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Share Name | Share Symbol | Market | Type |
---|---|---|---|
eBay Inc | NASDAQ:EBAY | NASDAQ | Common Stock |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.56 | 1.09% | 51.90 | 51.09 | 51.99 | 52.19 | 51.20 | 51.30 | 4,985,632 | 01:00:00 |
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Form 10-Q
|
|
[x]
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
[ ]
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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eBay Inc.
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(Exact name of registrant as specified in its charter)
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||
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Delaware
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77-0430924
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification Number)
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|
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2065 Hamilton Avenue
San Jose, California
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95125
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(Address of principal executive offices)
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(Zip Code)
|
|
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Large accelerated filer
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[x]
|
|
Accelerated filer
|
[ ]
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Non-accelerated filer
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[ ]
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(Do not check if a smaller reporting company)
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Smaller reporting company
|
[ ]
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|
Item 1:
|
Financial Statements
|
|
March 31,
2016 |
|
December 31,
2015 |
||||
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(In millions, except par value amounts)
|
||||||
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(Unaudited)
|
||||||
ASSETS
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
2,686
|
|
|
$
|
1,832
|
|
Short-term investments
|
5,327
|
|
|
4,299
|
|
||
Accounts receivable, net
|
599
|
|
|
619
|
|
||
Other current assets
|
1,091
|
|
|
1,154
|
|
||
Total current assets
|
9,703
|
|
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7,904
|
|
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Long-term investments
|
3,370
|
|
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3,391
|
|
||
Property and equipment, net
|
1,497
|
|
|
1,554
|
|
||
Goodwill
|
4,519
|
|
|
4,451
|
|
||
Intangible assets, net
|
82
|
|
|
90
|
|
||
Other assets
|
437
|
|
|
365
|
|
||
Total assets
|
$
|
19,608
|
|
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$
|
17,755
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LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Short-term debt
|
$
|
6
|
|
|
$
|
—
|
|
Accounts payable
|
275
|
|
|
349
|
|
||
Accrued expenses and other current liabilities
|
1,651
|
|
|
1,736
|
|
||
Deferred revenue
|
115
|
|
|
106
|
|
||
Income taxes payable
|
60
|
|
|
72
|
|
||
Total current liabilities
|
2,107
|
|
|
2,263
|
|
||
Deferred and other tax liabilities, net
|
2,080
|
|
|
2,092
|
|
||
Long-term debt
|
9,030
|
|
|
6,749
|
|
||
Other liabilities
|
74
|
|
|
75
|
|
||
Total liabilities
|
13,291
|
|
|
11,179
|
|
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Commitments and contingencies (Note 10)
|
|
|
|
|
|||
Stockholders’ equity:
|
|
|
|
||||
Common stock, $0.001 par value; 3,580 shares authorized; 1,143 and 1,184 shares outstanding
|
2
|
|
|
2
|
|
||
Additional paid-in capital
|
14,627
|
|
|
14,538
|
|
||
Treasury stock at cost, 486 and 443 shares
|
(17,204
|
)
|
|
(16,203
|
)
|
||
Retained earnings
|
8,207
|
|
|
7,713
|
|
||
Accumulated other comprehensive income
|
685
|
|
|
526
|
|
||
Total stockholders’ equity
|
6,317
|
|
|
6,576
|
|
||
Total liabilities and stockholders’ equity
|
$
|
19,608
|
|
|
$
|
17,755
|
|
|
Three Months Ended
March 31, |
||||||
|
2016
|
|
2015
|
||||
|
(In millions, except per share amounts)
|
||||||
|
(Unaudited)
|
||||||
Net revenues
|
$
|
2,137
|
|
|
$
|
2,061
|
|
Cost of net revenues
|
477
|
|
|
411
|
|
||
Gross profit
|
1,660
|
|
|
1,650
|
|
||
Operating expenses:
|
|
|
|
||||
Sales and marketing
|
538
|
|
|
519
|
|
||
Product development
|
239
|
|
|
221
|
|
||
General and administrative
|
209
|
|
|
302
|
|
||
Provision for transaction losses
|
52
|
|
|
69
|
|
||
Amortization of acquired intangible assets
|
8
|
|
|
10
|
|
||
Total operating expenses
|
1,046
|
|
|
1,121
|
|
||
Income from operations
|
614
|
|
|
529
|
|
||
Interest and other, net
|
(23
|
)
|
|
10
|
|
||
Income from continuing operations before income taxes
|
591
|
|
|
539
|
|
||
Provision for income taxes
|
(109
|
)
|
|
(90
|
)
|
||
Income from continuing operations
|
$
|
482
|
|
|
$
|
449
|
|
Income from discontinued operations, net of income taxes
|
—
|
|
|
177
|
|
||
Net income
|
$
|
482
|
|
|
$
|
626
|
|
|
|
|
|
||||
Income per share - basic:
|
|
|
|
||||
Continuing operations
|
$
|
0.42
|
|
|
$
|
0.37
|
|
Discontinued operations
|
—
|
|
|
0.14
|
|
||
Net income per share - basic
|
$
|
0.42
|
|
|
$
|
0.51
|
|
|
|
|
|
||||
Income per share - diluted:
|
|
|
|
||||
Continuing operations
|
$
|
0.41
|
|
|
$
|
0.37
|
|
Discontinued operations
|
—
|
|
|
0.14
|
|
||
Net income per share - diluted
|
$
|
0.41
|
|
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$
|
0.51
|
|
|
|
|
|
||||
Weighted average shares:
|
|
|
|
||||
Basic
|
1,159
|
|
|
1,216
|
|
||
Diluted
|
1,170
|
|
|
1,229
|
|
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Three Months Ended
