eBay(EBAY) - 2023 Q3 - Quarterly Report

Financial Performance - For the three months ended September 30, 2023, net revenues increased to $2,500 million, up from$ 2,380 million in the same period of 2022, representing a growth of 5.04%[16] - Gross profit for the nine months ended September 30, 2023, was $5,427 million, compared to$ 5,286 million for the same period in 2022, reflecting an increase of 2.67%[16] - The company reported a net income of $1,305 million for the three months ended September 30, 2023, compared to a net loss of$ 69 million in the same period of 2022[18] - Basic income per share from continuing operations for the three months ended September 30, 2023, was $2.47, a significant improvement from a loss of$ 0.13 per share in the same period of 2022[16] - eBay reported a net income of $2,043 million for the nine months ended September 30, 2023, compared to a net loss of$ 1,941 million in the same period of 2022[22] - Net income for Q3 2023 was $1,305 million, compared to a net loss of$ 69 million in Q3 2022, marking a significant turnaround[47] - Total net revenues for Q3 2023 reached $2,500 million, a 5% increase from$ 2,380 million in Q3 2022[57] - U.S. revenues for Q3 2023 were $1,259 million, up from$ 1,187 million in Q3 2022, reflecting a growth of 6%[57] Assets and Liabilities - Total assets as of September 30, 2023, amounted to $21,184 million, an increase from$ 20,850 million as of December 31, 2022[13] - Total liabilities decreased to $15,285 million as of September 30, 2023, down from$ 15,697 million as of December 31, 2022[13] - The company’s cash and cash equivalents increased to $2,550 million as of September 30, 2023, compared to$ 2,154 million as of December 31, 2022[13] - eBay's total stockholders' equity increased to $5,899 million as of September 30, 2023, compared to$ 4,853 million a year earlier[20] - As of September 30, 2023, total debt amounted to $7.723 billion, a decrease from$ 8.871 billion as of December 31, 2022, reflecting a reduction of approximately 13%[122] Cash Flow and Investments - The company generated net cash provided by continuing operating activities of $2,308 million for the nine months ended September 30, 2023, up from$ 1,941 million in the prior year[22] - Cash, cash equivalents, and restricted cash at the end of the period stood at $3,009 million, an increase from$ 2,106 million at the end of September 2022[23] - eBay's cash flows from investing activities yielded a net cash inflow of $520 million for the nine months ended September 30, 2023, compared to$ 3,755 million in the same period of 2022[22] - The company repurchased $1,160 million of common stock during the nine months ended September 30, 2023, compared to$ 3,031 million in the same period of 2022[20] - Cash flow from continuing operating activities was $862 million during the three months ended September 30, 2023, compared to$ 735 million in the same period in 2022[187] Expenses and Costs - Operating expenses for the three months ended September 30, 2023, totaled $1,340 million, up from$ 1,165 million in the same period of 2022, indicating an increase of 15.03%[16] - The effective interest expense for senior notes was approximately $65 million for the three months ended September 30, 2023, compared to$ 54 million for the same period in 2022, representing an increase of about 20%[131] - Total stock-based compensation expense for the three months ended September 30, 2023, was $144 million, an increase from$ 118 million in the same period of 2022[168] - Restructuring charges amounted to $42 million, primarily related to workforce reduction and exit costs[179] Equity Investments - The company reported a gain on equity investments of$ 1,212 million for the three months ended September 30, 2023, compared to a loss of $593 million in the same period of 2022[16] - The total estimated fair value of investments classified as available-for-sale debt securities and restricted cash is$ 2,886 million as of September 30, 2023[65] - The total equity investments increased from $3,377 million as of December 31, 2022, to$ 4,633 million as of September 30, 2023[66] - The equity investment in Adevinta is valued at $4,023 million as of September 30, 2023, reflecting an unrealized gain of$ 1,367 million for the quarter[71] - For the three months ended September 30, 2023, net gains on equity investments were $1,321 million, a significant recovery from a loss of$ 566 million in the same period of 2022[85] Legal and Regulatory Matters - The company is under examination by tax authorities for the 2010 to 2021 tax years, with potential adjustments to gross unrecognized tax benefits being reasonably possible in the next 12 months[171] - Legal and regulatory proceedings are inherently unpredictable, and unfavorable outcomes could materially impact the company's operating results or financial condition[149] - The company is responding to inquiries from the U.S. Department of Justice regarding potential liability for products sold on its Marketplace platforms, with a civil complaint filed against it alleging violations of environmental laws[154] - The company expects to incur significant costs related to ongoing legal disputes and regulatory inquiries, which could divert operational resources and impact business practices[152] Market and Operational Insights - The company experienced reduced traffic due to geopolitical events, inflationary pressure, and lower consumer confidence, impacting discretionary spending[184] - The take rate for Q3 2023 was 13.90%, up from 13.43% in Q3 2022, indicating improved monetization[199] - Gross Merchandise Volume (GMV) for Q3 2023 was $17,991 million, a 2% increase from$ 17,715 million in Q3 2022[199] - Operating margin decreased to 18.2% for the three months ended September 30, 2023, down from 23.9% in the same period in 2022[186]