1. Welcome to eBays2011 Analyst DayJennifer CeranVice President Investor Relations and Financial Planning & AnalysisFebruary 10, 2011

2. Forward-Looking StatementThis presentation contains non-GAAP measures relating to the companys performance. You can find thereconciliation of those measures to the nearest comparable GAAP measures in the appendix at the end ofthis presentation.This presentation includes forward-looking statements relating to our future performance that are based onour current expectations, forecasts and assumptions and involve risks and uncertainties. These statementsinclude, but are not limited to, statements regarding expected future performance (including, withoutlimitation, projected financial and operating results for the company and its Marketplaces and PayPalbusinesses), business strategy and plans, as well as anticipated developments concerning our businessand industry.Our actual results may differ materially from those discussed in these presentation for a variety of reasons,including, but not limited to, the after effects of the global economic downturn; changes in political,business, and economic conditions; foreign exchange rate fluctuations; the impact and integration of recentand future acquisitions; our increasing need to grow revenues from existing users in established markets;an increasingly competitive environment for our businesses; the complexity of managing an increasinglylarge enterprise, with a broad range of businesses; our need to manage regulatory, tax, IP and litigationrisks (including risks specific to PayPal, Bill Me Later and the financial industry); and our need to upgradeour technology and customer service infrastructure at reasonable cost while adding new features andmaintaining site stability.This presentation also contains product demonstrations, some of which are conceptual and may not bedeveloped or launched in the same form, with all of the same features or at all.You can find more information about factors that could affect our operating results in our most recentannual report on Form 10-K and our subsequent quarterly reports on Form 10-Q (available athttp://investor.ebayinc.com). You should not rely on any forward-looking statements, and we assume noobligation to update them. All information in the presentation is as of February 10, 2011, and we do notintend, and undertake no duty, to update this presentation. 3. Agenda Presenters Title Jenny Ceran Welcome and Todays Agenda eBay and the Changing Commerce John DonahoeLandscape Scott Thompson, Ed Eger, The Future of Payments is Now Sam Shrauger Break John Donahoe, Mark Carges, Doug McCallum, Reinventing the Shopping Experience Christopher Payne LunchCapitalizing on our Opportunities Bob Swan3 Yr Outlook Senior Management Question and Answer 4. Two years agoA different eBay 5. The futureAn inflection point 6. 4 trends shape how consumersshop and payMobileLocal DigitalSocial 7. Traditional boundaries are blurringOnlineOfflineworld worldMobile 8. Consumers have a store in their pocket Promotions &Loyalty couponsMobile Self-scanningeCommerce& self-checkoutPaymentIn-store price comparison Store locationShopping lists 9. New retail demands new ways to reach consumersSole proprietors Small and mediumsize businessesLarge merchants 10. Merchants of all sizes must reach buyers in newways and keep up with innovationSole proprietors Multi-Millions of channelbuyers Small and mediumsize businesses Global Pace of competition innovationLarge merchants 11. Huge opportunity: Taking the e out of ecommerceYesterdayTodayTomorrowOnline Online 4% 6%Web-Online influenced + Offlineoffline Offline 37%Offline96% 2008 = $325B 2013 = $10TSource: Forrester, Euromonitor and EconomistSource: Forrester Source: Economist Intelligence UnitIntelligence Unit 12. The new retail future: our unique positioneBay PayPal ClassifiedsShopping.com Mobile Apps Buyers SellersStubHub 13. Connected with consumers wherever they are At homeOn-the-go Everywhere 14. Our merchant footprint is expandingConsumer SmallBig brandsSellersbusinessOffline retailonline 15. And our platform assets can enable new opportunities BuyersSellers eBayPlatform Developers 16. The Next Generation ofCommerce Leadership 17. PayPal AdvantagesUnmatched competitive advantagesSignificant runway in the coreExpanded opportunity ahead 18. Marketplaces Advantages Turning the corner Technology-led innovation Sustainable, profitable growth 19. eBay Inc. Advantages Synergies with two strong cores Accelerating innovation Expanding opportunity set through open commerce platform 20. Playing offense in new commerce landscape 21. The Future ofPayments is NowScott ThompsonPresident, PayPalFebruary 10, 2011 22. The evolving PayPal storyUnmatched competitive advantagesSignificant runway in core businessExpanding opportunity ahead23 23. On track to meet 2009 Analyst Day forecasts 2011 Revenue 2011 Segment Margin$4.0-5.0$4.2+ Exceed18-20% BillionBillionrange2009Current 2009Current Analyst Day Trajectory1 Analyst Day Trajectory1ForecastForecast 1. Trajectory based on performance through 2010 24 24. Growth in Total Payment Volume (TPV) TPV growing 3.0 times faster than online market1$60 $72$92 Billion BillionBillion 2008 2009 2010 1. Online market growth based on 12 countries (US, CA, AU, UK, DE, FR, IT, NL, ES, AT, BE, CH) using Forrester online retail and travel estimates 25 25. Growth in accounts and engagementActive accounts1Transactions perIn millions active consumer account2 708194 11.5 12.2 13.5 2008 2009 2010200820092010 1. As of December 31 2. Trailing 12 months26 26. Growth in global presenceTotal Payment Volume New active accounts% of PayPal global total % of PayPal global total United 