Ebay Inc 10-Q for FY2021 Q1

Ebay Inc (EBAY)

10-Q 2021-04-29 For: 2021-03-31

Added on April 09, 2026

About this 10-Q

Ebay Inc filed this 10-Q on April 29, 2021, covering the quarter ended March 31, 2021 (FY2021 Q1).

Headline figures

Quarter ended March 31, 2021, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $3.02B; up 42.0% from $2.13B a year earlier
Net income: $641M; down 81.2% from net income of $3.41B a year earlier
Diluted EPS: $0.92; down 79.6% from $4.51 a year earlier

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Title of each class	Trading symbol	Name of exchange on which registered
Common stock	EBAY	The Nasdaq Global Select Market


	March 31, 2021		December 31, 2020
	(In millions, except par value)
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	1,667	$	1,428
Short-term investments	1,700		2,398
Accounts receivable, net of allowance for doubtful accounts of $86 and $97	348		412
Customer accounts and funds receivable	1,016		939
Other current assets	789		825
Current assets held for sale	1,171		1,188

Total current assets	6,691		7,190
Long-term investments	1,059		833
Property and equipment, net	1,321		1,358
Goodwill	4,591		4,675
Intangible assets, net	5		12
Operating lease right-of-use assets	477		509
Deferred tax assets	3,448		3,537
Warrant asset	1,015		1,051
Other assets	124		145


Total assets	$	18,731	$	19,310
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Short-term debt	$	1,172	$	18
Accounts payable	324		332
Customer accounts and funds payable	1,073		1,052
Accrued expenses and other current liabilities	1,849		1,858
Deferred revenue	114		110
Income taxes payable	135		180
Current liabilities held for sale	463		452

Total current liabilities	5,130		4,002
Operating lease liabilities	344		380
Deferred tax liabilities	2,381		2,359
Long-term debt	5,855		7,745
Other liabilities	1,251		1,263


Total liabilities	14,961		15,749
Commitments and Contingencies (Note 11)
Stockholders’ equity:
Common stock, $0.001 par value; 3,580 shares authorized; 681 and 684 shares outstanding	2		2
Additional paid-in capital	16,546		16,497
Treasury stock at cost, 1,027 and 1,021 shares	(36,807)		(36,515)
Retained earnings	23,476		22,961
Accumulated other comprehensive income	553		616
Total stockholders’ equity	3,770		3,561
Total liabilities and stockholders’ equity	$	18,731	$	19,310


	Three Months Ended March 31,
			2021		2020
		(In millions, except per share amounts)
		(Unaudited)
Net revenues			$	3,023	$	2,129
Cost of net revenues			823		502
Gross profit			2,200		1,627
Operating expenses:
Sales and marketing			687		520
Product development			318		232
General and administrative			258		207
Provision for transaction losses			88		96
Amortization of acquired intangible assets			7		7
Total operating expenses			1,358		1,062
Income from operations			842		565
Interest and other, net			(117)		1
Income from continuing operations before income taxes			725		566
Income tax provision			(156)		(135)
Income from continuing operations			569		431
Income from discontinued operations, net of income taxes			72		2,981
Net income			$	641	$	3,412


Income per share - basic:
Continuing operations			$	0.84	$	0.57
Discontinued operations			0.10		3.96
Net income per share - basic			$	0.94	$	4.53

Income per share - diluted:
Continuing operations			$	0.82	$	0.57
Discontinued operations			0.10		3.94
Net income per share - diluted			$	0.92	$	4.51

Weighted-average shares:
Basic			681		753
Diluted			693		757


	Three Months Ended March 31,
			2021		2020
		(In millions)
		(Unaudited)
Net income			$	641	$	3,412
Other comprehensive income (loss), net of reclassification adjustments:
Foreign currency translation gains (losses)			(117)		(113)
Unrealized gains (losses) on investments, net			(3)		(31)
Tax benefit (expense) on unrealized gains (losses) on investments, net			—		8
Unrealized gains (losses) on hedging activities, net			74		47
Tax benefit (expense) on unrealized gains (losses) on hedging activities, net			(17)		(10)
Other comprehensive income (loss), net of tax			(63)		(99)
Comprehensive income			$	578	$	3,313


	Three Months Ended March 31,
			2021		2020
		(In millions, except per share amounts)
		(Unaudited)
Common stock:
Balance, beginning of period			$	2	$	2
Common stock issued			—		—
Common stock repurchased			—		—
Balance, end of period			2		2
Additional paid-in-capital:
Balance, beginning of period			16,497		16,126
Common stock and stock-based awards issued			1		4
Tax withholdings related to net share settlements of restricted stock units and awards			(69)		(40)
Stock-based compensation			116		94

