Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

You should read the following Management’s Discussion and Analysis of Financial Condition and Results of Operations in conjunction with the condensed consolidated financial statements and the related notes included in this report. This section of this Form 10-Q generally discusses items relating to the three and nine-month periods ended September 30, 2024 and 2023 and comparisons between the respective periods.

OVERVIEW

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

Business

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 and through the third quarter of 2024, we experienced dynamic discretionary spending trends resulting from geopolitical events, inflationary pressure, foreign exchange rate volatility, elevated interest rates and lower consumer confidence. These trends are uncertain in duration and are expected to continue. In addition, our operating and financial results may continue to fluctuate as a result of changes in the legal and regulatory landscape and our response to those developments.

FX-Neutral Presentation

We present foreign exchange neutral (“FX-Neutral”) net revenues to supplement our results of operations presented in accordance with U.S. generally accepted accounting principles (“GAAP”) and to enhance investors’ understanding of our global business performance by excluding the positive or negative year-over-year impact of foreign currency movements on reported net revenues. We define FX-Neutral net revenues as GAAP net revenues minus the exchange rate effect, which we calculate by applying prior period foreign currency exchange rates to current year transactional currency amounts, excluding hedging activity. We believe presenting FX-Neutral net revenues provides useful information to both management and investors by isolating the effects of foreign currency exchange rate fluctuations that may not be indicative of our core operating results. In addition, because we have historically reported certain FX-Neutral results to investors, we believe that the inclusion of these FX-Neutral measures provides consistency in our financial reporting. FX-Neutral net revenues are non-GAAP financial measures that are not based on any comprehensive set of accounting rules or principles and may be calculated differently than other “FX-Neutral,” “constant currency” or similarly titled measures used by other companies. FX-Neutral net revenues are not presented as an alternative to GAAP net revenues and should only be used to evaluate our results of operations in conjunction with GAAP net revenues.

Quarter Highlights

Net revenues increased 3% to $2,576 million during the three months ended September 30, 2024 compared to the same period in 2023. FX-Neutral net revenues (as defined above) increased 3% during the three months ended September 30, 2024 compared to the same period in 2023. Operating margin increased to 23.1% for the three months ended September 30, 2024 compared to 18.2% for the same period in 2023.

We recorded $199 million of aggregate gains in gain (loss) on equity investments and warrant, net on our condensed consolidated statement of income during the three months ended September 30, 2024 compared to $1,212 million of aggregate gains recorded during the same period in 2023.

We generated cash flow from continuing operating activities of $755 million during the three months ended September 30, 2024 compared to $862 million in the same period in 2023.

During the three months ended September 30, 2024, we made cash payments of $755 million related to the purchase of common stock and $131 million in dividends.

In October 2024, our Board of Directors (our “Board”) declared a quarterly cash dividend of $0.27 per share of common stock to be paid on December 13, 2024 to stockholders of record as of November 29, 2024.

In August 2024, we repaid the $750 million aggregate principal amount of our previously outstanding 3.450% senior notes on the date of maturity. As of September 30, 2024, we had $450 million of commercial paper notes outstanding with a weighted average interest rate of 5.09% per annum, and a weighted average remaining term of 114 days.

On October 15, 2024, we met the processing volume milestone target to vest the second tranche of the Adyen warrant. Upon vesting of the second tranche, we exercised the option to purchase approximately 404 thousand shares of Adyen valued at $630 million on the settlement date of October 30, 2024 in exchange for $108 million in cash.

RESULTS OF OPERATIONS

We have one reportable segment to reflect the way management and our chief operating decision maker review and assess performance of the business. Our reportable segment is Marketplace, which includes 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. The accounting policies of our segment are the same as those described in “Note 1 — The Company and Summary of Significant Accounting Policies” in our condensed consolidated financial statements included in this report.

Net Revenues

Net revenues primarily include final value fees, feature fees, fees to promote listings, payment services fees, listing fees, and store subscription fees from sellers on our platforms. Our net revenues also include revenues from the sale of advertisements, revenue sharing arrangements and shipping fees. Our net revenues are reduced by incentives, including discounts, coupons and rewards, provided to our customers.