March 31, |
||||||
|
2016
|
|
2015
|
||||
|
(In millions)
|
||||||
|
(Unaudited)
|
||||||
Net income
|
$
|
482
|
|
|
$
|
626
|
|
Other comprehensive income (loss), net of reclassification adjustments:
|
|
|
|
||||
Foreign currency translation gain (loss)
|
154
|
|
|
(265
|
)
|
||
Unrealized gains (losses) on investments, net
|
23
|
|
|
(22
|
)
|
||
Tax benefit (expense) on unrealized gains (losses) on investments, net
|
(21
|
)
|
|
9
|
|
||
Unrealized gains (losses) on hedging activities, net
|
3
|
|
|
89
|
|
||
Tax benefit (expense) on unrealized gains (losses) on hedging activities, net
|
—
|
|
|
(2
|
)
|
||
Other comprehensive income (loss), net of tax
|
159
|
|
|
(191
|
)
|
||
Comprehensive income
|
$
|
641
|
|
|
$
|
435
|
|
|
Three Months Ended March 31,
|
||||||
|
2016
|
|
2015
|
||||
|
(In millions)
|
||||||
|
(Unaudited)
|
||||||
Cash flows from operating activities:
|
|
|
|
||||
Net income
|
$
|
482
|
|
|
$
|
626
|
|
Income from discontinued operations, net of income taxes
|
—
|
|
|
(177
|
)
|
||
Adjustments:
|
|
|
|
||||
Provision for transaction losses
|
52
|
|
|
69
|
|
||
Depreciation and amortization
|
167
|
|
|
160
|
|
||
Stock-based compensation
|
88
|
|
|
93
|
|
||
Changes in assets and liabilities, and other, net of acquisition effects
|
(148
|
)
|
|
(270
|
)
|
||
Net cash provided by continuing operating activities
|
641
|
|
|
501
|
|
||
Net cash provided by discontinued operating activities
|
—
|
|
|
650
|
|
||
Net cash provided by operating activities
|
641
|
|
|
1,151
|
|
||
Cash flows from investing activities:
|
|
|
|
|
|
||
Purchases of property and equipment
|
(158
|
)
|
|
(96
|
)
|
||
Purchases of investments
|
(2,935
|
)
|
|
(2,420
|
)
|
||
Maturities and sales of investments
|
2,030
|
|
|
2,019
|
|
||
Other
|
(12
|
)
|
|
(1
|
)
|
||
Net cash used in continuing investing activities
|
(1,075
|
)
|
|
(498
|
)
|
||
Net cash used in discontinued investing activities
|
—
|
|
|
(226
|
)
|
||
Net cash used in investing activities
|
(1,075
|
)
|
|
(724
|
)
|
||
Cash flows from financing activities:
|
|
|
|
|
|
||
Proceeds from issuance of common stock
|
7
|
|
|
38
|
|
||
Repurchases of common stock
|
(1,001
|
)
|
|
(1,000
|
)
|
||
Excess tax benefits from stock-based compensation
|
1
|
|
|
20
|
|
||
Tax withholdings related to net share settlements of restricted stock units and awards
|
(8
|
)
|
|
(51
|
)
|
||
Proceeds from issuance of long-term debt, net
|
2,216
|
|
|
—
|
|
||
Other
|
7
|
|
|
—
|
|
||
Net cash provided by (used in) continuing financing activities
|
1,222
|
|
|
(993
|
)
|
||
Net cash provided by discontinued financing activities
|
—
|
|
|
8
|
|
||
Net cash provided by (used) in financing activities
|
1,222
|
|
|
(985
|
)
|
||
Effect of exchange rate changes on cash and cash equivalents
|
66
|
|
|
(297
|
)
|
||
Net increase (decrease) in cash and cash equivalents
|
854
|
|
|
(855
|
)
|
||
Cash and cash equivalents at beginning of period
|
1,832
|
|
|
6,328
|
|
||
Cash and cash equivalents at end of period
|
$
|
2,686
|
|
|
$
|
5,473
|
|
Less: Cash and cash equivalents of discontinued operations
|
—
|
|
|
2,367
|
|
||
Cash and cash equivalents of continuing operations at end of period
|
$
|
2,686
|
|
|
$
|
3,106
|
|
Supplemental cash flow disclosures:
|
|
|
|
||||
Cash paid for interest
|
$
|
73
|
|
|
$
|
74
|
|
Cash paid for income taxes
|
$
|
31
|
|
|
$
|
101
|
|
|
Three Months Ended
March 31, |
||||||
|
2016
|
|
2015
|
||||
|
(In millions, except per share amounts)
|
||||||
Numerator:
|
|
|
|
||||
Income from continuing operations
|
$
|
482
|
|
|
$
|
449
|
|
Income from discontinued operations, net of income taxes
|
—
|
|
|
177
|
|
||
Net income
|
$
|
482
|
|
|
$
|
626
|
|
Denominator:
|
|
|
|
||||
Weighted average shares of common stock - basic
|
1,159
|
|
|
1,216
|
|
||
Dilutive effect of equity incentive awards
|
11
|
|
|
13
|
|
||
Weighted average shares of common stock - diluted
|
1,170
|
|
|
1,229
|
|
||
Income per share - basic:
|
|
|
|
||||
Continuing operations
|
$
|
0.42
|
|
|
$
|
0.37
|
|
Discontinued operations
|
—
|
|
|
0.14
|
|
||
Net income per share - basic
|
$
|
0.42
|
|
|
$
|
0.51
|
|
Income per share - diluted:
|
|
|
|
||||
Continuing operations
|
$
|
0.41
|
|
|
$
|
0.37
|
|
Discontinued operations
|
—
|
|
|
0.14
|
|
||
Net income per share - diluted
|
$
|
0.41
|
|
|
$
|
0.51
|
|
Common stock equivalents excluded from income per diluted share because their effect would have been anti-dilutive
|
6
|
|
|
4
|
|
|
Three Months Ended
March 31, |
||||||
|
2016
|
|
2015
|
||||
|
(In millions)
|
||||||
Net revenues
|
$
|
—
|
|
|
$
|
2,387
|
|
Cost of net revenues
|
—
|
|
|
1,039
|
|
||
Gross profit
|
—
|
|
|
1,348
|
|
||
Operating expenses:
|
|
|
|
||||
Sales and marketing
|
—
|
|
|
275
|
|
||
Product development
|
—
|
|
|
264
|
|
||
General and administrative
|
(2
|
)
|
|
363
|
|
||
Provision for transaction and loan losses
|
—
|
|
|
195
|
|
||
Amortization of acquired intangible assets
|
—
|
|
|
48
|
|
||
Total operating expenses
|
(2
|
)
|
|
1,145
|
|
||
Income from operations of discontinued operations
|
2
|
|
|
203
|
|
||
Interest and other, net
|
—
|
|
|
(2
|
)
|
||
Income from discontinued operations before income taxes
|
2
|
|
|
201
|
|
||
Provision for income taxes
|
(2
|
)
|
|
(24
|
)
|
||
Income from discontinued operations, net of income taxes
|
$
|
—
|
|
|
$
|
177
|
|
|
December 31,
2015 |
|
Goodwill
Acquired
|
|
Adjustments
|
|
March 31,
2016 |
||||||||
|
(In millions)
|
||||||||||||||
Goodwill
|
$
|
4,451
|
|
|
$
|
6
|
|
|
$
|
62
|
|
|
$
|
4,519
|
|
|
March 31, 2016
|
|
December 31, 2015
|
||||||||||||||||||||||||
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Carrying Amount
