EBay : 2021 Stockholder Letter

Dear Stockholders,

This year was transformative for eBay. When I returned to eBay two years ago as the President and CEO, we set a goal to fundamentally change the trajectory of our marketplace through a tech-led reimagination. Now, thanks to the tremendous efforts to accelerate our strategy, the tireless work and dedication of our employees, and the commitment and determination of our customers, we are realizing the fruits of our collective labor. We are incredibly excited about the progress we've made - and where we are headed next.

Every day, around the world, we connect people and build communities to create economic opportunity for all. Our platform serves over 147 million active buyers and 17 million sellers across 190 markets around the globe. And with approximately 1.5 billion live listings, no other company combines the scale, depth, breadth and unique inventory on a single, trusted platform the way we do.

Last year, our marketplace delivered robust financial results, while continuing to invest in our core business. Revenue was up 15% for the full year, and non-GAAP EPS was up 21%. We generated $2.6 billion of free cash flow and returned $7.5 billion to shareholders through repurchases and dividends. These significant returns to shareholders over the past year demonstrate our incredibly strong financial model, earnings power and solid cash flow generation.

At the same time, the generosity of our community was stronger than ever. Since 2003, when we first launched eBay for Charity, our community has donated more than $1.1 billion, and last year, sellers and buyers contributed more than $145 million to charities around the world. This marks another record-breaking year with an increase of 18% over the previous year - and our biggest year since the program was started almost 20 years ago. We're on track to hit our 2025 goal of raising another $600 million. It's truly incredible how our community comes together to help those in need.

We realize that in order to continue the growth of our company, we must also focus on the sustainability of our community and planet. More and more people are selling and buying pre-owned goods in an effort to boost their income, save money and live sustainably. And now, we're significantly increasing our dedication in this space. Last year, the volume of pre-loved products on our marketplace grew faster than new products - driven by demand of younger consumers. We delivered $2.7 billion of GMV in pre-owned electronics and apparel in the U.S., U.K. and Canada - and 540,000 metric tons of carbon emissions were avoided through people selling pre-owned electronics and apparel through C2C sales on eBay last year.

We have accelerated our goal to become the best global marketplace for our customers, powered by our continued focus on technology. We remain confident in our long-term vision to simplify the seller and buyer experience, increase customer satisfaction and improve our underlying growth trajectory. While we still have work to do, we're excited at the prospect of all we can achieve, together.

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Accelerating Our Strategic Vision

In 2021, we continued to accelerate our strategic vision and develop significant opportunities for our customers - always keeping their needs at the heart of everything we do.

Our strategy leverages three significant areas of change:

• • First: We simplified our portfolio to drive focus and deliver on eBay's core marketplace.

  • • In the past few years, we have divested non-core assets including Stubhub, eBay Classifieds and our South Korean businesses, creating $20 billion in shareholder value. We reinvested a portion of the proceeds back into the business and returned capital to shareholders. In addition, we created a robust advertising business and built a modern payments platform.

• • Second: We built a world-class leadership team with a vision for the future.

  • • Our leadership team is now an equal complement of new talent and eBay veterans, all coming from highly complex, competitive and dynamic operating environments. With proven experience in ecommerce, retail, technology and financial services, our team shares a steadfast commitment to customer centricity. As a result, we're able to attract and grow incredible talent throughout our company at all levels, helping us further innovate in the years ahead.

• • Third: We increased our focus on the categories where we are uniquely positioned to win.

  • • Previously, we had strayed from our original vision of eBay as a marketplace that connects sellers and buyers of non-new in season goods - and instead focused on branded, new in season products. This strategy was not working. So we recentered on what we do best. We sized the incredible growth potential of non-new in season products and we've grown our focus categories through strategic innovations in product and technology. In fact, close to 90% of eBay's GMV is derived from non-new in season items. We estimate that our total addressable market, or TAM, in online retail across our three largest markets was approximately $1.1 trillion in 2021. We firmly believe we will succeed on this path in the future.

We believe the tech-led reimagination we implemented is working, as evidenced by our compelling results to date.

Our focus categories bring together enthusiasts and passionate collectors over items of meaning and value. Over the past year, we have continued to lean into best-in-class satisfaction which has led to faster GMV growth. In fact, during Q4 of 2021, focus categories grew 15 points faster than the

rest of the marketplace. This success drives us to create world-class experiences across our global marketplace, faster than ever. We've addressed close to 20% of our total volume to date. And by the end of 2024, we plan to cover half of our global GMV with this playbook.

We are committed to understanding the customer and their needs, as we build product experiences that delight our customers and enhance the buying experience for our enthusiasts. Tech innovations, new product offerings and expansion of features have played a major role in our transformation.

• • To continue to strengthen our relationship and build trust with this community, we expanded our Authenticity Guarantee service from watches and sneakers to include more markets and categories. In addition to our current programs, we're now also authenticating watches in the U.K. and Germany, we expanded sneaker authentication to Canada, Australia, the U.K. and Germany, and added authentication for select handbags in the U.S. In late 2021, we acquired Sneaker Con, a leading authenticator with operations in the U.S., U.K., Canada, Australia and Germany. By bringing additional capacity in house, we increased the scale, reach and flexibility of our offerings. Through Authenticity Guarantee, we handle nearly 5,000 items per day, with the help of 200+ authenticators in centers around the world.

