eBay GSIAcquisitionFINAL

8/4/2019 eBay GSIAcquisitionFINAL

1/25

eBay Inc. to Acquire

Investor/Analyst Call

arc ,


2/25


3/25

Executive summary

Our key messages from last months analyst day

Commerce market evolvingnew retail environment retailerslooking for help

.

Two strong core businesses PayPal and Marketplaces with

growing synergy

Expanding opportunity set through open commerce platform

Toda s announcementthe ac uisition of GSI Commerce:

Extends eBay Inc.s reach with large brands/retailers

Brings together complementary capabilities in a manner whichstrengthens GSI and helps our existing core businesses

eBay Inc. - Proprietary & Confidential3

Extends our open commerce platform capabilities


4/25

Traditional boundaries are blurring

On-line Off-line



5/25

Retailers of all sizes must reach

Multi- Millions ofSole proprietors

Pace of

ma an me umsize businesses

competition innovation


Large merchants


6/25

The new retail future: our unique position

eBay

Bu ers

ass e s

MobileAppsSellers

StubHub

eBay Inc. - Proprietary & Confidential

Platform Capabilities

6


7/25

Strengthens our position with large retailers

Opportunity*

$160B

Large merchants

Small and medium

$36B

$12B


Sole proprietors

* Source Data: Internal estimates


8/25

Playing offense enabling commerce

Commerce Platform to drive innovation across eBay, PayPal and GSIC

Separate BU led by Chris Saridakis

GSIC to continue focus on leading retailers/brands

Commerce Platform drives innovation across eBay,


PayPal and GSIC


9/25


10/25

GSIC a great business

Global Marketino a ommerce erv ces

Commerce Technology FulfillmentCustomer

Services

Full-Service

WebstoreMulti-

Channel

7 Fulfillment

Centers4 Call Centers

Mobile Advertising

Order ManagementShipQuikProgram

Telephone /Email

Email and Affiliate Marketing

The only com any that enables all as ects of multi-channel commerce

Technology Operations International 11 Languages Analytics



11/25

supporting leading brands and

CategoriesApparel, Accessories &

Appliances & Tools

Baby Products

Cosmetics & Fragrances

Entertainment Media

General Merchandise

Gifts

Jewelry

Pets

Personal Care

S ecialt Foods

Sporting Goods

Toys & Video Games



12/25

Retailers need a partner, not a competitor Retailers need eBay/GSIC offer

Global marketplace with access

to more than 95M customers,9M+ SMBs and 180+ large

Access to multiple channels toreach customers and generatedemand

Global, full suite, commerce

solutions with on-line, off-line,

Flexible, customized solutions

and ability to keep up withpayments, and mobile capabilities

Investing > $1B in technologyannuall to build out next

and on-line

A trusted global partner to help

generation of products/servicesthem enable growth


e goa : e ay com na on as e s ra eg c

commerce partner of choice


13/25

Commitment to best in class platform Together, we can make

GSIs Enhanced Platform

Commerce OS leveraging

V11 FuturevX

best of GSI and eBaysplatforms

Key offerings as servicesfulfillment inventor

u ng-e ge s emanagement tools

Enhanced promotionscapability

management, promotions,etc

Leverage developer network

Integration architecture

Operationally efficient

-

platform

Most cost-effective lessintensive to maintain

configuration


to help retailers to grow their business


14/25

with some near-term opportunities

Local Shopping Mobile Capabilities Mobile Development

$1B+ combined R&D spend



15/25

In summar , GSIC 2013 Outlook*

Revenue $1.1B to $1.3B

Comp growth led by multi-, ,geographic expansion,

new productsKey growth drivers

19% to 21%**Direct segment

margin


* Assumes closing of the proposed transaction and the planned divestitures** Consistent with GSI Commerces definition of Non-GAAP income from operations, or NGIO


16/25


17/25

Todays announcement

eBay to acquire GSIC for $29.25 per share ($2.4B), financed with cash and debt andexpecte to c ose n t e r quarter

