l eBay's Korean business is reported as a discontinuing operation

Revenue was $ 2.7 billion, up 14% year-over-year, or 11% year-over-year excluding the impact of exchange rate changes .

Total transaction volume was US$22.1 billion, down 7% year-on-year. Excluding the impact of exchange rate changes, it was down 11% year-on-year .

GAAP diluted earnings per share from continuing operations were $0.43 and $0.99 , respectively .

The operating profit margins calculated based on and not based on GAAP were 27.4% and 32.8%, respectively .

Returned $ 1.6 billion to shareholders in the second quarter , including $1.5 billion in share repurchases and $ 121 million in cash dividends

Announced an agreement to sell 80.01% of eBay's Korean business to Emart for approximately $3 billion

On June 24, the company completed the sale of its Classifieds business to Adevinta for $13.3 billion, including $2.5 billion in cash and nearly 540 million Adevinta shares (equivalent to a 44% ownership stake).

l Reached an agreement to sell approximately 135 million of eBay's Adevinta shares to Permira for more than $2.4 billion, reducing eBay's stake in Adevinta to 33%

The Board of Directors has increased the total value of its stock repurchase authorization by an additional $3 billion

August 12, 2021--- eBay Inc. (NASDAQ: EBAY), a global commerce leader connecting hundreds of millions of buyers and sellers around the world, today announced financial results for the second quarter ended June 30, 2021.

"Today, I'm pleased to report that our company delivered another strong quarter. All key business metrics met or exceeded expectations on a comparable basis, with revenue growth driven by growth in managed payments and advertising," said Jamie Iannone, eBay's chief executive officer. "We achieved several important milestones during the quarter, including the divestiture of eBay's Classifieds business - a transaction that has already delivered exceptional value to shareholders - and the announcement of the sale of our South Korean business. We are simplifying our portfolio and growing our core businesses while delivering significant value to shareholders."

“We remain relentless in our commitment to harnessing the power of next-generation technologies to accelerate product innovation and create a more seamless experience for sellers," Iannone continued. "We are delivering innovative category experiences for buyers and rapidly advancing our quest to become the best global marketplace."

Second Quarter Financial Highlights

l Revenue was $2.7 billion, up 14% year-on-year, and up 11% year-on-year excluding the impact of exchange rate changes.

Total transaction volume (GMV) was US $ 22.1 billion, down 7% year-on-year. Excluding the impact of exchange rate changes, it was down 11% year-on-year.

GAAP net income from continuing operations was $294 million, or $0.43 per diluted share .

l Net income from continuing operations not calculated based on U.S. GAAP was $675 million, or $0.99 per diluted share.

Operating cash flow from continuing operations was $1.0 billion, and free cash flow from continuing operations was $910 million.

The number of active buyers decreased by 2% in the year, and the total number of active buyers worldwide reached 159 million .

The number of active sellers increased by 5% in the year, and the total number of active sellers worldwide reached 19 million.

l announced the pricing of its $2.5 billion offering of senior unsecured notes on May 3, 2021.

Background information on the earnings release

On June 24, 2021, eBay Inc. announced that it had reached an agreement for Emart to acquire eBay Inc.’s Korean business, and subsequently determined that the business met the accounting standards for discontinued operations. The restatement of the financial statements was released on Form 8-K on July 13, 2021.

To facilitate comparison with previously provided financial guidance, eBay provided a revision of the metrics in its April 28, 2021 guidance (see table below) that excludes the impact of its Korean business.

Business Highlights

eBay Inc. announced that it has completed the transfer of its classifieds business to Adevinta in exchange for $2.5 billion in cash and 44% of Adevinta’s equity, equivalent to approximately 540 million shares. With the completion of the transfer transaction, eBay Inc. updated its 2021 capital allocation plan, increasing its estimated share repurchase amount from $2 billion to $5 billion.

In July, eBay reached an agreement with Permi Capital to sell approximately 135 million Adevinta shares for an estimated total consideration of more than $2.4 billion. The sale reduced eBay's stake in Adevinta to 33% and fulfilled eBay's commitment to Austrian regulators as a condition of the sale of the classifieds business. The transaction included eBay's announced sale of 125 million Adevinta shares and Permi Capital's option to purchase approximately 10 million additional Adevinta shares - an option that Permi Capital has exercised.

eBay announced that it has reached an agreement with E-Mart on its acquisition of eBay's Korean business. Under the transaction, eBay will sell 80.01% of its shares in the Korean business, with total cash proceeds reaching 3.44 trillion won (about 3 billion US dollars).

eBay Inc. has announced the appointments of Steve Priest as chief financial officer and Stefanie Jay as chief commercial and strategy officer.

Revenue Initiatives

eBay continues to scale managed payments globally, launching a new experience for sellers across all marketplaces. In the second quarter, 71% of transactions on the global platform were processed through managed payments, and by the end of the quarter, more than 80%. At the end of the second quarter, eBay had more than 13 million global sellers migrated to managed payments.

