Item 1. BUSINESS

Unless otherwise expressly stated or the context otherwise requires, when we refer to “we,” “our,” “us,” “eBay” or the “Company” in this annual report on Form 10-K, we mean eBay Inc. and its consolidated subsidiaries.

Overview

Founded in 1995 in San Jose, California, eBay Inc. is a global commerce leader that connects people and builds communities to create economic opportunity for all. Our technology empowers millions of buyers and sellers in more than 190 markets around the world, providing everyone the opportunity to grow and thrive. Our Marketplace platforms, including our online marketplace located at www.ebay.com and its localized counterparts, our off-platform businesses in Japan and the United States, and our suite of mobile apps, together, create one of the world's largest and most vibrant marketplaces for discovering great value and unique selection. In 2023, eBay enabled more than $73 billion of gross merchandise volume. For more information about the Company and its global portfolio of online brands, visit www.ebayinc.com.

Our Strategy

As a global commerce leader and third-party marketplace, our technologies and services are designed to provide buyers choice and a breadth of relevant inventory from around the globe, and to enable sellers’ access to eBay’s 132 million buyers worldwide. Our business model and pricing are designed so our business is successful when our sellers are successful. We earn revenue primarily through fees collected on paid sales, inclusive of payment processing and first-party advertising.

eBay’s strategy is to leverage technology to enhance the marketplace experience for our customers to drive growth in Gross Merchandise Volume (“GMV”), while increasing the rate of revenue growth through our advertising initiatives and delivering healthy operating margins. Beginning in 2020, we embarked on a multi-year journey to build more compelling category experiences for enthusiastic consumers, to become the partner of choice for sellers and to strengthen trust in relationships with buyers on our Marketplace platforms. In 2023, we evolved our strategy to focus on reinventing the future of ecommerce for enthusiasts. We derived a majority of GMV in 2023 from the following product categories: parts & accessories, collectibles, fashion, electronics, and home & garden.

Since late 2021, eBay has managed payments for all transactions on our Marketplace platforms, delivering buyers and sellers a simplified end-to-end payments experience. Through managed payments, we are able to provide a frictionless experience for current and next-generation customers, consistent with today’s retail standards. We offer buyers more flexibility and choice in how to pay and offer sellers a more streamlined way to run their businesses.

We are focused on growing our first-party advertising revenue through our suite of Promoted Listings products while reducing our focus on non-strategic, third-party advertising. We currently offer several Promoted Listings products, including: Promoted Listings Standard (a cost-per-acquisition product), Promoted Listings Express (a cost-per-acquisition product for auction listings), Promoted Listings Advanced (a cost-per-click product) and External Promoted Listings (an off-platform advertising product). Through our portfolio of Promoted Listings offerings, we provide sellers with data-driven recommendations to improve their conversion and drive velocity, while testing and building more technology features to drive growth, position eBay as the seller’s platform of choice and surface relevant inventory to buyers.

We have acquired, and also disposed of, a significant number of businesses, technologies, services and products, and we maintain investments in certain businesses. We regularly review and manage our investments to ensure they support eBay’s strategic direction and complement our disciplined approach to value creation, profitability and capital allocation. We expect to continue to evaluate and consider potential strategic transactions as part of our strategy, including business combinations, acquisitions and dispositions of businesses, technologies, services, products and other assets, as well as strategic investments and joint ventures.

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Our Customer Offerings

We provide a number of features for our sellers and buyers that align with our approach to becoming the partner of choice for sellers and building life-long, trusted buyer relationships. These offerings are designed to build trust and confidence on our Marketplace platforms and drive GMV.

To become the partner of choice for sellers, we continuously invest in technology to deliver quality selling experiences and products to grow the seller tools ecosystem. Our new magical listing experience offers an artificial intelligence (“AI”) driven description for all listings across our Marketplace platforms — desktop, mobile and app — reducing the time to list and enhance seller experience. In 2023, we expanded our Promoted Listings offerings to help our sellers drive greater velocity and price realization for their inventory. We also expanded the eBay International Shipping program for United States sellers surfacing millions of listings to buyers across more than 190 countries while removing the friction of international shipping and customs formalities.

