Q1 2024 eBay Inc Earnings Call

Good afternoon, and welcome to Ebay's first quarter 'twenty 'twenty four earnings conference call.

Operator: Good afternoon, and welcome to eBay's first quarter 2024 earnings conference call. All participants are in a listen-only mode. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during that time, simply press a star followed by one on your telephone keypad. If you would like to withdraw your question, press star 1 again. In the interest of time, we ask that you please limit yourselves to one question and re-enter the queue for any additional questions. Thank you. As a reminder, this conference call is being recorded. I would now like to turn the call over to John Egbert, Vice President of Investor Relations. Thank you. Please go ahead.

All participants are in a listen only mode.

After the Speakers' remarks, there will be a question and answer session.

If you would like to ask a question during that time simply press star followed by one on your telephone keypad if.

If you would like to withdraw your question Press Star one again.

In the interest of time, we ask that you. Please limit yourself to one question and reenter the queue for any additional questions. Thank you as a reminder, this conference call is being recorded.

I'd now like to turn the call over to John Egbert, Vice President of Investor Relations. Thank you. Please go ahead.

John Egbert: Good afternoon. Thank you all for joining us for eBay's first quarter 2024 earnings conference call. Joining me today on the call are Jamie Iannone, our Chief Executive Officer, and Steve Priest, our Chief Financial Officer. We're providing a slide presentation to accompany our commentary during the call, which is available through the Investor Relations section of the eBay website at investors.ebayinc.com. Before we begin, I'll remind you that during this conference call, we will discuss certain non-GAAP measures related to our performance. You can find the reconciliation of these measures to the nearest comparable GAAP measures in our accompanying slide presentation.

John Egbert: Good afternoon. Thank you all for joining us for <unk> first quarter 2024 earnings Conference call. Joining me today on the call are Jamie Iannone, our Chief Executive Officer, and Steve priest, our Chief Financial Officer.

John Egbert: We're providing a slide presentation to accompany our commentary during the call which is available through the Investor Relations section of the ebay website at investors <unk> ebay, Inc. Dot com before we begin I'll remind you that during this conference call. We will discuss certain non-GAAP measures related to our performance you can find the reconciliation of these measures to the nearest comparable GAAP measure.

John Egbert: <unk> and our accompanying slide presentation.

John Egbert: Additionally, all growth rates noted in our prepared remarks will reflect FX neutral year over year comparisons and all earnings per share amounts reflect earnings per diluted share unless indicated otherwise during.

John Egbert: Additionally, all growth rates noted in our prepared remarks will reflect FX-neutral year-over-year comparisons, and all earnings per share amounts reflect earnings per diluted share, unless indicated otherwise. During this conference call, management will make forward-looking statements, including, without limitation, statements regarding our future performance and expected financial results. These forward-looking statements involve known risks and uncertainties. Our actual results may differ materially from our forecast for a variety of reasons. You can find more information about risks, uncertainties, and other factors that could affect our operating results in our most recent periodic reports on Form 10-K, Form 10-Q, and in our earnings release from earlier today.

John Egbert: During this conference call management will make forward looking statements, including without limitation statements regarding our future performance and expected financial results.

John Egbert: These forward looking statements involve known and unknown risks and uncertainties. Our actual results may differ materially from our forecast for a variety of reasons.

John Egbert: You can find more information about risks uncertainties and other factors that could affect our operating results in our most recent periodic reports on Form 10-K Form 10-Q, and our earnings release from earlier today, you should not rely on any forward looking statements. All information in this presentation is as of May one 2024, we do not.

John Egbert: You should not rely on any forward-looking statements. All information in this presentation is as of May 1st, 2024. We do not intend and undertake no duty to update this information. With that, I'll turn the call over to Jamie.

John Egbert: <unk> and undertake no duty to update this information.

John Egbert: With that I'll turn the call over to Jamie.

Jamie Iannone: Thanks, John. Good afternoon, everyone, and thank you all for joining us today.

Jamie Iannone: Thanks, John Good afternoon, everyone and thank you all for joining us today.

Jamie Iannone: We delivered strong results in Q1, even as we continue to navigate ongoing challenges in the global economy. Gross merchandise volume was roughly flat at $18.6 billion. While revenue grew more than 2% to $2.56 billion, our non-GAAP operating margin was 30.3%, non-GAAP earnings per share rose 13% to $1.25, and we returned $638 million to shareholders through repurchases and dividends. I'm incredibly proud of our teams for delivering these results, as they remain relentlessly focused on reinventing the future of e-commerce for enthusiasts.

Jamie Iannone: We delivered strong results in Q1, even as we continue to navigate ongoing challenges in the global economy.

Jamie Iannone: Merchandise volume was roughly flat at $18 6 billion.

Jamie Iannone: While revenue grew more than 2% to 256 billion.

Jamie Iannone: Our non-GAAP operating margin was 33% non-GAAP earnings per share rose, 13% to $1 25.

Jamie Iannone: And we returned $638 million to shareholders through repurchases and dividends.

Speaker Change: Incredibly proud of our teams for delivering these results as they remain relentlessly focused on reinventing the future of e-commerce for enthusiasts.

Jamie Iannone: And I'm pleased that we remain on track for GMV growth to turn positive by Q3 or Q4 of this year. Now, let's walk through some of the key drivers of our quarterly results. Focus categories play an important part in delivering relevant experiences to customers on eBay and remained a significant driver of underlying growth on our marketplace during Q1. Overall, focus category GMV grew nearly 5% last quarter, outpacing the remainder of our marketplace by roughly 6 points.

Speaker Change: And I am pleased that we remain on track for GMB growth to turn positive by Q3 or Q4 of this year.

Speaker Change: Now, let's walk through some of the key drivers of our quarterly results.

Speaker Change: Focused categories play an important part in delivering relevant experiences to customers on ebay and remains a significant driver of underlying growth on our marketplace during Q1.

Speaker Change: Overall focus category GMB grew nearly 5% last quarter outpacing the remainder of our marketplace by roughly six points.

Jamie Iannone: Motors, Parts, and Accessories, or P&A, was once again the largest contributor to growth among focus categories, despite facing headwinds in January due to extreme weather patterns in the U.S. Our teams continue to innovate on the P&A shopping experience, growing awareness, enhancing trust, and expanding the great inventory our marketplace has to offer. Fitment is a central component of trust within the P&A category, helping customers understand exactly which of our more than 600 million live listings in this category fits their vehicle.

Speaker Change: Motors parts and accessories or P&A was once again, the largest contributor to growth among focused categories. Despite facing headwinds in January due to extreme weather patterns in the U S.

Speaker Change: Our teams continue to innovate on the PNA shopping experience growing awareness enhancing trust and expanding the great inventory our marketplace has to offer.

Speaker Change: <unk> is a central component of trust within the PNA category, helping customers understand exactly which of our more than 600 million live listings in this category fit their vehicle. We continue to work closely with large P&A sellers to augment their inventory using the <unk> fitment toolkit to date, we have enhanced eligible autopart.

Jamie Iannone: We continue to work closely with large P&A sellers to augment their inventory using the MyFitment toolkit. To date, we have enhanced eligible auto parts with approximately 5 billion pieces of incremental fitment data, and we've continued to see a double-digit increase. Additionally, last quarter, we redesigned our self-service experience to simplify how sellers onboard, view, and publish fitment data for their P&A lists. Our updated experience better serves small and medium-sized businesses, which make up our largest cohort of P&A sellers.

Speaker Change: With approximately 5 billion pieces of incremental fitment data and we've continued to see a double digit increase in conversion on these augmented listings. Additionally.

Speaker Change: Additionally, last quarter, we redesigned our self service experience to simplify how sellers onboard view and published fitment data for P&A listings are updated experienced better serve small and medium sized businesses, which make up our largest cohort of <unk> sellers.

Jamie Iannone: On the buyer side, we continue to improve our value proposition for mass market P&A shoppers looking to maintain their vehicles. During Q1, we added a Motors DIY Guide page that makes do-it-yourself projects more accessible by integrating expert content for common maintenance jobs alongside eBay listings for the specific parts, tools, and materials needed to complete them.

Speaker Change: On the buyer side, we continued to improve our value proposition for mass market PNA shoppers looking to maintain their vehicles during.

Speaker Change: During Q1, we added a motors DIY guys page that makes do it yourself projects more accessible by integrating expert content for common maintenance jobs alongside ebay listings for the specific parts tools and materials needed to complete them.

Jamie Iannone: Our full-funnel approach to marketing has increased awareness and consideration of eBay as a trusted place to shop for auto parts and accessories. And I'm excited that yesterday we announced a multi-year partnership with the McLaren Racing Formula One team, which means motorsports enthusiasts around the world will see eBay branding on McLaren team race cars, starting with the Miami Grand Prix this week. eBay has been a leading player in collectibles for over two decades, and in recent years, we've accelerated the pace of innovation in areas like trading cards, which is one of our focus categories.

Speaker Change: Our full funnel approach to marketing has increased awareness and consideration of ebay as a trusted place to shop for auto parts and accessories.

Speaker Change: I'm excited that yesterday, we announced a multiyear partnership with Mclaren racing Formula one team, which means motor sports enthusiasts around the world will see ebay branding and Mclaren team race cars, starting with the Miami Grand Prix This week.

Jamie Iannone: We've rolled out new features like My Collections, Price Guides, Authentication and Grading Partnerships, Revamped Condition Standards, Live Commerce, Vault Storage, and new shipping methods to reduce costs. In Q1, we continue to innovate by launching a simplified listing flow for sports trading cards to all U.S. sellers. This experience leverages our proprietary technology to pre-fill the listing with relevant item aspects, provide simpler shipping options, and offer smarter pricing recommendations based on the value and the condition of the card.

Speaker Change: Ebay has been a leading player in collectibles for over two decades and in recent years, we've accelerated the pace of innovation in areas like trading cards, which is one of our focus categories. We've rolled out new features like my collections price guides authentication and grading partnerships revamped condition standards live commerce.

Speaker Change: Storage and new shipping methods to reduce costs.

Speaker Change: In Q1, we continued to innovate biologic a simplified listing flow for sports trading cards to all U S. Sellers. This experienced leverages, our proprietary technology to pre fill the listing with relevant item aspects provide simpler shipping options and offer smarter pricing recommendations based on the value and the condition of the card.

Jamie Iannone: This rollout has resulted in a double-digit percentage reduction in listing time and measurable increases in completed listings and sold items per customer. We are also seeing a more than 20% increase in CSAT for U.S. sports trading card sellers versus our baseline prior to this rollout.

Speaker Change: This rollout has resulted in a double digit percentage reduction in listing time and measurable increases in completed listings and sold items per customer.

Speaker Change: We are also seeing a more than 20% increase in seats that for U S sports trading card sellers versus our baseline prior to this rollout.