Expanded use of managed payments enabled eBay to further reduce seller unpaid items in the second quarter, with 99% of fixed-price transactions being paid upfront.

In the second quarter, the Promoted Listings paid promotion service achieved revenue of nearly $224 million, a year-on-year increase of 14%, and a year-on-year increase of 8% excluding the impact of exchange rate changes .

l eBay Advertising launched the "Automated Promoted Listings Campaigns" feature for promoted listings, which uses rule-based technology to help sellers automatically promote newly listed products and automatically adjust advertising rates to remain competitive. This makes it easier for sellers to display their products to buyers, increase the chances of their listed products being seen by buyers, and drive overall sales.

Technology-oriented platform reshaping

eBay launched its Authenticity Guarantee program for handbags over $500 in the U.S. and expanded its Authenticity Guarantee program for sneakers to the U.K., Canada and Australia.

eBay announced the addition of an escrow service for its marketplace payment service for luxury watches over $10,000. This new payment option will allow buyers and sellers to more easily pay through a trusted third party, Escrow.com, to keep funds safe until the transaction is completed.

During the quarter, eBay enhanced the auto parts shopping experience for buyers by launching a model finder for motorcycle parts in Germany and the UK. The company also expanded the My Garage feature to Canada, Italy, France and Spain.

l eBay has updated its policies to allow customers to buy and sell non-fungible tokens (NFTs) on its platform, with inventory provided by trusted sellers who meet eBay’s high standards, covering categories such as trading cards, music, entertainment and art.

eBay Inc. began offering its Terapeak product search service free of charge to all Seller Hub users on its main sites, providing sellers with market intelligence to help them decide what to sell, when to sell, where to sell and at what price.

eBay has expanded its standard envelope shipping service to postcards, stamps, coins and banknotes, providing sellers with a safer and more cost-effective way to ship items. eBay has also updated the seller listing page to show buyers all the shipping services offered by the seller, making it easy for buyers to select their preferred carrier, shipping cost and estimated delivery date.

Influence

As part of eBay 's commitment to keeping consumers safe, the company launched the Regulatory Portal, empowering selected, trusted authorities around the world to efficiently report illegal or unsafe listings from sellers for prompt removal.

eBay released its annual Diversity, Equity, and Inclusion report, which highlights the company’s efforts and commitment to being a diverse, truly fair and radically inclusive place to work, grow and trade.

eBay released its annual Impact Report, which highlights its efforts to help small businesses grow their online businesses, advance climate action plans, and connect buyers and sellers as a supportive global community during the COVID-19 pandemic.

eBay released a United States Small Online Business Report detailing how the company helped small businesses quickly adapt to the changing environment and connect with shoppers around the world during the early months of the pandemic.

As entrepreneurs and start-ups across the UK face cash flow constraints caused by the pandemic, eBay has launched Capital for eBay Business Sellers in the UK to help small businesses rebuild by connecting them with much-needed funding .

In the second quarter, eBay for Charity contributed $35.6 million worldwide, a 16% year-over-year increase .

Other financial and operating results

l Operating profit margin: The operating profit margin calculated based on US GAAP in the second quarter of 2021 decreased to 27.4%, compared with 32.7% in the same period last year. The operating profit margin not calculated based on US GAAP in the second quarter of 2021 decreased to 32.8%, compared with 39.0% in the same period last year.

Taxes: The effective tax rate for continuing operations calculated on a GAAP basis was 26.6% for the second quarter of 2021 , compared to 27.0% for the second quarter of 2020. The effective tax rate for continuing operations not calculated on a GAAP basis was 17.5% for the second quarter of 2021, compared to 16.4% for the second quarter of 2020.

l Cash flow: eBay's operating cash flow from continuing operations in the second quarter of 2021 was US$1 billion, and free cash flow from continuing operations was US$910 million.

l Capital Return: eBay repurchased approximately $1.5 billion of common stock in the second quarter of 2021, with a total of approximately 24 million shares repurchased. As of June 30, 2021, the total value of the remaining authorized repurchase shares of eBay was $4.2 billion. In the second quarter of 2021, eBay also distributed $121 million in cash dividends.

l Cash, cash equivalents and non-equity investments: As of June 30, 2021, eBay's cash, cash equivalents and non-equity investment portfolio totaled US$7.6 billion.

Business Outlook

eBay Inc. provides the following guidance for continuing operations for the third quarter of 2021:

Net revenue is expected to be between $2.42 billion and $2.47 billion, with an organic growth rate of 6% to 8% excluding the impact of currency fluctuations.

GAAP diluted earnings per share from continuing operations are expected to be in the range of $0.64 to $0.68 .

Non-GAAP diluted earnings per share from continuing operations are expected to be in the range of $0.86 to $0.90 .

Declare a dividend

eBay Inc.’s Board of Directors has declared a cash dividend of $0.18 per share of common stock, payable on September 17, 2021 to shareholders of record as of September 1, 2021.

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