To further strengthen our buyers’ confidence and trust in our services, we offer “eBay Money Back Guarantee,” which allows buyers to receive their money back if the item they ordered does not arrive, is faulty or damaged or does not match the listing. eBay Money Back Guarantee covers most items purchased on the eBay Marketplace platform in the United States, the United Kingdom, Germany, Australia, Canada, France, Italy and Spain through a qualifying payment method. In addition, eBay authenticates eligible luxury and collectible items in five categories through “Authenticity Guarantee”, an independent authentication service available in the United States, the United Kingdom, Germany, Australia and Canada. In our parts & accessories category, we focused on fitment to ensure that automotive enthusiasts are able to find the right parts to fit their vehicles by integrating the acquired technical capabilities of MyFitment onto our platforms. We also continue to expand our eBay Refurbished offering, a dedicated destination that brings inventory from pre-selected brands and top rated sellers with standardized condition grading, to meet consumer demand for top products backed by a warranty.

Our Impact and Responsibility

eBay’s purpose is to empower people and create economic opportunity for all through our technology for our global community of users. Every day, people build businesses on our Marketplace platforms. With a low cost of entry for sellers, we offer a highly accessible way for all types of users to interact in a global marketplace that’s inclusive and connects people of all backgrounds. Accordingly, we prioritize our corporate responsibility efforts to impact the areas of economic empowerment and sustainable commerce. Key economic programs include eBay for Charity, the eBay Foundation and our small business enablement efforts, such as our Up & Running Grants program.

eBay for Charity empowers buyers and sellers to support charities around the world. In 2023, eBay for Charity matched donations made to the International Rescue Committee, Team Rubicon, World Central Kitchen, Hawaii Community Foundation and American National Red Cross, and partnered with Homes For Our Troops, GiveLove, Deckaid Inc, Direct Relief and Free The Work. In 2023, nearly $162 million was raised by buyers and sellers to support charities via eBay for Charity.

The eBay Foundation helps to build economically vibrant and thriving communities. During 2023, the eBay Foundation granted more than $19 million through strategic grantmaking and our employee gift-matching program, primarily to support historically excluded entrepreneurs. To date, the eBay Foundation has awarded more than $120 million to more than 1,800 nonprofits.

Recommerce has been an integral part of eBay’s purpose since the Company was founded in 1995. As a pioneer of the circular economy, eBay has created an online space where people can buy and sell pre-owned goods. This helps preserve the world’s natural resources by avoiding a portion of the carbon emissions, water, energy and waste typically used in producing new goods.

eBay has continued to work towards its goal of achieving 100% renewable energy in its operations and data centers by 2025. We have also set Science Based Targets for all three scopes of our emissions. We have set a goal to reduce our scope 1 and scope 2 emissions by 90% by 2030 from a 2019 base year and to reduce value chain (scope 3) emissions from downstream transportation and distribution by 20% in the same timeframe, and we believe we are on track to achieve that goal. In 2023, eBay was ranked in the U.S. Environmental Protection Agency’s Green Power Partnership National Top 100 and Top 30 Tech & Telecom for the fourth year. In 2023, eBay was also recognized for its commitment to sustainability and responsible business by its inclusion in the Dow Jones

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Sustainability World and North American Indices for the fifth straight year. In 2023, eBay also scored an A- on the CDP Climate Change questionnaire.

Financial Information

We measure our footprint in our addressable market according to GMV. GMV consists of the total value of all paid transactions between users on our Marketplace platforms during the applicable period inclusive of shipping fees and taxes. In 2023, we generated $73 billion in GMV, of which approximately 52 percent was generated outside the United States. We believe that GMV provides a useful measure of the overall volume of paid transactions that flow through our Marketplace platforms in a given period.

At the end of 2023, eBay had 132 million active buyers and approximately 2.0 billion live listings globally. The term “active buyer” means, as of any date, all buyer accounts that paid for a transaction on our Marketplace platforms within the previous 12-month period. Buyers may register more than once and, as a result, may have more than one account.

