Devin Wenig - President, Chief Executive Officer Scott Schenkel - Chief Financial Officer Selim Freiha - VP of Investor Relations

Good day ladies and gentlemen, and welcome to the eBay, Q4 2018 Earnings Call. At this time all participants are in a listen-only mode. Later we will conduct a question-and-answer session and instructions will follow at that time. [Operator Instructions]. As a reminder, this conference is being recorded. I would now like to introduce your host for today's conference, Mr. Selim Freiha, VP of Investor Relations. Mr. Freiha you may begin.

Thank you, operator. Good afternoon. Thank you for joining us and welcome to eBay's earnings release conference call for the fourth quarter of 2018. Joining me today on the call are Devin Wenig, our President and Chief Executive Officer; and Scott Schenkel, our Chief Financial Officer. We're providing a slide presentation to accompany Scott's commentary during the call. All revenue and GMV growth rates mentioned in Devin and Scott's remarks represent FX-Neutral year-over-year comparisons unless they indicate otherwise. This conference call is also being broadcast on the internet, and both the presentation and call are available through the Investor Relations section of the eBay website at investors.ebayinc.com. You can visit our Investor Relations website for the latest company news and updates. In addition, an archive of the webcast will be accessible for at least three months through the same link. Before we begin, I'd like to remind you that during the course of this conference call we will discuss some non-GAAP measures related to our performance. You can find the reconciliation of these measures to the nearest comparable GAAP measures in the slide presentation accompanying this conference call. In addition, management will make forward-looking statements that are based on our current expectations, forecasts and assumptions and involve risks and uncertainties. These statements include but are not limited to statements regarding the future performance of eBay Inc. and its consolidated subsidiaries, including the expected financial results for the first quarter and full year 2019 and the future growth of our business. Our actual results may differ materially from those discussed in this call 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 Annual Report on Form 10-K and subsequent quarterly reports on Form 10-Q, copies of which may be obtained by visiting the company's Investor Relations website at investors.ebayinc.com or the SEC's website at sec.gov. You should not rely on any forward-looking statements. All information in this presentation is as of January 29, 2019, and we do not intend and undertake no duty to update this information. With that, let me turn the call over to Devin.

Thanks Selim and good afternoon everyone. We delivered record earnings this quarter with top line results in line with our expectations, although we did see slowing consumer spend in December. In Q4 total GMV was up 2% and revenue was up 6%, while our active buyer base grew 4% to $179 million. Underlying these results, GMV on our marketplace platform grew 3%, StubHub volume was down 1% and our classified platform grew revenue at 11%. Scott will go into more detail on our financial results shortly. First let me provide a bit more context on our business. We continue to experience consistent active buyer growth, which historically has driven GMV. However, more recently we’ve seen GMV growth drop below active buyer growth, the result of several factors. As discussed last quarter, while some of the simplified buying experiences we launched have been positively received by new buyers, they were causing some conversion pressure with our existing buyer base. Give that dynamic, we stopped scaling these experiences to our existing customers. This in turn has created some downward pressure on GMV as we lap acceleration from last year. We’ll continue to roll out these experiences with new buyers. Additionally non-structured data SEO pages are delivering less traffic and lower conversion compared to a year ago, and while we increased our marketing spend in Q4, we experienced lower returns than expected. As we entered 2019 we've aligned our tactics to directly address these issues and to capitalize on the opportunities ahead of us as we transition to a different eBay in 2020 with a comprehensive catalog, intermediated payments and a robust and high contribution advertising business. eBay is a unique company with a unique value proposition and we're focusing on a few critical areas to build on this. First we'll pursue several…