The following table presents net revenues for the periods indicated (in millions, except percentages):

			Three Months Ended September 30,																		Nine Months Ended September 30,
			2024						2023						% Change						2024						2023						% Change
Net revenues			$	2,576					$	2,500					3		%				$	7,704					$	7,550					2		%

Seasonality

We expect transaction activity patterns on our platforms to trend with general consumer buying patterns and expect that these trends will continue. Seasonal trends in net revenues may be influenced by macroeconomic conditions as well as the introduction and scaling of new products. The following table presents our total net revenues and the sequential quarterly movements of these net revenues for the periods indicated (in millions, except percentages):

			Quarter Ended
			March 31						June 30						September 30						December 31
2022
Net revenues			$	2,483					$	2,422					$	2,380					$	2,510
% change from prior quarter			(5)		%				(2)		%				(2)		%				5		%
2023
Net revenues			$	2,510					$	2,540					$	2,500					$	2,562
% change from prior quarter			—		%				1		%				(2)		%				2		%
2024
Net revenues			$	2,556					$	2,572					$	2,576					$	—
% change from prior quarter			—		%				1		%				—		%

Net Revenues by Geography

Revenues are attributed to U.S. and international geographies primarily based upon the country in which the customer is located. The following table presents net revenues by geography for the periods indicated (in millions, except percentages):

			Three Months Ended September 30,																		Nine Months Ended September 30,
			2024						2023						% Change						2024						2023						% Change
U.S.			$	1,302					$	1,259					3		%				$	3,897					$	3,785					3		%
Percentage of net revenues			51		%				50		%										51		%				50		%
International			1,274						1,241						3		%				3,807						3,765						1		%
Percentage of net revenues			49		%				50		%										49		%				50		%
Total net revenues (1)(2)			$	2,576					$	2,500					3		%				$	7,704					$	7,550					2		%

(1)Net revenues included $11 million and $31 million of hedging losses during the three and nine months ended September 30, 2024, respectively, compared to $2 million and $45 million of hedging gains during the same periods in 2023.

(2)Foreign currency movements relative to the U.S. dollar had unfavorable impacts of $6 million and $3 million on net revenues during the three and nine months ended September 30, 2024, respectively, compared to a favorable impact of $43 million and an unfavorable impact of $11 million during the same periods in 2023. The effect of foreign currency exchange rate movements during the three and nine months ended September 30, 2024 compared to the same periods in 2023 was primarily attributable to the strengthening of the U.S. dollar against the euro and other major currencies.

Our commerce platforms operate globally, resulting in certain revenues that are denominated in foreign currencies, primarily the British pound and euro. Year-over-year appreciation or depreciation of the U.S. dollar may have a material impact to our financial results. We experienced elevated foreign currency volatility which we expect to continue throughout 2024. Through our hedging programs, we actively monitor foreign currency volatility and attempt to mitigate significant risk. As shown in the table above, we generate approximately half of our net revenues internationally. Therefore, we are subject to the risks related to conducting business in foreign countries as discussed in “Part I — Item 1A: Risk Factors” of the 2023 Form 10-K.

Key Operating Metrics

Gross Merchandise Volume (“GMV”) and take rate are significant factors that we believe affect our net revenues.

GMV consists of the total value of all paid transactions between users on our platforms during the applicable period inclusive of shipping fees and taxes. Despite GMV’s divergence from revenue, we still believe that GMV provides a useful measure of the overall volume of paid transactions that flow through our platforms in a given period.

FX-Neutral GMV is defined as GMV minus the exchange rate effect, which we calculate by applying prior period foreign currency exchange rates to current year transactional currency amounts.

Take rate is defined as net revenues divided by GMV and represents net revenues as a percentage of overall volume on our platforms. We believe that take rate provides a useful measure of our ability to monetize volume through marketplace services on our platforms in a given period. We use take rate to identify key revenue drivers on our marketplace.

The following table presents net revenues and our key operating metrics of GMV and take rate for the periods indicated. The following table also presents a reconciliation of FX-Neutral net revenues and FX-Neutral GMV (each as defined above) to our reported net revenues and GMV for the periods indicated (in millions, except percentages):

			Three Months Ended September 30,
			2024																		2023						% Change
			As Reported (1)						Exchange Rate Effect						FX-Neutral						As Reported						As Reported						FX-Neutral
Net Revenues			$	2,576					$	(6)					$	2,582					$	2,500					3		%				3		%
GMV			$	18,306					$	45					$	18,261					$	17,991					2		%				1		%
Take rate			14.08		%																13.90		%				0.18		%

			Nine Months Ended September 30,
			2024																		2023						% Change
			As Reported (1)						Exchange Rate Effect						FX-Neutral						As Reported						As Reported						FX-Neutral
Net Revenues			$	7,704					$	(3)					$	7,707					$	7,550					2		%				3		%
GMV			$	55,347					$	187					$	55,160					$	54,615					1		%				1		%
Take rate			13.92		%																13.82		%				0.10		%

(1)Net revenues included $11 million and $31 million of hedging losses during the three and nine months ended September 30, 2024, respectively, compared to $2 million and $45 million of hedging gains during the same periods in 2023.