45%42% 64%59% States 55%58%International36%41% 2008 2010 2008201027 27. Transforming commerce onlineGlobal Internet FinancialCompanies Networks 28 28. Unmatched advantagesWhat we said at Analyst Day 2009Internet Fraudtechnologyexpertise Closed-loop Globaldata connections 29 29. Unmatched advantagesWhere we are todayPace ofinnovation InternetFraud technology expertiseOpenCross-border platform businessClosed-loopGlobal dataconnectionsDigital wallet 30 30. Operating successfully in a regulatedenvironment globally Support for 190 markets, 24 currencies and 20 local language sites Global connections to 15K+ bank partners and 57 financial networks31 31. PayPals position in the ecosystemFinancial Internet institutionscompaniesPaymentTelcosstartups 32 32. Delivering greater value to consumersMulti-channel paymentsCredit /Loyalty benefits Bill Me LaterPayment flexibility Global markets Security Buyer protection 33 33. Delivering greater value to merchants Multi-channel paymentsMarketing /Cross borderpromotionsHigher conversionLess expensive & salesEase of online selling 34 34. Favorable global trends $630B$415B Over 50% of Internet usersGlobal onlineretail sales1are in developing countries3 eCommerce is 6% of retail sales in the United States3 2.1B 35% of consumers in Western Europe will have mobile 1.7BGlobal internet internet access by 20133 users22010 2013E 1. Forrester and Euromonitor; excludes food/grocery and online travel 2. Forrester; 2010 & 2013 data is straight-lined from Forrester 2009 & 2014 estimates 3. Forrester35 35. ~50 billion connected devices globally in 20201Mobile phonesTelevisions Video game systems eReaders Navigation systemsAppliancesComputers Tablets1. Ericsson forecast 36. ~50 billion connected devices globally in 20201 Mobile phonesTelevisionsVideo gamesystemseReadersubiquitousNavigationsystemsdigital walletAppliances Computers Tablets PayPal seeks to enable payments across devices and channels 1. Ericsson forecast 37. Lines are blurring between online & offlineOnlineOfflineubiquitous digital wallet Mobile38 38. Connected devices will unlock retail sales2010 Global Retail Sales1 $8+ TrillionJust 1% of globalretail sales is$80B+ in TPV1. Economist Intelligence Unitexcluding food/grocery39 39. How we will achieve our visionGlobalMarketplaces GlobalAdjacenciesMerchant& SeedsServices 40 40. Continued strength in core business Marketplaces MerchantServices41 41. Success across merchants & consumers PayPal global share1Key metrics20082010Active sellers8M 9M Merchant 18%Active coverage 2010accounts270M94MTransactions /14%active consumer 11.513.52008account3 Consumer preference1. Calculated based on 12 countries (US, CA, AU, UK, DE, FR, IT, NL, ES, AT, BE, CH) using Forrester online retail and travel estimates; not to scale; excludes Bill Me Later2. As of December 31 3. Trailing 12 months42 42. PayPals virtuous cycleGlobaleCommercegrowthMerchantcoverage Increased Increased merchant consumer coverage andengagementpenetrationConsumer preference 43 43. Continued strength in core business Global eCommerce growthIncreasedIncreasedmerchantconsumercoverage and engagement penetration44 44. Powerful partnership with eBay 45 45. Penetration growing on eBay PayPal penetration eBay Addressable GMV & on eBay globally (%) PayPal penetration2010$25B $19B58%69% 75-80% 85%57%2008 2010 2013E United States International46 46. Merchant Services gaining volume & shareMerchant Services TPV and % of total TPV162% 56%49%42% $125B+ 35%30% $56B $40B$30B $12B $20B$8B2005 2006 20072008 2009 2010 2013E 1. Excludes Bill Me Later 47 47. Success across merchant segmentsShare of PayPalSole proprietors merchant accounts1Small / mediumbusinessesShare of GlobalLarge merchantseCommerce11. Illustrative representation of size 48 48. Delivering value for all merchants Merchant segmentPayPal value to segmentSole proprietors Ease of getting and selling onlineSmall / medium All-in-one solutionbusinesses Competitive pricing Fraud detection More payment optionsLarge merchants Multi-channel payments Higher conversion rates 49 49. Better PayPal integration drives volume50 50. Serving the worlds largest brandsPayPal # of top 100PayPal large merchantsonline merchants1United59StatesRetailUnited40KingdomGermany 30France28TravelAustralia 63 1. Internal analysis; United States count includes both PayPal and Bill Me Later merchants51 51. Expanding our global footprintCountries with increased local merchant services presence in 2010-2011DenmarkSwedenNorwayTurkeyMalaysiaIsrael Mexico BrazilSingapore 52 52. Connecting sellers and buyers globallyGlobal Cross Border TPV $14B$17B $22B$40-45B20082009 20102013E53 53. Continued strength in core business Global eCommerce growthIncreasedIncreasedmerchantconsumercoverage and engagement penetration54 54. Engagement drives the businessActive accounts1 Transactions perIn millionsactive consumer account2 94130+13.516.5+2010 2013E20102013E 1. As of December 31 2. Trailing 12 months55 55. Improving engagement for consumers Specialized customer support New to PayPalteam for new members Updated online tools Growing coverage where our Casual users consumers shop Offering Bill Me Later creditduring checkout Dedicated customer supportwith white glove service Highly engaged Product investment PayPal Advantage program56 56. Rewarding our engaged consumers57 57. Increasing value to consumers Fill up your cart Checkout using Bill Me Later Receive your Bill Later Bill Me Later provides credit to consumers during checkout Helps merchants drive sales and increase conversion Helps PayPal drive consumer engagement and preference58 58. Bill Me Later engaging eBay consumers Lift on eBay average orderSource of new Bill Mevalue when