Forward contract for share repurchase			—		(450)
Other			1		(11)
Balance, end of period			16,546		15,723
Treasury stock at cost:
Balance, beginning of period			(36,515)		(31,396)
Common stock repurchased			(292)		(3,550)
Balance, end of period			(36,807)		(34,946)
Retained earnings:
Balance, beginning of period			22,961		17,754
Net income			641		3,412
Dividends and dividend equivalents declared			(126)		(115)



Balance, end of period			23,476		21,051
Accumulated other comprehensive income:
Balance, beginning of period			616		384
Foreign currency translation adjustment			(117)		(113)
Change in unrealized gains (losses) on investments			(3)		(31)
Change in unrealized gains (losses) on derivative instruments			74		47
Tax benefit (provision) on above items			(17)		(2)

Balance, end of period			553		285
Total stockholders’ equity			$	3,770	$	2,115

Dividends and dividend equivalents declared per share or restricted stock unit			$	0.18	$	0.16


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


	Three Months Ended March 31,
		2021		2020 (1)
Classifieds income from discontinued operations, net of income taxes		$	72	$	54
StubHub income from discontinued operations, net of income taxes		—		2,928
PayPal and Enterprise (loss) from discontinued operations, net of income taxes		—		(1)
Income from discontinued operations, net of income taxes		$	72	$	2,981


	Three Months Ended March 31,
		2021		2020(1)
Net revenues		$	—	$	100
Cost of net revenues		—		31
Gross profit		—		69
Operating expenses:
Sales and marketing		—		51
Product development		—		29
General and administrative		—		33
Provision for transaction losses		—		3
Amortization of acquired intangible assets		—		1
Total operating expenses		—		117
Income (loss) from operations of discontinued operations		—		(48)
Pre-tax gain (loss) on sale		—		3,876
Income (loss) from discontinued operations before income taxes		—		3,828
Income tax benefit (provision)		—		(900)
Income (loss) from discontinued operations, net of income taxes		$	—	$	2,928


	March 31, 2021		December 31, 2020
Carrying amounts of assets included as part of held for sale:
Cash and cash equivalents	$	31	$	23
Accounts receivable, net	113		117
Other current assets	34		30
Long-term investments	32		32
Property and equipment, net	34		31
Goodwill	454		465
Intangible assets, net	35		35
Operating lease right-of-use assets	23		20
Deferred tax assets	415		435

Total assets classified as held for sale in the condensed consolidated balance sheet	$	1,171	$	1,188

Carrying amounts of liabilities included as part of held for sale:

Accounts payable	$	37	$	18
Accrued expenses and other current liabilities	100		104
Deferred revenue	5		4
Income taxes payable	37		35
Operating lease liabilities	14		11
Deferred tax liabilities	268		278
Other liabilities	2		2
Total liabilities classified as held for sale in the condensed consolidated balance sheet	$	463	$	452


	December 31, 2020		Goodwill Acquired		Adjustments		March 31, 2021
Goodwill	$	4,675	$	—	$	(84)	$	4,591


	March 31, 2021
	Gross Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Short-term investments:
Restricted cash	$	23	$	—	$	—	$	23
Corporate debt securities	1,650		2		—		1,652
Government and agency securities	25		—		—		25


	$	1,698	$	2	$	—	$	1,700
Long-term investments:
Corporate debt securities	507		2		(1)		508
Government and agency securities	16		—		—		16
	$	523	$	2	$	(1)	$	524


	March 31, 2021
One year or less (including restricted cash of $23)	$	1,700
One year through two years	292
Two years through three years	156
Three years through four years	44
Four years through five years	22
Five years through six years	10






	$	2,224


	March 31, 2021		December 31, 2020
Equity investments without readily determinable fair values	$	528	$	539
Equity investments under the equity method of accounting	7		8
Total equity investments	$	535	$	547


	Balance Sheet Location	March 31, 2021		December 31, 2020
Derivative Assets:
Foreign exchange contracts designated as cash flow hedges	Other Current Assets	$	22	$	12
Foreign exchange contracts designated as net investment hedges	Other Current Assets	1		—
Foreign exchange contracts not designated as hedging instruments	Other Current Assets	15		23
Interest rate contracts designated as cash flow hedges	Other Current Assets	56		—
Warrant	Warrant Asset	1,015		1,051
Foreign exchange contracts designated as cash flow hedges	Other Assets	20		14
Interest rate contracts designated as cash flow hedges	Other Assets	—		13

Total derivative assets		$	1,129	$	1,113

Derivative Liabilities:
Foreign exchange contracts designated as cash flow hedges	Other Current Liabilities	$	15	$	17
Foreign exchange contracts designated as net investment hedges	Other Current Liabilities	—		2

Foreign exchange contracts not designated as hedging instruments	Other Current Liabilities	13		25
Interest rate contracts designated as cash flow hedges	Other Current Liabilities	1		1
Interest rate contracts designated as cash flow hedges	Other Liabilities	1		1