|
|
Weighted Average Useful Life (Years)
|
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Carrying Amount
|
|
Weighted Average Useful Life (Years)
|
||||||||||||
|
(In millions, except years)
|
||||||||||||||||||||||||||
Intangible assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Customer lists and user base
|
$
|
425
|
|
|
$
|
(408
|
)
|
|
$
|
17
|
|
|
5
|
|
$
|
419
|
|
|
$
|
(399
|
)
|
|
$
|
20
|
|
|
5
|
Marketing related
|
608
|
|
|
(586
|
)
|
|
22
|
|
|
5
|
|
594
|
|
|
(570
|
)
|
|
24
|
|
|
5
|
||||||
Developed technologies
|
244
|
|
|
(221
|
)
|
|
23
|
|
|
4
|
|
238
|
|
|
(215
|
)
|
|
23
|
|
|
4
|
||||||
All other
|
157
|
|
|
(137
|
)
|
|
20
|
|
|
4
|
|
157
|
|
|
(134
|
)
|
|
23
|
|
|
4
|
||||||
|
$
|
1,434
|
|
|
$
|
(1,352
|
)
|
|
$
|
82
|
|
|
|
|
$
|
1,408
|
|
|
$
|
(1,318
|
)
|
|
$
|
90
|
|
|
|
Fiscal years:
|
|
|
||
Remaining 2016
|
|
$
|
35
|
|
2017
|
|
35
|
|
|
2018
|
|
11
|
|
|
2019
|
|
1
|
|
|
2020
|
|
—
|
|
|
Thereafter
|
|
—
|
|
|
|
|
$
|
82
|
|
|
Three Months Ended
March 31, |
||||||
|
2016
|
|
2015
|
||||
|
(In millions)
|
||||||
Net Revenues by Type:
|
|
|
|
||||
Net transaction revenues:
|
|
|
|
||||
Marketplace
|
$
|
1,500
|
|
|
$
|
1,536
|
|
StubHub
|
177
|
|
|
132
|
|
||
Total net transaction revenues
|
1,677
|
|
|
1,668
|
|
||
Marketing services and other revenues:
|
|
|
|
||||
Marketplace
|
274
|
|
|
235
|
|
||
Classifieds
|
186
|
|
|
162
|
|
||
Corporate and other
|
—
|
|
|
(4
|
)
|
||
Total marketing services and other revenues
|
460
|
|
|
393
|
|
||
Total net revenues
|
$
|
2,137
|
|
|
$
|
2,061
|
|
|
March 31, 2016
|
||||||||||||||
|
Gross
Amortized
Cost
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
|
|
Estimated
Fair Value
|
||||||||
|
(In millions)
|
||||||||||||||
Short-term investments:
|
|
|
|
|
|
|
|
||||||||
Restricted cash
|
$
|
25
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
25
|
|
Corporate debt securities
(1)
|
4,349
|
|
|
2
|
|
|
(56
|
)
|
|
4,295
|
|
||||
Government and agency securities
|
50
|
|
|
—
|
|
|
—
|
|
|
50
|
|
||||
Equity instruments
|
9
|
|
|
948
|
|
|
—
|
|
|
957
|
|
||||
|
$
|
4,433
|
|
|
$
|
950
|
|
|
$
|
(56
|
)
|
|
$
|
5,327
|
|
Long-term investments:
|
|
|
|
|
|
|
|
||||||||
Corporate debt securities
(1)
|
3,266
|
|
|
16
|
|
|
(42
|
)
|
|
3,240
|
|
||||
|
$
|
3,266
|
|
|
$
|
16
|
|
|
$
|
(42
|
)
|
|
$
|
3,240
|
|
|
|
December 31, 2015
|
||||||||||||||
|
Gross
Amortized
Cost
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
|
|
Estimated
Fair Value
|
||||||||
|
(In millions)
|
||||||||||||||
Short-term investments:
|
|
|
|
|
|
|
|
||||||||
Restricted cash
|
$
|
28
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
28
|
|
Corporate debt securities
|
3,302
|
|
|
1
|
|
|
(16
|
)
|
|
3,287
|
|
||||
Government and agency securities
|
55
|
|
|
—
|
|
|
—
|
|
|
55
|
|
||||
Equity instruments
|
9
|
|
|
920
|
|
|
—
|
|
|
929
|
|
||||
|
$
|
3,394
|
|
|
$
|
921
|
|
|
$
|
(16
|
)
|
|
$
|
4,299
|
|
Long-term investments:
|
|
|
|
|
|
|
|
||||||||
Corporate debt securities
|
3,327
|
|
|
7
|
|
|
(67
|
)
|
|
3,267
|
|
||||
|
$
|
3,327
|
|
|
$
|
7
|
|
|
$
|
(67
|
)
|
|
$
|
3,267
|
|
|
March 31,
2016 |
||
|
(In millions)
|
||
One year or less (including restricted cash of $25)
|
$
|
4,369
|
|
One year through two years
|
1,476
|
|
|
Two years through three years
|
1,482
|
|
|
Three years through four years
|
242
|
|
|
Four years through five years
|
36
|
|
|
Five years through six years
|
—
|
|
|
Six years through seven years
|
—
|
|
|
Seven years through eight years
|
5
|
|
|
Eight years through nine years
|
—
|
|
|
Nine years through ten years
|
—
|
|
|
|
$
|
7,610
|
|
Description
|
Balance as of
March 31, 2016 |
|
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
|
|
Significant Other
Observable Inputs
(Level 2)
|
||||||
|
(In millions)
|
||||||||||
Assets:
|
|
|
|
|
|
||||||
Cash and cash equivalents
|
$
|
2,686
|
|
|
$
|
2,156
|
|
|
$
|
530
|
|
Short-term investments:
|
|
|
|
|
|
||||||
Restricted cash
|
25
|
|
|
25
|
|
|
—
|
|
|||
Corporate debt securities
|
4,295
|
|
|
—
|
|
|
4,295
|
|
|||
Government and agency securities
|
50
|
|
|
—
|
|
|
50
|
|
|||
Equity instruments
|
957
|
|
|
957
|
|
|
—
|
|
|||
Total short-term investments
|
5,327
|
|
|
982
|
|
|
4,345
|
|
|||
Derivatives
|
190
|
|
|
—
|
|
|
190
|
|
|||
Long-term investments:
|
|
|
|
|
|
||||||
Corporate debt securities
|
3,240
|
|
|
—
|
|
|
3,240
|
|
|||
Total long-term investments
|
3,240
|
|
|
—
|
|
|
3,240
|
|
|||
Total financial assets
|
$
|
11,443
|
|
|
$
|
3,138
|
|
|
$
|
8,305
|
|
|
|
|
|
|
|
||||||
Liabilities:
|
|
|
|
|
|
||||||
Derivatives
|
$
|
62
|
|
|
$
|
—
|
|
|
$
|
62
|
|
Description
|
Balance as of
December 31, 2015 |
|
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
|
|
Significant Other
Observable Inputs
(Level 2)
|
||||||
|
(In millions)
|
||||||||||
Assets:
|
|
|
|
|
|
||||||
Cash and cash equivalents
|
$
|
1,832
|
|
|
$
|
1,664
|
|
|
$
|
168
|
|
Short-term investments:
|
|
|
|
|
|
||||||
Restricted cash
|
28
|
|
|
28
|
|
|
—
|
|
|||
Corporate debt securities
|
3,287
|
|
|
—
|
|
|
3,287
|
|
|||
Government and agency securities
|
55
|
|
|
—
|
|
|
55
|
|
|||
Equity instruments
|
929
|
|
|
929
|
|
|
—
|
|
|||
Total short-term investments
|
4,299
|
|
|
957
|
|
|
3,342
|
|
|||
Derivatives
|
97
|
|
|
—
|
|
|
97
|
|
|||
Long-term investments:
|
|
|
|
|
|
||||||
Corporate debt securities
|
3,267
|
|
|
—
|
|
|
3,267
|
|
|||
Total long-term investments
|
3,267
|
|
|
—
|
|
|
3,267
|
|
|||
Total financial assets
|
$
|
9,495
|
|
|
$
|
2,621
|
|
|
$
|
6,874
|
|
|
|
|
|
|
|
||||||
Liabilities:
|
|
|
|
|
|
||||||
Derivatives
|
$
|
25
|
|
|
$
|
—
|
|
|
$
|
25
|
|
|
Balance Sheet Location
|
|
March 31,
2016 |
|