paid with BillLater accounts1Me Later240%+25%Accounts 60%openedon-eBayAccountsopenedoff-eBay 1. Q4 2010 2. Q4 2010; includes shipping and handling 59 59. Driving the core businessMerchant CoverageConsumer Engagement Penetrating eBay globally Rewarding engaged consumers Strengthening relationships with Increasing value delivered to all merchant segmentsconsumers Expanding our global footprint Engaging eBay consumers withBill Me Later Growing cross-border trade Moving into new verticals60 60. Significant runway in core businessPayPal global share1 20-24% 2013E18%Merchant2010coverage14%2008Consumer preference1. Calculated based on 12 countries (US, CA, AU, UK, DE, FR, IT, NL, ES, AT, BE, CH) using Forrester online retail and travel estimates; not to scale; excludes Bill Me LaterSource: Internal PayPal analysis, not to scale61 61. Expanding our business through innovationAdjacencies Seeds62 62. The adjacent opportunities are immense Point of sale12010 Global Market Size~$8T+Credit2~$5T+ MobilePayments3 Digital ~$180B Goods4~$20B1. Economist Intelligence Unitexcluding food/grocery2. Nilson Report3. Juniper Research4. GigaOm 63 63. Bill Me Later (BML) synergies Improve customer economics Lower BML fraud losses Lower BML cost of capital Increase merchant coverage and speed up merchant sales cycle Increase consumer engagement and preference64 64. BML increases spending & engagement Average spend perNumber of engaged consumer after signing consumers after signing upup for Bill Me Later1 for Bill Me Later1 +124% +76% 1. Internal analysis on multiple tests groups each consisting of 5-10K US consumers who signed up for Bill Me Later in July 2010; Engaged defined as 13+ trxns in trailing 12 mos 65 65. Continue to grow Bill Me LaterTotal Payment Volume for Bill Me Later $1.3B$0.9B 2008201066 66. Evolving key capabilities to accelerate growthProprietary Data Superior Insight Incremental Growth PayPal & eBay DataMerchantRisk ModelingUnderwriting HistoryCredit Engine DecisionScoreTransactionDetails 67 67. Global launch of Digital Goods platformDigital Goods platform is a payment solution for digital media (e.g. games, software, video, music, news, eBooks)$3.4B in PayPal Digital GoodsTPV in 2010, up over50% year-over-year17countries launched the newPayPal for Digital Goodsproduct, with key merchantssuch as Facebook 68 68. Enabling new monetization models 69 69. Rapid growth of mobilePayPal Mobile TPV In millions$2,000+ $750$140$25 2008 2009 2010 2011E70 70. Key priorities to accelerate mobile growthExpand mCommerce products and market shareIncrease global coverageAvailability across technologies and platformsEvolve the mobile wallet 71 71. Driving innovation through open platform Accelerating internal innovation Foundation for new products, services, and markets Increased responsiveness to market developments PayPal paymentsplatform Enabling external innovation Global open payment platform Thousands of engaged developers Innovative solutions for changing payments landscape72 72. Lines are blurring between online & offline Online Offline worldworldMobile73 73. PayPal powers the digital wallet Traditional wallet Financial Ubiquitousflexibility & access across controlchannelsFinancial connections among individuals,groups & businesses74 74. How we will achieve our visionGlobalMarketplaces GlobalAdjacenciesMerchant& SeedsServices 75 75. An incredible futureRapidly growing addressable marketUnmatched competitive advantagesContinued strength in core businessExpanding our business through innovation76 76. The worlds favorite wayto pay and be paid 77 77. Reinventing theShopping ExperienceJohn DonahoePresident and Chief Executive Officer, eBay Inc.February 10, 2011 79 78. What we said in March 2009 Transforming our Marketplace... Fixing the foundation Focusing where we can win Secondary market Growing our complementary formats 79. TodayA new eBay 80. How have we done?2011 Revenue2011 Segment Margin Middle$5-7 ofBillionrangeMiddle 35-45%ofrange 2009Current2009CurrentAnalyst Day Trajectory Analyst Day Trajectory Forecast Forecast82 81. Marketplaces mix shift... 2008 Q4 2010 GlobalRevenue Adjacencies Adjacencies and Vehicles Fixedand VehiclesPrice FixedPrice Auctions AuctionsAdjacencies include Classifieds, Advertising, StubHub and other non-transactional revenue 82. The eBay StrategyImprove TrustIncrease SelectionDevelop Tailored Shopping ExperiencesMarket the eBay experienceInnovate for Customers84 83. Driving Technology,User Experience &InnovationMark CargesSenior Vice President and Chief Technology Officer, MarketplacesFebruary 10, 2011 85 84. Technology: Transforming the shopping experienceCulture of innovation focused oncustomer needsTailored shopping experiencesacross categories and devicesWorld class technologyorganization delivering greaterinnovation 86 85. Thats great, but Did you fix search?Have you improved the user experience? 87 86. 