Jamie Iannone: In recent quarters, we've seen improving volume trends in trading cards, as many of the new and returning hobbyists who joined eBay during the pandemic remain highly engaged with our platform. With so much enthusiasm for the hobby, it's the perfect time to talk about the definitive agreement we announced a few weeks ago with Collectors, the parent company of PSA, which is the gold standard in third-party authentication and grading of trading cards and collectibles

Speaker Change: In recent quarters, we've seen improving volume trends and trading cards as many of the new and returning hobbyists who joined ebay during the pandemic remain highly engaged with our platform.

Speaker Change: With so much enthusiasm in the hobby, it's the perfect time to talk about the definitive agreement, we announced a few weeks ago with collectors parent company of PSA, which is the gold standard in third party authentication and grading of trading cards in collectibles ebay and collectors have entered into three separate transactions designed to streamline and improve the overall.

Jamie Iannone: Collectors have entered into three separate transactions designed to streamline and improve the overall experience for hobbyists. As part of this deal, I'm incredibly excited to welcome Ken Golden to eBay. We've agreed to acquire Golden, a leading U.S.-based auction house for high-value collectibles, which brings together two renowned marketplace brands in the trading card hobby. Many of you know Ken from his fantastic series on Netflix, King of Collectibles, The Golden Tuck.

Speaker Change: For hobbyists.

Speaker Change: As part of this deal I'm incredibly excited to welcome Ken Goldman to ebay, we have agreed to acquire Golden a leading U S based auction house for high value collectibles, which brings together two renowned marketplace brands in the trading card hobby.

Jamie Iannone: Combining Golden with eBay enhances our respective marketplace offerings by expanding the range of inventory available to eBay customers and opening up an expansive global audience for Golden Cellar. We believe this will enable a more well-rounded collecting experience across price points and service models, complementing our acquisition of TCG Player and recent partnership with sports trading card company ComSea. Additionally, eBay has entered into commercial agreements with collectors and PSA to reduce friction in the authentication and grading of trading cards. We have also agreed to divest the eBay vault to PSA.

Speaker Change: Many of you know Ken from his fantastic series on Netflix King of collectibles, the Golden touch combining golden with ebay enhances our respective marketplace offerings by expanding the range of inventory available to ebay customers and opening up an expansive global audience for Golden sellers.

Speaker Change: We believe this will enable a more well rounded collecting experience across price points and service models complementing our acquisition of TCG player and recent partnership with sports trading card company comp C.

Speaker Change: Additionally, ebay has entered into commercial agreements with collectors and PSA to reduce friction in the authentication and grading of trading cards. We also agreed to divest the ebay volatile PSA through a newly branded service offering are companies plan to launch an integrated program to buy sell grade and store.

Jamie Iannone: Through a newly branded service offering, our company plans to launch an integrated program to buy, sell, grade, and store trading cards. eBay will become PSA's exclusive marketplace partner for trading cards, enabling hobbyists to more easily list and sell their cards on eBay at the time of grading. Importantly, these deals enable each company to prioritize what it does best. At eBay, we can focus on enhancing our marketplace and streamlining the buying and selling experience for millions of hobbyists, while collectors can concentrate on its operational expertise in grading, authenticating, and securely storing collectibles.

Speaker Change: Trading cards ebay will become PSA is exclusive marketplace partner for trading cards, enabling hobbyists to more easily lift in southern cards on ebay at the time of grading.

Speaker Change: Importantly, these deals enable each company to prioritize what it does best at ebay, we can focus on enhancing our marketplace and streamlining the buying and selling experience for millions of hobbyists, while collectors can concentrate on its operational expertise and grading authenticating and securely storing collectibles there'll be more we can do.

Jamie Iannone: There'll be more we can share about our company's joint plans after the deal is closed, which we expect to occur during Q2, subject to closing conditions. In Q1, we also continued to rapidly innovate on our eBay live experience, which now spans multiple categories, including We expanded coverage to new categories like comics and sports memorabilia. We introduced a revamped auctions experience that makes bidding more seamless and reliable. We enabled viewing on desktop so that buyers can join live events wherever they are shopping.

Speaker Change: Sure about our companies joined plans after the deals close which we expect to occur during Q2 subject to closing conditions.

Speaker Change: In Q1, we also continued to rapidly innovate on our ebay live experience, which now spans multiple categories, including collectibles.

Speaker Change: We expanded coverage to new categories like comics and sports memorabilia, we introduced a revamped auctions experience that makes bidding more seamless and reliable we enabled viewing on desktop so that buyers can joined live events wherever they are shopping.

Jamie Iannone: And we dramatically improved event discoverability on the homepage with personalized recommendations. While eBay Live remains in beta, we're extremely excited about continuing to scale this experience throughout the year. As a pioneer of e-commerce, giving pre-owned goods a second life is core to who we are as a company. We reached a major milestone in Q1 as pre-owned and refurbished goods reached 40% of total GMV on our marketplace after consistently outpacing the sales of brand new goods since the pandemic.

Speaker Change: And we've dramatically improved the event discover ability on the homepage with personalized recommendations, while EBIT loss remains in beta we're extremely excited about continuing to scale. This experience throughout the year.

Speaker Change: As a pioneer of ecommerce, giving pre owned goods a second life is core to who we are as a company. We reached a major milestone in Q1 as pre owned and refurbished goods reached 40% of total GMB on our marketplace. After consistently outpacing the sales of brand new goods since the pandemic.

Jamie Iannone: In service of that mission, a major priority for 2024 is strengthening our consumer value proposition in pre-owned fashion. Through our multi-year partnership with Love Island in the UK, we have grown awareness of the sustainability benefits of e-commerce and educated consumers on the potential economic savings from shopping for pre-owned items. But there is more we can do to unlock consumers' closets and accelerate the circular economy.

Speaker Change: In service of that mission, our major priority in 2024 is strengthening our consumer value proposition and pre owned fashion.

Speaker Change: Through our multiyear partnership with Love Island in the U K, we have grown awareness of the sustainability benefits of re commerce and educated consumers on the potential economic savings from shopping for pre owned items, but there is more we can do to unlock consumers closets and accelerate the circular economy.

Jamie Iannone: To that end, last month we began to dramatically streamline the buying and selling experiences for pre-owned fashion on eBay, focusing on the UK. We redesigned our shopping experience from the ground up to reduce friction and better meet the needs of modern fashion consumers. Our initial rollout included a number of features and improvements, such as a simplified selling flow, curated item specifics, photo guidance, intelligent pricing suggestions, and condensed shipping options. We also eliminated final value fees on pre-owned apparel for C2C sellers in the UK and introduced new AI-powered tools to enhance discovery and drive more inspirational shopping behavior on our marketplace.

Speaker Change: To that end last month, we began to dramatically streamline the buying and selling experiences for pre owned fashion on ebay focusing on the U K, we redesigned our shopping experience from the ground up to reduce friction and better meet the needs of modern fashion consumers.

Speaker Change: Our initial rollout included a number of features and improvements such as a simplified selling flow curated items specifics photo guidance intelligent pricing suggestions and condensed shipping options.

Speaker Change: We also eliminated final value fees on pre owned apparel for <unk> sellers in the U K and introduced new AI powered tools to enhance discovery and drive more inspirational shopping behavior on our marketplace.

Jamie Iannone: One such feature is Explore, a new AI-powered shopping feed enabling users to browse a nearly unlimited list of personalized recommendations based on implicit and explicit interest signals, such as the user's style preferences and sizes. The Explore feed updates in real time in response to products that users interact with.

Speaker Change: One such feature is explore a new AI powered shopping feed enabling users to browse a nearly unlimited list of personalized recommendations based on implicit and explicit interest signals such as the user style preferences and sizes.

Speaker Change: The explore feed updates in real time and response to products that users interact with while buyers can refine their shopping journey using our visually similar search feature powered by computer vision.

Jamie Iannone: Buyers can refine their shopping journey using our visually similar search feature powered by computer vision. Explore is focused on fashion to start, and we plan to expand its capabilities later this year. Explorers is currently live for all UK users in beta alongside small pilots in other countries as we gather feedback and information. In April, we also rolled out an early version of Shop the Look, which leverages generative AI to create shoppable content and fashion recommendations. Shop the Look showcases a variety of styles, such as business casual, Scandinavian minimalism, or urban athleisure.

Speaker Change: Explore is focused on fashion to start and we plan to expand its capabilities later this year.

Speaker Change: Explore is currently lie for all UK users in beta alongside small pilots and other countries as we gather feedback and insights.

Speaker Change: In April we also rolled out an early version of shop, the look which leverages generative AI to create shopper book content and fashion recommendations shop.

Speaker Change: <unk> the look showcases a variety of styles, such as business casual Scandinavian minimalism or urban athleisure recommended.

Jamie Iannone: Recommended outfits are linked to visually similar products on eBay, drawing from our hundreds of millions of live fashion listings. Shop the Look is live on iOS in the U.S. and U.K., and we will evolve this experience throughout 2024 based on customer feedback, including additional styles, greater diversity of outfits, and increased user control over personalization. Next, I'd like to go deeper on the transformative power of AI. Last quarter, I talked about the meaningful strides we've taken in establishing eBay as a leader in generative AI for e-commerce.

Speaker Change: Recommended outfits are linked to visually similar products on ebay drawing from our hundreds of millions of live listings in fashion.

Speaker Change: <unk> is live in iOS in the us and UK and we will evolve this experienced throughout 2024 based on customer feedback, including additional styles greater diversity of outputs and increased user control over personalization.

Speaker Change: Next I'd like to go deeper on the transformative power of AI.

Speaker Change: Last quarter I talked about the meaningful strides we've taken in establishing ebay as a leader in generative AI for ecommerce in Q1, we doubled our GPU capacity versus the end of 2023, which enabled our teams to accelerate our training and fine tuning our foundational large language models to power a number of EBIT features and services.

Jamie Iannone: In Q1, we doubled our GPU capacity versus the end of 2023, which enabled our teams to accelerate the training and fine-tuning of foundational large language models to power a number of eBay features and services. In addition to powering consumer-facing features like Explore, Shop the Look, Magical Listing, and Background Enhancement, we're increasingly leveraging generative AI to change how we work, driving meaningful productivity and efficiency improvements across our organization. A prime example of this is within our Global Customer Experience Organization, or GCS.

Speaker Change: In addition to powering consumer facing features like explore shop, the look magical listing and background enhancement, we're increasingly leveraging generative AI to change, how we work driving meaningful productivity and efficiency improvements across our organization.

Speaker Change: A prime example of this is within our global customer experience organization or <unk> we.