December 31,
2015 |
||||
|
|
|
(In millions)
|
||||||
Derivative Assets:
|
|
|
|
|
|
||||
Foreign exchange contracts designated as cash flow hedges
|
Other Current Assets
|
|
$
|
54
|
|
|
$
|
42
|
|
Foreign exchange contracts not designated as hedging instruments
|
Other Current Assets
|
|
32
|
|
|
14
|
|
||
Interest rate contracts designated as fair value hedges
|
Other Assets
|
|
104
|
|
|
41
|
|
||
Total derivative assets
|
|
|
$
|
190
|
|
|
$
|
97
|
|
|
|
|
|
|
|
||||
Derivative Liabilities:
|
|
|
|
|
|
||||
Foreign exchange contracts designated as cash flow hedges
|
Other Current Liabilities
|
|
$
|
12
|
|
|
$
|
1
|
|
Foreign exchange contracts not designated as hedging instruments
|
Other Current Liabilities
|
|
50
|
|
|
24
|
|
||
Total derivative liabilities
|
|
|
$
|
62
|
|
|
$
|
25
|
|
|
|
|
|
|
|
||||
Total fair value of derivative instruments
|
|
|
$
|
128
|
|
|
$
|
72
|
|
|
December 31, 2015
|
|
Amount of gain (loss)
recognized in other
comprehensive income
(effective portion)
|
|
Amount of gain (loss)
reclassified from
accumulated other
comprehensive income
to earnings
(effective portion)
|
|
March 31, 2016
|
||||||||
|
(In millions)
|
||||||||||||||
Foreign exchange contracts designated as cash flow hedges
|
$
|
36
|
|
|
$
|
19
|
|
|
$
|
16
|
|
|
$
|
39
|
|
|
December 31, 2014
|
|
Amount of gain (loss)
recognized in other
comprehensive income
(effective portion)
|
|
Amount of gain (loss)
reclassified from
accumulated other
comprehensive income
to earnings
(effective portion)
|
|
March 31, 2015
|
||||||||
|
(In millions)
|
||||||||||||||
Foreign exchange contracts designated as cash flow hedges
|
$
|
41
|
|
|
$
|
45
|
|
|
$
|
20
|
|
|
$
|
66
|
|
|
Three Months Ended
March 31, |
||||||
|
2016
|
|
2015
|
||||
|
(In millions)
|
||||||
Foreign exchange contracts designated as cash flow hedges recognized in cost of net revenues and operating expenses
|
$
|
4
|
|
|
$
|
20
|
|
Foreign exchange contracts designated as cash flow hedges recognized in interest and other, net
|
12
|
|
|
—
|
|
||
Foreign exchange contracts not designated as hedging instruments recognized in interest and other, net
|
(2
|
)
|
|
16
|
|
||
Total gain (loss) recognized from foreign exchange derivative contracts in the condensed consolidated statement of income
|
$
|
14
|
|
|
$
|
36
|
|
|
Three Months Ended
March 31, |
||||||
|
2016
|
|
2015
|
||||
|
(In millions)
|
||||||
Gain (loss) from interest rate contracts designated as fair value hedges recognized in interest and other, net
|
$
|
63
|
|
|
$
|
37
|
|
Gain (loss) from hedged items attributable to hedged risk recognized in interest and other, net
|
(63
|
)
|
|
(37
|
)
|
||
Total gain (loss) recognized from interest rate derivative contracts in the condensed consolidated statement of income
|
$
|
—
|
|
|
$
|
—
|
|
|
March 31,
|
||||||
|
2016
|
|
2015
|
||||
|
(In millions)
|
||||||
Foreign exchange contracts designated as cash flow hedges
|
$
|
1,542
|
|
|
$
|
489
|
|
Foreign exchange contracts not designated as hedging instruments
|
2,864
|
|
|
2,256
|
|
||
Interest rate contracts designated as fair value hedges
|
2,400
|
|
|
2,400
|
|
||
Total
|
$
|
6,806
|
|
|
$
|
5,145
|
|
|
|
Coupon
|
|
As of
|
|
Effective
|
|
As of
|
|
Effective
|
|||||||
|
|
Rate
|
|
March 31, 2016
|
|
Interest Rate
|
|
December 31, 2015
|
|
Interest Rate
|
|||||||
|
|
(In millions, except percentages)
|
|||||||||||||||
Long-Term Debt
|
|
|
|
|
|
|
|
|
|
|
|||||||
Floating Rate Notes:
|
|
|
|
|
|
|
|
|
|
|
|||||||
Senior notes due 2017
|
|
LIBOR plus 0.20%
|
|
|
$
|
450
|
|
|
0.651
|
%
|
|
$
|
450
|
|
|
0.586
|
%
|
Senior notes due 2019
|
|
LIBOR plus 0.48%
|
|
|
400
|
|
|
0.853
|
%
|
|
400
|
|
|
0.825
|
%
|
||
|
|
|
|
|
|
|
|
|
|
|
|||||||
Fixed Rate Notes:
|
|
|
|
|
|
|
|
|
|
|
|||||||
Senior notes due 2017
|
|
1.350
|
%
|
|
1,000
|
|
|
1.456
|
%
|
|
1,000
|
|
|
1.456
|
%
|
||
Senior notes due 2018
|
|
2.500
|
%
|
|
750
|
|
|
2.775
|
%
|
|
—
|
|
|
—
|
%
|
||
Senior notes due 2019
|
|
2.200
|
%
|
|
1,150
|
|
|
2.346
|
%
|
|
1,150
|
|
|
2.346
|
%
|
||
Senior notes due 2020
|
|
3.250
|
%
|
|
500
|
|
|
3.389
|
%
|
|
500
|
|
|
3.389
|
%
|
||
Senior notes due 2021
|
|
2.875
|
%
|
|
750
|
|
|
2.993
|
%
|
|
750
|
|
|
2.993
|
%
|
||
Senior notes due 2022
|
|
3.800
|
%
|
|
750
|
|
|
3.989
|
%
|
|
—
|
|
|
—
|
%
|
||
Senior notes due 2022
|
|
2.600
|
%
|
|
1,000
|
|
|
2.678
|
%
|
|
1,000
|
|
|
2.678
|
%
|
||
Senior notes due 2024
|
|
3.450
|
%
|
|
750
|
|
|
3.531
|
%
|
|
750
|
|
|
3.531
|
%
|
||
Senior notes due 2042
|
|
4.000
|
%
|
|
750
|
|
|
4.114
|
%
|
|
750
|
|
|
4.114
|
%
|
||
Senior notes due 2056
|
|
6.000
|
%
|
|
750
|
|
|
6.547
|
%
|
|
—
|
|
|
—
|
%
|
||
Total senior notes
|
|
|
|
9,000
|
|
|
|
|
6,750
|
|
|
|
|||||
Hedge accounting fair value adjustments
|
|
|
|
104
|
|
|
|
|
41
|
|
|
|
|||||
Unamortized discount and debt issuance costs
|
|
|
|
(74
|
)
|
|
|
|
(42
|
)
|
|
|
|||||
Total long-term debt
|
|
|
|
$
|
9,030
|
|
|
|
|
$
|
6,749
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|||||||
Short-Term Debt
|
|
|
|
|
|
|
|
|
|
|
|||||||
Other indebtedness
|
|
|
|
6
|
|
|
|
|
—
|
|
|
|
|||||
Total short-term debt
|
|
|
|
6
|
|
|
|
|
—
|
|
|
|
|||||
Total Debt
|
|
|
|
$
|
9,036
|
|
|
|
|
$
|
6,749
|
|
|
|
|
Shares Repurchased
|
|
Average Price per Share
(1)
|
|
Value of Shares Repurchased
|
|
Remaining Amount Authorized
|
||||||
|
(In millions, except per share amounts)
|
||||||||||||
Balance as of January 1, 2016
|
|
|
|
|
|
|
$
|
1,836
|
|
||||
Repurchase of shares of common stock
|
42
|
|
|
$
|
23.67
|
|
|
1,000
|
|
|
(1,000
|
)
|
|
Balance as of March 31, 2016
|
|
|
|
|
|
|
$
|
836
|
|
|
|
Options
|
|
|
(In millions)
|
|
Outstanding as of January 1, 2016