During the three and nine months ended September 30, 2024, the increase in net revenues was primarily due to higher GMV and the expansion of promoted listings products, eBay International Shipping and financial services offered to buyers and sellers within our payments platform. Net revenues and GMV increased despite the impact of dynamic discretionary spending trends resulting from geopolitical events, inflationary pressure, foreign exchange rate volatility, elevated interest rates and lower consumer confidence.

Cost of Net Revenues

Cost of net revenues represents costs associated with customer support, site operations and payment processing. Significant components of these costs primarily consist of employee compensation (including stock-based compensation), contractor costs, facilities costs, depreciation of equipment and amortization expense, bank transaction fees, credit card interchange and assessment fees, authentication costs, shipping costs and digital services tax. The following table presents cost of net revenues for the periods indicated (in millions, except percentages):

			Three Months Ended September 30,																		Nine Months Ended September 30,
			2024						2023						% Change						2024						2023						% Change
Cost of net revenues (1)(2)			$	727					$	705					3		%				$	2,162					$	2,123					2		%
Percentage of net revenues			28		%				28		%										28		%				28		%

(1)Cost of net revenues were net of immaterial hedging activity during the three and nine months ended September 30, 2024 and 2023, respectively.

(2)Foreign currency movements relative to the U.S. dollar had unfavorable impacts of $1 million and $3 million on cost of net revenues during the three and nine months ended September 30, 2024, respectively, compared to an unfavorable impact of $8 million and a favorable impact of $7 million during the same periods in 2023.

The increase in cost of net revenues during the three months ended September 30, 2024 compared to the same period in 2023 was primarily due to a $21 million increase related to indirect tax matters, a $15 million increase in cost of promoted listings products and an $8 million increase in site operations costs, partially offset by a $16 million decrease in payment processing costs driven by rate improvements and a $14 million decrease in

depreciation expense due to the change in our estimate of the useful lives for our servers and networking equipment.

The increase in cost of net revenues during the nine months ended September 30, 2024 compared to the same period in 2023 was primarily due to a $50 million increase related to indirect tax matters, a $41 million increase in cost of promoted listings products, a $30 million increase related to eBay International Shipping and an $11 million disposition of data center equipment, partially offset by a $57 million decrease in depreciation expense due to the change in our estimate of the useful lives for our servers and networking equipment and a $36 million decrease in payment processing costs driven by rate improvements.

Operating Expenses

The following table presents operating expenses for the periods indicated (in millions, except percentages):

			Three Months Ended September 30,																		Nine Months Ended September 30,
			2024						2023						% Change						2024						2023						% Change
Sales and marketing			$	592					$	567					4		%				$	1,710					$	1,644					4		%
Percentage of net revenues			23		%				23		%										22		%				22		%
Product development			374						401						(7)		%				1,104						1,145						(4)		%
Percentage of net revenues			15		%				16		%										14		%				15		%
General and administrative			194						283						(31)		%				673						831						(19)		%
Percentage of net revenues			8		%				11		%										9		%				11		%
Provision for transaction losses			89						85						4		%				266						259						3		%
Percentage of net revenues			3		%				3		%										3		%				3		%
Amortization of acquired intangible assets			5						4						42		%				14						17						(12)		%
Total operating expenses (1)(2)			$	1,254					$	1,340					(6)		%				$	3,767					$	3,896					(3)		%

(1)Operating expenses were net of immaterial hedging activity during the three and nine months ended September 30, 2024 and 2023, respectively.

(2)Foreign currency movements relative to the U.S. dollar had an unfavorable impact of $1 million and a favorable impact of $2 million on operating expenses during the three and nine months ended September 30, 2024, respectively, compared to an unfavorable impact of $8 million and a favorable impact of $33 million during the same periods in 2023.