We generate revenue primarily through fees collected on paid sales, inclusive of payment processing and first-party advertising. The majority of our revenue comes from a take rate on the GMV of transactions paid on our Marketplace platforms. We define “take rate” as net revenues divided by GMV.

Our Marketplace platforms are designed to enable our buyers and sellers to leverage our economies of scale and capital investments in sales and marketing, mobile, customer acquisition, technology innovation and customer service.

Competition

We encounter vigorous competition in our business from numerous sources. Our users can list, sell, buy, and pay for similar items through a variety of competing online, mobile and offline channels. These include, but are not limited to, retailers, distributors, liquidators, import and export companies, auctioneers, catalog and mail-order companies, directories, search engines, commerce participants (consumer-to-consumer, business-to-consumer and business-to-business), shopping channels and networks. As our product offerings continue to broaden into new categories of items and new commerce formats, we expect to face additional competition from other online, mobile and offline channels for those new offerings. We compete on the basis of price, product selection and services, and global scale.

For more information regarding competitive factors impacting our business, see the information in “Item 1A: Risk Factors” under the captions “Substantial and increasingly intense competition worldwide in ecommerce may harm our business” and “We could be subject to regulatory or agency investigations and/or court proceedings under unfair competition laws that could adversely impact our business.”

Government Regulation

Government regulation impacts key aspects of our business. In particular, we are subject to laws and regulations that affect the ecommerce industry in many countries where we operate.

Our business is subject to payments reporting requirements for U.S. sellers as a result of federal legislation. During 2021, legislation was passed requiring all businesses that process payments to issue a Form 1099-K for all sellers who receive more than $600 in gross payments in a year, a decrease from the previous reporting threshold of $20,000 and 200 transactions. The Internal Revenue Service (“IRS”) recently announced a second one-year delay of this rule. As a result, Form 1099-Ks for the $600 threshold will be issued beginning in January 2025 for 2024 transactions, subject to potential new federal legislation raising the threshold and/or future IRS action. Tax collection responsibility and the additional costs associated with complex sales and use tax collection, remittance and audit requirements, or reporting, could create additional burdens for buyers and sellers on our websites and mobile platforms.

The EU Digital Services Act (the “DSA”) will begin to be enforced for all online platforms as of mid-February 2024. The DSA imposes legal obligations on online marketplaces operating in Europe, requiring them to verify and ensure the accuracy and disclosure of required information, as well as the safety and authenticity of products posted by third-party merchants. The DSA also enforces new content moderation obligations, notice obligations,

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advertising restrictions and other requirements on digital platforms that will create additional operational burdens and compliance costs for us. Additionally, on October 26, 2023, the United Kingdom’s Online Safety Act (the “Act”) became law. The Act creates requirements around monitoring and handling harmful content and may require us to expend resources to comply with the new regulations.

For more information regarding regulatory risks, see the information in “Item 1A: Risk Factors” under the caption “Our business is subject to extensive and increasing government regulation and oversight, which could adversely impact our business” and “Our business and our sellers and buyers may be subject to evolving sales and other tax regimes in various jurisdictions, which may harm our business.”

Seasonality

We expect transaction activity patterns on our Marketplace platforms to mirror general consumer buying patterns. Please see the additional information in “Item 7: Management’s Discussion and Analysis of Financial Condition and Results of Operations” under the caption “Seasonality.”

Technology

The eBay Marketplace uses a combination of proprietary technologies and services as well as technologies and services provided by others. We have developed intuitive user interfaces; buyer, seller and developer tools; and transaction processing, database and network applications that help enable our users to reliably and securely complete transactions on our sites. Our technology infrastructure simplifies the storage and processing of large amounts of data, eases the deployment and operation of large-scale global products and services and automates much of the administration of large-scale clusters of computers. Our infrastructure has been designed around industry-standard architectures to reduce downtime in the event of outages or catastrophic occurrences.