2009 Priorities Search Catalog User Experience Platform 88 87. Searchimprovements:Before & after 89 88. Catalog enables:Mobile selling 90 89. Catalog enables:Product based experience 91 90. User experienceimprovements:Fashion: Personalization &profiles 92 91. User experienceimprovements:Fashion: Image search93 92. Platformimprovements:eBay Mobile(iPad, iPhone, Android, RIM, Windows)94 93. Highlights of key launches since March 2009Fashion Shopping Experience, Fashion Outlet, Fashion VaultMotors Parts and Accessories Shopping Experience eBay Group GiftsTell Us What You ThinkImage Search and Visual NavigationFitment for Motors Parts and AccessoriesInstant SaleFull Product-based Experience in MP3 Players, GPS, and DVDs Greatly Improved Search Experience and RelevanceExpanding Coverage in Catalogs eBay Buyer Protection eBay Garden Simplified Selling, Tools for Large Sellers, Better Shipping Visibility Deals: Daily Deals, Flash Sales, eBay Bucks, DealFinder New Home PageModern Site DesigneBay Top-Rated SellersHands-down Leader in Mobile Commerce 96 94. Transforming eBay in 2011+SearchCatalogUser ExperiencePlatform Develop Leverage Transform site Fastersearch as catalog across experience innovationcompetitive eBay Create more Mobile: enableadvantage Simplify tailored accesssellingshopping experiences 97 95. InternationalMarketplacesDouglas McCallumSenior Vice President, Marketplaces EuropeFebruary 10, 2011 98 96. This is anextraordinary timefor eBay. 99 97. International: Large growth opportunity eBay non-vehicle GMV eCommerce aggregate growth(2010)opportunity, 2011 2015 (Est.) 190% Larger $270B 38% 62%$95B USInternationalInternational USSource: Forrester and Euromonitor; excluding travel 10 0 98. Increased customer focus by categoriesPassionate about shoppingin their category FashionElectronics Many shared requirementssuch as easy finding &trusted shopping experienceSome category-specificneeds, such as visualbrowsing & size filters in Homefashion101 99. eBay strategy is working in the UKImprove TrustIncrease SelectionDevelop Tailored Shopping ExperiencesMarket the eBay ExperienceInnovate for Customers102 100. UK: Greatly improved trust perceptionTop-rated sellers are leading to enhanced increasing share of UKcustomer perception GMV Video 30%18% Top Competitor Q4 09 Q4 10 Q4 09 Q4 10% of UK Core GMV NPS for Active Buyersfrom Top-rated sellersSource: Based on surveys conducted by eBay and a 3 rd party vendor103 101. UK: Dramatic increase in selectionSignificant pricingand search changes60%25%2007200820092010YoYAverage weekly fixed price live listings in the UK growth104 102. Featuring leading UK brands & retailers105 103. eBay: A fashionable destination106 104. Outlet sellers: Brands people love 10 7 105. Integrated marketing drives awareness Video108 106. Innovation in the UK with mobileA new channel for our very attractive to oursellers buyers~260% YoYGrowthQ4 09 Q4 10 2010 quarterly mobile GMV109 107. Strategy driving share gains in the UKeBay vs. UK eCommerce marketgrowth 19%UK eCommerce 15%market growth10%8% 20092010% YoY growthSource: Forrester; market growth excludes travel110 108. eBay EU plans: Building on UK Fashion Applying recipe to otherFrom a step-change strategic verticalsin online fashion to Rolling out to Germany & other European markets111 109. eBay leadership in GermanyUnique Visitors vs. #2 Player 1.2x 1.3x 2.4x 1.8xSource: Nielsen112 110. Apply the strategy to GermanyImprove Trust Improve Trust eBay Buyer ProtectionIncrease Selection C2C & B2C growthIncrease Selection Brands4FriendsDevelop Tailored ShoppingDevelop Tailored Shopping Fashion experienceExperiencesExperiences Electronics experienceMarket the eBay Experience Retail positioning withMarket the eBay Experience integrated marketingInnovate for CustomersInnovate for Customers Mobile innovation 11 3 111. Foundation of trust in Germany 2010 20112012+Higher seller standards Ramp Top-rated seller penetrationeBay Buyer Protection program Raise consumer understanding Further PayPal penetration Strengthen Buyer protection114 112. Brands4Friends: Private Sales leader NIKEMEXX SAMSONITE BURTON PUMAORWELLOver 600 direct brandFlash sales provides relationships retail experienceSelection of brands sold on Brands4Friends.de; Source Brands4Friends.de115 113. Accelerating Brands4Friends leadership116 114. Deals program driving resultsDeals driving velocity in resulting in GMV growthGermany +170% YoY Growth Q409 Q410 Deals GMV in Germany117 115. eBay is building on its success in EuropeExtending leadership in UKEmploying strategy inGermanyCompeting in France & ItalyIncreasing leadership inNetherlands & ScandinavianPositioning for growth inRussia & Eastern Europe118 116. Growth in Asia-Pacific regionPortfolio of Korea: market leadership marketplacesthrough Gmarket and IAC Australia: strong business exceeding market growth China: leveraging exports business for global customers India: market leading position with significant growth opportunity Rest of Asia: expanding footprint through partnerships & investments119 117. Global Marketplace enables cross-border trade ~20% of eBay business is across borders* *As of Q4 2010 12 0 118. Actively managing China & HK exports Partner with China and Hong Kong sellers to improve buyer experience GMV of China and Hong Kong Top-rated sellers grew by 33% in Q4 2010 YoY Facilitate inventory sourcing for Top-rated US sellers 12 1 119. Summary: eBays international opportunity62% of 2010 GMV internationalPortfolio of market leading positionseBay strategy customized by geographyGlobal Marketplace enables cross-border tradeExpanding within new geographic markets122 120. Marketplaces NorthAmericaChristopher PayneVice President, Marketplaces North AmericaFebruary 10, 2011 12 3 121. Christopher, Can eBay compete in the U.S. market?124 122. I believe we can.125 123. Our focus126 124. 2010: Increased selectionImplemented search, pricing and formatchanges to increase selection:100M Items35M ItemsJan 10Dec 10Listings in Core Search Results 12 7 125. 2010: Improvements driving conversion Sold items accelerating 8%4%Q4 09 Q4 10 % YoY growth of US Sold Items128 126. 