Total derivative liabilities		$	30	$	46

Total fair value of derivative instruments		$	1,099	$	1,067


	Three Months Ended March 31,
		2021		2020
U.S.		$	1,296	$	822

United Kingdom		503		327
South Korea		389		312
Germany		344		232
Rest of world		491		436
Total net revenues		$	3,023	$	2,129


	December 31, 2020		Amount of Gain (Loss) Recognized in Other Comprehensive Income		Less: Amount of Gain (Loss) Reclassified From AOCI to Earnings		March 31, 2021
Foreign exchange contracts designated as cash flow hedges	$	(95)	$	3	$	(27)	$	(65)
Interest rate contracts designated as cash flow hedges	10		43		(1)		54
Total	$	(85)	$	46	$	(28)	$	(11)


	December 31, 2019		Amount of Gain (Loss) Recognized in Other Comprehensive Income		Less: Amount of Gain (Loss) Reclassified From AOCI to Earnings		March 31, 2020
Foreign exchange contracts designated as cash flow hedges	$	(9)	$	47	$	—	$	38


	March 31, 2021		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash and cash equivalents	$	1,667	$	1,667	$	—	$	—
Short-term investments:
Restricted cash	23		23		—		—
Corporate debt securities	1,652		—		1,652		—
Government and agency securities	25		—		25		—


Total short-term investments	1,700		23		1,677		—

Derivatives	1,129		—		114		1,015
Long-term investments:
Corporate debt securities	508		—		508		—
Government and agency securities	16		—		16		—
Total long-term investments	524		—		524		—
Total financial assets	$	5,020	$	1,690	$	2,315	$	1,015

Liabilities:
Derivatives	$	30	$	—	$	30	$	—


	March 31, 2021		December 31, 2020
Opening balance at beginning of period	$	1,051	$	281

Change in fair value	(36)		770
Closing balance at end of period	$	1,015	$	1,051


	Coupon	As of		Effective		As of		Effective
	Rate	March 31, 2021		Interest Rate		December 31, 2020		Interest Rate
Long-Term Debt
Floating Rate Notes:
Senior notes due 2023	LIBOR plus 0.87%	$	400	1.184	%	$	400	1.187	%






Senior notes due 2022	3.800%	750		3.989	%	750		3.989	%
Senior notes due 2022	2.600%	605		2.678	%	1,000		2.678	%
Senior notes due 2023	2.750%	750		2.866	%	750		2.866	%
Senior notes due 2024	3.450%	750		3.531	%	750		3.531	%
Senior notes due 2025	1.900%	800		1.803	%	800		1.803	%
Senior notes due 2027	3.600%	850		3.689	%	850		3.689	%
Senior notes due 2030	2.700%	950		2.623	%	950		2.623	%
Senior notes due 2042	4.000%	750		4.114	%	750		4.114	%
Senior notes due 2056	6.000%	—		—	%	750		6.547	%
Total senior notes		6,605				7,750
Hedge accounting fair value adjustments (1)		10				10
Unamortized premium/(discount) and debt issuance costs		(12)				(20)
Other long-term borrowings		2				5
Less: Current portion of long-term debt		(750)				—
Total long-term debt		5,855				7,745

Short-Term Debt
Current portion of long-term debt		750				—

Commercial paper		400				—

Other short-term borrowings		22				18
Total short-term debt		1,172				18
Total Debt		$	7,027			$	7,763


	Shares Repurchased (1)	Average Price per Share (2)		Value of Shares Repurchased (2)		Remaining Amount Authorized
Balance as of January 1, 2021						$	2,033
Authorization of additional plan in February 2021						4,000
Repurchase of shares of common stock	5	$	55.70	$	292	(292)


Balance as of March 31, 2021						$	5,741


			Units (1)
Outstanding as of January 1, 2021			25
Awarded			2
Vested			(4)
Forfeited			(1)
Outstanding as of March 31, 2021			22


	Unrealized Gains (Losses) on Derivative Instruments		Unrealized Gains (Losses) on Investments		Foreign Currency Translation		Estimated Tax (Expense) Benefit		Total
Balance as of December 31, 2020	$	(85)	$	5	$	654	$	42	$	616
Other comprehensive income (loss) before reclassifications	46		(3)		(117)		(11)		(85)
Less: Amount of gain (loss) reclassified from AOCI	(28)		—		—		6		(22)
Net current period other comprehensive income (loss)	74		(3)		(117)		(17)		(63)
Balance as of March 31, 2021	$	(11)	$	2	$	537	$	25	$	553


Details about AOCI Components	Affected Line Item in the Statement of Income		Amount of Gain (Loss) Reclassified From AOCI
		Three Months Ended March 31,
			2021		2020
Gains (losses) on cash flow hedges
Foreign exchange contracts	Net Revenues		$	(28)	$	—
Foreign exchange contracts	Cost of net revenues		1		—



