01—Abstract
Summary
Summary of the 10-K filed February 6, 2015. Cited figures are marked; the original filing is the authoritative source.
In its 2014 10-K filing, eBay Inc. reported net revenues of $17.9 billiona, a 12% increase year-over-year, and operating income of $3.5 billion.
A significant development highlighted is the announced plan to separate PayPal into an independent publicly traded company in the second half of 2015. This strategic move aims to unlock value for both businesses by allowing them to focus on their respective growth opportunities and strategies. The company also faced a cyberattack in the second quarter of 2014, impacting its Marketplaces segment, leading to an expense of approximately $46 millionb and requiring password resets for users.
02—Key points
Key Highlights
- Announced plan to separate PayPal into an independent publicly traded company in the second half of 2015.
- Reported net revenues of $17.9 billion for fiscal year 2014, a 12% increase from 2013.
- Experienced a cyberattack in Q2 2014 affecting the Marketplaces segment, resulting in approximately $46 million in expenses and customer credits.
- Marketplaces segment GMV grew by 9% to $82.95 billion, while Payments segment Net TPV increased by 27% to $227.9 billion.
- Operating margin for 2014 was 20%, a slight decrease from 21% in 2013.
- Generated $5.7 billion in cash flow from operations in 2014, an increase from $5.0 billion in 2013.
- Authorized additional stock repurchase programs totaling approximately $3.0 billion as of January 2015.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2014, eBay Inc kept $0.01.
- Revenue$8.79B100.0%
- Cost of revenue−$1.66B18.9%
- Gross profit$7.13B81.1%
- Operating costs−$4.65B52.9%
- Operating income$2.48B28.2%
- Interest, other & tax−$2.43B27.6%
- Net income$46.0M0.5%
Where FY2014 revenue went
$8.79B- Other operating costs: $3.67B, 42% of revenue
- Interest, other & tax: $2.43B, 28% of revenue
- Cost of revenue: $1.66B, 19% of revenue
- Net income: $46.0M, 0.5% of revenue
- R&D: $983.0M, 11% of revenue
Kept 0.5% as net incomeNet income $46.0M · 0.5%
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2014filed February 6, 2015Financial Statements
FY2014 against FY2013
| Line item | FY2014FY2013 | Change |
|---|---|---|
| Revenue | $8.79B$8.26B | +6.5% |
| Cost of Revenue | $1.66B$1.49B | +11.5% |
| Gross Profit | $7.13B$6.76B | +5.4% |
| R&D Expenses | $983.00M$915.00M | +7.4% |
| Operating Expenses | $4.65B$4.31B | +7.9% |
| Operating Income | $2.48B$2.45B | +0.9% |
| Interest Expense | $109.00M$95.00M | +14.7% |
| Net Income | $46.00M$2.86B | −98.4% |
| EPS (Basic) | $0.04$2.20 | −98.2% |
| EPS (Diluted) | $0.04$2.18 | −98.2% |
| Shares Outstanding (Basic) | 1.25B1.29B | −3.4% |
| Shares Outstanding (Diluted) | 1.25B1.31B | −4.7% |
05—Questions
Frequently Asked Questions
What is the most significant strategic announcement made in this filing?
The most significant strategic announcement is the plan to separate PayPal into an independent publicly traded company, which was expected to be completed in the second half of 2015.
How did the cyberattack in 2014 affect eBay's financial performance?
The cyberattack in Q2 2014 impacted the Marketplaces segment, leading to approximately $46 million in expenses and customer credits. While the precise impact on lost revenue is hard to quantify, the company incurred costs for investigation, remediation, and customer support to preserve trust.
What were the key financial performance indicators for eBay in 2014?
eBay reported net revenues of $17.9 billion, a 12% increase year-over-year. Operating income was $3.5 billion, and the company generated $5.7 billion in cash flow from operations. Diluted earnings per share were $0.04.
What is the company's approach to returning capital to shareholders?
eBay does not currently pay cash dividends. However, the company has been actively repurchasing its stock. As of January 2015, they had approximately $3.0 billion remaining under authorized stock repurchase programs, indicating a commitment to reducing share count and offsetting dilution.
06—Continue