Slide 1: Q1 2019 Financial Highlights
Q1 2019 FINANCIAL HIGHLIGHTS April 23, 2019
Slide 2: Disclosures
DISCLOSURES This presentation contains non-GAAP measures relating to our performance. You can find the reconciliation of these measures to the nearest comparable GAAP measures in the appendix at the end of this presentation. All growth rates represent year-over-year comparisons, except as otherwise
Slide 3: CFO Comments
CFO COMMENTS
Slide 4: Q1 Highlights
Q1 HIGHLIGHTS • Revenue of $2.6B, up 2% Y/Y (up 4% FX-Neutral) • GAAP EPS of $0.57 and Non-GAAP EPS of $0.67 • GAAP operating margin of 23%, up 1pt Y/Y • Non-GAAP operating margin of 30%, up 2pts Y/Y • Generated $550M of Operating Cash Flow and $368M of Free Cash Flow • Returned $1.6B to shareholder
Slide 5: Trailing 12-Month Active Buyers
TRAILING 12-MONTH ACTIVE BUYERS (millions) 180 179 177 175 170 171 Q4 17 Q1 18 Q2 18 Q3 18 Q4 18 Q1 19 Y/Y Growth* 5% 4% 4% 4% 4% 4% 5 *Starting in the second quarter of 2018, Y/Y growth rate is on a pro-forma basis, which includes Giosis’ Japan business active buyers in both current and prior year
Slide 6: GMV
GMV ($ millions) 24,425 23,591 23,629 22,719 24,641 22,589 14,565 14,115 14,357 14,883 13,708 13,701 Int’l 9,860 9,476 9,272 9,011 9,758 8,888 US Q4 17 Q1 18 Q2 18 Q3 18 Q4 18 Q1 19 US Y/Y Growth 8% 7% 5% 3% (1)% (6)% Int’l FX-Neutral Y/Y Growth 6% 7% 7% 7% 5% 3% Total FX-Neutral Y/Y Growth 7% 7% 7%
Slide 7: Revenue
REVENUE ($ millions) 2,707 2,580 2,640 2,649 2,877 2,643 582 MS&O 578 557 563 560 535 • Q1 FX-Neutral Transaction Revenue up 5% Y/Y … down 2pts Q/Q Transaction 2,129 2,023 2,077 2,089 2,295 2,108 • Q1 FX-Neutral MS&O Revenue up 1% Y/Y ... down 2pts Q/Q Q4 17 Q1 18 Q2 18 Q3 18 Q4 18 Q1 19 Y/Y Growth.
Slide 8: Marketplace GMV & Revenue
MARKETPLACE GMV & REVENUE ($ millions) 22,993 23,231 22,547 22,569 • Q1 FX-Neutral B2C GMV GMV 21,482 21,571 flat Y/Y and FX-Neutral C2C GMV down 2% Y/Y 316 333 310 298 301 277 • Q1 FX-Neutral MS&O Transaction Revenue up Revenue 6% Y/Y, down 1pt Q/Q • Q1 FX-Neutral MS&O Revenue down 8% Y/Y, Transact
Slide 9: Payments Progress
PAYMENTS PROGRESS ~4,300 400 $363M 350 ~3,500 300 250 200 150 100 50 Product 25-Sep Launch 10-Oct 25-Oct 9-Nov 24-Nov 9-Dec 24-Dec 8-Jan 23-Jan 7-Feb 22-Feb 9-Mar 24-Mar 3/31/19 Q4 18 Q1 19 9/25/18 Cumulative GMV Intermediated # Sellers in Program GMV intermediated to date = $363M Grew total sellers
Slide 10: StubHub GMV & Revenue
STUBHUB GMV & REVENUE ($ millions) 1,432 1,410 1,237 GMV 1,044 1,060 1,018 • Q1 FX-Neutral GMV 1 3 1 1 3 5 down 2% Y/Y, down MS&O 2 5 5 2 6 1pts Q/Q on a softer 9 1 Revenue 1 61 6 7 event landscape 306 311 • Q1 FX-Neutral Revenue 286 flat Y/Y Transaction 231 240 223 Revenue • Segment Margin down 2pt
Slide 11: Classifieds Revenue
CLASSIFIEDS REVENUE ($ millions) • Q1 FX-Neutral Revenue up 12% Y/Y, up 1pt Q/Q, driven by ongoing strength in Germany 259 263 and supported by 254 256 244 246 Motors.co.uk • Segment Margin up 1pt Y/Y driven by volume leverage from larger platforms Q4 17 Q1 18 Q2 18 Q3 18 Q4 18 Q1 19 Rev Y/Y Growth.