Thanks Devin. I will begin my prepared remarks with our Q4 financial highlights starting on side four of the earnings presentation. In Q4 we generated $2.9 billion of total revenue, $0.71 of non-GAAP EPS, and $1.1 billion of free cash flow, while repurchasing $1.5 billion of our stock. Moving to active buyers on slide five, in the quarter we increased our total active buyer base to 2 million to a total of a 179 million up 4%. Buyer growth was stable driven by increased marketing investments offset by pressure in SCO. On slide six in Q4, we enabled $24.6 billion of total GMV, growing 2%, a 3 point deceleration versus the prior quarter. The growth was driven by international, which delivered 14.9 billion of GMV, up 5%, while the U.S. generation $9.8 billion of GMV down 1%. Moving to revenue on slide seven, we generated net revenues of $2.9 billion, up 5% organically, in line with the prior quarter. We delivered $2.3 billion of transaction revenue, up 7%, and $582 million of marketing services and other revenue up 3%. Turning to slide eight, our marketplaces platform GMV grew 3% in Q4, a 2 point deceleration versus the prior quarter. U.S. GMV was down 1%, a 3 point deceleration from the prior quarter, driven by a number of factors that Devin discussed earlier. Additionally export headwinds continue to impact GMV growth on a year-over-year basis. International GMV grew 5%, deceleration 2 points very Q3 with the UK and Germany deceleration roughly 2 points combined. This is driven in part by the dynamics that Devin discussed earlier. Additionally specific to the UK, macroeconomic pressures are negatively impacting consumer spending. Total Marketplace revenue was $2.3 billion up 6%, accelerating 1 point from prior quarter. Transaction revenue grew 7%, 4 points higher than GMV,…

Thank you. [Operator Instructions]. Our first question comes from Ross Sandler with Barclays.

Great! Hey guys. So it sounds like 2019 will be a little bit of a reset year and then 2020 will see reaccelerating growth. You have been able to do that in the past as we saw in 2017. So I guess Devin, what specific initiatives can you point to today that give you that confidence that you can deliver that accelerating growth in GMV in 2020. And then the second question is you are guiding the operating margins up nicely in the ’19; that's a reversal from the prior couple of year timeline. So do you feel like we are at a trough for operating margin and we'll see consistent improvement from here beyond ’19. Thanks.

Thanks for the question. Vis-à-vis GMV I think you're right to point out the fact that GMV has dipped before and then reaccelerated. I've seen it several times in my time here at eBay and I start by looking at the kind of core health metrics and to me those – I always go to buyer growth and traffic, both of which are healthy and stable. We are going to focus intensely on conversion as I said. We'll focus intensely on improving that traffic and buyer grow through an evolution of our SEO strategy, we’ll focus on resetting marketing a little bit so that we are at a healthier basis when we enter ‘20 and obviously in ‘20 we’ll kind of lap that we’ll end up with I think a healthier ROI on that spend. So I think that we've built a very solid foundation, but there's some things we've learned and we’ll make adjustments on that, and I think that gives us confidence that GMV will – this is not a trough of GMV, but we have the opportunity to accelerate beyond this. Keep in mind that in addition to GMV there is an important revenue dynamic in ’20, which is in the second half of the year. We begin to operate our payments initiative without the operating agreement and you've seen that advertising is scaling nicely and we assume that it will continue to scale nicely. So I have a high degree of confidence in accelerating revenue growth in ‘20 and we believe that the actions we are taking in ‘19 will set us up well for reacceleration of GMV as we move forward beyond this year. Vis-à-vis operating margin, you know we're not going to guide obviously out beyond 2019. I just say with the dynamic I just said, we’ll look for whatever opportunity there is to drive the improvement and growth of operating income and in part that will depend on what growth is. But I do think given that in the second half of the year payments will reverse, start to reverse from an investment to a revenue contributor. The opportunity is there to go further if we can -- if that's the most efficient way to drive operating income growth. So I think we've got a number of levers. We feel very good about our opportunity to deliver this year and then even better as we enter 2020. Thanks for the question.

Thank you. Our next question comes from the Eric Sheridan with UBS.