Jamie Iannone: We are in the midst of a multi-year journey to transform our GCX capabilities using technology. Our North Star for customer service is not just to reduce costs but meaningfully improve the quality of interaction. Recently, we implemented generative AI technology that supports our GCX teammates by analyzing incoming communications to create a simple summary of customers' needs and intents. This technology automatically extracts relevant solutions and next steps from an LLM fine-tuned using our comprehensive knowledge base and policy documents.

Speaker Change: We are in the midst of a multiyear journey to transform our gcs capabilities using technology.

Speaker Change: Northstar for customer service is not just to reduce costs, but meaningfully improve the quality of interactions.

Speaker Change: Recently, we implemented generative AI technology that supports our <unk> teammates by analyzing incoming communications to create a simple summary of customers' needs and intense.

Speaker Change: This technology automatically extracts relevant solutions and next steps from an L. M fine tuned using our comprehensive knowledge base and policy documents. We are now able to present solutions and a clear and concise structure to our gtx team, allowing them to quickly provide customers with the help and support they need.

Jamie Iannone: We are now able to present solutions and a clear and concise structure to our GCX, allowing them to quickly provide customers with the help and support they need, improving the accuracy, consistency, and quality of support. With tens of millions of live customer contacts annually, these efficiencies should yield meaningful cost savings for our GCX organization. Generative AI tools are also improving our developer productivity and accelerating our overall tech velocity. Last year, we made GitHub Copilot available to all of our developers and saw encouraging results.

Speaker Change: Improving the accuracy consistency and quality of support.

Speaker Change: With tens of millions of live customer contacts annually. These efficiencies should yield meaningful cost savings for our <unk> organization.

Speaker Change: Generative AI tools are also improving our developer productivity and accelerating our overall tech velocity.

Jamie Iannone: We observed measurable improvements in productivity along with code acceptance and accuracy. In fact, nearly three-quarters of our developers now use Copilot every day. In parallel, we began building internal tools to streamline our development processes and improve efficiency. We fine-tuned an open-source LLM with eBay's code base and other internal data to develop a proprietary coding assistant that has been incredibly helpful in labor-intensive areas like code migration and software upkeep. For instance, we estimate these tools can reduce the time required for code migration by as much as 20%.

Speaker Change: Last year, we made good have copilot available to all of our developers and saw encouraging results, we observed measurable improvements in productivity, along with code acceptance and accuracy.

Speaker Change: Nearly three quarters of our developers now use co pilot everyday in parallel we began building internal tools to streamline our development processes and improve efficiency, we fine tuned and open source LLM with ebay codebase and other internal data to develop a proprietary coating assistant that has been incredibly helpful and labor intensive.

Speaker Change: Areas like code migration and software upkeep for instance, we estimate these tools can reduce the time required for code migration by as much as 20%.

Speaker Change: We also created an internal gpt's, specifically for developers that answers thousands of questions per week, serving as the knowledge base for our internal documentation.

Jamie Iannone: We also created an internal GPT specifically for developers that answers thousands of questions per week, serving as a knowledge base for our internal documentation. Overall, we're still early in our generative AI productivity journey, but these are just a few examples of proprietary tools we've introduced to our GCX and technology teams that are already yielding tangible benefits. Turning to advertising, our ad business continues to deliver healthy growth at scale while improving velocity and price realization for our sellers at a compelling return on ad spending. During Q1, first-party advertising grew 28%, while total ad revenue represented 2.1% of GMV.

Speaker Change: Overall, we are still early in our generative AI productivity journey, but these are just a few examples of proprietary tools, we've introduced to our <unk> and technology teams that are already yielding tangible benefits.

Speaker Change: Turning to advertising.

Speaker Change: Our ads business continues to deliver healthy growth at scale, while improving velocity and price realization for our sellers at compelling return on AD spend levels.

Speaker Change: Q1 first party advertising grew 28%, while total AD revenue represented two 1% of GMB.

Jamie Iannone: During the quarter, over 3 million sellers adopted a single ad product, and we ended the quarter with over 950 million live promoted listeners. Our standard cost-per-acquisition units remain the largest contributor to year-over-year ad revenue growth in Q1, followed by our cost-per-click advanced products. We are also seeing promising results from some promoted listing products in beta. One such product that's continuing to gain traction in beta is Offsite

Speaker Change: During the quarter over 3 million sellers adopted a single AD product and we ended the quarter with over 950 million live promoted listings.

Speaker Change: Our standard cost per acquisition units remain the largest contributor to year over year AD revenue growth in Q1, followed by our cost per click advanced product.

Speaker Change: We're also seeing promising results from some promoted listing products in beta.

Speaker Change: One such product that's continuing to gain traction in beta is offsite ads. This off ebay solution enable sellers to more actively participate in extending the reach of their listings through CPC ads placed on external surfaces.

Jamie Iannone: This off eBay solution enables sellers to more actively participate in extending the reach of their listings through CPC ads placed on external services. This product leverages eBay's decades of advertising technology investment on behalf of those sellers, enabling advanced targeting, campaign management, and pricing optimization. We expanded our go-to-market efforts for off-site ads toward the end of last year, and this product emerged as a material contributor to first-party ad revenue growth in Q1. We have an ambitious roadmap to further optimize these ad units and increase seller adoption throughout 2024. Now, let's turn to impact.

Speaker Change: This product Leverages ebay's decades of advertising technology investment on behalf of those sellers, enabling advanced targeting and campaign management and pricing optimization.

Speaker Change: We expanded our go to market efforts for Offsite ads towards the end of last year and this product emerged as a material contributor to first party AD revenue growth in Q1, we have ambitious roadmap to further optimize these AD units and increased seller adoption throughout 2024.

Speaker Change: Now, let's turn to impact EBIT community continues to impress us with their generosity last quarter ebay for charity enabled sellers and buyers to raise more than $46 million up 18% year over year.

Jamie Iannone: The eBay community continues to impress us with their generosity. Last quarter, eBay for Charity enabled sellers and buyers to raise more than $46 million, 18% year over year. We also recently published our 8th Annual Diversity, Equity, and Inclusion Report. With our purpose of connecting people and building communities to create economic opportunity for all, we know diversity makes us a better and stronger place to work, sell, and buy. Among the highlights from our 2023 DE&I report were the launch of our first ever Inclusion Index, which helps us gain a stronger understanding of our employee experience, measure our progress over time, and determine how we can better support our employees as a workforce. Our communities of inclusion, our internal eBay resource groups, also remained an integral part of what we do. In 2023, our 11 COIs hosted more than 360 global events, reaching more than 17,000 attendees during the year.

Speaker Change: We also recently published our eighth annual diversity equity and inclusion report.

Speaker Change: With our purpose of connecting people and building communities to create economic opportunity for all we know diversity makes us a better and stronger place to work sell and buy.

Speaker Change: Among the highlights from our 2023 D E and I report was the launch of our first ever inclusion index, which helps us gain a stronger understanding of our employee experience measure our progress over time and determine how we can better support our employees as a workplace or.

Speaker Change: Our communities of inclusion our internal ebay resource groups also remains an integral part of what we do.

Speaker Change: In 2023, our 11th <unk> hosted more than 360 global events, reaching more than 17000 attendees during the year.

Jamie Iannone: And finally, for the eighth year in a row, we've concluded our gender pay equity study, and I'm proud to report our gender pay ratio remained consistent at just over 100% globally. In closing, Q1 marked a strong start to 2024 as we exceeded our financial targets and continued to make progress toward our goal of long-term sustainable GMB growth. Focus categories maintain significant momentum despite ongoing macro pressure on discretionary. After many quarters of consistent innovation in focus categories like luxury, T&A, refurbished, sneakers, and streetwear, we are bringing our innovation playbook to pre-owned fashion in the UK to simplify selling, drive inspirational shopping, and promote the circular economy.

Speaker Change: And finally for the eighth year in a row. We've concluded our gender pay equity study and I'm proud to report our gender pay ratio remained consistent at just over 100% globally.

Speaker Change: In closing Q1 marked a strong start to 2024 as we exceeded our financial targets and continue to make progress toward our goal of long term sustainable GMB growth focused categories maintained significant momentum despite ongoing macro pressure on discretionary ecommerce after many quarters of consistent innovation.

Speaker Change: And focused categories like luxury TNA refurbished sneakers and street, where we are bringing our innovation playbook to pre owned fashion in the UK to simplify selling drive inspirational shopping and promote the circular economy.

Jamie Iannone: Our agreement with collectors would further strengthen our value proposition for hobbyists as we streamline the process of buying, selling, grading, and storing trading cards. And we believe our advancements in generative AI are fundamentally changing the customer experience on eBay, increasing productivity across our organization, and ultimately driving more value for shareholders. Our momentum and excelling pace of innovation are a testament to the incredible work of our employees who continue to execute our strategic roadmap and serve our customers. With that, I'll turn the call over to Steve to provide more details on our financial performance. Steve

Speaker Change: Our agreement with collectors with further strengthen our value proposition for hobbyists as we streamline the process of buying selling grading and storing trading cards.

Speaker Change: And we believe our advancement in generative AI are fundamentally changing the customer experience on ebay, increasing productivity across our organization and ultimately driving more value for shareholders.

Speaker Change: Our momentum ex selling pace of innovation are a testament to the incredible work of our employees, who continue to execute our strategic roadmap and service of our customers.

Speaker Change: With that I'll turn the call over to Steve to provide more details on our financial performance.

Stephen J. Priest: Steve, over to you. Thank you, Jamie, and thank you all for joining us today. I'll begin with the financial highlights section of our earnings presentation, and then I'll discuss our key financial and operating metrics in greater detail. Finally, I'll provide our outlook for the second quarter and context on the full year before we begin Q&A. My comments will reflect FX Neutral year-over-year comparisons unless I note otherwise. We exceeded expectations across our key financial metrics in Q1, despite an uneven demand environment in our major markets to start the year. Gross merchandise volume was roughly flat at $18.6 billion.

Stephen J. Priest: Steve over to you.

Stephen J. Priest: Thank you Jamie and thank you all for joining us today.

Stephen J. Priest: Revenue grew more than 2% to $2.56 billion, outpacing volume by over 2%. The Non-Gap Operating Margin was 30.3%. We delivered $1.25 of non-gap earnings per share, up 13%, and we returned $638 million to shareholders through repurchasing dividends. Let's take a closer look at our financial performance during the first quarter. Gross merchandise volume of $18.6 billion was roughly flat year over year, while foreign exchange was a tailwind of nearly 1 point to reported GMV growth.

Stephen J. Priest: I'll begin with the financial highlights section of our earnings presentation.

Stephen J. Priest: Next I'll discuss our key financial and operating metrics in greater detail.

Stephen J. Priest: Finally, I'll provide our outlook for the second quarter.

Speaker Change: Context on the full year before we begin Q&A.

Speaker Change: My comments will reflect FX neutral year over year comparisons unless I note otherwise.