2011: Executing on eBay strategyImprove TrustIncrease SelectionDevelop Tailored Shopping ExperiencesMarket the eBay ExperienceInnovate for Customers129 127. Trust: Consistent, trusted marketplace Launched eBay Buyer Protection Growing Top-rated Sellers Removed sub-standard sellers130 128. Trust: Results show it is workingTrust: Safe place to shop ImprovingH2 09H2 10 trust on eBay67%66%63%58% Best inBest in ClassClassTop buyers Top buyersBased on surveys conducted by eBay and a Third Party vendor;survey question :[companys site] is a safe place to shop online 13 1 129. Trust: Free shipping Increasing Sales with Free Shipping 33% 5% Q1 08Q4 10Percent of sold items with free shipping 13 2 130. Selection: Stimulate business sellingTop-rated sellers grew with market +12% GrowthQ4 09Q4 10 GMV for Top-rated sellers 13 3 131. eBay Business Seller: Barnes & Noble 13 4 132. Selection: Stimulate consumer sellingIncreasing consumer engagementBuyers who sellincrease value foreBay Average BuyerAverage Buyer who sellsCustomer Value for eBay135 133. Selection: eBay Instant Sale 13 6 134. Tailored shopping experience: Customer needs FashionTech Tickets Vehicle partsShopping behaviorWant tailored shoppingdiffers by categoryexperiences 13 7 135. Launched tailored shopping experiencesElectronics 13 8 136. Tailored shopping experience: TicketsStubHub 23%GMV CAGR2008 2009 2010 13 9 137. Tailored shopping experience: MotorsMotor Parts Business: 10% YoY Tire center: +18% ConversionGMV growth in Q4 10 rate (Q4 YoY growth) 14 0 138. Tailored shopping experience: FashionFashion: 8% YoY GMV growth in Q4 10 14 1 139. Launched tailored shopping experiencesElectronics 14 2 140. 143 141. Innovation: Expanding opportunities Local Social Mobile 14 4 142. Innovation: Milo & RedLaser integrationCustomers Increases selection through local options Retailers Increases foot traffic and sales145 143. 2011: Executing on eBay strategyImprove TrustIncrease SelectionDevelop Tailored Shopping ExperiencesMarket the eBay ExperienceInnovate for Customers146 144. Driving Technology,User Experience &InnovationMark CargesSenior Vice President and Chief Technology Officer, MarketplacesFebruary 10, 2011 14 7 145. Innovation: Expanding opportunities Local Social Mobile 14 8 146. LocalAccessing offline inventory online.149 147. LocalIncreasing selection & optionsfor customers as the lines blurbetween online and offlinecommerce150 148. SocialSocial networking drives shopping behavior.151 149. SocialLeveraging the social graph toenable engagement and socialcommerce 15 2 150. MobileMobile devices make anyplace a store.153 151. iPhone Fashion App: Virtually try on sunglasses154 152. MobileMobile devices make anyplace a store.155 153. MobileExtending leadership positionby providing access any time,any place, any device156 154. Open Commerce Platform 15 7 155. Marketplaces & PayPal have developer networksDeveloper Network Opened platforms to external developer networks 15 8 156. Merchant & consumer needs are changing Consumers wantMerchants want to find what they want multiple channels when they want it demand generation how they want it fast innovation Anywhere, anytimeWithout complexity159 157. eBay has unique assets to address needs Payments Demand generation Identity Inventory Data/Catalog 16 0 158. eBay Inc. Enabling commerce161 159. Capitalizing on ourOpportunitiesBob SwanCFOSan JoseFebruary 10, 2011 160. Agenda Since March 09 Analyst Day... where we are now Over the next 3 years Our framework for execution... PayPal extending leadership position Marketplaces expanding market opportunities Capital allocation investing for growth 3 year outlook what you should expect from us 161. What we said Analyst Day Mar09Our aspiration for 2011 RevenueGoal $10 - $12 B2011EPS CAGR Mid-single2009 - 2011digitFree Cash Flow $6 to 7 billion2009 - 2011 162. What we said Analyst Day Mar09 $4 - $5B $5 - $7BRevenue High growth &Grow at ecommerce $1B+rates in10, faster inHyper growth gaining share 11KeyOn-eBayFixed price,penetration, Users growthMerchant Advertising, activity services,Classifieds,driverBML, MobileBuyer retention monetizationDirect18% to 35% to 18% tosegment margin* 20%45%20% * As of March 2009: Direct segment margin does not include ~3-4 points of corporate overhead 163. Achieving full potential requires Excellence What we said Operational Operating $2B over 3Significantsmarteryears investmentCustomer LowerCustomer loyaltyretention /retention / loyalty processing costs ...lower take rateUser experience / Improved search / platform customerexperienceImproved trust /Organizationcomprehensionsimplification 164. On track to deliver 13-14% Revenue* REVENUE CAGR $10.3B $10.6B $9.2B$8.1B $3.4BPayPal$2.8B Marketplaces $5.3B$5.7B2009 20102011 Guidance (Jan 19, 2011)Non-GAAP$1.47$1.73 $1.90-$1.95 EPS* 14-15%Op Margin*29.5%29.5% ~ flat Y/YEPS CAGR * Ex Skype; reconciliation in appendix 165. On track to deliver OE cost savings Cost Savings Achieved...... while reinvesting wisely~$1.0BA lower take rate... Align withour sellers$0.8BMore R&D... Accelerating the$0.6Brate of innovationA more trusted experience...eBay / PayPal protectionsMore loyal customers... Lesschurn 2009 20102011 Est. 166. on track to deliver ... FCF... cumulative free cash flows > $6.5B2011 Est.