Thanks. Maybe two if I can. One just following up on the macro commentary, I just wanted to understand if that was commentary broad based about December or focused exclusively on the UK and whether you could quantify as a rate of change you saw in December verses October and November and what you’re calling out and how that might impact January. Second question, going back to Ross, when you look at ‘19 and you look at some of the headwinds, is there a way to tease out or qualify some of you know the headwinds to GMV or buyer growth and how we should be aware of those sort of arcing though the year whether it be first half, second half or it’s going to be fairly steady as we go through 2019? Thanks guys.

I'll take the first part just vis-à-vis holiday and December and then I'll turn it to Scott for the rest of it if that's okay. You know look, I think obviously it hard for us to know what happened out in the market beyond our own platform. But what we did see is over the last few years there has been a shift in holiday spending. There's been an acceleration into November, there's been acceleration into deals, there's been an acceleration into the kind of peak November shopping season, because consumers know they're going to get good prices around that time. This year what we did see is kind of across the board, a slowdown in December. Is that simply a remix of holiday shopping? Is that a macro effect, I don't know, and I think we'll wait and see what the landscape looks like. But we did see that affect more pronounced this year than we have in prior years. And Scott, can take the second part of the question.

Just a couple of points Eric that I’d kind of supplement to what Devin answered to Ross. I think first, the first half of the year had higher growth, better conversion and it's going to be tougher lapping; that's reflected in our Q1 guide. Ultimately it will be reflected in our Q2 outlook, no doubt. And as we phase into the second half, we started to see the deceleration with weakening conversion and that ought to provide some easier lapping from a first half to second half dynamics. And then you know as I flagged in my comments you know we've got an operating margin dimension as well that will make first half look a little bit higher, second half little lower from foreign exchange. But we expect to kind of fall within the range that we gave for the full year, both on revenue and EPS.

Great, thank you.

Thank you. Our next question comes from Colin Sebastian with Robert W. Baird.

Great, thanks. I have a couple as well. I guess first I just wanted to reconcile the ability to reduce marketing spend, while still generating modest GMV growth, if you could provide a little bit more color on the mix shift and added formats or channels that give you confidence and generating that growth next year. And then secondly, we are just curious given the fact that you have divested Flipkart. There are significant changes to the landscape in India and I’m wondering if that anyway does open a new window for eBay in that market? Thanks.

Thank you Colin. On the first part vis-à-vis marketing, you know we did a high degree of experimentation last year. We tried a lot of different new things. We pushed to the efficient frontier of returns and frankly we push far beyond. And we did that to see what we would get in terms of return, not just in GMV but in buyers and healthy CLV. We’ve always been disciplined marketers, we are very ROI driven, always have been. And as we reduce GMV already in the new - sorry as we reduce our marketing already in the New Year we've obviously taken out the lowest ROI spend that we saw last year. There was some things we did that worked very, very well and there's some things we did that did not return well. So that will have a GMV impact. We expect it will have a GMV impact in the short run, but it won't have a value impact. In fact taking it out we’ll increase value overall but have a short term headwind on GMV growth. That’s reflected in our guidance. So we are being surgical about what we take out. Let's keep in mind we are not stopping marketing, we're still going to market, but we're being very surgical in the way we reduce marketing spending throughout the year and particularly in the first half. Vis-à-vis Flipkart, we have relaunched eBay India, that is phase one. Phase one is without domestic selling, but it is a domestic experience. Right now Indian buyers are seeing eBay.India again. We put that back into the market on New Year’s eve. And phase 2 will be the ability for domestic sellers to sell directly in the Indian market and obviously today domestic Indian sellers are exporting as they were before the Flipkart transaction. So the export businesses is live, the domestic buying experiences is live and the next phase will be the domestic selling experience. I would say there are multiple opportunities, there are many other parties that have approached us about potential collaboration. We'll see how that goes, but I don't think – I think the Indian market is still in its early phases. There is plenty of growth left. There won't be one or two parties that make up the entirety of the Indian ecommerce opportunity and we certainly intend to have a share of it.