|
7
|
|
Granted and assumed
|
—
|
|
Exercised
|
—
|
|
Forfeited/expired/canceled
|
(1
|
)
|
Outstanding as of March 31, 2016
|
6
|
|
|
Units
|
|
|
(In millions)
|
|
Outstanding as of January 1, 2016
|
36
|
|
Awarded and assumed
|
1
|
|
Vested
|
(1
|
)
|
Forfeited
|
—
|
|
Outstanding as of March 31, 2016
|
36
|
|
|
Three Months Ended March 31,
|
||||||
|
2016
|
|
2015
|
||||
|
(In millions)
|
||||||
Cost of net revenues
|
$
|
7
|
|
|
$
|
8
|
|
Sales and marketing
|
21
|
|
|
24
|
|
||
Product development
|
31
|
|
|
29
|
|
||
General and administrative
|
29
|
|
|
32
|
|
||
Total stock-based compensation expense
|
$
|
88
|
|
|
$
|
93
|
|
Capitalized in product development
|
$
|
3
|
|
|
$
|
3
|
|
|
Three Months Ended March 31,
|
|
|
2015
|
|
Risk-free interest rate
|
1.46
|
%
|
Expected life (in years)
|
4.4
|
|
Dividend yield
|
—
|
%
|
Expected volatility
|
27
|
%
|
|
Unrealized Gains (Losses) on Cash Flow Hedges
|
|
Unrealized
Gains on
Investments
|
|
Foreign
Currency
Translation
|
|
Estimated tax (expense) benefit
|
|
Total
|
||||||||||
|
(In millions)
|
||||||||||||||||||
Beginning balance
|
$
|
36
|
|
|
$
|
845
|
|
|
$
|
(45
|
)
|
|
$
|
(310
|
)
|
|
$
|
526
|
|
Other comprehensive income (loss) before reclassifications
|
19
|
|
|
18
|
|
|
154
|
|
|
(21
|
)
|
|
170
|
|
|||||
Amount of gain (loss) reclassified from accumulated other comprehensive income
|
16
|
|
|
(5
|
)
|
|
—
|
|
|
—
|
|
|
11
|
|
|||||
Net current period other comprehensive income
|
3
|
|
|
23
|
|
|
154
|
|
|
(21
|
)
|
|
159
|
|
|||||
Ending balance
|
$
|
39
|
|
|
$
|
868
|
|
|
$
|
109
|
|
|
$
|
(331
|
)
|
|
$
|
685
|
|
|
Unrealized Gains (Losses) on Cash Flow Hedges
|
|
Unrealized
Gains on
Investments
|
|
Foreign
Currency
Translation
|
|
Estimated tax (expense) benefit
|
|
Total
|
||||||||||
|
(In millions)
|
||||||||||||||||||
Beginning balance
|
$
|
168
|
|
|
$
|
1,029
|
|
|
$
|
334
|
|
|
$
|
(360
|
)
|
|
$
|
1,171
|
|
Other comprehensive income (loss) before reclassifications
|
159
|
|
|
(23
|
)
|
|
(265
|
)
|
|
7
|
|
|
(122
|
)
|
|||||
Amount of gain (loss) reclassified from accumulated other comprehensive income
|
70
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
69
|
|
|||||
Net current period other comprehensive income
|
89
|
|
|
(22
|
)
|
|
(265
|
)
|
|
7
|
|
|
(191
|
)
|
|||||
Ending balance
|
$
|
257
|
|
|
$
|
1,007
|
|
|
$
|
69
|
|
|
$
|
(353
|
)
|
|
$
|
980
|
|
Details about Accumulated Other Comprehensive
Income Components
|
|
Affected Line Item in the Statement of Income
|
|
Amount of Gain (Loss) Reclassified from
Accumulated Other Comprehensive Income
|
||||||
|
|
|
|
Three Months Ended
March 31, 2016 |
|
Three Months Ended
March 31, 2015 |
||||
|
|
|
|
|
|
|
||||
Gains (losses) on cash flow hedges - foreign exchange contracts
|
|
Cost of net revenues
|
|
$
|
2
|
|
|
$
|
6
|
|
|
|
Sales and marketing
|
|
—
|
|
|
1
|
|
||
|
|
Product development
|
|
2
|
|
|
11
|
|
||
|
|
General and administrative
|
|
—
|
|
|
2
|
|
||
|
|
Interest and other, net
|
|
12
|
|
|
—
|
|
||
|
|
Total, from continuing operations before income taxes
|
|
16
|
|
|
20
|
|
||
|
|
Provision for income taxes
|
|
—
|
|
|
—
|
|
||
|
|
Total, from continuing operations net of income taxes
|
|
16
|
|
|
20
|
|
||
|
|
Total, from discontinued operations net of income taxes
|
|
—
|
|
|
50
|
|
||
|
|
Total, net of income taxes
|
|
16
|
|
|
70
|
|
||
|
|
|
|
|
|
|
||||
Unrealized gains (losses) on investments
|
|
Interest and other, net
|
|
(5
|
)
|
|
(1
|
)
|
||
|
|
Total, before income taxes
|
|
(5
|
)
|
|
(1
|
)
|
||
|
|
Provision for income taxes
|
|
—
|
|
|
—
|
|
||
|
|
Total, net of income taxes
|
|
(5
|
)
|
|
(1
|
)
|
||
|
|
|
|
|
|
|
||||
Total reclassifications for the period
|
|
Total, net of income taxes
|
|
$
|
11
|
|
|
$
|
69
|
|
Item 2:
|
Management's Discussion and Analysis of Financial Condition and Results of Operations
|
|
Three Months Ended
March 31, 2016 |
|
Three Months Ended
March 31, 2015 |
|
|
|
|
||||||||||||||
|
As Reported
|
|
Exchange Rate Effect
(1)
|
|
FX-Neutral
(2)
|
|
As Reported
|
|
As Reported Percent Change
|
|
FX-Neutral Percent Change
|
||||||||||
|
(In millions, except percentage changes)
|
||||||||||||||||||||
GMV
(3)
:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Marketplace
|
$
|
19,581
|
|
|
$
|
(624
|
)
|
|
$
|
20,205
|
|
|
$
|
19,476
|
|
|
1
|
%
|
|
4
|
%
|
StubHub
|
869
|
|
|
(1
|
)
|
|
870
|
|
|
675
|
|
|
29
|
%
|
|
29
|
%
|
||||
Total GMV
|
$
|
20,450
|
|
|
$
|
(625
|
)
|
|
$
|
21,075
|
|
|
$
|
20,151
|
|
|
1
|
%
|
|
5
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net transaction revenues:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Marketplace
|
$
|
1,500
|
|
|
$
|
(44
|
)
|
|
$
|
1,544
|
|
|
$
|
1,536
|
|
|
(2
|
)%
|
|
1
|
%
|
StubHub
|
177
|
|
|
—
|
|
|
177
|
|
|
132
|
|
|
34
|
%
|
|
34
|
%
|
||||
Total net transaction revenues
|
1,677
|
|
|
(44
|
)
|
|
1,721
|
|
|
1,668
|
|
|
1
|
%
|
|
3
|
%
|
||||
Marketing services and other revenues:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Marketplace
|
274
|
|
|
(5
|
)
|
|
279
|
|
|
235
|
|
|
17
|
%
|
|
19
|
%
|
||||
Classifieds
|
186
|
|
|
(4
|
)
|
|
190
|
|
|
162
|
|
|
15
|
%
|
|
17
|
%
|
||||
Corporate and other
|
—
|
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
**
|
|
|
**
|
|
||||
Total marketing services and other revenues
|
460
|
|
|
(9
|
)
|
|
469
|
|
|
393
|
|
|
17
|
%
|
|
19
|
%
|
||||
Total net revenues
|
$
|
2,137
|
|
|
$
|
(53
|
)
|
|
$
|
2,190
|
|
|
$
|
2,061
|
|
|
4
|
%
|
|
6
|
%
|
|
(1)
|
We define exchange rate effect as the year-over-year impact of foreign currency movements using prior period foreign currency rates applied to current year transactional currency amounts.