Speaker Change: We exceeded expectations across our key financial metrics in Q1, despite an uneven demand environment in our major markets to start the year.

Speaker Change: Gross merchandise volume was roughly flat at 18 $6 billion Rev.

Speaker Change: Revenue grew more than 2% to 256 billion.

Speaker Change: Pricing and volume by over two points.

Speaker Change: non-GAAP operating margin was 33%.

Speaker Change: We delivered $1 and 25 of non-GAAP earnings per share up 13%.

Speaker Change: And we returned $638 million to shareholders through every person derivatives.

Speaker Change: Let's take a closer look at our financial performance during the first quarter.

Speaker Change: Gross merchandise volume of $18 $6 billion was roughly flat year over year, while foreign exchange tailwind of nearly one point to reported <unk> growth.

Stephen J. Priest: Our teams did a tremendous job executing on our strategy across focus categories, country-specific investments, and horizontal initiatives. Q1 volume also benefited from an extra day in the quarter due to the leap year. However, we continue to navigate through a tough environment for discretionary e-commerce, particularly in the UK and Germany, two of our largest markets.

Speaker Change: Our teams did a tremendous job executing on our strategy across focused categories country specific investments.

Speaker Change: As long term initiatives.

Speaker Change: Our Q1 volume also benefited from an extra day in the quarter due to the leap year.

Speaker Change: However, we continue to navigate through a tough environment for discretionary e-commerce, particularly in the UK, Germany two of our largest markets.

Speaker Change: Focused categories, Jim grew by nearly five percentage of aggregate roughly six points faster than the remainder of our marketplace during the quarter.

Stephen J. Priest: Focus Categories GMV grew by nearly 5% in aggregate, or roughly 6 points faster than the remainder of our marketplace during the quarter. This continued momentum was driven by positive volume growth in P&A, refurbished collectibles, and luxury goods, reflecting the breadth and resilience of our focus category. Next, I'll walk through our results on a geographic basis.

Speaker Change: This continued momentum was driven by positive volume growth in P&I refurbished collectibles and luxury goods, reflecting the breadth and the resilience of our focus categories.

Speaker Change: Next I'll walk through our results on a geographic basis.

Stephen J. Priest: USGMV was nearly flat in Q1. As Jamie mentioned, P&A was the largest contributor to growth among focus categories, despite the slow start in January caused by severe weather conditions in the US. These headwinds slightly offset the solid performance in trading cards, but we have seen improving volume trends in recent quarters, which disproportionately benefit our U.S. business. International GMV grew nearly 1% on an FX-neutral basis and increased by nearly 3% as reported due to the FX tailwind.

Speaker Change: <unk> was nearly flat in Q1.

Speaker Change: As Jamie mentioned it was the largest contributor to growth and then focus categories. Despite the slow start in January caused by severe weather conditions in the U S.

Speaker Change: These headwinds slightly offset with solid performance in trading costs.

Speaker Change: It's an improving volume trends in recent quarters was disproportionately benefit our U S business.

Speaker Change: International <unk> grew nearly 1% on an FX neutral basis and increased by nearly 3% as reported due to FX tailwind.

Stephen J. Priest: Last quarter, we highlighted the impact of our Germany C2C initiative on overall growth in the region. I am pleased that German C2C volume growth remained positive even as we began to phase the rollout of these changes in March of last year. In the UK, we did see some softness in C2C volumes during the quarter when the new UK digital sales reporting requirements came into effect. We are currently working to educate sellers that many of them actually do not incur taxes for selling pre-owned items. Contrast, our B2C business trends were consistent with recent quarters as we kept pace with our closest market benchmark as reported by the British Retail Consortium. Moving on to bias,

Speaker Change: Last quarter, we highlighted the impact of our Germany States say initiative on overall growth in the region I am pleased that Germany seat to see volume growth remained positive even as we began to lap the rollouts of these changes in March of last year.

Speaker Change: In the UK, we did see some softness in <unk> volumes during the quarter, while the new U K digital sales reporting requirements came into effect.

Speaker Change: We are currently working to educate sellers, but many of them actually do not incur taxes to setting pre owned items.

Speaker Change: In contrast, our basic business trends were consistent with recent quarters as we kept pace with our closest market benchmark as reported by the British retail consortium.

Speaker Change: Moving on to buyers.

Stephen J. Priest: Trading 12 month active buyers and enthusiast buyers were both stable sequentially at approximately $132 million and $16 million, respectively, at the end of Q1. Within the quarter, growth in new and reactivated bios remained positive year-over-year, while bioretention improved compared to recent quarters. Despite macro hedge wins, spend per active and enthusiast buyer both grew slightly compared to a year ago. Turning to revenue, we generated revenue of $2.56 billion during Q1, up over 2%, outpacing volume by over 2%. Foreign exchange was a headwind of roughly 60 basis points to reported year-over-year revenue growth. Our take rate in the first quarter was over 13.7%, down less than 10 basis points quarter-over-quarter.

Speaker Change: Trailing 12 month active buyers of enthusiast baas were both stable sequentially at approximately $132 million and $16 million respectively. At the end of Q1.

Speaker Change: Within the quarter growth in new and reactivated buyers remains positive year over year, while buyer retention improved compared to recent quarters.

Speaker Change: Despite macro headwinds spend per octave and enthusiast buyer, both grew slightly compared to a year ago.

Speaker Change: Turning to revenue, we generated revenue of $2 $5 6 billion during Q1 private.

Speaker Change: 2%.

Speaker Change: Pricing volume by over two points.

Speaker Change: Foreign exchange was a headwind of roughly 60 basis points to reported year over year revenue growth.

Speaker Change: I'll take rates in the first quarter was over 13, 7% ton less than 10 basis points quarter over quarter.

Stephen J. Priest: The sequential decline was primarily driven by FX headwinds, which more than offset the seasonal improvement in call take rates in Q1. On a year-over-year basis, our take rate expanded by nearly 10 basis points, driven by tailwinds from first-party advertising, eBay international shipping, and payments, offset by a 20-basis-point headwind from FX. Total advertising revenue grew 20% to $384 million and represented 2.1% of GMV. First party ads grew 28% to $370 million, nearly 28 points faster than volume.

Speaker Change: The sequential decline was primarily driven by FX headwinds, which more than offset the seasonal improvement in core take rate in Q1.

Speaker Change: On a year over year basis, I'll take rates expanded by nearly 10 basis points driven by tailwind from first party advertising.

Speaker Change: International shipping on payments.

Speaker Change: Set by a 20 basis point headwind from FX.

Speaker Change: Total advertising revenue grew 20% to $394 million and.

Speaker Change: <unk> to 1% penetration of gym visit.

Speaker Change: First party ads grew 28% to $370 million.

Speaker Change: The 28 points faster than volume.

Stephen J. Priest: Our legacy third-party display ads remained a headwind to total advertising growth in Q1, with revenue declining 55% to less than $15 million. As discussed in recent quarters, we continue to selectively deprecate these non-core ads on certain pages to improve the overall user experience, and they now make less than 4% of total ad revenue. Shifting to profitability, Non-Gap Gross Margin improved by 60 basis points year-over-year, as headwinds from eBay international shipping, traffic acquisition costs associated with a ramp of offside ads, and FX were more than offset by lower depreciation expenses and costs of payment sufficient.

Speaker Change: Our legacy third party display ads remains a headwind to total advertising growth in Q1 with revenue declining 55% to less than $15 million.

Speaker Change: As discussed in recent quarters, we continued to selectively deprecate. These noncore us on certain pages to improve the overall user experience and then Mike less than 4% of total AD revenue.

Speaker Change: Shifting to profitability.

Speaker Change: non-GAAP gross margin improved by 60 basis points year over year with headwinds from ebay International shipping traffic acquisition cost with the ramp of Offsite ads and FX were more than offset by lower depreciation expenses and cost of payment sufficiency.

Stephen J. Priest: As we discussed last quarter, our depreciation expense in 2024 is impacted by an extension in the accounting useful life of our servers and networking equipment, which will primarily be recognized in cost of revenue. Additional information will be available in our TANQ filing.

Speaker Change: As we discussed last quarter depreciation expense in 2024 is impacted by an extension in the accounting useful life of our servers and networking equipment, which primarily will be recognized in cost of revenue.

Speaker Change: Additional information will be available in our 10-Q filing.

Stephen J. Priest: Non-Gap Operating Margin was 30.3% in Q1, improving 70 basis points year-over-year and 360 basis points sequentially. On a year-over-year basis, our operating margins benefited from our workforce reduction in January. The aforementioned accounting trend, Cost of Payments Efficiencies, and our Structured Cost Programme. However, this leverage was partly offset by a foreign exchange headwind of roughly 70 basis points and re-investments into sales and marketing to support our full-fledged online initiative. We grew non-gap earnings per share by nearly 13% to $1.25 in the first quarter. On a gap basis, our earnings per share were 85 cents in Q1.

Speaker Change: non-GAAP operating margin was 33% in Q1, improving 70 basis points year over year to 360 basis points sequentially.

Speaker Change: On a year over year basis, our operating margins benefited from our workforce reduction in January.

Speaker Change: The aforementioned accounting change cost of payments efficiencies on our structural cost program.

Speaker Change: This leverage was partly offset by foreign exchange headwinds of roughly 70 basis points and made investments into sales and marketing to support a full funnel of initiatives.

Speaker Change: We grew non-GAAP earnings per share by nearly 13% to $1 25 in the first quarter.

Speaker Change: On a GAAP basis earnings per share was <unk> 85 in Q1 <unk>.

Stephen J. Priest: The difference was primarily due to stock-based compensation and a reduction in the value of our equity investment portfolio, largely due to FX moving. Next, I'll discuss our balance sheet and capital allocation. Our free cash flow was $472 million in Q1, down year over year due to the timing of working capital items. We ended the first quarter with cash and non-equity investments of $4.9 billion, and gross debt of $7.7 billion. We repurchased $499 million of eBay shares at an average price of approximately $51 during Q1 and had $2.9 billion remaining under our buyback authorization at the end of the period.

Speaker Change: The difference was primarily due to stock based compensation.

Speaker Change: The reduction in the value of our equity investment portfolio largely due to FX movements.

Stephen J. Priest: In addition, we paid a quarterly cash dividend of $139 million in March, or $0.27 per share. Since the beginning of 2022, we have returned $6.2 billion to shareholders through repurchase and dividends, or roughly 134% of cumulative free cash flow over that period. Now, I'll give an update on our investment portfolio.

Speaker Change: Next I'll discuss our balance sheet and capital allocation.

Speaker Change: Our free cash flow was $472 million in Q1.

Speaker Change: On year over year due to the timing of working capital items.

Speaker Change: We ended the first quarter with cash and non equity investments of $4 9 billion and gross debt of $7 7 billion.