Sales and Marketing

Sales and marketing expenses primarily consist of advertising and marketing program costs (both online and offline), employee compensation (including stock-based compensation), certain user coupons and rewards, contractor costs, facilities costs and depreciation on equipment. Online marketing expenses represent traffic acquisition costs in various channels such as paid search, affiliates marketing and display advertising. Offline advertising primarily includes brand campaigns and buyer/seller communications.

The increase in sales and marketing expenses during the three months ended September 30, 2024 compared to the same period in 2023 was primarily due to a $31 million increase in online and offline marketing program costs inclusive of user coupons, partially offset by an $11 million decrease in employee-related costs.

The increase in sales and marketing expenses during the nine months ended September 30, 2024 compared to the same period in 2023 was primarily due to a $118 million increase in online and offline marketing program costs inclusive of user coupons, partially offset by a $48 million decrease in employee-related costs.

Product Development

Product development expenses primarily consist of employee compensation (including stock-based compensation), contractor costs, facilities costs and depreciation on equipment. Product development expenses are net of required capitalization of major platform and other product development efforts, including the development and maintenance of our technology platform. Our top technology priorities include improving seller tools and buyer experiences across our platforms powered by intelligent computing at scale.

The decrease in product development expenses during the three and nine months ended September 30, 2024 compared to the same periods in 2023 was primarily due to a decrease in employee-related costs. While employee costs are decreasing, we continue to invest in strategic areas such as browsing experience, search optimization and providing relevant recommendations to enhance the experience for our customers around the world.

Capitalized internal use and platform development costs were $27 million and $84 million during the three and nine months ended September 30, 2024, respectively, compared to $28 million and $86 million during the same periods in 2023. These costs are primarily reflected as a cost of net revenues when amortized in future periods.

General and Administrative

General and administrative expenses primarily consist of employee compensation (including stock-based compensation), contractor costs, facilities costs, depreciation of equipment, legal expenses, restructuring, insurance premiums and professional fees. Our legal expenses, including those related to various ongoing legal proceedings, may fluctuate substantially from period to period.

The decrease in general and administrative expenses during the three months ended September 30, 2024 compared to the same period in 2023 was primarily due to a $50 million legal accrual release during the third quarter of 2024 compared to a $50 million increase in the legal accrual recorded during the third quarter of 2023, partially offset by a $10 million contribution to the eBay Foundation during the third quarter of 2024. See “Note 10 — Commitments and Contingencies” to the condensed consolidated financial statements included in this report for additional details regarding our legal matters.

The decrease in general and administrative expenses during the nine months ended September 30, 2024 compared to the same period in 2023 was primarily due to a $50 million legal accrual release during the third quarter of 2024 compared to a $50 million increase in the legal accrual recorded during the third quarter of 2023 and a $52 million decrease in one-time restructuring costs. See “Note 10 — Commitments and Contingencies” and “Note 15 — Restructuring” to the condensed consolidated financial statements included in this report for additional details regarding our legal matters and the restructuring, respectively.

Provision for Transaction Losses

Provision for transaction losses primarily consists of transaction loss expense associated with our buyer protection programs, losses from our managed payments services, fraud and bad debt expense. We expect our provision for transaction losses to fluctuate depending on many factors, including changes to our protection programs and the impact of regulatory changes.

The increase in provision for transaction losses during each of the three and nine months ended September 30, 2024 compared to the same period in 2023 was primarily due to a prior year recovery that did not reoccur in the current periods.

Gain (loss) on equity investments and warrant, net

Gain (loss) on equity investments and warrant, net primarily consists of gains and losses related to our various types of equity investments, including our equity investments in Adevinta ASA (“Adevinta”) and Gmarket Global LLC (“Gmarket”), and gains and losses due to changes in fair value of the warrant received from Adyen N.V. (“Adyen”) and the Aurelia Option (as defined in “Note 5 — Investments”). The following table presents gain (loss) on equity investments and warrant, net for the periods indicated (in millions, except percentages):

			Three Months Ended September 30,																		Nine Months Ended September 30,
			2024						2023						% Change						2024						2023						% Change
Unrealized change in fair value of equity investment in Adevinta			$	—					$	1,367					(100)		%				$	(234)					$	1,331					(118)		%
Realized change in fair value of shares sold in Adevinta			—						—						**						78						—						100		%
Change in fair value of Aurelia option			35						—						100		%				(74)						—						(100)		%
Change in fair value of warrant			145						(109)						233		%				120						(40)						400		%
Unrealized change in fair value of equity investment in Gmarket			16						(43)						137		%				(12)						(83)						86		%
Gain (loss) on other investments			3						(3)						**						2						(12)						**
Total gain (loss) on equity investments and warrant, net			$	199					$	1,212					(84)		%				$	(120)					$	1,196					(110)		%
Percentage of net revenues			8		%				48		%										(2)		%				16		%

** Not meaningful

The change in gain (loss) on equity investments and warrant, net during the three months ended September 30, 2024 compared to the same period in 2023 was primarily driven by the change in the fair value of our equity investments and the warrant as well as the change in fair value of the Aurelia Option.