• • This past November, we launched eBay Refurbished, an extension of the original program that includes inventory from thoroughly vetted top-rated sellers and introduced standardized grading across four conditions - Certified Refurbished (our first enhanced experience), Excellent, Very Good and Good. eBay Refurbished provides more inventory that meets our rigorous standards, giving buyers more choice and greater confidence, along with a money-back guarantee and warranty. Significantly improving trust has increased customer satisfaction and accelerated GMV to positive double-digit rates.

Seller profile - Aditi Minda and Ashwini Gadia, Adastra Jewelry

In 2014, sisters Aditi Minda and Ashwini Gadia opened their eBay store, Adastra Jewelry, pivoting their careers from animation and screenwriting to handcrafted jewelry. They've broken gender barriers, fighting against the implicit biases they've seen in the traditionally male-dominated jewelry industry, to create a thriving business as they seek to empower other women to succeed. Now, they employ 70 people - including local artisans - and sell their creations all over the world from their offices in Mumbai. "eBay has given us a scope and a reach that I don't think any other platform would have been able to give us," Ashwini said.

• • Motors Parts & Accessories (P&A) is one of our largest categories globally. One out of every three eBay shoppers buy parts and accessories with more than 40 million buyers in this category worldwide, contributing over $10 billion in GMV annually. Starting in December, we began investing in top of funnel marketing across TV, radio and social channels in partnership with key industry influencers to highlight the valuable choices P&A enthusiasts have on eBay across hundreds of millions of listings. In addition, we implemented monetization changes to higher priced items and saw an increase in listings in the fourth quarter of 2021. eBay has increased the tools available for our Motors enthusiasts by expanding the My Garage feature to Canada, Italy, France and Spain and adding a motorcycle parts finder to the fitment shopping experience. We're enabling new cross-border trade corridors as a result of unifying our global categorization for parts and accessories.

• • For sneakers, we introduced 3D True View on select listings, using AI to provide the ability for full 360 degree views and zoom capability so that buyers can see every detail on a shoe to increase trust and appeal.

• • In luxury handbags, we saw accelerated growth in the U.S. We are also growing the number of brands covered by Authenticity Guarantee - and we began authenticating cross-border luxury handbag imports from Japan.

• • For collectibles, our new Collection tool allows enthusiasts to view, manage and to use the Price

  Guide to track the value of their trading card collection. Also for trading cards and stamps, we simplified the shipping experience with new features and tools.

We are sharply focused on our best and most valuable buyers: our enthusiasts. These buyers drive 71% of our GMV, on average shopping on eBay over 30 days each year and spending more than $3,000.

Seller profile - John Derringer, Driven Products

John Derringer got his start on eBay selling used tires out of his woodshed. He's the perfect example of someone who starts occasionally selling on our marketplace then turns that side income into a thriving small business - someone we like to call an Accidental Entrepreneur. He now runs an eBay Motors Parts & Accessories store called Driven Products in Washington state and has his own office facility and warehouse. Sellers like John help power our marketplace, and we innovate with their success in mind.

Enthusiast buyers are extremely engaged and, on average, new enthusiasts increase their spend and purchase days by 50% after one year on eBay. We are investing in them in a variety of ways.

• • We are always working to make it easier to simplify and personalize the eBay experience for our buyers, creating additional opportunities for them to customize eBay around their own needs and desires. By utilizing our visual technology and leveraging our vast image catalog, we are able to recommend more relevant items buyers may be interested in based solely on their search.

• • We've also created a new loyalty program called Top Star specifically for our most frequent buyers.

  And we've seen great responses in categories like sneakers, where tens of thousands of people have asked to become more involved.

• • In addition to broadening the inventory selection for buyers, our cross-border trade capabilities create a seamless global shopping experience. Nearly 90% of enthusiast buyers have purchased from international sellers. And with our new payments functionality, faster shipment features and forward deployment of inventory, it's now even easier to shop across borders.

• • We are meeting our buyers where they are - specifically for our next generation of buyers, connecting with them to help drive discovery on our platform. We are becoming more active on social platforms including TikTok, where we recently launched a marketing campaign called "Step and Flex" - which received over 12 billion views and inspired about 2 million user-generated videos. In the coming year, you'll see us reaching out more and more to enthusiast buyers through our full funnel marketing campaigns.

• • Buyer trust is essential in a third-party marketplace, and is an area of focus for our technology investments. In addition to our Authenticity Guarantee program which facilitates trust for our buyers, in late 2021, we also leveraged artificial intelligence to significantly decrease the time to detect and remove counterfeits. In the categories where it has been deployed to date, most listings are removed before a buyer has a chance to see them.

Our connection with our seller community is also unique. We don't compete with our sellers. We partner with them. When our sellers succeed, we succeed. And our seller base is incredibly diverse - ranging from Gen Zers who may be exploring new interests, to long established businesses that generate hundreds of millions in sales each year. Regardless of their size, we provide all of our sellers with a number of unique advantages and over the past year, we have created new tools to drive growth and build their brand at a lower cost.