Speaker Change: We repurchased 499 million.

Speaker Change: Shares at an average price of approximately $51 during Q1 and had $2 $9 billion remaining under our buyback authorization at the end of the period.

Speaker Change: In addition, we paid a quarterly cash dividend of $139 million in March was <unk> 27 per share.

Speaker Change: Since the beginning of 2022, we have returned $6 2 billion to shareholders through repurchases and dividends or roughly 134% of cumulative free cash flow over that period.

Speaker Change: Now I will give an update on our investment portfolio.

Stephen J. Priest: Our equity investments and warrants were valued at over $5 billion at the end of Q1. Our adventure stake was valued at over $4 billion, down over $200 million quarter-on-quarter, primarily due to FX Movements. On April 24th, the consortium led by Premier and Blackstone received its final regulatory clearance regarding the offer to acquire Advento.

Speaker Change: I can see investments in loans provided to over $5 billion at the end of Q1.

Speaker Change: Other than to state was valued at over $4 billion.

Speaker Change: Don over $200 million quarter on quarter, primarily due to FX movements.

Speaker Change: On April 24, the consortium led by <unk> and Blackstone received its final regulatory clearance, we go into the offer to acquire other venture.

Stephen J. Priest: We expect this transaction to close on May 29th, subject to closing conditions. While changes in FX rates impact the value of our stake for quarterly reporting purposes, they do not impact the cash proceeds we expect from the pending deal. Our add-in wallets were valued at over $500 million at the end of Q1. Our warrant value is calculated based on several assumptions, including add-in share price and the probability of vesting.

Speaker Change: We expect this transaction to close on May the 29th subject to closing conditions.

Speaker Change: While changes in FX rates impact the value of our stake for quarterly reporting purposes.

Speaker Change: Do not impact the cash proceeds we expect from the pending deal.

Speaker Change: Other ones, we're valued at over $500 million at the end of Q1.

Speaker Change: Ah one value is calculated based on several assumptions, including adding share price on the probability of investing.

Speaker Change: Turning to our outlook.

Stephen J. Priest: Thanks for our outlook. Our strategy and execution are driving underlying growth in our business. However, the macro environment remains challenging and dynamic.

Speaker Change: Our strategy and execution are driving underlying growth in our business.

Speaker Change: However, the macro environment remains challenging and dynamic.

Stephen J. Priest: Balancing these factors, we forecast Q2 GMV between $17.8 and $18.2 billion, representing FX-neutral growth between negative 2% and flat year-over-year. At current rates, FX would represent roughly half a point of the hedge window. Q2 GMV growth year over year and roughly a point of headwind quarter over quarter. We expect to generate revenue between $2.49 and $2.54 billion in Q2, representing FX-neutral growth between negative 1% and positive 1% year-over-year. Our forecast implies revenue will outpace volume by close to one point on an FX-neutral basis.

Speaker Change: Balancing these factors, we forecast Q2, GM V between $17 eight and $18 2 billion.

Speaker Change: Representing FX neutral growth between negative, 2% and flat year over year.

Speaker Change: At current rates FX would represent roughly half a point of headwind to Q2 GMB growth year over year on roughly a point of headwind quarter over quarter.

Speaker Change: We expect to generate revenue between $2 49 to $5 4 billion in Q2, representing FX neutral growth between negative, 1% and positive 1% year over year.

Speaker Change: Our forecast implies revenue will outpace volume by close to one point on an FX neutral basis.

Stephen J. Priest: We estimate FX will represent more than a one-point headwind to spot revenue growth in Q2. Additionally, we expect first party ad revenue growth to decelerate to low double digits year over year in Q2 due to lapping and one-time factors. As we discussed last year, a deferral release to CPC ads pulled forward approximately $9 million of ad revenue into Q2 of 2023. In addition, benefits from our Halo attribution change in Q2 of last year led to extraordinary growth in first-party advertising overall, which will create more challenging year-over-year comparisons for the remainder of this year.

Speaker Change: We estimate FX will represent more than a one point headwind to spot revenue growth in Q2.

Speaker Change: We expect first party AD revenue growth to decelerate to low double digits year over year in Q2 due to lapping a one time factors as.

Speaker Change: As we discussed last year, a deferral relates to CPE sales pulled forward approximately $9 million of AD revenue into Q2 of 2023 and.

Speaker Change: In addition benefits from a hydro attribution change in Q2 of last year.

Speaker Change: Extraordinary growth and first party advertising, our rule, which will create more challenging year over year comparisons for the remainder of this year.

Stephen J. Priest: However, we do expect a recovery in advertising growth during the second half of 2024, driven by continued adoption and optimization of our first-party ad products. We forecast Q2 non-gap operating margin between 26.9% and 27.6%, or 35 basis points of year-over-year improvement at the midpoint. This is consistent with historical seasonality, where Q1 is usually the high point for operating margin, followed by a sequential decline in Q2, reflecting both the seasonal decrease in volumes and the ramp-up in product and full-front-end marketing investments.

Speaker Change: However, we do expect a recovery in advertising growth during the second half of 2024, driven by continued adoption and optimization of our first party ad products.

Speaker Change: We forecast Q2, non-GAAP operating margin between $26 nine from 27, 6% of 35 basis points of year over year improvements at the midpoint.

Speaker Change: This is consistent with historical seasonality, where Q1 is usually the high points of operating margin followed by a sequential decline in Q2, reflecting both the seasonal decrease in volumes on the ramp up in product in full funnel marketing investments.

Speaker Change: We expect to generate non-GAAP earnings per share between $1 10.

Stephen J. Priest: We expect to generate non-GAAP earnings per share between $1.10 and $1.15 in the second quarter, representing non-GAAP EPS growth between 6% and 11% year-over-year. Based on current rates, FX would represent a headwind of roughly 2.5% a year. Moving on to the foliage.

Speaker Change: $1 15 in the second quarter.

Speaker Change: Representing non-GAAP EPS growth between six and 11% year over year.

Speaker Change: Based on current rates FX would represents a headwind of roughly <unk> five percentage points.

Speaker Change: Moving to the full year, we continue to plan our business, assuming no fundamental change in the macro environment and the ship.

Stephen J. Priest: We continue to plan our business, assuming no fundamental change in the macro environment this year. Within this context, we expect our FX-neutral GMV to turn positive in Q3 or Q4. We expect revenue to outpace GMV growth by approximately 2 points for the full year on an FX-neutral basis. In addition, FX represents close to a one-point expected headwind to total spot revenue growth.

Speaker Change: Within this context, we expect FX neutral Jim V to turn positive in Q3 or Q4.

Speaker Change: We expect revenue to outpace GMB growth by approximately two points for the full year on an FX neutral basis.

Speaker Change: In addition, FX represents close to a one point expected headwind to total spot revenue growth.

Speaker Change: We maintain our outlook for non-GAAP operating margin to expand by 60 to 100 basis points for the full year.

Stephen J. Priest: We maintain our outlook for non-GAAP operating margin to expand by 60 to 100 basis points for the full year. Where we land in this range could vary based on investment opportunities we see throughout the year, not necessarily our volume trends alone. At current rates, we continue to expect FX to be a year-over-year headwind of roughly 50 basis points to operating margins, which is mostly offset by an expected tailwind of 40bpm, primarily driven by the change in accounting estimate associated with the extension of the useful life of service and networking of equipment. For the full year, we project capital expenditures to be between 4% and 5% of revenue, in line with our historical average. We expect our non-gap tax rate to remain stable at 16 and a half.

Speaker Change: We landed this range could vary based on investments opportunities, we see throughout the year not necessarily a volume trends alone.

Speaker Change: Our current rates, we continue to expect FX to be a year over year headwind of roughly 50 basis points operating margins, which is mostly offset by unexpected tailwind of 40 basis points, primarily driven by the change in accounting estimate associated with the extension of the useful life of servers and networking.

Speaker Change: Equipment.

Speaker Change: For the full year, we project capital expenditures to be between four and 5% of revenue in line with our historical average.

Speaker Change: We expect our non-GAAP tax rates to remain stable at 16, 5%.

Stephen J. Priest: We expect just under $2 billion of free cash flow in 2024, with the majority generated in the second half of the year. As a reminder, our free cash flow has been temporarily pressured in recent years by scheduled repatriation payments and changes to the tax treatment of R&D expenses, which will largely be alleviated after 2025. From a timing perspective, our federal cash tax payments will revert to a normal schedule this year, with our largest outlay occurring in Q2, leading to a more normalized cadence of free cash flow.

Speaker Change: We expect just under $2 billion of.

Speaker Change: Our free cash flow in 2024 with the majority generated in the second half of the year.

Speaker Change: As a reminder, our free cash flow has been temporarily pressured in recent years by scheduled repatriation payments and changes to the tax treatment of R&D expenses, which were largely alleviated after 2025.

Speaker Change: From a timing perspective, our federal cash tax payments will be.

Speaker Change: To our normal schedule to ship with our largest outlet occurring in Q2.

Speaker Change: Leading to a more normalized cadence of free cash flow.

Speaker Change: From a capital allocation standpoint, our board declared a quarterly dividend of <unk> seven per share for Q2 to be paid in June.

Stephen J. Priest: From a capital allocation standpoint, our board declared a quarterly dividend of 27 cents per share for Q2 to be paid in June. For the full year, we are targeting a share repurchase of just over $2 billion. Given our better-than-expected Q1 results and our confidence in our strategy and execution, we are increasing our forecast for non-GAAP earnings per share growth to 9 to 11% year-over-year in 2024. In closing, Q1 was a strong quarter for eBay as we exceeded our outlook across our key financial metrics.

Speaker Change: For the full year, we are targeting share repurchases of just over $2 billion.

Speaker Change: Given our better than expected Q1 results and our confidence in our strategy and execution.

Speaker Change: We are increasing our forecast for non-GAAP earnings per share growth to 9% to 11% year over year in 2024.

Speaker Change: In closing Q1 was a strong quarter for ebay.

Speaker Change: We exceeded our outlook across our key financial metrics.

Stephen J. Priest: Our results highlight the resilience of our marketplace and business model amid persistent challenges in the global economy. We remain on track to achieve positive GMV growth this year in Q3 or Q4, driven by our accelerating pace of innovation across focus categories and horizontal initiatives. In addition, we are laser focused on further improving our cost discipline and efficiency and expect operating margin expansion this year, even as we make incremental investments to drive sustainable long-term growth.

Speaker Change: Our results highlight the resilience of our marketplace business model amid persistent challenges in the global economy.

Speaker Change: We remain on track to achieve positive <unk> growth. This year in Q3, or Q4, driven by accelerating pace of innovation across focused categories and horizontal initiatives.

Speaker Change: In addition, we are laser focused on further improving our cost discipline and efficiency unexpected operating margin expansion this year.