The change in gain (loss) on equity investments and warrant, net during the nine months ended September 30, 2024 compared to the same period in 2023 was primarily driven by the change in the fair value of our equity investments and the warrant as well as the realized gain from the sale of shares in Adevinta and the related fair value of the Aurelia Option. See “Note 5 — Investments” to the condensed consolidated financial statements included in this report for more information on the Adevinta Transactions and the Aurelia Option.

Interest Expense, Interest Income and Other, Net

Interest expense primarily consists of interest charges on amounts borrowed, commitment fees on unborrowed amounts under our credit agreement and interest expense on our outstanding debt securities and commercial paper, if any. Interest income and other, net primarily consists of interest earned on cash, cash equivalents and investments, gains and losses on foreign exchange transactions and transaction costs on acquisitions. The following table presents interest expense and interest income and other, net for the periods indicated (in millions, except percentages):

			Three Months Ended September 30,																		Nine Months Ended September 30,
			2024						2023						% Change						2024						2023						% Change
Interest expense			$	(63)					$	(65)					(3)		%				$	(194)					$	(198)					(2)		%
Percentage of net revenues			(2)		%				(3)		%										(3)		%				(3)		%
Interest income			$	72					$	58					24		%				$	196					$	148					32		%
Foreign exchange and other			(6)						1						**						4						(1)						**
Total interest income and other, net			$	66					$	59					12		%				$	200					$	147					36		%
Percentage of net revenues			3		%				2		%										3		%				2		%

** Not meaningful

Interest expense decreased during the three and nine months ended September 30, 2024, primarily due to a lower average notional amount of outstanding debt compared to the same periods in 2023.

Interest income increased during the three and nine months ended September 30, 2024 compared to the same periods in 2023, primarily due to higher yields on interest bearing instruments.

Income Tax Provision

The following table presents provision for income taxes for the periods indicated (in millions, except percentages):

			Three Months Ended September 30,												Nine Months Ended September 30,
			2024						2023						2024						2023
Income tax provision			$	161					$	355					$	360					$	629
Effective tax rate			20.2		%				21.4		%				21.7		%				23.5		%

The decrease in our effective tax rate for the three and nine months ended September 30, 2024 compared to the same periods in 2023 was primarily due to the excess tax benefits on stock-based compensation.

In addition, the decrease in our effective tax rate for the nine months ended September 30, 2024 compared to the same period in 2023 was also due to the non-recurring increase in reserves for uncertain tax positions in 2023.

We are regularly under examination by tax authorities both domestically and internationally. We believe that adequate amounts have been reserved for any adjustments that may ultimately result from these examinations, although there are inherent uncertainties in these examinations. Due to the ongoing tax examinations, it is generally impractical to determine the amount and timing of these adjustments. However, we expect several tax examinations to close within the next 12 months. See “Note 13 — Income Taxes” to the condensed consolidated financial statements included in this report for more information on estimated settlements within the next 12 months.

Liquidity and Capital Resources

Cash Flows

			Nine Months Ended September 30,
			2024						2023
			(In millions)
Net cash provided by (used in):
Continuing operating activities			$	1,737					$	2,308
Continuing investing activities			951						520
Continuing financing activities			(2,814)						(2,071)
Effect of exchange rates on cash, cash equivalents and restricted cash			5						(16)
Net decrease in cash, cash equivalents and restricted cash - discontinued operations			—						(4)
Net increase in cash, cash equivalents and restricted cash			$	(121)					$	737

Continuing Operating Activities

Our operating cash flows arise primarily from cash received from our customers on our platforms offset by cash payments for sales and marketing, employee compensation and payment processing expenses.

Cash provided by continuing operating activities of $1.7 billion in the nine months ended September 30, 2024 compared to cash provided by continuing operating activities of $2.3 billion in the nine months ended September 30, 2023 was primarily attributable to working capital movements and changes in non-cash items during the nine months ended September 30, 2024 compared to the same period in 2023.