> $2.3B+2010$2.0B Reduced by~$350Mone-time tax payments2009$2.3B*Reconciliation in appendix 167. ... On track to deliver ... portfolio ... a stronger, more focused portfolio Sold 70% of Skype...Strengthened core businesses ~ $2B Proceeds~ $2.7Bdba/BilBasen/ Brands4Friends Alternative formatsGmarket expand AsiaReinvestedpresenceBML extend PayPal reach 168. ... we have an increasingly diverse portfolioBy Format... ... By Geography 2010 RevenuePP onAsia Auctions eBay 15%Americas Marketplaces Merchant49%Services Europe Fixed36% PricePayPalAdjacencies/ SeedsMarketplacesAdjacencies/ Seeds 169. ... and market trends are in our favor ...Market growth rates...The lines of commerce Consumers can shop accelerating! are blurring anywhere all the timeWeb- On and off-line influenced~15% offline Offline Many devicesCAGR 37%57% All geographiesOnlineLast ~3 years Next ~3 years6% ... Sellers/merchants Global eCommerce Y/Y* eCommerce + retail** need help navigating * Global eCommerce growth estimates, Forrester and Euromonitor, excludes online travel ** 2010 US forecast, Forrester Research 170. As we enter 2011 We feel good about where we are: Improving macro picture ... Expanding market opportunity A stronger, more diverse portfolio... And a massive global footprint Stable Core... Adjacencies with scale... Seeds with possibilities Ops Excellence... The way we work Excellent balance sheet... See enormous opportunity ahead 171. ... and we recognize the concernsIncreasing competition ... in both e-commerce &payments ... US & Intl.The Core eBay ... bridging gap to competitionwithout end-to-end controlEvolving regulatory framework ... Durbin ...PayPal margin implicationsGrowing cash balance... What will you do ... We are confident in our plans !! 172. Agenda Since March 09 Analyst Day... where we are now Over the next 3 years Our framework for execution... PayPal extending leadership position Marketplaces expanding market opportunities Capital allocation investing for growth 3 year outlook what you should expect from us 173. Our framework for growth ...Protect and ExpandPlant andExtend ourAdjacencies Grow SeedsCoreBusinesses...Leverage our platform... and balance sheet 174. Our framework for execution ...Operating $1B+ over next 3Significant smarteryears (2011-2013) investmentLower Increased processing consumer costs / fraudengagementBetter customerexperience ...Improved Fewer defectscustomerexperience...more outbound Scale...Accelerate leverageinnovation ...more product 175. Our framework for capital allocation ...Redistribute StrategicExcess Cash Organic Acquisitions/ Redistribute InvestmentInvestmentsCash ~Buyback ~Strengthen our Offset comp-based Fund BML growth portfolio... extend ourdilutionreach ... while maintaining financial flexibility !! 176. Agenda Since March 09 Analyst Day... where we are now Over the next 3 years Our framework for execution... PayPal extending leadership position Marketplaces expanding market opportunities Capital allocation investing for growth 3 year outlook what you should expect from us 177. Framework for growth PayPal global share* * PayPal global shareFollow our merchants...20-24% our customers ... and2013E2013E20-24%Local Merchant coverageOffline...Merchant coverage 201018% SocialPoint 18%Of Sale 2010 14%2008 14%2008 ConsumerConsumer preferencepreference CreditDigitalMobile P2P Accelerate the rate of innovation Platform X ... Seeds* Internal analysis; not to scale; excludes Bill Me Later181 178. What do you have to believe ...RevenueLowCAGR %Mid-high ~21% ~24%+$6 - 7B ~35% ~40%+SeedsSeeds ... Credit / $3.4BCredit Other ~25% ~30%+Adjacencies... Merchant ServicesMerchant ServicesCore ... On eBay ~7%~9%+ 2010 2013 Est. 182 179. Growth on eBay ...A $40B+ TPV Platform in 2013*Increased penetration*Stable aGMV growth Americas ~85%... stable mid-high single digits Europe >60%... + ~10 pts Asia >80%... stable Cross Border >80%... + ~5 pts Trade 2007 2008 2009 20102011 E 2012 E 2013 E ~75%+ penetration !!* * Company projections 183 180. Merchant Services momentum continues ...A $125B+ TPV Platform in 2013*CAGR %** PayPal global share**Market/SSS Growth~ 10-15%2013E20-24% SeedsMerchant coverageIncreased Coverage ~ 5-10%Credit 18% 2010Increased Consumer ~ 10-15%Frequency 14%2008 ~ 25-40% Consumer preference* 2010 to 2013 CAGR: company projections **Internal analysis; not to scale; excludes Bill Me Later 184 181. New products gain momentum ... Credit/BMLDigital GoodsMobileRevenuesnTPVnTPV 10X+ 3X+3X+2010 2013 Est.2010 2013 Est. 2010 2013 Est. 182. ... and Platform expands opportunitiesDeveloper platformEnables opportunities Enables opportunitiesaccelerates time to we would never we dont do marketthink of 60k developers ...1,500 apps Innovative solutionsfor changing paymentslandscape 183. PayPals business model Great proposition Consumer Funding Risk management for merchantsChoice(Transaction losses) (Global take rate)(Transaction Expense)08 0910 Future*08 09 10 Future* 0809 10Future*Stable / down declinesstable / down... ~60%+ transaction margin business* * Company projections 184. OE improves customer experience ...Consumer EngagementOur Contact/Ops ... Our Product ... Merchant Adoption Center... Development cycle(Sales & Marketing % Revenue) (% of Revenue)(% of Revenue)~11%~8%~10% Outbound InnovateResponsiveResponsiveSustain/Maintain2010 Future* 2010Future *2010Future*Creates capacity to invest ... and drives operating leverage/efficiency * Company projections 185. Ops Excellence ... funds investments10 Segment margin ~ 21%...Transaction marginSignificant operating Higher R&D... marginally lowerleverage and processConsumer improvementengagement... Yields 13 segment margin ~ 24-26%** Company projections 186. In summary, PayPal 2013 outlook $6 - $7B Revenue(mid-point CAGR: 24%)High growth &gaining share ConsumerPreferences, Key growth driversMerchant coverage; New Products New MarketsDirect segment margin*24% to 26% *Direct segment margin does not include ~3 points of corporate overhead 187. Agenda Since March 09 Analyst Day... where we are now Over the next 3 years Our framework for execution... PayPal extending leadership position Marketplaces expanding market opportunities Capital allocation investing for growth 3 year outlook what you should expect from us 188. Framework for growth ... The core platform...New formatsNew marketsExisting: New:Advertising,Local,Classifieds,SocialPrivate sale,StubHubTechnologyTailoredEngagement TrustUserShoppingCustomer AccelerateexperienceExperiences focusthe rate of innovationPlatform... mobile 189. What do you have to believe ... RevenueCAGR %Low Mid-High~7% ~10%+$7-8B Seeds $5.7B~12% ~15%+ CreditAdjacent formats / Seeds*eBay Platform** ~5%~7%+ GMV 2010 2013 Est. * Classifieds, Advertising, StubHub, Shopping.com, Rent.com, other** GMV-based transactional business, excluding StubHub 190. The Core... a ~$75B+* GMV platform in 13The widest selection... The best deals... A trusted experience Fixed Price... Auction stable ... ... Vehicles format expands...shift Double digit CAGRFlat ... 