Thank.

Thank you. Our next question comes from Anthony DiClemente with Evercore ISI.

Thanks a lot. Devin maybe if you could just talk about or give us your updated thoughts on your assets, your portfolio, the corporate structure of eBay and if you've considered looking at divesting StubHub or Classifieds. I know you talked about cross merchandising and cross platform opportunities in your prepared remarks, but just want to hear more about that. And then secondly wanted to just ask for your updated thoughts on the competitive landscape. When you look at the GMV growth guidance you are expecting, do you see any incremental competitive pressure from other market place competitors, be the niche-oriented companies like Poshmark, The RealReal or others? Just wondering if you could kind of update us on how you think this new world of competitive landscape is evolving. Thanks?

Thanks for the question. On the first part, look I think our actions on the last three years proved that we are constantly reevaluating our portfolio and we will and we have taken actions that are in the best interest of our shareholders and will continue to do that. Vis-à-vis our existing portfolio there are real and substantial synergies as I mentioned and they are growing across that portfolio and those synergies are not only for our shareholders, but for our customers. But we always evaluate our assets and will continue to do so. On the second part of your question, I don't – look, it’s an intensely competitive industry. We are competing for $11 trillion of commerce. There is nothing fundamentally that changed in the last 30 or 60 or 90 days. It makes for a good headline, but the fact is there's no incremental competitive pressure that changed our results materially. It is super competitive and it has been. It was a year ago and it is now. Is it slightly more competitive, maybe, but did it dramatically change this holiday or last quarter, it did not.

Got it thank you very much.

Thank you. Our next question comes from Edward Yruma with KeyBanc Capital Markets.

Hey, good evening, thanks for taking my question. I guess you know you did have some success within the marketing and the new initiatives to drive new customers last year. I guess how are these consumers kind of aging? Are they behaving in the way that you would have expected. And then second, as you roll back some of these product enhancements, you know how is the existing customer that maybe had difficult with some of the changes kind of reacting and are they spending at their previous levels? Thank you.

You know vis-à-vis the cohort of customers, we are always watching that. I don't think there are material differences to the cohort of customers we've acquired say in the last 6 months from those that we've acquired in previous cohorts. We measure that all the time to make sure that there's not something in our marketing spend or the way we target that is bringing in a less valuable set of customers. So we are constantly adjusting that. Keep in mind that at 4% we are adding a couple of million buyers a quarter and that's against the base of $179 million. So it takes time to mix this out. It's still a small number against a very large number, but for the reasons I said, we'll be aggressive about continuing to push the new product experiences with are resonating well. The new customers are converting well on those experiences and vis-à-vis the existing customers, it's more a factor of what we don’t do rather than rolling it back. We tried and tested in select populations, we didn't have it rolled out broadly. We're hoping we could, but we'll go slower with that base. So there is no disruption of those customers and they are largely stable.

Great! Thank you so much.

Thank you. Our next question comes from Heath Terry with Goldman Sachs.

Great. Thank you. Devin, wondering if could just spend some time on your technology priorities from here to the extent we're going to see this improvement in margins and rationalization around some of the some of the spending outside of marketing. How do you feel about the level of tech investments that you're going to be able to make under this structure and if you could give us a sense of sort of where your priorities set now after coming through last year, would certainly appreciate it?

Yeah, I feel good about – I feel good that we can deliver on behalf of our customers with these levels of investment. Keep in mind a lot of our priorities will continue. The tactics are evolving as the real experiences reach real customers, but building out our catalog and structured data will continue. That will continue to be an investment that’s critical to our future. We’ll continue to invest tech resources in payments and ads, we’ll continue to invest in search improvements, we’ll continue to invest in conversion improvements. I would not enhance the margin in the short run if I thought that that was going to compromise the technology platform or our customers experience in the midterm or long term. We won’t do that. We have opportunity given lower growth to adjust marketing which we said. The areas will be ruthless about finding efficiencies. You heard from Scott about how ruthless we've been with G&A and we’ll continue to be. I think it’s a very healthy discipline in the face of lower growth to drive expansion and to drive operating income improvement which is what we'll do. But we will not, we will not touch critical capabilities or critical priorities. We would not do that in the face of trying to generate a lot expansion in a quarter or two. We are running the company on behalf of customers, employees and shareholders for the long term and every decision we make is with that in mind.