Continuing Investing Activities

Cash provided by continuing investing activities of $951 million in the nine months ended September 30, 2024 was primarily attributable to proceeds of $10.4 billion from the maturities and sales of investments and proceeds of $2.4 billion from the sale of our equity investment in Adevinta, partially offset by cash paid for investments of $11.5 billion and property and equipment of $341 million.

The largely offsetting effects of purchases of investments and maturities and sale of investments results from the management of our investments. As our immediate cash needs change, purchase and sale activity will fluctuate.

Continuing Financing Activities

Cash used in continuing financing activities of $2.8 billion in the nine months ended September 30, 2024 was primarily attributable to cash paid to repurchase $2.2 billion of common stock, repayment of the $750 million aggregate principal amount of our previously outstanding 3.450% senior notes and $405 million paid in cash dividends, partially offset by borrowings under our commercial paper program of $441 million.

The positive effect of exchange rate movements on cash, cash equivalents and restricted cash was due to the weakening of the U.S. dollar against other currencies during the nine months ended September 30, 2024 compared to the 2023 year-end rate.

Liquidity and Capital Resource Requirements

As of September 30, 2024 and December 31, 2023, we had assets classified as cash and cash equivalents as well as short-term and long-term non-equity investments, in an aggregate amount of $5.8 billion and $5.1 billion, respectively. These amounts do not include cash held on behalf of customers related to marketplace activity of $679 million and $481 million, respectively, which are recorded separately within customer accounts and funds receivable with a corresponding liability within customer accounts and funds payable in our condensed consolidated balance sheet. These amounts also do not include restricted cash held for purposes of safeguarding customer funds of $104 million and $27 million, respectively. We believe these assets together with cash expected to be generated from operations, borrowings available under our credit agreement and commercial paper program, and our access to capital markets, will be sufficient to satisfy our material cash requirements over the next 12 months and for the foreseeable future.

However, geopolitical events, inflationary pressure, foreign exchange rate volatility, elevated interest rates and global economic uncertainty have caused material disruptions in both U.S. and international financial markets and economies and are uncertain in duration. The impact of these events has increased, and may continue to increase, our borrowing costs and other costs of capital and otherwise adversely affect our business, results of operations, financial condition and liquidity. The future impact of these events cannot be predicted with certainty and we cannot assure that we will have access to external financing at times and on terms we consider acceptable, or at all, or that we will not experience other liquidity issues going forward.

We have certain fixed contractual obligations and commitments that include future estimated payments for general operating purposes. Changes in our business needs, contractual cancellation provisions, fluctuating interest rates, and other factors may result in actual payments differing from the estimates. We cannot provide certainty regarding the timing and amounts of these payments. The following sections summarizes our fixed contractual obligations and commitments.

Senior Notes

On August 1, 2024, we repaid the $750 million aggregate principal amount of our previously outstanding 3.450% senior notes on the date of maturity.

In January 2023, we repaid the $1.2 billion aggregate principal amount of the floating rate and 2.750% senior notes due 2023 on the date of maturity.

As of September 30, 2024, we had fixed-rate senior notes outstanding with an aggregate principal amount of $7.0 billion, with $800 million payable within 12 months. The net proceeds from the issuances of these senior notes are used for general corporate purposes, including, among other things, capital expenditures, share repurchases, repayment of indebtedness and possible acquisitions.

Commercial Paper

We have a commercial paper program pursuant to which we may issue commercial paper notes in an aggregate principal amount at maturity of up to $1.5 billion outstanding at any time with maturities of up to 397 days from the date of issue. During the three and nine months ended September 30, 2024, we issued and repaid $180 million of commercial paper notes with original maturities less than 90 days and issued $450 million of commercial paper notes with original maturities greater than 90 days. As of September 30, 2024, we had $450 million of commercial paper notes outstanding with a weighted average interest rate of 5.09% per annum, and a weighted average remaining term of 114 days.

Credit Agreement

In March 2020, we entered into a credit agreement that provides for an unsecured $2.0 billion five-year credit facility (the “Prior Credit Agreement”).