|
(2)
|
We define FX-Neutral Gross Merchandise Volume as Gross Merchandise Volume minus the exchange rate effect. We define the non-GAAP financial measures of FX-Neutral net revenue as net revenue minus the exchange rate effect.
|
(3)
|
We define Gross Merchandise Volume (“GMV”) as the total value of all successfully closed transactions between users on our Marketplace and StubHub platforms during the applicable period regardless of whether the buyer and seller actually consummated the transaction. We believe that GMV provides a useful measure of the overall volume of closed transactions that flow through our platforms in a given period, notwithstanding the inclusion in GMV of closed transactions that are not ultimately consummated.
|
|
Three Months Ended March 31,
|
||||||
|
2016
|
|
2015
|
||||
|
(In millions)
|
||||||
Net Revenues by Type:
|
|
|
|
||||
Net transaction revenues:
|
|
|
|
||||
Marketplace
|
$
|
1,500
|
|
|
$
|
1,536
|
|
StubHub
|
177
|
|
|
132
|
|
||
Total net transaction revenues
|
1,677
|
|
|
1,668
|
|
||
Marketing services and other revenues:
|
|
|
|
|
|||
Marketplace
|
274
|
|
|
235
|
|
||
Classifieds
|
186
|
|
|
162
|
|
||
Corporate and other
|
—
|
|
|
(4
|
)
|
||
Total marketing services and other revenues
|
460
|
|
|
393
|
|
||
Total net revenues
|
$
|
2,137
|
|
|
$
|
2,061
|
|
|
|
|
|
||||
Net Revenues by Geography:
|
|
|
|
||||
U.S.
|
$
|
909
|
|
|
$
|
864
|
|
International
|
1,228
|
|
|
1,197
|
|
||
Total net revenues
|
$
|
2,137
|
|
|
$
|
2,061
|
|
|
Three Months Ended March 31,
|
|
Percent
|
|||||||
|
2016
|
|
2015
|
|
Change
|
|||||
|
(In millions, except percentage changes)
|
|||||||||
Supplemental Operating Data:
|
|
|
|
|
|
|||||
GMV:
|
|
|
|
|
|
|||||
Marketplace
|
$
|
19,581
|
|
|
$
|
19,476
|
|
|
1
|
%
|
StubHub
|
869
|
|
|
675
|
|
|
29
|
%
|
||
Total GMV
|
$
|
20,450
|
|
|
$
|
20,151
|
|
|
1
|
%
|
|
|
|
|
|
|
|||||
Transaction take rate:
|
|
|
|
|
|
|||||
Marketplace
(1)
|
7.66
|
%
|
|
7.89
|
%
|
|
(0.23
|
)%
|
||
StubHub
(2)
|
20.37
|
%
|
|
19.56
|
%
|
|
0.81
|
%
|
||
Total transaction take rate
(3)
|
8.20
|
%
|
|
8.28
|
%
|
|
(0.08
|
)%
|
|
|
Three Months Ended
|
||||||||||||||
|
March 31
|
|
June 30
|
|
September 30
|
|
December 31
|
||||||||
|
(In millions, except percentage changes)
|
||||||||||||||
2014
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net revenues
|
$
|
2,149
|
|
|
$
|
2,168
|
|
|
$
|
2,150
|
|
|
$
|
2,323
|
|
Percent change from prior quarter
|
(6
|
)%
|
|
1
|
%
|
|
(1
|
)%
|
|
8
|
%
|
||||
2015
|
|
|
|
|
|
|
|
||||||||
Net revenues
|
$
|
2,061
|
|
|
$
|
2,110
|
|
|
$
|
2,099
|
|
|
$
|
2,322
|
|
Percent change from prior quarter
|
(11
|
)%
|
|
2
|
%
|
|
(1
|
)%
|
|
11
|
%
|
||||
2016
|
|
|
|
|
|
|
|
||||||||
Net revenues
|
$
|
2,137
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||
Percent change from prior quarter
|
(8
|
)%
|
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
Three Months Ended
March 31, |
|
Change from
2015 to 2016 |
|||||||||||
|
2016
|
|
2015
|
|
in Dollars
|
|
in %
|
|||||||
|
(In millions, except percentages)
|
|||||||||||||
Cost of net revenues
|
$
|
477
|
|
|
$
|
411
|
|
|
$
|
66
|
|
|
16
|
%
|
As a percentage of net revenues
|
22.3
|
%
|
|
19.9
|
%
|
|
|
|
|
|
|
|
Three Months Ended
March 31, |
|
Change from
2015 to 2016 |
|||||||||||
|
2016
|
|
2015
|
|
in Dollars
|
|
in %
|
|||||||
|
(In millions, except percentage changes)
|
|||||||||||||
Sales and marketing
|
$
|
538
|
|
|
$
|
519
|
|
|
$
|
19
|
|
|
4
|
%
|
Product development
|
239
|
|
|
221
|
|
|
18
|
|
|
8
|
%
|
|||
General and administrative
|
209
|
|
|
302
|
|
|
(93
|
)
|
|
(31
|
)%
|
|||
Provision for transaction losses
|
52
|
|
|
69
|
|
|
(17
|
)
|
|
(25
|
)%
|
|||
Amortization of acquired intangible assets
|
8
|
|
|
10
|
|
|
(2
|
)
|
|
(20
|
)%
|
|||
Interest and other, net
|
(23
|
)
|
|
10
|
|
|
(33
|
)
|
|
(330
|
)%
|
|
Three Months Ended
March 31, |
||||
|
2016
|
|
2015
|
||
Sales and marketing
|
25
|
%
|
|
25
|
%
|
Product development
|
11
|
%
|
|
11
|
%
|
General and administrative
|
10
|
%
|
|
15
|
%
|
Provision for transaction losses
|
2
|
%
|
|
3
|
%
|
Amortization of acquired intangible assets
|
—
|
%
|
|
—
|
%
|
Interest and other, net
|
(1
|
)%
|
|
—
|
%
|
|
Three Months Ended
March 31, |
||||||
|
2016
|
|
2015
|
||||
|
(In millions, except percentages)
|
||||||
Provision for income taxes
|
$
|
109
|
|
|
$
|
90
|
|
Effective tax rate
|
18
|
%
|
|
17
|
%
|
|
Three Months Ended March 31,
|
||||||
|
2016
|
|
2015
|
||||
|
(In millions)
|
||||||
Net cash provided by (used in):
|
|
|
|
||||
Continuing operating activities
|
$
|
641
|
|
|
$
|
501
|
|
Continuing investing activities
|
(1,075
|
)
|
|
(498
|
)
|
||
Continuing financing activities
|
1,222
|
|
|
(993
|
)
|
||
Effect of exchange rates on cash and cash equivalents
|
66
|
|
|
(297
|
)
|
||
Net increase in cash and cash equivalents - discontinued operations
|
—
|
|
|
432
|
|
||
Net increase (decrease) in cash and cash equivalents
|
$
|
854
|
|
|
$
|
(855
|
)
|
Item 3:
|
Quantitative and Qualitative Disclosures About Market Risk
|
|
Fair Value Asset/(Liability)
|
|
Fair Value Sensitivity
(1)
|
||||
|
(In millions)
|
||||||
Foreign exchange contracts - Cash flow hedges
|
$
|
42
|
|
|
$
|
(48
|
)
|
Marketable Securities
|
$
|
1,132
|
|
|
$
|
(226
|
)
|
|
Item 4:
|
Controls and Procedures
|
Item 1:
|
Legal Proceedings
|
Item 1A:
|
Risk Factors
|
•
|
ability to attract, retain and engage buyers and sellers;
|
•
|
volume of transactions and price and selection of goods;
|
•
|
trust in the seller and the transaction;
|
•
|
customer service;
|
•
|
brand recognition;
|
•
|
community cohesion, interaction and size;
|
•
|
website, mobile platform and application ease-of-use and accessibility;
|
•
|
system reliability and security;
|
•
|
reliability of delivery and payment, including customer preference for fast delivery and free shipping and returns;
|
•
|
level of service fees; and
|
•
|
quality of search tools.
|
•
|
expenses associated with localizing our products and services and customer data, including offering customers the ability to transact business in the local currency and adapting our products and services to local preferences (e.g., payment methods) with which we may have limited or no experience;