Great! I really appreciate that.

Thank you. Our next question comes from Stephen Ju with Credit Suisse.

Okay thanks. So Devin I guess the part of the benefits for payments is to take down friction for the buyers and I guess add value to the sellers. To the former point, are you starting to see any signs of hopefully higher conversion rates due to the greater choice of payments. And secondary, you now owned the Japanese asset for about six months now. I guess it's a large market, but it's also a well contested market. So can you talk about what you might be doing to grow the opportunity? Is there a strategy in that market that will be different versus to western markets? Thanks.

Both good questions, thank you. Vis-à-vis payments, I think that the best analogy to look at is historically non-PayPal customers, because obviously PayPal we have not turned on yet, we will turn that on later in the year. So we have looked at historical credit card purchasers on eBay and ApplePay users on eBay and both are showing higher conversion in the new payment experience. So we have confidence that we are on the right track and we’ll obviously measure the PayPal base once PayPal is wired on, but we think it is a good experience. I've rarely seen something that has so many positive benefits for customers, for our shareholders, for our partners, payment providers. There is a lot of goodness to go around with this and we are really seeing positive early signs. Keep in mind, this is an optional trial. So nobody is required at this point to be using payments intermediation, yet we’ve done a 140 million since we launched and its growing rapidly. So we feel really good about the opportunity and I think quarter-by-quarter the market will begin to see that, that this is real and it's happening and it's going to get really real after the second half of 2020. On Japan, Japan asset is growing very, very nicely. It’s a young asset, so it is – it's not yet at scale but it is a very differentiated asset in the Japan market. The Japan market is fairly mature. You've got a couple of big entrance players like Yahoo!, like RocketOn, like Amazon, and we are growing rapidly with a different base. It’s a business that is more browse and search oriented. It's a business that has more millennials, more women; it's a business more skewed to fashion and soft goods categories and it’s doing great. We couldn't be happier with the acquisition and it's potential in the future. It is carving out a meaningful niche in a very, very large – the world's third largest Ecommerce market where we've had nothing and now we look forward and say this is going to be a big business for us in several years. Thanks for the question.

Thank you.

Thank you. Our next question comes from Douglas Anmuth with JPMorgan.

Devin in your prepared remarks you talked about some of the cross platform opportunities and benefits. Could you just elaborate on that a little bit in terms of what you saw in ’18 across the core and then classifieds and StubHub. And then just shifting over to sales and marketing, we saw a deleverage, I think almost 400 basis points in 4Q. Can you just flush out the inefficiencies there across promotional activity and then also Japan and how we should think about promotional activity going forward? Thanks.

I’ll let Scott answer the second. On the first part, I start and stop with the customers and if I take a platform like eBay Classifieds, increasingly this is just becoming one consumer selling experience. It's really becoming an experience where you list and your listing ends up on both eBay and classifieds, including the reverse, which is you may list on classifieds and it ends up on eBay. To me, I said this before, I'm not saying anything different, classifieds is just the selling format. It's selling locally as opposed to selling globally, but its consumer selling to consumers which is something that eBay has done in its entire history. Vis-à-vis StubHub increasingly we are directing traffic and ticket sales to step up from the core eBay market place. If you go on StubHub and buy something today, you very well may see eBay being merchandise in the check-out floor – merchandise for your team or your event. We’ve really started this at the beginning of 2018 and are just getting up to scale. But with classifieds we've proven that we can deliver for customers and we can grow those cross platform synergies. We tend to do that with a classifieds and StubHub. Scott can answer the marketing question.