Speaker Change: Even as we make incremental investments to drive sustainable long term growth.

Stephen J. Priest: As a result, we plan to deliver double-digit earnings growth this year at the midpoint of our guidance and exceed our original three-year target for total capital return. With that, Jamie and I will now take your questions. As a reminder, to ask a question, please press the star followed by the number one on your telephone.

Speaker Change: As a result, we plan to deliver double digit earnings growth this year at the midpoint of our guidance.

Speaker Change: Our original three year target for total capital returns.

Speaker Change: With that Jamie and I will now take your questions.

Operator: As a reminder, to ask a question, please press star followed by the number one on your telephone keypad. In the interest of time, we ask that you please limit yourself to one question and rejoin the queue for any additional questions. Thank you. Our first question will come from Nathan Feather from Morgan Stanley. Please go ahead. Your line is open.

Speaker Change: As a reminder to ask a question. Please press star followed by the number one on your telephone keypad and the interests of time, we ask that you. Please limit yourself to one question and rejoin the queue for any additional questions. Thank you.

Stephen J. Priest: Hey Nathan, I'll take that. Good afternoon, Steve here.

Speaker Change: Our first question will come from Nathan further from Morgan Stanley. Please go ahead. Your line is open.

Nathan: Hey, everyone. Thanks for taking my question.

Nathan: I wanted to dig into especially in March the <unk> non-GAAP operating margin is down about 300 basis points at the midpoint.

Nathan: Normal Barclays seasonality you see.

Nathan: Can you provide some more color on the puts and takes which are driving that and then with that in mind, how should we think about the cadence of operating margins with remainder of the year. Thanks.

Stephen J. Priest: Our Q2 guide implies margin expansion between 0 and 70 basis points year over year, depending on where we land in the range. That's really driven by underlying advertising growth, efficiency gains, partly offset by some of the investments we've talked about, and some FX headwinds that we're seeing. You're right, there's a bit of seasonality that we deal with as we go through the year. The second quarter does generally have sequential contraction

Speaker Change: Hi, Nathan I'll tell you that good good afternoon, Steve here.

Stephen J. Priest: Our Q2 guide implies margin expansion between zero to 70 basis points year over year, depending on where we land in the range, that's really driven by underlying advertising growth efficiency guidance, partly offset by some of the investments we've talked about and some FX headwinds that we're seeing.

Stephen J. Priest: There's a bit of seasonality that we deal with as we go through the year.

Stephen J. Priest: The second quarter. So it's definitely have sequential contraction. That's in line with the last few years, but just seasonally Q1 is our strongest quarter for operating margin due to relatively high G. M V.

Stephen J. Priest: That's in line with the last few years because, seasonally, Q1 is our strongest quarter for operating margin due to relatively high GMV and low expenses. On a few of the pets and takes that we're seeing, the first thing I would say is that we continue to lean in on investment. We see a lot of opportunity for good ROI as we continue to be committed to growing GMV in either the third or fourth quarter of next year, and we're seeing benefits associated with that.

Speaker Change: <unk> expenses.

Speaker Change: Here are the puts and takes that we're seeing the first thing I would say is that we continue to lean in and investment we see a lot of opportunity for good ROI as we are continuing to be committed to growing GM V in either third or the fourth quarter of next year.

Speaker Change: Same benefits associate with that secondly, there is a couple of dynamics with regards to advertising in Q2 of 2023, we saw changes in terms of the hydro attribution.

Stephen J. Priest: Secondly, there are a couple of dynamics with regard to advertising. In Q2 of 2023, we saw changes in terms of halo attribution, which really sort of saw significant momentum in our first party ads in the second quarter of 2023. In addition, we saw some revenue recognition changes in the second quarter, about $9 million that was pulled forward.

Speaker Change: Which really sort of saw significant momentum in our first party ads in the second quarter of 2023 and in addition.

Speaker Change: We saw some revenue recognition changes in the second quarter were about $9 million that was pulled forward. So we sort of dating whereas those two dynamics, but as you've seen from our prepared remarks, we continue to be confidence in the outlook and we.

Stephen J. Priest: We're sort of dealing with those two dynamics, but as you've seen from our prepared remarks, we continue to be confident in the outlook, and we continue to guide margin expansion through 2024 between 60 and 100 basis points, as we look forward to going through the rest of the year. Great, thank you. Our next question comes from Colin Sebastian from Baird. Please go ahead. Your line is open.

Speaker Change: It can change the guide margin expansion through 2020 for between 60 and 100 basis points.

Speaker Change: As we look forward to getting through the rest of the year.

Speaker Change: Great. Thank you.

Speaker Change: Our next question comes from Colin Sebastian from Baird. Please go ahead. Your line is open.

Jamie Iannone: Oh, great. Thanks. Good afternoon.

Colin Alan Sebastian: Great. Thanks, good afternoon.

Colin Alan Sebastian: Jimmy I appreciate the review of all the product initiatives in the marketplace and I guess in the context of of the confidence you have in that acceleration in growth in the back half.

Colin Alan Sebastian: Guess, which of these innovations are driving the most incremental activity or conversions on the platform and and is that is that part of that.

Colin Alan Sebastian: That acceleration that you're anticipating thank you yes.

Jamie Iannone: Yeah, I'd really say it's threefold, Colin. I would say first, it's the focus category work that we're doing. You see us not only kind of expanding what we're doing there but investing in categories that we've already launched before, like what we announced in collectibles with the collectors and Golden this quarter, and what we're seeing in terms of the growth of luxury and P&A refurbished at 5%. So that's probably the first thing I'd say.

Jimmy: I'd really say, it's threefold Colin I'd say first is the focus category work that we're doing you see us not only kind of expanding what we're doing there, but investing in categories that we've already launched before like what we announced in collectibles with the collectors and Golden.

Jimmy: This quarter, what we're seeing in terms of the growth of luxury of PMA refurbished at 5%. So that's probably the first thing I would say the second is just the work that we're doing in specific geographies.

Jamie Iannone: The second is just the geo work that we're doing and specific geographies. If you look at the work that we did in Germany on C2C, we continue to see healthy returns from that. We're more than a year from launching that. We launched that in Q1 of last year, and we're continuing to see positive C2C momentum in Germany and healthy metrics and encouraging numbers from our CSAT standpoint. So that's the second. I'd call out two that we talked about this quarter, which are Explore and Shop the Look, new AI capabilities that we're launching first in fashion to really create a new browsing experience.

Jimmy: If you look at the work that we did in Germany on <unk>, we continue to see healthy returns from that were more than a year from launching that we launched that in Q1 of last year and we're continuing to see positive C to see momentum in Germany, and healthy metrics and encouraging numbers from our <unk> SaaS standpoint.

Colin Alan Sebastian: So thats the second and the third I would say is that the efforts that we have against our horizontal innovations. So we've talked about things like magical listing of simplifying the selling flow.

Colin Alan Sebastian: We continue to invest in search and CRM in a number of horizontal initiatives I'd call out to you that we talked about this quarter, which are explore and shop. The look new AI capabilities that we're launching first in fashion to really create a new browsing experience. So all three of those together.

Jamie Iannone: So all three of those together give us confidence in moving forward and how we feel good about what we put out there. Our next question comes from Eric Sheridan from Goldman Sachs. Scott Hedgerline says, Thanks so much for taking the question, maybe a two-parter if I could.

Colin Alan Sebastian: What gives us the confidence in moving forward and how.

Colin Alan Sebastian: So we feel good about about what we put out there.

Speaker Change: Great. Thank you.

Speaker Change: Okay.

Jamie Iannone: Our next question comes from Eric Sheridan from Goldman Sachs. Please go ahead, your line is open. Thanks so much.

Speaker Change: Our next question comes from Eric Sheridan.

Eric J. Sheridan: Please go ahead your line is open.

Eric J. Sheridan: Thanks, so much for taking the question maybe two parter, if I could in terms of cross border Commerce, which the currency youre seeing in terms of cross border and region wide globally in terms of a driver of GMB dynamics into the business and have you seen impact from increased competition from cross border.

Eric J. Sheridan: In areas of the World like Europe, and how would you characterize the state of competitive intensity. Thanks, so much.

Jamie Iannone: Yeah, look, our cross-border business is one of our great strengths as a business. One in five transactions, or about 20% of GMV, goes across borders on eBay. And it's very strategic for us, in that for sellers, it opens up a very vast demand opportunity. We've talked for a couple of quarters about eBay International Shipping as an example of one of those things. We've talked about our payments team investing in Buyer and Seller FX to make that more easy and take the friction out for customers.

Speaker Change: Yeah look our cross border is one of our great strengths as a business one in five transactions are about 20% of GMB goes across borders on ebay and it's very strategic for us in that for sellers. It opens up a very vast demand opportunity we've talked for a couple of quarters about ebay international shipping as in.

Speaker Change: Example of one of those things we've talked about our payments team investing in buyer and seller FX to make that.

Speaker Change: More easy and take the friction out for customers. So you've taken for example look at parts and accessories, which continues to perform well at mid single digits. One of the largest contributors to that growth is really healthy CVT business you look at luxury being positive even in this macro environment.

Jamie Iannone: So you take, for example, a look at parts and accessories, which continues to perform well at mid-single digits. One of the largest contributors to that growth is a really healthy CBT business. You look at luxury being positive even in this macro environment, and it's in part because of the work we're doing, where we launched an authentication center in Japan, and we have great inventory coming out of there. So it's one of the benefits that we have from a global marketplace.

Speaker Change: In part because of the work, we're doing where we launched an authentication center in Japan, and we have great inventory coming out of there. So it's one of the benefits that we have from a global marketplace. We think we're unique from that perspective in terms of what we offer in terms of our capability for sellers and we're pleased with what we're seeing in the growth of <unk>.

Jamie Iannone: We think we're unique from that perspective in terms of what we offer, in terms of the capability for sellers, and we're pleased with what we're seeing and the growth of CBT overall. Our next question comes from Tom Champion of Piper Sandler. Please go ahead, your line.

Colin Alan Sebastian: BT overall.

Colin Alan Sebastian: Okay.

Colin Alan Sebastian: Our next question comes from Tom Champion from Piper Sandler. Please go ahead. Your line is open.

Jamie Iannone: Our next question comes from Tom Champion on Piper Sandler. Please go ahead. Your line is open.

Thomas Champion: Thank you good afternoon Jay.

Thomas Champion: Amy I'm wondering if you could just talk about your view of the health of the consumer so it doesn't seem to be much consensus out there and just curious your view and how that may have changed over the last 90 days. Thank you.

Jamie Iannone: Yeah, Tom, thanks for the question. Look, we continue to operate in a really dynamic environment, given the macro challenges globally, with inflationary pressures and interest rates. You know, we talked about Q1 starting off a bit softer because of some of the weather, but then we had a reasonably good tax period. I would say the backdrop remains weaker in Europe than it does in the U.S., where the U.S. is in better shape. If you look at, you know, e-commerce growth rates in the UK and Germany this quarter, they're negative.