09 10 13 E091013 E 091013 EFrom 50% to ~70% From 50% to ~30%Shifting from GMV toof GMV... ** of GMV...** lead gen model ** Note: All GMV figures are FX-neutral *Company projections**Growth rates are 2008-2010 CAGR, ex Gmarket 191. Connecting ... with adjacent formatsToday, a nearly $1.3B collection of businesses...ClassifiedsAdvertising- Improvedformat* based format** VerticalsDouble-digitMid-singleDouble-digitPrivateCAGRdigit CAGRCAGRsale StubHubRevenue RevenueRevenue 20102013 E 20102013 E 20102013 E ... Expected to grow at ~15% CAGR*Includes Rent.com revenue ** Includes Shopping.com revenue 192. Seeds... Better conversion... new markets OrganicAcquisitionsInvestments Innovation Mobile / Local / Red Laser Magento Social Milo Appcelerator Group Gifts Critical Path Deal FinderSoftware Instant Sale Deal Blasts 193. OE improves customer experience ... Growing trusted Improved buyerSatisfaction sellers experienceguaranteed% of GMV...BBEs 32%+ Q410 Consistent... from declineTop ratedQ410sellers... with FreeShippingReducing numberof bad buyerexperiences eBay Buyer Protection ... Lower customer ... Lower customer service ... Increased protection acquisitioncosts; more outbound...costs 194. Ops Excellence ... to fund investments10 Segment margin ~ 40%... Leverage and Ops Faster growing Fund investmentsExcellence adjacencies in trust, engagement and innovationOperating Margin Levers... Yields 13 segment margin ~ 38 to 42%* * Company projections 195. In summary, Marketplaces 2013 outlook Marketplaces $7 - $8B(mid-point CAGR : 10%)RevenueGrow with ecommerce rates, lead innovationTailored shopping Key growth driversexperiences, Local C2C strength, global tickets, Mobile, Offline, PlatformDirect segment38% to 42%margin**Direct segment margin does not include ~3 points of corporate overhead 196. Agenda Since March 09 Analyst Day... where we are now Over the next 3 years Our framework for execution... PayPal extending leadership position Marketplaces expanding market opportunities Capital allocation investing for growth 3 year outlook what you should expect from us 197. We enter 11 with a strong balance sheetChange in CashExcellent cash flows... A stronger, more focused portfolio... Lower cost of capitalDebt: $0.7B $7.8B$1.8B Buyback M&A:US FCF:$3.0B Skype: $2.7B $4.4B $2.0B$3.3B Intl$5.1B2008 Ending Balance2010 Ending Balance... and the flexibility and discipline to invest wisely 198. Our philosophy in order of priorityRedistribute StrategicExcess Cash Organic Acquisitions/ Redistribute InvestmentInvestmentsCash ~Buyback ~Strengthen our Offset comp-based Fund BML growth portfolio... extend ourdilutionreach ... while maintaining financial flexibility !! 199. Accelerate strategic priorities with M&A ... Capitalize on key market trends Mobile Social Digital Local PayPal: Digital wallet Expand ourMarketplaces: Merchant growth Alternate formats...geographic enablers;tailored shopping footprintexperiences... Low cost processor capabilities Risk analytics ... Enhancing our platform for commerce while pursuing Technology/Talent-based acquisitions to accelerate organic plans 200. Recent acquisitions ... future growthMobile Development Local Shopping Private Sales Critical Path Milo.com Brands4Friends Software Enter new Participate in Accelerates organicadjacency fastest-growing plans withchannel for technology & talent Real-time secondary CSA inacquisitionavailability of local Europeinventory Increases mobile Strengthens talent, capacity and Brings offlineposition as a capabilitiesinventory onlineleading onlinefashion destinationin Europe Integration witheBay.com andRedLaser mobileapp 201. Investments to enhance opportunities Geographic Adjacencies Non-CoreReach 202. Agenda Since March 09 Analyst Day... where we are now Over the next 3 years Our framework for execution... PayPal extending leadership position Marketplaces expanding market opportunities Capital allocation investing for growth 3 year outlook what you should expect from us 203. Our 3 year outlook to 2013Marketplaces $6 - $7B $7 - $8B (mid-point CAGR: 24%)(mid-point CAGR : 10%)Revenue High growth &Grow with ecommercegaining sharerates, lead innovation ConsumerTailored shoppingKey Preferences,experiences, Local C2C growthMerchant coverage; strength, global tickets, New Products Mobile, Offline, Platformdriver New MarketsDirectsegment 24% to 26%38% to 42% margin* *Direct segment margin does not include ~3 points of corporate overhead 204. Our aspiration for 2013Revenue Goal $13B - $15B 2013 Non-GAAP EPS CAGR 10 - 14% 2010 2013**Free Cash Flow*$7.5 to 8.5B 2011 - 2013 *Reconciliation in appendix **CAGR is measured using 2010 as the base 205. Summary Incredible opportunityWell positioned unmatchedcompetitive advantagesAccelerating innovation 206. APPENDIX 207. Reconciliation of GAAP to Non-GAAP EPSReconciliation of GAAP EPS to Non-GAAP EPSTwelve Months Ended December 31, December 31,December 31,December 31,December 31,(In millions, except per share amounts)2006 2007200820092010GAAP net income (loss)$1,125.6 $348.3 $ 1,779.4 $ 2,389.1 $ 1,801.0 Stock-based compensation expense317.4301.8 352.1 394.8 381.5 Employer payroll