eBay Inc.

Good day, everyone. My name is Megan, and I will be your conference operator today. At this time, I would like to welcome you to the eBay second quarter 2025 earnings call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time and have joined via the webinar, please use the raise hand icon, which can be found at the bottom of your webinar application. At this time, I would like to turn the call over to John Egbert, Vice President of Investor Relations.

Good afternoon. Thank you all for joining us for eBay's second quarter 2025 earnings conference call. Joining me today on the call are Jamie Iannone, our chief executive officer, and Peggy Alford, 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. Additionally, all growth rates noted in our prepared remarks will reflect organic, 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 and unknown risks and uncertainties. Our actual results may differ materially from our forecasts 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 our earnings release from earlier today. You should not rely on any forward-looking statements. All information in this presentation is as of July 30th, 2025. We do not intend and undertake no duty to update this information. With that, I'll turn the call over to Jamie.

Thanks, John. Good afternoon, and thank you all for joining us today. I'll begin with highlights from the second quarter. Then I'll go deeper on the fundamental drivers of our results and progress against our strategic initiatives. Following my remarks, I will turn the call over to Peggy, our new CFO, who will discuss our financial performance and outlook in greater detail before we open up the call for Q&A. We delivered another strong quarter in Q2, with all of our key financial metrics exceeding both consensus expectations and the high end of our respective guidance ranges. Our gross merchandise volume grew by 4% to $19.5 billion, accelerating by over two points sequentially. Revenue grew by more than 4% to $2.73 billion. Non-GAAP operating income grew 8% to $775 million. And our non-GAAP earnings per share grew 16% year over year to $1.37. These results are a testament to our continued progress in reinventing the future of e-commerce for enthusiasts. The fundamental drivers of our return to profitable growth remain intact, while our marketplace has proven resilient to recent uncertainty brought on by tariffs and trade policy changes. Now let's go deeper into the key drivers behind our Q2 performance. Our focus categories continue to be a significant engine of growth for eBay. In Q2, focus category GMV grew by over 10%, outpacing our core categories by 9 percentage points. This momentum was broad-based, as all of our individual focus categories accelerated year over year during Q2. Collectibles was once again the largest contributor to growth, as year-over-year growth in trading cards GMV accelerated for the 10th straight quarter on the back of continued momentum in both collectible card games and sports trading cards. Interest in Pokemon cards has surged recently, with GMB growth in the triple digits for the second straight quarter amid renewed interest from collectors and a particularly strong slate of product releases. While we expect to start lapping elevated growth in Pokemon in Q4, we continue to see strong secular growth across all our major trading card subcategories. For instance, sports trading cards and Magic the Gathering also accelerated sequentially, and GMV growth for each remains in the healthy double digits year over year. Our TCG player subsidiary is also consistently posting healthy double-digit GMV growth and set a new record for weekly GMV during its Mayhem event in Q2, which coincided with the pre-release window for the highly anticipated Final Fantasy Universes Beyond crossover. Overall, we remain confident in the durability for the trading cards category, even if our growth is not linear from quarter to quarter due to the varying cadence and relative strength of product release cycles. Our strategic initiatives and partnerships have meaningfully contributed to our recent momentum in collectibles, as we improve on our industry-leading experience for hobbyists. During Q2, we fully ramped our grading add-on solution in the U.S. in partnership with PSA and continued to see healthy attach rates. We introduced bulk selling capabilities for cards added to my collection to effortlessly populate multiple listings with just a few clicks. we began integrating inventory from Golden Auctions into the eBay marketplace, generating more exposure for these high SP listings. And our Golden subsidiary acquired Studio Auctions, which expands our offering for collectors of Hollywood and pop cultural memorabilia. Motors, Parts and Accessories, or P&A, also contributed nearly a point of year-over-year GMV growth for our overall enterprise, driven by strength across our major markets and trade quarters. While we've observed some pressure on direct shipped inventory from greater China following tariff increases and removal of the de minimis exemption, we've seen increased adoption of speed pack and resilient growth trends within forward deployed inventory. We also continue to expand buyers access to well-priced supply in key areas like used and green parts, many of which are sourced in their local markets. In the U.S., we've begun automating the enhancement of fitment data to P&A listings in recent quarters, which exposes them to a larger number of relevant auto parts shoppers. And in July, we launched easy and free returns