GSIC is a leading, full service provider of on-line commerce solutions and interactivemarketing services for brands and retailers

We believe the combination of eBay and GSIC enhances eBays position as thestrategic commerce partner of choice for leading retailers and consumer brands

Simultaneous with closing, we expect to sell certain businesses of GSIC that are not- ,

Rubin, while retaining a financial interest in certain of them

Assuming we close in mid 3rd quarter, we expect the acquisition to be immaterial to our2011 non-GAAP EPS uidance announced Januar 19th and have a 0.30 - 0.34

negative impact to our 2011 GAAP EPS guidance, including a GAAP charge primarilyrelated to the divested GSIC businesses


strategic commerce partner of choice


18/25

Structure of transaction enables us to

Acquiring Wholeco...

Divesting Assets for ~ $0.6B Retaining Strategic Assets

100%

30%ownership

Licensed SportsMerchandise

Global

MarketingServices ~$0.2B(1)

+

$1.4B(1)

.

70%

Global ~$0.7B(1)

Consideration (3)

$467M Loan from eBay

eCommerceServices $31M Cash


(1) 2010 Revenue

(2) Includes approximately $170M of revenue associated with owned inventory model that will be transitioned

away by 2013

(3) Excludes value of retained minority stakes in Rue La La and ShopRunner 18

~$0.9B(2)


19/25

Our framework for growth

Protect and Expand Plant andextend core

businesses

Adjacencies Grow Seeds

Leverage our platform ... and balance sheet



20/25

Synergistic Value Framework

Enhance GSI PlatformExtend PayPal / BML reachon GSIC a ~ 3.5B latform

Expand large merchantresence on eBa latform

MerchantcoverageRevenue

~$1.2B

~$0.9B (1)

eBay Synergies

Leverage platform capabilities

Global expansion

preference Reduce G&A / payment processing costs


13 Est. Synergies ~$60M+

(1) Includes approximately $170M of revenue associated with owned inventory model expected to betransitioned away by 2013.


21/25

Our revised 3 year outlook to 2013*

$6B - $7B $7B - $8B $1.1B - $1.3BRevenue

Tailored shoppingexperiences, Local

ConsumerPreferences,

Comp growth led by

multi-channel, newC2C strength, global

tickets, Mobile,Offline, Platform

Merchant coverage,New Products,New Markets

ey growdrivers

clients, geographicexpansion,

New products

24% to 26%** 38% to 42%**recsegment

margin19% to 21%***


** Direct segment margin does not include ~3 points of corporate overhead for PayPal and eBay* Assumes closing of the proposed transaction and the planned divestitures

*** Consistent with GSI Commerces definition of Non-GAAP income from operations, or NGIO


22/25

Our revised aspirations for 2013*

20132013

. - .

NonNon--GAAP EPSGAAP EPS 12% - 16%20102010 2013**2013**

Free CashFree Cash Flow***Flow***

$8.0B - $9.0B

eBay Inc. - Proprietary & Confidential 22

* Assumes closing of the proposed transaction and the planned divestitures

**CAGR is measured using 2010 as the bases

***Reconciliation in the appendix


23/25

Executive summary

Our key messages from last months analyst day

Commerce market evolvingnew retail environment retailerslooking for help

.

Two strong core businesses PayPal and Marketplaces withgrowing synergy

Expanding opportunity set through open commerce platform

Toda s announcementthe ac uisition of GSI Commerce:

Extends eBay Inc.s reach with large brands/retailers

Brings together complementary capabilities in a manner whichstrengthens GSI and helps our existing core businesses


Extends our open commerce platform capabilities


24/25

Appendix



25/25

Reconciliation of FY2011-FY2013 Free

Reconciliation of

Operating Cash Flow

to Free Cash Flow

3 Years Total

(in Billions) FY2011 - FY2013

GAAP operating cash flow $ $10.7B - $12.0B

Purchases of property and

equipment, net ($2.7B - $3.0B)Free cash flow $ $8.0B to $9.0B

eBay Inc. - Proprietary & Confidential

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eBay GSIAcquisitionFINAL

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