taxes on stock-based compensation5.36.9 3.1 5.313.8 Amortization of acquired intangible assets (1)214.9223.7 264.1 314.8 229.9 Restructuring --49.138.221.4 Impairment of goodwill-1,390.9 - - - Joltid settlement -- - 343.2 - Sale of Skype and transaction related items -- -(1,407.5) 18.1 Amortization of intangibles and stock-based compensation for Skype-- - -35.8 Income taxes associated with certain non-GAAP entries(171.6)(165.4) (202.9)(12.1) (202.8)Non-GAAP net income $1,491.6 $2,106.2 $ 2,244.9 $ 2,065.8 $ 2,298.7Non-GAAP net income attributable to Skype-- -(147.0)-Non-GAAP net income excluding Skype $1,491.6 $2,106.2 $ 2,244.9 $ 1,918.8 $ 2,298.7Diluted net income per share:GAAP $0.79 $ 0.25 $1.36 $1.83 $1.36Non-GAAP $1.05 $ 1.53 $1.71 $1.58 $1.73Non-GAAP excluding Skype $- $ - $ - $1.47 $1.73Shares used in non-GAAP diluted share calculation1,4251,376 1,313 1,305 1,327(1) Includes amortization of acquired intangible assets within cost of net revenues and operating expenses. 208. Calculation of Free Cash Flow (FCF)Reconciliation of Operating Cash Flow to Free Cash FlowTwelve Months Ended December 31, December 31, December 31, December 31, December 31,(in millions)2006 20072008 20092010GAAP operating cash flow $ 2,247.8 $ 2,641.3 $2,882.0 $2,908.1 $ 2,745.8 Purchases of property andequipment, net(515.4) (454.0)(565.9)(567.1) (723.9)Free cash flow $ 1,732.4 $ 2,187.3 $2,316.1 $2,341.0 $ 2,021.9 209. Reconciliation of FY 2011 and FY2011-FY2013 Free Cash Flow (FCF) projection Reconciliation of Operating Cash Flow to Free Cash FlowTwelve Months Ended 3 Years Total(in Billions) 31-Dec-2011FY2011 - FY2013GAAP operating cash flow~3.1B $10B - $11.3B Purchases of property andequipment, net~($0.8B)($2.5B - $2.8B)Free cash flow ~$2.3B $7.5B to $8.5B 210. Calculation of ROICReconciliation of Return of Invested Capital (ROIC) In millions, except percentages(in thousands, except percentages)Numerator components:Q107 Q207 Q307 Q407 Q108 Q208 Q308 Q408 Q109 Q209 Q309 Q409 Q110 Q210 Q310 Q410Non-GAAP operating income$ 593,445 $ 594,664 $ 593,445 $ 754,979 $ 701,364 $ 700,487 $ 674,318 $ 667,958 $ 620,347 $ 602,252 $ 635,468 $ 694,976 $ 672,852 $ 645,650 $ 644,997 $ 736,729Non-GAAP effective tax rate26% 25% 10% 24% 23% 22% 17% 24% 22% 20% 21% 16% 22% 21% 21% 8%Non-GAAP operating income after tax$ 441,523 $ 447,544 $ 531,845 $ 576,276 $ 540,892 $ 549,673 $ 559,684 $ 508,685 $ 485,732 $ 482,223 $ 505,197 $ 580,791 $ 524,286 $ 510,967 $ 509,806 $ 674,789Denominator components:Q107Q207Q307Q407 Q108Q208 Q308Q408Q109Q209 Q309Q409Q110Q210Q310Q410Total assets 13,920,051 14,361,157 14,786,812 15,366,03715,046,305 15,021,62514,240,157 15,592,439 15,127,787 16,566,28917,356,372 18,408,320 18,690,178 18,747,584 19,948,062 22,003,762Total cash, cash equivalents and investments3,519,8803,793,6774,461,7755,035,692 4,108,1414,181,717 3,777,4823,458,8403,326,8053,134,478 3,638,5876,325,5696,505,4686,725,7687,463,9279,114,826Current liabilities 2,250,5712,328,6433,272,8673,099,579 3,080,4323,006,234 2,854,7333,705,0873,159,9243,730,364 3,646,6783,641,9683,587,0113,564,2613,808,9094,516,514TTM Non-GAAP operating income after tax$ 1,518,940 $ 1,633,595 $ 1,827,615 $ 1,997,188 $ 2,096,556 $ 2,198,685 $ 2,226,524 $ 2,158,933 $ 2,103,774 $ 2,036,324 $ 1,981,837 $ 2,053,943 $ 2,092,498 $ 2,121,242 $ 2,125,851 $ 2,219,848TTM average total assets 13,339,193 13,697,718 14,005,030 14,385,614 14,696,072 14,916,387 14,892,187 15,053,313 15,005,663 15,309,659 15,776,609 16,610,241 17,229,789 17,953,749 18,630,103 19,559,581TTM 95% of average cash, cash equivalents and investments3,486,641 3,536,980 3,622,670 3,858,237 3,974,641 4,100,390 4,097,313 3,906,756 3,582,067 3,397,071 3,293,876 3,778,013 4,356,872 5,002,675 5,825,271 6,865,756TTM average current liabilities2,078,113 2,207,540 2,518,232 2,694,011 2,806,418 2,957,551 3,062,769 3,149,213 3,161,282 3,291,268 3,419,357 3,576,804 3,553,189 3,634,056 3,649,765 3,823,733ROIC 19.5% 20.5% 23.2% 25.5% 26.5% 28.0% 28.8% 27.0% 25.5% 23.6% 21.9% 22.2% 22.5% 22.8% 23.2% 25.0%(in thousands, except percentages) Full Year Ended December 31, 2007 200820092010TTM Non-GAAP operating income after tax$ 1,997,188 $ 2,158,933 $ 2,053,943 $ 2,219,848TTM average total assets 14,385,614 15,053,313 16,610,241 19,559,581TTM 95% of average cash, cash equivalents and investments3,858,2373,906,756 3,976,856 6,865,756TTM average current liabilities2,694,0113,149,213 3,576,804 3,823,733ROIC 25.5%27.0% 22.7% 25.0% 211. Three Months EndingReconciliation of FY 2011 GAAP to Non-March 31, 2011(in millions, except per share amounts)GAAP Non-GAAP (a)Revenues $2,400 - $2,500$2,400 - $2,500GAAP Guidance (Jan. 19, 2011)Diluted EPS $0.34 - $0.36$0.44 - $0.46(a) Estimated non-GAAP amounts above for the three months ending March 31, 2011, reflect theadjustments that exclude the estimated amortization of acquired intangible assets of approximately$50 - $60 million, estimated stock-based compensation expense and employer payroll taxes onstock-based compensation expense of approximately $110 - $130 million and estimatedrestructuring charges of approximately $1 million. Full Year EndingDecember 31, 2011(in millions, except per share amounts)GAAPNon-GAAP (b)Revenues$10,300 - $10,600$10,300 - $10,600Diluted EPS $1.56- $ 1.61 $1.90 - $1.95(b) Estimated non-GAAP amounts above for the twelve months ending December 31, 2011, reflectadjustments that exclude the estimated amortization of acquired intangible assets of approximately$200 - $240 million, estimated stock-based compensation expense and employer payroll taxes onstock-based compensation expense of approximately $420 - $460 million and estimated restruturingcharges of approximately $1 million.