for P&A in the U.S., which enables buyers to easily return eligible purchases for any reason, further improving our leading value proposition for auto enthusiasts. Our luxury and apparel focus categories also contributed positively to growth in Q2. In recent months, we've expanded the number of streetwear and luxury apparel brands eligible for authentication in the US. And in June, we launched luxury apparel authentication in the UK, covering dozens of the world's most sought after brands. Our authenticity guarantee program achieved two significant milestones in Q2. inspecting over 1 million items in a single quarter for the first time, and reaching a total of more than 15 million cumulative items processed through our authentication centers. Our momentum in fashion continues to benefit from improved consideration among enthusiasts, which has been amplified by our full funnel marketing strategy. In May, we sponsored the Met Gala live stream and had a major presence on the red carpet, resulting in nearly 5 billion earned media impressions. eBay became the first non-designer brand to dress attendees head to toe, with celebrities like Chapel Roan, Emma Chamberlain, and Jeremy Pope wearing pre-loved and vintage items sourced from eBay. our marketing efforts have also benefited from our increased capabilities in generative AI. In recent months, we've started leveraging GenAI to optimize listing titles in our product listing ads syndicated to Google, resulting in measurably higher quality scores, ranking, and overall performance for these listings, leading to incremental GMV. We have also leveraged proprietary models to detect and replace low-quality or cluttered listing images with higher-quality AI-generated alternatives for Google PLAs, which has increased the acceptance rate on these listings and shown a significant lift to GMV. We're also leveraging generative AI to drive personalized engagement with our customers. In late 2024, we introduced AI-generated subject lines and pre-headers for personalized CRM emails in the US, which drove a greater than 40% increase in quality visits versus our prior approach. In recent months, we've expanded this feature to the UK and have seen similar results. We're now expanding these personalized emails to more use cases, such as abandoned carts and followed seller emails. We've leveraged proprietary LLMs to generate these personalized messages, and our teams have managed to keep GPU utilization costs low by optimizing customer segmentation, as we've seen the strongest uplift when focusing on our enthusiast customers. We're already sending millions of these tailored emails each week and plan to continue leveraging generative AI to personalize more touchpoints of the customer experience through CRM channels. Our geo-specific initiatives represent another key building block for growth in 2025, and we made notable progress on our UK initiative during Q2. Since launching a suite of new capabilities to upgrade the consumer-to-consumer experience in the UK in Q4, we have seen notably stronger GMV growth trends versus our prior baseline, even after introducing a buyer-facing fee in Q1. During Q2, we continued to scale adoption of our managed shipping solution for UK C2C sellers as we introduced new features and functionality. We added package collection services for convenience and a deliver-to-store feature that enables buyers to have their items shipped to any one of over 10,000 every parcel shops or lockers in the UK, which yields significant cost savings relative to home delivery. In late Q2, we began mandating adoption of managed shipping for all new C2C listings outside of certain edge cases. Over the next few months, we plan to continue improving the managed shipping experience by adding new solutions for bulky items and age-verified products. We are also planning to expand to thousands more collection and drop-off points in the UK and drive awareness of the cost savings and sustainability benefits of adopting these services. These enhancements build upon the already strong value proposition that managed shipping offers. Faster listing times, lower shipping costs, greater transparency from added tracking, and protection against lost or damaged items. eBay Live is another major area of focus and investment in 2025. eBay Live brings our most engaged communities to life, transforming how enthusiasts discover, assess, and compete for high demand inventory in real time. It's a natural extension of our leadership in categories like trading cards, fashion, and luxury goods, where trust, storytelling, and scarcity are core to the purchase experience. By layering live commerce on top of our scaled marketplace, we're creating new shopping experiences where sellers can connect directly with their audience and like-minded buyers can engage with each other, all while leveraging the sellers, inventory, and demand we already have. GMV and watch time for eBay Live continues to grow quarter after quarter as we onboard more sellers into the program. eBay Live initially ramped within the trading cards category, but during Q2, we saw accelerating contributions from luxury watches, jewelry, handbags, and pre-loved apparel. In May, we formally launched eBay Live in the UK market alongside a major activation at Comic-Con London. Our teams also continue to innovate on the live commerce experience for sellers and buyers. During the quarter, we introduced a redesigned host console for sellers that enables real-time edits to listings, item lineup viewing, and a greater number of