In support of our commitment to innovation and a better customer experience, we have been on a multi-year evolution to modernize our Marketplace. Through technologies like AI, including generative AI (“GAI”), we are anticipating the needs of buyers, sellers and developers, empowering entrepreneurs looking to grow their business, and making the platform more accessible to everyone. We aim to create highly personalized and inspiring shopping experiences powered by advanced technologies.

For information regarding technology-related risks, see the information in “Item 1A: Risk Factors” under the captions “Our business is subject to online security risks, including security breaches and cyberattacks,” “Systems failures and resulting interruptions in the availability of or degradation in the performance of our websites, applications, products or services could harm our business” and “New laws and increasing levels of regulation in the areas of privacy and protection of user data could harm our business.”

Intellectual Property

We regard the protection of our intellectual property, including our trademarks (particularly those covering the eBay name), patents, copyrights, domain names, trade dress and trade secrets as critical to our success. We aggressively protect our intellectual property rights by relying on federal, state and common law rights in the United States and internationally, as well as a variety of administrative procedures. We also rely on contractual restrictions to protect our proprietary rights in products and services. We routinely enter into confidentiality and invention assignment agreements with our employees and contractors and nondisclosure agreements with parties with whom we conduct business to limit access to and disclosure of our proprietary information.

We routinely pursue registration of our domain names, trademarks and patents in the United States and internationally. Additionally, we have filed U.S. and international patent applications covering certain aspects of our proprietary technology. Effective trademark, copyright, patent, domain name, trade dress and trade secret protection is typically expensive to maintain and may require litigation. We must protect our intellectual property rights and other proprietary rights in an increasing number of jurisdictions, a process that is expensive and time consuming and may not be successful.

We have registered our core brands as trademarks and domain names in the United States and internationally and have in place an active program to continue to secure trademarks and domain names that correspond to our brands in markets of interest. If we are unable to register or protect our trademarks or domain names, we could be adversely affected in any jurisdiction in which our trademarks or domain names are not

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registered or protected. We have licensed in the past, and expect to license in the future, certain of our proprietary rights, such as trademarks, to others.

From time to time, third parties have claimed — and others will likely claim in the future — that we have infringed their intellectual property rights. We are typically involved in a number of such legal proceedings at any time. Please see the information in “Item 3: Legal Proceedings” and in “Item 1A: Risk Factors” under the captions “The listing or sale by our users of certain items, including items that allegedly infringe the intellectual property rights of rights owners, including pirated or counterfeit items, illegal items or items used in an illegal manner, may harm our business,” and “We may be unable to adequately protect or enforce our intellectual property rights and face ongoing allegations by third parties that we are infringing their intellectual property rights.”

Human Capital Management

As of December 31, 2023, we employed approximately 12,300 people globally. Approximately 7,500 of our employees were located in the United States. eBay has robust people-focused programs to attract, support and retain our employees globally. Our recruitment, development, compensation and benefits, wellness, and diversity, equity and inclusion programs are designed to reflect our values, ensure eBay’s competitiveness in the talent market and ensure we support our employees’ well-being. eBay’s management is focused on delivering programs that develop and support our people and connect them with our customers, our community, and each other. Given the importance of eBay’s employees to our overall success, since 2022, the Compensation Committee of the Board of Directors has been responsible for oversight of our human capital management strategy and practices, including activities such as talent recruitment, development and retention, employee engagement, succession planning, and diversity, equity and inclusion.

Culture

eBay’s purpose to connect people and build communities to create economic opportunity for all continues to serve as the backbone of our culture. We bring this purpose to life through five core beliefs that eBayers embody in their day-to-day work. Our Beliefs are:

• Empower our community

• Innovate boldly

• Deliver with impact

• Be for everyone

• Act with integrity

Evolving How We Work

When eBay reopened its offices around the globe we introduced FlexWork, giving employees the opportunity to work in one of three models: onsite, remote, or hybrid. We believe FlexWork provides us the flexibility to attract and hire the right talent and we leverage tools to keep our workforce connected. We are focused on striking the right balance between in-person and remote work as we aim for individual productivity and overall team success. Enhanced in-person collaboration is creating a more dynamic and engaging culture that unlocks innovation and drives better decision making. For employees who are in the office more often, we have maintained programs, such as back-up in-home child and adult care, to support families and caregivers.

