$
|
28,218
|
|
|
$
|
680,659
|
|
|
$
|
297,486
|
|
|
Income taxes associated with certain non-GAAP entries
|
|
|
(259,024
|
)
|
|
|
34,546
|
|
|
|
(23,006
|
)
|
|
|
202,759
|
|
|
Non-GAAP provision for income taxes (b)
|
|
$
|
196,565
|
|
|
$
|
62,764
|
|
|
$
|
657,653
|
|
|
$
|
500,245
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP income before income taxes (c)
|
|
$
|
2,435,201
|
|
|
$
|
587,405
|
|
|
$
|
3,910,046
|
|
|
$
|
2,098,447
|
|
|
Stock-based compensation expense
|
|
|
111,256
|
|
|
|
93,660
|
|
|
|
457,188
|
|
|
|
381,492
|
|
|
Employer payroll taxes on stock-based compensation
|
|
|
1,167
|
|
|
|
1,565
|
|
|
|
17,334
|
|
|
|
13,845
|
|
|
Acquisition related transaction expense
|
|
|
793
|
|
|
|
—
|
|
|
|
58,070
|
|
|
|
—
|
|
|
Amortization of acquired intangible assets within cost of net
revenues
|
|
|
19,781
|
|
|
|
8,660
|
|
|
|
61,039
|
|
|
|
40,156
|
|
|
Amortization of acquired intangible assets within operating expenses
|
|
|
85,396
|
|
|
|
41,623
|
|
|
|
267,374
|
|
|
|
189,727
|
|
|
Restructuring
|
|
|
(7
|
)
|
|
|
1,000
|
|
|
|
(489
|
)
|
|
|
21,437
|
|
|
Amortization of intangibles and stock-based compensation for Skype
|
|
|
—
|
|
|
|
12,636
|
|
|
|
43,098
|
|
|
|
35,809
|
|
|
Gain from the acquisition of a business
|
|
|
—
|
|
|
|
—
|
|
|
|
(73,400
|
)
|
|
|
—
|
|
|
Accretion of note receivable
|
|
|
(4,321
|
)
|
|
|
—
|
|
|
|
(8,270
|
)
|
|
|
—
|
|
|
Sale of Skype and transaction related items
|
|
|
(1,664,079
|
)
|
|
|
—
|
|
|
|
(1,664,079
|
)
|
|
|
18,048
|
|
|
Loss on divested business
|
|
|
—
|
|
|
|
—
|
|
|
|
256,501
|
|
|
|
—
|
|
|
Non-GAAP income before income taxes (d)
|
|
$
|
985,187
|
|
|
$
|
746,549
|
|
|
$
|
3,324,412
|
|
|
$
|
2,798,961
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP effective tax rate (a/c)
|
|
|
19
|
%
|
|
|
5
|
%
|
|
|
17
|
%
|
|
|
14
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-GAAP effective tax rate (b/d)
|
|
|
20
|
%
|
|
|
8
|
%
|
|
|
20
|
%
|
|
|
18
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Operating Cash Flow to Free Cash Flow
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Year Ended
|
|
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
December 31,
|
|
|
|
2011
|
|
2010
|
|
2011
|
|
2010
|
|
|
|
(In thousands)
|
|
Net cash provided by operating activities
|
|
$
|
982,260
|
|
|
$
|
854,005
|
|
|
$
|
3,273,674
|
|
|
$
|
2,745,760
|
|
|
Less: Purchases of property and equipment, net
|
|
|
(291,647
|
)
|
|
|
(197,467
|
)
|
|
|
(963,498
|
)
|
|
|
(723,912
|
)
|
|
Free cash flow
|
|
$
|
690,613
|
|
|
$
|
656,538
|
|
|
$
|
2,310,176
|
|
|
$
|
2,021,848
|
|
Investor Relations Contact:
Tracey Ford, 408-376-7205
Media
Relations Contact:
John Pluhowski
press@ebay.com
Investor
Information Request: 408-376-7493
Company News: http://www.ebayinc.com/news
Investor
Relations website: http://investors.ebayinc.com
Source: eBay Inc.
News Provided by Acquire Media