Interest rate contracts	Interest and other, net		(1)		—
	Total, from continuing operations before income taxes		(28)		—
	Provision for income taxes		6		—


	Total, net of income taxes		(22)		—






Total reclassifications for the period	Total, net of income taxes		$	(22)	$	—


	Employee Severance and Benefits
Accrued liability as of January 1, 2021	$	—
Charges	33
Payments	(25)

Accrued liability as of March 31, 2021	$	8


	Quarter Ended
	March 31			June 30			September 30			December 31
2019
Net revenues	$	2,161		$	2,156		$	2,083		$	2,236
% change from prior quarter	(6)		%	—		%	(3)		%	7		%
2020
Net revenues	$	2,129		$	2,668		$	2,606		$	2,868
% change from prior quarter	(5)		%	25		%	(2)		%	10		%
2021
Net revenues	$	3,023		$	—		$	—		$	—
% change from prior quarter	5		%


	Three Months Ended March 31,				% Change
		2021			2020			As Reported
U.S.		$	1,296		$	822		58	%
Percentage of net revenues		43		%	39		%

International		1,727			1,307			32	%
Percentage of net revenues		57		%	61		%

Total net revenues		$	3,023		$	2,129		42	%


	Three Months Ended March 31,		Change
			2021			2020			As Reported		FX-Neutral
		(In millions, except percentages)
Net transaction revenues (1)			$	2,732		$	1,900		44	%	40	%

Supplemental data:
GMV			$	27,460		$	21,259		29	%	24	%
Take rate			9.95		%	8.93		%	1.02	%


	Three Months Ended March 31, 2021						Three Months Ended March 31, 2020
	As Reported		Exchange Rate Effect(1)(3)		FX-Neutral(2)		As Reported		As Reported % Change		FX-Neutral % Change

GMV	$	27,460	$	1,149	$	26,311	$	21,259	29	%	24	%



Net Revenues:

Net transaction revenues	$	2,732	$	69	$	2,663	$	1,900	44	%	40	%



Marketing services and other revenues	291		11		280		229		27	%	22	%




Total net revenues	$	3,023	$	80	$	2,943	$	2,129	42	%	38	%


	Three Months Ended March 31,
	2021		2020
	(In millions)
Net cash provided by (used in):
Continuing operating activities	$	938	$	614
Continuing investing activities	266		(1,568)
Continuing financing activities	(1,169)		(3,159)
Effect of exchange rates on cash, cash equivalents and restricted cash	(11)		(34)
Net increase in cash, cash equivalents and restricted cash - discontinued operations	103		4,050
Net increase (decrease) in cash, cash equivalents and restricted cash	$	127	$	(97)


	Fair Value Asset/(Liability)		Fair Value Sensitivity
	(In millions)
Foreign exchange contracts - Cash flow hedges	$	27	$	(238)
Foreign exchange contracts - Net investment hedges	$	1	$	(42)


Period Ended	Total Number of Shares Purchased	Average Price Paid per Share (2)		Total Number of Shares Purchased as Part of Publicly Announced Programs	Maximum Dollar Value that May Yet be Purchased Under the Programs (1)
January 31, 2021	3,609,821	$	55.40	3,609,821	$	1,833,023,515
February 28, 2021	425,878	$	55.70	425,878	$	5,808,023,642
March 31, 2021	1,202,165	$	55.53	1,202,165	$	5,741,264,858
	5,237,864			5,237,864


Exhibit Number	Filed or furnished with this 10-Q	Description
31.01	X	Certification of Registrant’s Chief Executive Officer, as required by Section 302 of the Sarbanes-Oxley Act of 2002.
31.02	X	Certification of Registrant’s Chief Financial Officer, as required by Section 302 of the Sarbanes-Oxley Act of 2002.
32.01	X	Certification of Registrant’s Chief Executive Officer, as required by Section 906 of the Sarbanes-Oxley Act of 2002.
32.02	X	Certification of Registrant’s Chief Financial Officer, as required by Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS	X	Inline XBRL Instance Document (the Instance Document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document)
101.SCH	X	Inline XBRL Taxonomy Extension Schema Document
101.CAL	X	Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	X	Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	X	Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE	X	Inline XBRL Taxonomy Extension Presentation Linkbase Document
104	X	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)


		eBay Inc.
		Principal Executive Officer:

		By:	/s/ Jamie Iannone
			Jamie Iannone
			Chief Executive Officer
Date:	April 29, 2021
		Principal Financial Officer:

		By:	/s/ Andy Cring
			Andy Cring
			Interim Chief Financial Officer
Date:	April 29, 2021
		Principal Accounting Officer:

		By:	/s/ Brian J. Doerger
			Brian J. Doerger
			Vice President, Chief Accounting Officer
Date:	April 29, 2021