|
•
|
trade barriers and changes in trade regulations;
|
•
|
difficulties in developing, staffing, and simultaneously managing a large number of varying foreign operations as a result of distance, language, and cultural differences;
|
•
|
stringent local labor laws and regulations;
|
•
|
credit risk and higher levels of payment fraud;
|
•
|
profit repatriation restrictions, foreign currency exchange restrictions or extreme fluctuations in foreign currency exchange rates for a particular currency;
|
•
|
political or social unrest, economic instability, repression, or human rights issues;
|
•
|
geopolitical events, including natural disasters, public health issues, acts of war, and terrorism;
|
•
|
import or export regulations;
|
•
|
compliance with U.S. laws such as the Foreign Corrupt Practices Act, and foreign laws prohibiting corrupt payments to government officials, as well as U.S. and foreign laws designed to combat money laundering and the financing of terrorist activities;
|
•
|
antitrust and competition regulations;
|
•
|
potentially adverse tax developments and consequences;
|
•
|
economic uncertainties relating to sovereign and other debt;
|
•
|
different, uncertain, or more stringent user protection, data protection, privacy, and other laws;
|
•
|
risks related to other government regulation or required compliance with local laws;
|
•
|
national or regional differences in macroeconomic growth rates;
|
•
|
local licensing and reporting obligations; and
|
•
|
increased difficulties in collecting accounts receivable.
|
•
|
our products and services continue to expand in scope and complexity;
|
•
|
we continue to expand into new businesses, including through acquisitions; and
|
•
|
the universe of patent owners who may claim that we, any of the companies that we have acquired, or our customers infringe their patents, and the aggregate number of patents controlled by such patent owners, continues to increase.
|
•
|
Some jurisdictions, in particular jurisdictions outside the United States, prohibit the resale of event tickets (anti-scalping laws) at prices above the face value of the tickets or at all, or highly regulate the resale of tickets, and new laws and regulations or changes to existing laws and regulations imposing these or other restrictions could limit or inhibit our ability to operate, or our users’ ability to continue to use, our tickets business.
|
•
|
Regulatory agencies or courts may claim or hold that we are responsible for ensuring that our users comply with these laws and regulations.
|
•
|
In many jurisdictions, our tickets business depends on commercial partnerships with event organizers or licensed ticket vendors, which we must develop and maintain on acceptable terms for our tickets business to be successful.
|
•
|
Our tickets business is subject to seasonal fluctuations and the general economic and business conditions that impact the sporting events and live entertainment industries.
|
•
|
A portion of the tickets inventory sold by sellers on the StubHub platform is processed by StubHub in digital form. Systems failures, security breaches, theft or other disruptions that result in the loss of such sellers’ tickets inventory, could result in significant costs and a loss of consumer confidence in our tickets business.
|
•
|
Lawsuits alleging a variety of causes of actions have in the past, and may in the future, be filed against StubHub and eBay by venue owners, competitors, ticket buyers, and unsuccessful ticket buyers. Such lawsuits could result in significant costs and require us to change our business practices in ways that negatively affect our tickets business.
|
•
|
Our tickets business also faces significant competition from a number of sources, including ticketing service companies, event organizers, ticket brokers, and online and offline ticket resellers. Some ticketing service companies, event organizers, and professional sports teams have begun to issue event tickets through various forms of electronic
|
•
|
Some sports teams have threatened to revoke the privileges of season ticket owners if they resell their tickets through a platform that is not affiliated with, or approved by, such sports teams. In March 2015, StubHub filed suit against Ticketmaster and the Golden State Warriors, alleging antitrust and various state law violations arising out of the defendants’ restrictive ticketing practices, which include prohibiting the resale of Warriors tickets on StubHub or any other non-Ticketmaster secondary exchange.
|
•
|
In Turkey, local prosecutors and courts are investigating our liability for allegedly illegal actions by users of our Turkish Marketplace business (GittiGidiyor). In accordance with local law and custom, they have indicted one or more members of the board of directors of our local Turkish subsidiary. We intend to defend vigorously against any such actions and a growing number of these cases have been dismissed by the relevant courts.
|
•
|
In August 2012, we were informed that U.S. listings of footwear with religious imagery were visible on our local Indian site and we immediately removed these listings. In September 2012, a criminal case was registered against us in India in regard to these listings, and we are challenging the prosecution of this case.
|
•
|
requiring us to use a significant portion of our cash flow from operations and other available cash to service our indebtedness, thereby reducing the amount of cash available for other purposes, including capital expenditures and acquisitions;
|
•
|
our indebtedness and leverage may increase our vulnerability to downturns in our business, to competitive pressures, and to adverse changes in general economic and industry conditions;
|
•
|
adverse changes in the ratings assigned to our debt securities by credit rating agencies will likely increase our borrowing costs;
|
•
|
our ability to obtain additional financing for working capital, capital expenditures, acquisitions, share repurchases or other general corporate and other purposes may be limited; and
|
•
|
our flexibility in planning for, or reacting to, changes in our business and our industry may be limited.