Amy: Tom Thanks for the question look we continue to operate in a really dynamic environment, given the macro challenges globally with inflationary pressures in interest rates.

Tom: We talked about Q1 started off a bit softer because of some of the weather, but then we had a reasonably good tax period I would say the backdrop remains weaker in Europe than it does in the U S where U S is in better shape. If you look at e-commerce growth rates in UK, and Germany, this quarter Theyre negative and Thats.

Jamie Iannone: And that's, you know, overall, and obviously, we play more in discretionary than consumables. So I think this is where our model is really winning, right? Our model is working because, you know, we have global demand, we've really focused on non-new and season over the last couple of years, and we can provide value in a marketplace like this. We can be a great avenue for selling in terms of consumer demand. And I think it's why we reached the milestone this year, or this quarter, of now 40% of our inventory is preloved or refurbished is because, you know, we're Our next question comes from Doug Anmuth from J.P. Morgan. Please go ahead. Your line is open.

Tom: Overall, and obviously, we play more in discretionary than consumables. So I think this is where our model is really winning right. Our model is working because we have global demand, we've really focused in on non new in season over the last couple of years and we can provide value in a marketplace. Like this we can be a great Avenue for selling.

Tom: In terms of consumer demand and I think it's why we reached the milestone this year or this quarter of now 40% of our inventory is preloved or refurbished is because we're seeing strength from the value proposition that we've built and it's resonating with the consumer.

Douglas Till Anmuth: Thank you.

Jamie Iannone: Our next question comes from Doug Anmuth from J.P. Morgan. Please go ahead; your line is open.

Jamie Iannone: Our next question comes from Doug Anmuth from Jpmorgan. Please go ahead. Your line is open.

Jamie Iannone: Great. Thanks for taking my questions, it's Brian <unk> on for Doug.

Brian: Are you just talking about the velocity of the investments across generative AI and any affiliated Capex needs and then I guess on that same line of questioning to just timing of when you could see revenue uplift from these investments over time.

Jamie Iannone: Yeah, look, we're really excited by the advancements that we're making in AI. I feel somewhat privileged to be able to lead this company, because when you think of the breadth of categories, the data that we have gathered for over 20 years, the scale of this size of business, being able to put AI against those is really compelling. So, on the consumer-facing side, we continue to see amazing traction with Magical Listing. It now writes descriptions for 100% of users across native, desktop, and web, and we're working on phase two there.

Thomas Champion: Yeah look we're really excited by the advancements that we're making in AI.

Brian: Somewhat of a privilege to be able to lead this company because when you think of the the breadth of categories. The data that we have for over 20 years. The scale of the size of business being able to put AI against those is is really compelling. So on the consumer facing side, we continue to see amazing traction with magical listing is now.

Jamie Iannone: Writes description for 100% of users across native desktop and web and we're working on phase two there and we've got that rolled out to a percentage of sellers, which is great. When you look at it.

Jamie Iannone: We've got that rolled out to a percentage of sellers, which is great. When you look at Explore and Shop the Look, those are two features that, starting with fashion, are really bringing a whole new browse experience to eBay. If you think about it, our fashion category on eBay is over $10 billion, and we have amazing inventory and incredible values. But if you wanted to put an outfit together on eBay, the buyer had to do all that work for the last 20 years, and most of them did, and we built a really healthy business.

Jamie Iannone: Explore and shop. The look those are two features that starting with fashion are really bringing a whole new browse experience to ebay.

Jamie Iannone: Think about it our fashion category on ebay is over $10 billion, and we have amazing inventory and incredible values, but if you wanted to put an outfit together on ebay. The buyer had to do all that work for the last 20 years and most of them did and we built a really healthy business now we can use AI to basically do all of that hard work for the consumer and depending.

Jamie Iannone: Now we can use AI to basically do all of that hard work for the consumer. And, you know, depending on their style, which they tell us, or we infer based on their sizing, we can put the right products in front of them directly. So we're really excited by the potential of what we're seeing, by the acceptance that we have. When you look at Magical Listing, 90% of customers that use it accept what we put together, which is fantastic, and also just the interest from our consumers.

Jamie Iannone: On their style, which they tell us are we infer based on their sizing we can put the right products in front of them directly. So we're really excited by the potential of what we're seeing by the acceptance that we have when you look at magical listing 90% of customers that used it except what we put together, which is fantastic and also.

Jamie Iannone: The interest from our consumers, Steve maybe you want to talk a little bit about financially Costa Brian I think it was a couple of things I'd say first of all our size our scale and our financial architecture the value with the strength of the balance sheet. We have is a distinct advantage for us, particularly as we look to exploit generative II and the benefits that come from that.

Stephen J. Priest: Steve, maybe you want to talk a little bit about finances? Yeah, of course. So Brian, I think there's a couple of things I'd say.

Stephen J. Priest: Yeah, of course. So, Brian, I think there's a couple of things I'd say.

Stephen J. Priest: First of all, our size, our scale, and our financial architecture at eBay with the strength of the balance sheet we have is a distinct advantage for us, particularly if you look to exploit generative AI and the benefits that come from that. With regard to how we're thinking about it from a CapEx and OpEx standpoint, all of the investment that we've talked about in 2024 from a CapEx standpoint is embedded in the 4% to 5% of revenue, which we've guided to the full year.

Stephen J. Priest: With regards to how are we thinking about it from a capex and Opex standpoint.

Stephen J. Priest: All of the investment that we've talked about in 2024 from a capex standpoint is embedded in the 4% to 5% of revenue, which would cause it to the full year in terms of the opex investments associated with generative II and everything that comes through or not that is contemplated in both our earnings and margin architecture that we've laid out on in time.

Stephen J. Priest: In terms of the OpEx investments associated with generative AI and everything that comes from that, that is contemplated in both our earnings and margin architecture that we've laid out. And in terms of revenue contribution, that's sort of embedded in the work that we've done and is enabling us to put the margin accretion on the board between 60 and 100 basis points for 2024. And it will also give us benefits for years to come as we improve trust and momentum on the overall platform. Our next question comes from John Blackledge from TD Cowan. Please go ahead.

John Ryan Blackledge: The revenue contribution.

John Ryan Blackledge: Embedded in that and the work that we've done and is enabling us to put the margin accretion that upon the board between 600 basis points for 2024, and it will also give us benefits as Jeremy talked about for years to come as we improve trust our momentum on the overall platform.

Stephen J. Priest: Our next question comes from John Blackledge from TD Cowen. Please go ahead. Your line is open.

Jamie Iannone: Our next question comes from John Blackledge from TD Cowan. Please go ahead. Your line is open. Oh, great. Thanks.

John Ryan Blackledge: Great. Thanks.

John Ryan Blackledge: <unk> business you guys mentioned that trading card volume is up over the last few quarters, just curious what's driving the uptick in volume and would you expect volumes to kind of remain elevated as we get through the year. Thank you.

Jamie Iannone: Yeah, look, we're excited by what we're seeing on trading cards. What we saw is that, you know, there was obviously a lot of activity during the pandemic.

John Ryan Blackledge: Yeah look we're excited by what we're seeing in trading cards. What we saw is that there was obviously a lot of activity during the pandemic and we were able to hold onto a lot of customers that we acquired and frankly, a lot of customers that got reactivated or re interested into the hobby. When you look at collectibles, we've been investing at a quite over quite some time.

Jamie Iannone: And we were able to hold on to a lot of customers that we acquired, and frankly, a lot of customers that got reactivated or re-interested in the hobby. When you look at collectibles, we've been investing in it for quite some time. We've launched a number of features, whether it's price guides, making it easier, My Collections on the Marketplace, we've launched new shipping forms, we've introduced authentication in that product, etc., and really built the suite of what collectors were asking us to do.

Jamie Iannone: Launched a number of features whether its price guides, making it easier my collections on the marketplace. We've launched new shipping forms we've introduced authentication in that product et cetera, and really build the suite of what collectors were asking us to do and then this quarter as you saw a few weeks ago. The three party agreement that we have.

Jamie Iannone: And then this quarter, as you saw a few weeks ago, the three-part agreement that we've developed with collectors really takes that to the next level. And frankly, this is something that collectors have been asking us to do, which is, you know, hey, we create real value by getting our cards graded. We love selling them on eBay. How could we make that whole process easier?

Jamie Iannone: <unk> with collectors really takes that to the next level.

Jamie Iannone: And frankly this is something that collectors had been asking us to do which is hey, we create real value in getting our cards graded we love selling them on ebay, how could we make that whole process easier and when you look at the three separate deals that we put together that's exactly what we intended to do with trading card. So we're bringing in the Golden platform excited.

Jamie Iannone: And when you look at the three separate deals that we put together, that's exactly what we intended to do with trading cards. So we're bringing in the Golden Platform, excited to bring Ken and his team in. This is going to bring really unique inventory, frankly, the world's most desirable inventory into the platform. Like they, you know, they sold an Onis Wagner card for $7 million. It was the third most expensive trading card ever sold, behind Michael Jordan sneakers that sold for $1.4 million. There's this great book called The Golden 100.

Jamie Iannone: Bring Ken and his team in this is going to bring really unique inventory frankly, the world's most desirable inventory onto the platform like they you know they saw the onus Wagner card for $7 million was the third most expensive trading card ever sold Michael Jordan Sneakers that sold for $1 $4 million. There's this great book of the Golden 100.

Jamie Iannone: And we're just excited to have this new high touch white glove experience available to sellers and to bring our global reach now for Golden sellers on the marketplace and then when you look at the commercial agreements, making it easier to buy sell trade and grain on the platform through an integrated experience is a great opportunity because clearly are.

Jamie Iannone: And we're just excited to have this new high-touch, white-glove experience available to sellers and to bring a global reach now for gold sellers on the marketplace. And then when you look at the commercial agreements, making it easier to buy, sell, trade, and grade on the platform through an integrated experience is a great opportunity, because clearly, a lot of collectors buy ungraded cards on eBay that they want to get graded, or they've just graded a card, and they realize the value based on the grade they have, and they want to sell it.

Jamie Iannone: A lot of collectors by upgrading the cards on ebay that they want to get graded or they've just graded a card and they realize the value based on the grade they have that they want to sell it and so our ability to do this really helps grow the industry. It helps grow the hobby and it's really what collectors had been asking us to do so I'm really excited about what it means.

Jamie Iannone: And so our ability to do this really helps grow the industry, it helps grow the hobby, and it's really what collectors have been asking us to do. So I'm really excited about what it means for collecting and the future here at eBay.

Jamie Iannone: For the collecting and the future here at ebay.