In January 2024, we terminated the Prior Credit Agreement and entered into a new credit agreement (the “Credit Agreement”) that provides for an unsecured $2.0 billion five-year revolving credit facility. We may also, subject to the agreement of the applicable lenders, increase the commitments under the revolving credit facility by up to $1.0 billion. Funds borrowed under the Credit Agreement may be used for working capital, capital expenditures, acquisitions and other general corporate purposes and will bear interest at either (i) a customary forward-looking term rate based on the secured overnight financing rate published by CME Group for the relevant interest period plus an adjustment of 0.1% or (ii) a customary base rate formula, plus a margin (based on our public debt ratings) ranging from 0% to 0.375%. The covenants of the Credit Agreement are discussed in “Note 8 — Debt” to the condensed consolidated financial statements included in this report. As of September 30, 2024, we had $450 million of commercial paper notes outstanding; therefore, $1.6 billion of borrowing capacity was available for other purposes permitted by the Credit Agreement.

Income Taxes

The timing of the resolution and/or closure of audits is highly uncertain. Given the number of years remaining subject to examination and the number of matters being examined, we are unable to estimate the full range of possible adjustments to the balance of gross unrecognized tax benefits. We expect the gross amount of unrecognized tax benefits to be reduced within the next 12 months by at least $170 million.

As of September 30, 2024, our assets classified as cash and cash equivalents as well as short-term and long-term non-equity investments included assets held in certain of our foreign operations totaling approximately $1.8 billion. As we repatriate these funds to the United States, we will be required to pay income taxes in certain U.S. states and applicable foreign withholding taxes on those amounts during the period when such repatriation occurs. We have accrued deferred taxes for the tax effect of repatriating the funds to the United States. For additional details related to our income taxes, please see “Income Tax Provision” in our Results of Operations above and “Note 13 — Income Taxes” to the condensed consolidated financial statements included in this report.

Stock Repurchases

Our stock repurchase programs are intended to programmatically offset the impact of dilution from our equity compensation programs and, subject to market conditions and other factors, to make opportunistic and programmatic repurchases of our common stock to reduce our outstanding share count. Any share repurchases under our stock repurchase programs will be funded from our working capital or other financing alternatives.

We expect to continue making opportunistic and programmatic repurchases of our common stock, subject to market conditions and other uncertainties. However, our stock repurchase programs may be limited or terminated at any time without prior notice. The timing and actual number of shares repurchased will depend on a variety of factors, including corporate and regulatory requirements, price and other market conditions and management’s determination as to the appropriate use of our cash.

In February 2024, our Board authorized an incremental $2.0 billion under our stock repurchase program in addition to the $4.0 billion previously authorized in 2022. The stock repurchase program has no expiration from the date of authorization.

During the nine months ended September 30, 2024, we repurchased approximately $2.2 billion of our common stock under our stock repurchase program. As of September 30, 2024, a total of approximately $1.2 billion remained available for future repurchases of our common stock. See “Note 11 — Stockholders’ Equity” to the condensed consolidated financial statements included in this report for more information about our stock repurchase program.

Dividends

The Company paid a total of $131 million and $132 million in cash dividends during the three months ended September 30, 2024 and 2023, respectively, and $405 million and $399 million in cash dividends during the nine months ended September 30, 2024 and 2023, respectively. In October 2024, our Board declared a cash dividend of $0.27 per share of common stock to be paid on December 13, 2024 to stockholders of record as of November 29, 2024.

Other Capital Resource Requirements

We actively monitor all counterparties that hold our cash and cash equivalents and non-equity investments, focusing primarily on the safety of principal and secondarily on improving yield on these assets. We diversify our cash and cash equivalents and investments among various counterparties in order to reduce our exposure should any one of these counterparties fail or encounter difficulties. To date, we have not experienced any material loss or lack of access to our invested cash, cash equivalents or short-term investments; however, we can provide no assurances that access to our invested cash, cash equivalents or short-term investments will not be impacted by adverse conditions in the financial markets, including, without limitation, as a result of the impact of geopolitical events, inflationary pressure, lower consumer spending and foreign exchange rate volatility. At any point in time, we have funds in our operating accounts and customer accounts that are deposited and invested with third party financial institutions. We have entered into various indemnification agreements and, in the ordinary course of business, we have included limited indemnification provisions in certain of our agreements with parties with which we have commercial relations. It is not possible to determine the maximum potential loss under these various indemnification provisions due to our limited history of prior indemnification claims and the unique facts and circumstances involved in each particular provision. To date, losses recorded in our consolidated statement of income in connection with our indemnification provisions have not been significant, either individually or collectively. See “Note 10 — Commitments and Contingencies” to the condensed consolidated financial statements included in this report for more information about our indemnification provisions.