|
•
|
repatriate funds to the United States at substantial tax cost;
|
•
|
seek additional financing in the debt or equity markets;
|
•
|
refinance or restructure all or a portion of our indebtedness;
|
•
|
sell selected assets; or
|
•
|
reduce or delay planned capital or operating expenditures.
|
•
|
the potential loss of key customers, merchants, vendors and other key business partners of the companies we acquire, or dispose of, following and continuing after announcement of our transaction plans;
|
•
|
declining employee morale and retention issues affecting employees of companies that we acquire or dispose of, which may result from changes in compensation, or changes in management, reporting relationships, future prospects or the direction of the acquired or disposed business;
|
•
|
difficulty making new and strategic hires of new employees;
|
•
|
diversion of management time and a shift of focus from operating the businesses to the transaction, and in the case of an acquisition, integration and administration;
|
•
|
the need to provide transition services to a disposed of company, which may result in the diversion of resources and focus;
|
•
|
the need to integrate the operations, systems (including accounting, management, information, human resource and other administrative systems), technologies, products and personnel of each acquired company, which is an inherently risky and potentially lengthy and costly process;
|
•
|
the inefficiencies and lack of control that may result if such integration is delayed or not implemented, and unforeseen difficulties and expenditures that may arise as a result;
|
•
|
the need to implement or improve controls, procedures and policies appropriate for a larger public company at companies that prior to acquisition may have lacked such controls, procedures and policies or whose controls, procedures and policies did not meet applicable legal and other standards;
|
•
|
risks associated with our expansion into new international markets;
|
•
|
derivative lawsuits resulting from the acquisition or disposition;
|
•
|
liability for activities of the acquired or disposed of company before the transaction, including intellectual property and other litigation claims or disputes, violations of laws, rules and regulations, commercial disputes, tax liabilities and other known and unknown liabilities and, in the case of dispositions, liabilities to the acquirors of those businesses under contractual provisions such as representations, warranties and indemnities;
|
•
|
the potential loss of key employees following the transaction;
|
•
|
the acquisition of new customer and employee personal information by us or a third party acquiring assets or businesses from us, which in and of itself may require regulatory approval and or additional controls, policies and procedures and subject us to additional exposure; and
|
•
|
our dependence on the acquired business’ accounting, financial reporting, operating metrics and similar systems, controls and processes and the risk that errors or irregularities in those systems, controls and processes will lead to errors in our consolidated financial statements or make it more difficult to manage the acquired business.
|
Item 2:
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
Period Ended
|
|
Total Number of
Shares Purchased |
|
Average Price Paid
per Share |
|
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, 2016
|
|
10,020,640
|
|
|
$
|
24.78
|
|
|
10,020,640
|
|
|
$
|
1,587,915,175
|
|
February 29, 2016
|
|
32,231,928
|
|
|
$
|
23.32
|
|
|
32,231,928
|
|
|
$
|
836,234,777
|
|
March 31, 2016
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
836,234,777
|
|
|
|
42,252,568
|
|
|
|
|
42,252,568
|
|
|
|
|
(1)
|
In January 2015, our Board authorized an additional
$2 billion
stock repurchase program, with no expiration from the date of authorization. In June 2015, our Board authorized an additional
$1 billion
stock repurchase program, with no expiration from the date of authorization. The stock repurchase programs are intended to programmatically offset the impact of dilution from our equity compensation programs and, in addition, subject to market conditions and other factors, to make opportunistic repurchases of our common stock to reduce outstanding share count. Any share repurchases under our stock repurchase programs may be made through open market transactions, block trades, privately negotiated transactions (including accelerated share repurchase transactions) or other means at times and in such amounts as management deems appropriate and will be funded from our working capital or other financing alternatives.
|
Item 3:
|
Defaults Upon Senior Securities
|
Item 4:
|
Mine Safety Disclosures
|
Item 5:
|
Other Information
|
Item 6:
|
Exhibits
|
|
|
eBay Inc.
|
|
|
|
Principal Executive Officer:
|
|
|
|
|
|
|
|
By:
|
/s/ Devin N. Wenig
|
|
|
|
Devin N. Wenig
|
|
|
|
President and Chief Executive Officer
|
Date:
|
April 26, 2016
|
|
|
|
|
Principal Financial Officer:
|
|
|
|
|
|
|
|
By:
|
/s/ Scott F. Schenkel
|
|
|
|
Scott F. Schenkel
|
|
|
|
Senior Vice President, Chief Financial Officer
|
Date:
|
April 26, 2016
|
|
|
|
|
Principal Accounting Officer:
|
|
|
|
|
|
|
|
By:
|
/s/ Brian J. Doerger
|
|
|
|
Brian J. Doerger
|
|
|
|
Vice President, Chief Accounting Officer
|
Date:
|
April 26, 2016
|
|
|
Exhibit 3.01(1)
|
|
Amended and Restated Bylaws of Registrant, effective March 15, 2016.
|
Exhibit 4.01(2)
|
|
Officers’ Certificate dated February 29, 2016.
|
Exhibit 4.02(3)
|
|
Officers’ Certificate dated March 9, 2016.
|
Exhibit 4.03(2)
|
|
Form of 6.00% Note due 2056.
|
Exhibit 4.04(3)
|
|
Form of 2.500% Note due 2018.
|
Exhibit 4.05(3)
|
|
Form of 3.800% Note due 2022.
|
Exhibit 10.01+
|
|
Amended and Restated eBay Inc. Change in Control Severance Plan for Key Employees.
|
Exhibit 10.02+
|
|
Amended and Restated eBay Inc. SVP and Above Standard Severance Plan.
|
Exhibit 10.03+
|
|
Offer letter dated September 2, 2014 between Registrant and Steve Fisher.
|
Exhibit 10.04+
|
|
Offer letter dated April 2, 2015 between Registrant and Marie Oh Huber.
|
Exhibit 10.05+
|
|
Offer letter dated April 3, 2015 between Registrant and Harry Lawton.
|
Exhibit 10.06+
|
|
Form of Performance Based Restricted Stock Unit Award Agreement under Registrant's 2008 Equity Incentive Award Plan.
|
Exhibit 12.01
|
|
Statement regarding computation of ratio of earnings to fixed charges.
|
Exhibit 31.01
|
|
Certification of Registrant’s Chief Executive Officer, as required by Section 302 of the Sarbanes-Oxley Act of 2002.
|
Exhibit 31.02
|
|
Certification of Registrant’s Chief Financial Officer, as required by Section 302 of the Sarbanes-Oxley Act of 2002.
|
Exhibit 32.01
|
|
Certification of Registrant’s Chief Executive Officer, as required by Section 906 of the Sarbanes-Oxley Act of 2002.
|
Exhibit 32.02
|
|
Certification of Registrant’s Chief Financial Officer, as required by Section 906 of the Sarbanes-Oxley Act of 2002.
|
101.INS
|
|
XBRL Instance Document
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
1 Year eBay Chart |
1 Month eBay Chart |
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