Diversity, Equity and Inclusion

Diversity, Equity and Inclusion (“DE&I”) remains a priority for eBay. As a global marketplace bringing together millions of sellers and buyers across more than 190 markets around the world, our purpose is to connect people and build communities to create economic opportunity for all. In our workplace, we bring the best talent from different communities together to learn, grow, thrive and innovate.

Our four DE&I objectives are increasing representation, cultivating a sense of belonging, engaging our communities and allies, and building inclusive technology. Our Communities of Inclusion (“COI”) are the cornerstone of our DE&I efforts and help, welcome and connect eBay employees of many backgrounds and identities from around the world. Through innovative experiential events, and meaningful discussions and connections, our COI aim to encourage growth and create an open, safe and welcoming place for everyone.

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Equity remains at the forefront of our efforts to hire, develop, and retain top talent, enhance corporate performance, and foster a welcoming and inclusive company. We have continued to enhance our people and business processes, leveraging data insights, and providing ongoing learning and development opportunities to employees. We have also continued to enhance our internal governance model to ensure a shared accountability around DE&I throughout the organization.

Well-Being Support for Employees and Their Families

We have continually engaged with our people to support their physical, financial, and mental well-being for them and their families through expanded wellness resources. As part of these efforts, we have continued our focus on ensuring our employees and their families have access to high quality care. In 2023, we introduced a new medical plan in the United States focused on affordability and quality and expanded access to telehealth services. In 2023, we also hosted a global well-being challenge and continued mental health first aid training for managers and peers to help manage burnout. We continually look for ways to enhance the support we provide to employees and improve the effectiveness of our benefit programs.

In addition to competitive pay and benefits, eBay offers additional parental time off beyond what is required by law in the United States and in most countries where we operate. This benefit is offered for parents welcoming a new child into the family whether by giving birth, adopting or welcoming a child through surrogacy. We have also expanded support to employees by enhancing bereavement leave and adding an emergency paid leave program. This is an important demonstration of how eBay seeks to support its employees and their family in moments that matter.

Acting with Integrity

We are committed to ethics and acting with integrity. We regularly communicate about the importance of being open, honest, ethical and authentic with ongoing trainings and quarterly “tone from the top” topics that encourage conversations between leaders with their employees. In addition, we host an annual Ethics and Compliance Week focused on educating employees about our programs and the resources available to them to support ethical conduct and decision making.

Employee Voice & Values

In addition to multiple channels for sharing feedback, we also regularly survey our employees through our eBay Listens program. We ask about trust and engagement, their experience with diversity, equity and inclusion, ethics and integrity, and last year we asked for upward feedback about managers. We believe our employees welcome sharing their points of view with us and are encouraged by how their input molds several strategic programs and our values, including our commitments in critical areas such as Impact and Responsibility.

Available Information

Our Internet address is www.ebay.com. Our investor relations website is located at investors.ebayinc.com. We make available free of charge on our investor relations website under the heading “Financial Information - SEC Filings” our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports as soon as reasonably practicable after such materials are electronically filed with (or furnished to) the SEC at www.sec.gov.

We webcast our earnings calls and certain events we participate in or host with members of the investment community on our investor relations website. Additionally, we provide notifications of news or announcements regarding our financial performance, including SEC filings, investor events, press and earnings releases, and blogs on our investor relations website, as well as our company website and social media channels from time to time. Company sustainability information for investors is available on our investor relations website under the heading “ESG Investors.” Corporate governance information, including our governance guidelines for our Board of Directors (“Board”), Board committee charters and code of conduct, is also available on our investor relations website under the heading “Corporate Governance.”

The contents of our websites and webcasts and information that can be accessed through our websites and webcasts are not incorporated by reference into this Annual Report on Form 10-K or in any other report or

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document we file with (or furnish to) the SEC, and any references to our websites and webcasts are intended to be inactive textual references only.

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