Yeah I mean the largest deleverage that you mention is really driven by market places. I had highlighted a few contexts that I think we talked about in the past. But first remember we've been shifting away from incentives that end up showing up in contra and as those shift and move into the marketing expense line that pushes up a few areas. First off, buyer coupons and those buyer coupon have been focused on both, new and reactivated buyers, as well as retained buyers to try and influence buying decisions. As Devin talked about, we pushed that spend pretty far out the curb and we’ll be modifying that as we look out into 2019 and one area that we’ll be cutting back. Second, we pushed pretty hard on SEM stand, Search Engine Marketing spend to really try and compensate for the softness that we saw in our SEO channel and as Devin talked about, we have been working on our SEO channel with a number of different activities in 2019 that should favor that as we're able to dive back a little bit SEM spend in ’19. And then finally, I'd call out brand spend. We certainly spent more in Q4 than we did in earlier quarters around brands than more than we’ve spent in prior years and we’ll dial that back a bit, but you should expect us to be spending on branding over the course of ‘19 as well, just not to the same extent as we did in ‘18.

Okay, thank you both.

Thank you. Our next question comes from Dan Salmon with BMO Capital Markets.

Good afternoon guys. Let’s start maybe with Scott. Just thanks for all the detail. On the capital plans I’m guessing there is no sort of insights on what you are expecting to do with debt levels there. Specifically though we can kind of back into it based on what you are talking about with leverage and cash balances to assume you go-to-market. I'm guessing no details there as you don’t want to get ahead of yourself, but would there be any reason we wouldn't expect you to do something in the market sooner rather than later, is there any sort of visible hurdle that we should be waiting just as we think about layering that into our models. And then maybe just a comment on how you think about potential M&A. Is there any budget in there for it specifically? We’d expect it to be modest, but any color on that would be great. And then Devin just on the ad business, with the growth that’s going on there are promoted listings. We assume that the number of actions, of revenue actions since you charged on a CPA basis is growing significantly as the coverage improves. Could you just maybe offer a little bit of color on pricing. We presume it's pretty strong, but it doesn’t always need to be the case and any comments on what you hope to do to drive further demand growth in 2019 as well.

Yeah Dan, to your questions, first off we do have kind of M&A basked into our outlook. I would say grossly speak – at gross levels that we talked about in the past and so enabling us to continue to be accusative within the same strategy, it was talked about within you know geo expansion tech and talent newer verticals. And we expected that to continue and that's assumed in our outlook. With regards to debt, you know look this is an evolution of our capital structure. You know as I talked about, we are targeting $3.5 billion of cash and 1.5x net debt, net leverage ratio. I think that allows to be aligned, align our capital structure and our cash generation profile, that’s super strong with our priorities and our shareholder returned objectives that we talked about. And to the extent that you know the ongoing user, you know the ongoing use and access to capital debt markets that we need to, we’ll do so and if we don't need to we won’t and so we are leaving ourselves a little room as we move forward there. Devin, on the second.

Yeah, I’ll take the ads question. The pricing has been pretty stable so far. We've seen the growth coming from both the source seller adoption and the sync buyer consumption. So pricing has been stable. I think as we move forward the sources of additional grow, the sources of being able to continue to scale at this rate which has been high is three areas: one, on the seller's side more opportunity for sellers to source first party ads. We still haven’t fully opened up the funnel to sellers. One example would be API access, our biggest sellers who genuinely interface with eBay though APIs, not through seller hub. We don’t yet have access to first party ads here if they want it. So we’ll open that up, that’s just one example. For buyers there will be more placements through things like unified ranking which will make sure that we're serving the right listing, to maximize conversion; through search and browse results not a separate slot for first party ad. The algorithm should fully understand how to maximize every pixel on the screen and that's where we're moving to. And then finally the model, there's been demand for a CPC model to go along with the CPA model and I would expect that at some point during the year, we’ll roll out a CPC model for brands in particular to complement the CPA model.