one-click actions to increase sales velocity. In the US, we launched two of our most requested features for eBay Live, auto charge and combined shipping capabilities, which improve trust and reduce friction. We also debuted eBay Live on Tour, a series of in-person events bringing eBay Live to the community via trade nights, hobby block parties, and pop culture events. We see eBay Live as a way to harness the power of the vibrant communities that have organically developed on eBay over the past 30 years. We have already seen significant evidence that live commerce can deepen engagement among eBay enthusiasts and unlock even greater velocity in our strongest verticals, which validates our continued investment in this experience. Turning next to advertising. During Q2, our first-party advertising revenue on the eBay platform grew 17%, driven by balanced growth across our ads portfolio. Active promoted listings made up nearly $1.2 billion of the close to $2.4 billion total listings on eBay, while 4.1 million sellers adopted a single promoted listings product during the quarter. Within promoted listings, general ads were the largest contributor to year-over-year growth in Q2, followed by priority ads and promoted offsite units. Promoted stores also continue to scale quickly off of a small base. During the quarter, we implemented several optimizations for our ads portfolio that contributed to growth, such as leveraging proprietary models trained on more granular buyer behavior to surface more relevant products. and using LLMs to analyze search queries and surface more relevant promoted products. We also extended priority ads to vehicle sellers for the first time, enabling both dealers and C2C sellers to generate more exposure for their vehicle listings. Within payments and financial services, we continue to focus on enhancing buyer choice, reducing conversion friction, and expanding our solutions for sellers. A key highlight this quarter was the successful expansion of our partnership with Klarna into the U.S. market on April 1st, building on our established global strategic partnership. Following our successful expansion in Europe late last year, Klona's U.S. launch has surpassed our initial expectations in terms of incremental GMV and new and reactivated buyers. The average order value on Klona transactions is approximately three times the U.S. marketplace average, while adoption has been particularly strong in focus categories like P&A, fashion, and electronics. Klarna is also helping us attract a younger demographic with roughly 50% of sales coming from Gen Z and millennial buyers and a higher mix of sales generated by female shoppers. Beyond Klarna, our other financial services initiatives continue to deliver value for customers. In the UK, our eBay balance feature continues to gain traction, enabling our several million active UK C2C sellers to utilize their sales earnings for eBay purchases, generating incremental GMV while lowering our payment costs in the process. Our seller capital program continues to empower small businesses with access to crucial funding, having dispersed over $100 million of growth capital year to date to more than 10,000 sellers globally. Beyond our operational performance, our dedication to the impact and sustainability of our marketplace continues to be recognized. I'm proud to share that eBay was named one of Time World's most sustainable companies and Newsweek's world's greenest companies 2025, underscoring our unwavering commitment to e-commerce and a healthier planet. Our purpose-driven community also continues its incredible work, notably through the eBay Foundation's One Good Thing campaign, where more than 8,500 volunteer hours and over $790,000 were donated by employees and the eBay Foundation to over 250 nonprofits globally, truly embodying our mission to create economic opportunity for all. In closing, Q2 was another strong quarter for eBay, demonstrating the continued momentum of our strategy and resilience of our marketplace. Focus categories remain an engine of growth for our marketplace and accelerated to 10% GMV growth. Our UK business is benefiting from a similar playbook being deployed at the geographic level, with GMV growth comfortably above our baseline before our investments in overhauling the C2C experience. AI continues to fundamentally change the eBay experience for customers as we've streamlined the listing experience, improved the efficacy of search to connect the right buyers and inventory, created more inspirational shopping experiences, and enhanced trust throughout our marketplace. Additionally, we are increasingly leveraging AI to improve the effectiveness of our advertising products and marketing, and personalize our CRM communications with our enthusiast customers. We also continue to invest in medium and longer-term initiatives like eBay Live and our vehicles business, enabled by the acquisition of Caramel, which are contributing modestly to GMB in 2025, but represent significant opportunities in the years to come. As we approach the 30th anniversary of eBay's founding in September, I would like to thank our teams for the significant progress they've made in reinventing the future of e-commerce for enthusiasts in recent years. Their unwavering dedication toward our mission has kept us firmly on the path towards sustainable long-term growth, yielding significant value for our shareholders. With that, I'll turn the call over to Peggy, who will provide more details on our financial performance and outlook. Peggy, over to you.