Slide 12: Non-GAAP Expenses
NON-GAAP EXPENSES (% of revenue) Operating Expense at 48.0%, down 3pts Y/Y Cost of Revenue Sales & Marketing Product Development General & Admin 22.2% 28.4% 27.2% 11.2% 8.8% 8.6% 20.9% 9.5% Q1 18 Q1 19 Q1 18 Q1 19 Q1 18 Q1 19 Q1 18 Q1 19 Lower cost base and Investments in Site favorable FX, partiall
Slide 13: Non-GAAP EPS
NON-GAAP EPS • Q1 Non-GAAP Operating Margin up 190bps Y/Y primarily due to a reduced cost base and FX $0.71 $0.67 • Q1 Non-GAAP EPS $0.59 $0.56 growth driven by net $0.53 $0.53 benefit of share repurchases, margin expansion and lower tax rate, partially offset by payments Q4 17 Q1 18 Q2 18 Q3 18 Q4
Slide 14: Free Cash Flow
FREE CASH FLOW ($ millions) • Q1 FCF up 9% Y/Y due to higher earnings 1,104 partially offset by 796 restructuring costs 337 381 368 188 Q4 17 Q1 18 Q2 18 Q3 18 Q4 18 Q1 19 Y/Y Growth 64% -25% -64% -47% 39% 9% CapEx % of Revenue 7% 6% 7% 7% 5% 7% FCF % of Revenue 29% 13% 7% 14% 38% 14% 14 Calculation
Slide 15: 2019 Cash & Debt
2019 CASH & DEBT Capital Allocation Tenets • Preserve financial flexibility to execute on strategy and drive long-term value creation • Drive organic growth while balancing profitability $7.3B • Supplement organic growth with disciplined acquisitions and investments Debt • Optimize financial flexibi
Slide 16: Guidance
GUIDANCE Q2 19 Low High Revenue. $2.64 $2.69 (in billions) . Y/Y Growth. 0% 2% Organic FX-Neutral Y/Y Growth. 2% 4% Non-GAAP EPS. $0.61 $0.63 Y/Y Growth. 15% 19% Full Year Guidance • Raising Revenue to $10.83 - $10.93 billion representing Organic FX-Neutral growth of 2-3% • Non-GAAP Operating Margin
Slide 17: Q&A
Q&A
Slide 18: Reconciliations
RECONCILIATIONS
Slide 19: GAAP to Non-GAAP Quarterly Reconciliations: Operating Margin
GAAP TO NON-GAAP QUARTERLY RECONCILIATIONS OPERATING MARGIN Three months ended December 31, March 31, June 30, September 30, December 31, March 31, 2017 2018 2018 2018 2018 2019 (in millions, except percentages) GAAP operating income $ 663 $ 579 $ 406 $ 556 $ 681 $ 609 Stock-based compensation expen
Slide 20: GAAP to Non-GAAP Quarterly Reconciliations: Net Income / EPS
GAAP TO NON-GAAP QUARTERLY RECONCILIATIONS NET INCOME / EPS Three months ended December 31, March 31, June 30, September 30, December 31, March 31, 2017 2018 2018 2018 2018 2019 (in millions, except per share data) GAAP Income from continuing operations $ (2,597) $ 407 $ 638 $ 720 $ 763 $ 521 Stock-
Slide 21: GAAP to Non-GAAP Quarterly Reconciliations: Statement of Income
GAAP TO NON-GAAP QUARTERLY RECONCILIATIONS STATEMENT OF INCOME Three months ended March 31, 2019 March 31, 2018 Non-GAAP Non-GAAP Reported Entries Non-GAAP Reported Entries Non-GAAP (in millions, except per share data and percentages) Net revenues $ 2,643 $ — $ 2,643 $ 2,580 $ — $ 2,580 Cost of net
Slide 22: Calculation of Free Cash Flow
CALCULATION OF FREE CASH FLOW Three months ended December 31, March 31, June 30, September 30, December 31, March 31, 2017 2018 2018 2018 2018 2019 (in millions) Net cash provided by continuing operating activities $ 988 $ 495 $ 372 $ 560 $ 1,234 $ 550 Less: Purchases of property and equipment, net
Slide 23: Reconciliation of Total Revenue
RECONCILIATION OF TOTAL REVENUE Three months ended December 31, March 31, June 30, September 30, December 31, March 31, 2017 2018 2018 2018 2018 2019 Net Revenues by Type (in millions) Net Transaction Revenues: Marketplace (2) $ 1,823 $ 1,792 $ 1,837 $ 1,803 $ 1,984 $ 1,885 StubHub 306 231 240 286 3
Slide 24: Reconciliation of Organic Revenue
RECONCILIATION OF ORGANIC REVENUE Three months ended December 31, March 31, June 30, September 30, December 31, March 31, 2017 2018 2018 2018 2018 2019 As Reported Revenue Growth 9% 12% 9% 6% 6% 2% Acquisition/Disposition Impact —% —% (0)% (1)% (1)% (1)% Foreign Currency Impact (2)% (5)% (3)% (0)% (
Slide 25: GAAP to Non-GAAP Reconciliations: Guidance
GAAP TO NON-GAAP RECONCILIATIONS GUIDANCE Three Months Ending June 30, 2019 (in billions, except per share amounts) GAAP Non-GAAP (a) Net Revenue $2.64 - $2.69 $2.64 - $2.69 Diluted EPS $0.41 - $0.45 $0.61 - $0.63 Twelve Months Ending December 31, 2019 (in billions, except per share amounts) GAAP No
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