Great. Thank you that's very helpful.

Thank you. Our next question comes from Justin Post with Bank of America/ Merrill Lynch.

Sure, just one quick one. Trying to get my GMV forecast kind of in order here. If the softness in December continued through January, I'm sure we can kind of back into it on your 1Q guidance, but wondering if you could comment on that. And then secondly, how does the company think about GAAP versus non-GAAP earnings and do you think about ways to maybe close that GAAP and I guess the biggest difference will be stock based comp, but how do you think about that? Thank you.

Look Justin, generally I mean you know we don't comment about inter-quarter trends. I would just say that you know at this point January kind of ended up about where we thought it would and was kind of in line with the extra trajectory of December and so that’s about I’ll say on that one. GAAP to non-GAAP look we absolutely think about GAAP versus non-GAAP all the time. As you guys know we provide all those reconciliation, implied in our Q1 and 2019 outlook you can see that our stock based compensation is not going to – is not expected to increase this year, our expectation is flat. That will bring us closer in-line, not to mention the amortization of intangibles also is come down and so that’s bringing us closer in line. There is of course unusuals and they have been significant unusuals for all U.S. based companies around the world with this last year with U.S. Tax Reform, not to mention then how you adjust and go forward. And so as we look at it, we closely monitor our cost at every line item both GAAP and non-GAAP. I think we've demonstrated our capabilities to control those costs and also articulate them and I feel pretty good about the operational aspects of the GAAP outlook for ‘19 in particular.

Great! Thank you.

Operator, we’ll take one more question.

Thank you. And our final question comes from Ygal Arounian with Wedbush Securities.

Hey guys, thanks so much for taking the question. So you know talking about the core users versus the new users and talking about that bunch, there was some pushback on the core user base, taking up some of the structure data initiatives and specifically the product listing experience. But there is still focus as we go into 2019, obviously kind of bring that new user experience to them as well. So can you really talk about what the balance between are continuing to push those initiatives through were. If there are other things that you are focused on to kind of bring them up to speed and catch them up to how the new users are experiencing eBay going forward. Thanks.

Yeah I had a little trouble hearing you, but I think the question was really about product experience and the dynamic between new users and existing users, something like that.

Yeah exactly, and then you know what -- if they didn’t – if there were some push back on some of the initiatives from that we have been pursing though, specifically the product listing and structure data. Is there a focus to continue to push that though next year or are there new things that you are focused on to catch them up and bring them up to speed.

Yeah, I think you know really everything we do is built on structured data at this point. So we’ll expand the catalog further as I said which will help in the SEO outside the environment ecosystem. But yeah, well a lot of the existing base particularly buys, we are really talking buyers, they will get conversion improvements and frequency improvements. We are doing a lot of drive frequency of existing buyers, so that they use eBay in different ways than just the rare purchase. You know a lot of – when we call – when we think about churn, a customer who didn’t buy in the last year, often times that’s now somebody who we lost, it’s just somebody who uses eBay in a very niche way and there are a lot more opportunities for them to shop more broadly on our platform. So we think that’s both product and marketing messages frequency will become a bigger part of what we do in 2019. I think that's another way we'll start to build a healthier based towards ’20. So you'll see new users get more aggressive. What I would call retail like experiences, and existing will get more incremental, but still important improvements to conversion and similar. For sellers they will get protections, they'll get more data, they'll get better tools. We’ve got a big road map on behalf of our sellers and we are excited about that. So we are very dialed in to tactical and targeted product enhancements in 2019 that will set us up well for both ‘19 the guidance you’ve heard and beyond.

Great! Thank you so much.

Thank you. Ladies and gentlemen, thank you for participating in today's conference. This concludes the program. You may all disconnect and have a wonderful day.