Speaker Change: Thank you.

Jamie Iannone: Okay.

Jamie Iannone: Our next question comes from Richard Kramer from Aret Research. Please go ahead; your line is open.

Jamie Iannone: Our next question comes from Richard Kramer from Arete Research. Please go ahead. Your line is open.

Jamie Iannone: Thank you very much. I have a quick question for both of you. Jamie, when you talk about the guidance on take rate expansion, can you talk through how you might mitigate the risk of seeing seller defections to other platforms that are doing cheap promotions? And also whether you'd anticipate the promotion like you're doing now in the UK on used apparel being something that's permanent and that people can get used to? And then Steve, could you maybe quickly just size the cost savings from the head count reductions you made at the start of the year and whether that's going to get reinvested, or is that something that's supporting the margin expansion you mentioned? Thanks very much.

Richard Alan Kramer: Alright, Thank you very much quick.

Speaker Change: Quick question for both of you.

Jamie Iannone: <unk>.

Jamie Iannone: Jamie when you talk about the guidance would take rate expansion could you talk through how you might mitigate risk of seeing seller defections to other platforms that are doing cheap promotions and also whether you would anticipate the promotion like Youre doing now in the UK on used apparel being something that's permanent and that people can get used to and then Steve could you maybe quickly just size the cost savings from our <unk>.

Steve: Count reductions you made at the start of the year and whether that's going to get reinvested or is that something thats supporting the margin expansion you mentioned, thanks very much.

Jamie Iannone: Yeah, look, the reason that we have such good seller metrics and sellers are so loyal, Richard, is because we let them build a brand on eBay, they build an eBay store, they have a presence, and we bring them a lot of really unique value propositions. You know, we bring them the scale and breadth of global buyers on the marketplace. We bring them all of the capabilities to market and advertise their products really easily.

Speaker Change: Yes look the reason that we have such good seller metrics and sellers are so loyal Richard is because we let them build a brand on ebay they build an ebay store or they have a presence and we bring them a lot of really unique value propositions, we bring them the scale and breadth of global buyers in the marketplace, we bring them all of the capabilities too.

Jamie Iannone: Market and advertise their products really easily we just we've.

Jamie Iannone: We've been working last couple of quarters on this product that I talked about with off site ads, which helps them, bringing traffic back and so it's really those are really I think important to sellers and what we see as really good feedback from doing those.

Jamie Iannone: We've been working for the last couple of quarters on this product I talked about with off-site ads, which helps them bring traffic back. And so, it's really, you know, those are really important to sellers, and what we see is really good feedback from doing those. You know, and what we're doing in the UK. The UK is a unique market for us. We have very strong awareness, and we're a leading player in e-commerce, but we view the pre-loved fashion category as really a gateway to e-commerce.

Jamie Iannone: And what we're doing in the U K U K is a unique market for us we have very strong awareness and we're a leading player in re commerce.

Jamie Iannone: But we view the fashion.

Jamie Iannone: <unk> is really a gateway to re commerce pre.

Jamie Iannone: Pre-owned apparel shoppers are really valuable to our business, and what we see is that 30% of our C2C sellers actually sell pre-owned apparel. So, given the strategic nature, we not only looked at what we could do to drive that velocity with the fee structure that we outlined, but we built about 10 different discrete features into that launch. From a streamlined listing flow, where there are much simpler shipping options, for example, we simplified item aspects to just the relevant field.

Jamie Iannone: Pre owned apparel shoppers are really valuable to our business and what we see is that 30% of our CDC sellers actually sell in pre owned apparel. So given the strategic nature, we not only looked at what we can do to drive that velocity with the fee structure that we outlined but we bought about 10 different discrete features.

Jamie Iannone: And that in that launch from a streamlined listing flow where there is much simpler shipping options. For example, we simplified item aspects too just the relevant fields, we now offer photo guidance and a really compelling way, including a better image removal and background swap change the default. So did a lot of things to make this.

Jamie Iannone: We now offer photo guidance in a really compelling way, including better image removal and background swap, and changed the defaults. So, we did a lot of things to make the selling process easier while launching, exploring, and shopping the look on the buying side to really take advantage of a much more modern experience for shopping for fashion on eBay. Thanks, Jamie.

Jamie Iannone: Selling process easier, while launching explore and shop the look on the buying side to really take advantage of a much more modern experience for shopping for fashion on on ebay.

Jamie Iannone: Thanks, Jamie. And Richard, it's good to speak to you.

Jamie Iannone: Thanks, Jeremy and Richard gets expenditure, obviously, we made the difficult decision at the start of the year to go through the reduction in force.

Stephen J. Priest: Obviously, we made a difficult decision at the start of the year to go through the reduction in force. From the magnitude of the headcount and the restructuring charges, it was obviously a significant event for us. It was not just about driving cost savings and creating capacity. It was also about driving greater agility, speed, and decision-making across the organization so we can continue to deliver for our customers. As it relates to the value of that, along with other savings that we continue to drive through operational efficiencies, through our structural cost program that we've been running through for a few years, it is creating the capacity for us to invest back into the business to stimulate some sort of customer stickiness and also to drive long-term sustainable growth.

Stephen J. Priest: And the magnitude of the head count.

Stephen J. Priest: And the restructuring charges. It was obviously a significant event for us it was not just about driving cost savings and creating capacity. There was also about sort of driving greater agility speed and decision making across the organization. So we can continue to deliver for our customers as it pertains to the value of that that along with other savings.

Stephen J. Priest: But we continue to drive through operational efficiencies through our structural cost program that we've been running through for a few years. It is creating the capacity for us to invest back into the business to stimuli such a customer stickiness and also to drive long term sustainable growth. It is contemplated in the 62.

Stephen J. Priest: It is contemplated in the 60 to 100 basis points of margin expansion that we've laid out for the full year and obviously a critical part of the earnings momentum that we're expecting to see with double-digit earnings growth at the midpoint of our guide.

Stephen J. Priest: 100 basis points of margin expansion that we've laid out for the full year and obviously a critical part of the earnings momentum that we are expecting to see with double digit earnings growth at the midpoint of that God.

Speaker Change: Okay. Thanks.

Jamie Iannone: Our next question comes from Michael Morton from Moffitt Nathanson. Please go ahead. Your line is open.

Stephen J. Priest: Our next question comes from Michael Martin from Moffett Nathanson. Please go ahead. Your line is open.

Jamie Iannone: Thank you for the question. I just wanted to maybe talk a little bit about what we discussed last quarter as well. And it's the impressive strength you've seen from cross-border e-commerce, I think, with your ability to lower the friction around it, and then also places like China opening back up. I'd love to learn a little bit more about the composition of the goods coming cross-border if it's very representative of the entire focus category platform or eBay more broadly, and then the ability to see continued strength from some of the regions like China. Thank you. Yeah, so look, it's been an important strategic move.

Michael Morton: Alright. Thank you for the question I, just wanted to maybe talk a little bit about what.

Jamie Iannone: Scott last quarter, as well and it's an impressive strength you've seen from cross border I think with that.

Jamie Iannone: <unk> to lower the friction around it and then also places like China opening back up.

Jamie Iannone: I'd love to learn a little bit more about the composition of the goods coming cross border. If it's very representative of the entire focus category platform or ebay more broadly and then the ability to see continued strength from some of the reasons regions.

Jamie Iannone: China. Thank you.

Jamie Iannone: Yeah, so look, it's been an important strategic area for us. One of the reasons we launched eBay International Shipping was the whole concept that we wanted you to be able to ship a product from, you know, L.A. to Norway, and it would be as easy as shipping it from L.A. to Chicago. And we built that product, and eBay takes care of all of the hard work in the background of customs, duties, et cetera. And we're seeing really great feedback in terms of the CSAT and the performance that we're getting from our sellers from that perspective.

Jamie Iannone: Yeah. So look it's been an important strategic area for US one of the reasons, we launched ebay International shipping was the whole concept that we wanted you to be able to ship a product from L. A to Norway and it would be as easy as shipping it from la to Chicago.

Jamie Iannone: We built that product and ebay takes care of all of the hard work in the background of customs duties et cetera.

Jamie Iannone: And we're seeing really great feedback in terms of the seats that in the performance that we're getting from our sellers from that perspective, we built a lot of features like buyer and seller FX. So that the buyer can transact in their currency of choice to make that really easy for for the for both the buyer and for the seller when you look at the categories and.

Jamie Iannone: We built a lot of features like Buyer and Seller FX so that the buyer can transact in their currency of choice to make that really easy for both the buyer and for the seller. When you look at the categories and what we have, it's really across the board, and it's really aligned with our focus category strategy that we have. So, whether that's parts and accessories and being able to generate great parts and accessories in different parts of the world and ship them around the world, even unique parts that may be manufactured in one country where there may be global demand from that perspective.

Jamie Iannone: What date.

Jamie Iannone: What we have it's really across the board and.

Jamie Iannone: And it's really align with our focused category strategy that we have so whether that's you know parts and accessories and <unk>.

Jamie Iannone: You're able to generate great parts and accessories and different parts of the world and ship them around the world even to unique parts that may be manufactured in one country that there may be global demand from from that perspective, we talked about handbags being another example in luxury.

Jamie Iannone: We talked about handbags being another example and a luxury where, you know, there's inventory coming out of, for example, Japan. It's a great market for handbags by putting an authentication center there. That now opens up global demand for the great inventory that sits there. And really, when you think about it, you know, there's great inventory in a lot of our categories all across the world. And what we really focus on is how to open that up.

Jamie Iannone: There's inventory coming out of for example, Japan.

Jamie Iannone: Great market for handbags by putting authentication center, there that now opens up global demand for the great inventory that sits there in and really when you think about it you know there's great inventory and a lot of our categories all across the world and what we really focus on is is how to open that up when you think about the scale of it.

Jamie Iannone: When you think about the scale of a $73 billion platform where, you know, one in five transactions is going across borders, the scale of that means that, you know, it's broad, it's very diverse from that perspective, and, you know, we have 2 billion live listings on the platform. So, really, just about every category on the platform benefits from the work we've done on cross-border and making that simpler and easier for our customers.

Jamie Iannone: A $73 billion platform, where one in five transactions is going across borders.

Jamie Iannone: The scale of that means that it's broad it's very diverse from that perspective, and we have 2 billion live listings on the platform. So really just about every category on the platform benefits from the work we've done in cross border and making that simpler and easier for our customers.

Jamie Iannone: Okay.

Speaker Change: Thank you.

Speaker Change: Thanks, Michael.

Operator: We have no further questions. This will conclude today's conference call. Thank you for your participation. You may now disconnect.

Speaker Change: We have no further questions. This will conclude today's conference call. Thank you for your participation you may now disconnect.

Speaker Change: Thank you.

Operator:

Operator:

Operator: