Good afternoon. My name is Emma, and I will be your conference operator today. At this time, I would like to welcome everyone to the eBay First Quarter 2023 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker’s remarks, there will be question-and-answer session. [Operator Instructions] John Egbert, Senior Director of Investor Relations, you may begin your conference.

Good afternoon. Thank you for joining us for eBay's first quarter 2023 earnings conference call. Joining me today on the call are Jamie Iannone, our Chief Executive Officer; and Steve Priest, 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 a 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, 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 forecast 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 April 26, 2023. 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, everyone, and thank you for joining us today. I am pleased with our strong performance during the first quarter. We delivered better than expected results across our key financial and operating metrics despite continued challenges in the macro environment. Our emphasis on non-new-in-season goods, advancements of our focused category strategy, site-wide innovation for sellers and buyers and investments in trusted experiences have enhanced the durability of our marketplace and kept us on the path to achieving sustainable long-term growth. We generated over $18.4 billion of gross merchandise volume in Q1, representing a 3 point acceleration in organic year-over-year growth sequentially and over 4% organic growth versus the first quarter of 2019. Revenue eclipsed $2.5 billion and grew 2% organically, outpacing GMV by roughly 5 points, primarily due to contributions from advertising. Our operating margin was 29.6% and we delivered non-GAAP earnings per share of $1.11, up 5% year-over-year. Our financial results provide clear evidence that our strategy is working and driving underlying growth in our business. Our progress is most evident in focused categories, which outgrew the rest of our marketplace by roughly 8 points during Q1 and grew low-single digits year-over-year overall. Our largest focused category, motors, parts and accessories, or P&A, accelerated a few points sequentially and was the largest contributor to GMV growth in Q1. Based on the data we are seeing, we believe P&A grew at market rates of growth for this category during the quarter, which is a testament to the results that are possible when we are laser focused on driving customer satisfaction and awareness in even the largest categories. In February, we launched the eBay Guaranteed Fit program in the U.S., which enables millions of P&A shoppers to buy with confidence knowing their auto parts will fit or they'll…

Thank you, Jamie, and thank you all for joining us today. I'll begin with highlights from the first quarter on Slide 9 of our earnings presentation. Next, I'll walk through our key operating and financial metrics in greater detail. Finally, I'll provide our outlook for the second quarter and some additional thoughts on the second half of the year before we begin Q&A. As usual, my comments will reflect year-over-year comparisons on an organic FX neutral basis unless I note otherwise. Overall, I am pleased with our Q1 results as our key financial metrics exceeded expectations despite navigating a challenging macro environment for e-commerce. Gross merchandise volume was down 3% to $18.4 billion, improving 3 points sequentially, while FX was a 3 point headwind to reported year-over-year growth. Revenue was up 2% to approximately $2.5 billion, which outpaced volume by 5 points due primarily to continued momentum within our advertising business. Non-GAAP operating margin was 29.6%, down 2.8 points year-over-year due to volume deleverage and continued investment in product innovation and full funnel marketing to support our strategic initiatives. We delivered $1.11 of non-GAAP earnings per share, up 5% year-over-year. And we generated $709 million of free cash flow, up 30% year-over-year, while returning $384 million to shareholders through repurchases and dividends. Our Q1 results demonstrate the strength and durability of our scaled global marketplace during periods of economic uncertainty, as well as the meaningful impact our strategic initiatives are having on our long-term growth trajectory. Let's take a closer look at our financial performance during the first quarter. Gross merchandise volume of $18.4 billion was down 3% year-over-year on an organic FX neutral basis or down 2%, including the impact of recent M&A. Organic GMV growth accelerated by 3 points sequentially in Q1, driven by continued outperformance in focused…

[Operator Instructions] Your first question today comes from the line of Nikhil Devnani with Bernstein. Your line is now open.

Great. Thank you both for taking my questions. So I had a couple around expenses and margins. On the 2023 expense outlook, it looks like that's increased from about 2% growth this year to now mid-single digits. Could you maybe provide some more specifics around what's changed in that outlook and where you now expect to spend a little bit more? And then I had a second question on margins that I'll ask after. Thanks.

Hi, Nikhil. Steve here. Great to speak to you, and thank you for the question. As you are more than aware, we're not fully guiding the full year at this point due to the uncertainty of the current macro environment. But let me give you a little bit of color with regards to the expense commentary that we shared on the call. Last quarter, when we talked to the markets, we talked about targeting total expense growth for 2023 of approximately 2% increase with onetime factors, as we talked about, like M&A and the rollout of eBay International Shipping, contributed a significant amount of that year-over-year expense growth. The mid-single digit guide that we provided you with today assumes the current weaker U.S. dollar exchange rate that we've seen continues for the remainder of the year. This FX impact accounts for the majority of the delta versus the prior outlook. And obviously, we will have corresponding positive impact on both GMV and revenue. In addition, the top line performance of the first quarter, we are pleased with the levels of execution that we had during the quarter, is providing us with incremental investment capacity for 2023. And so you're seeing us continue to invest in the business because we're getting such a strong return on investment as we go forward. And this is really aiding towards our drive towards long-term sustainable growth.

Thanks. And maybe just a big picture one on margins as you look out further. Obviously, there's a lot of important reinvestment happening. Business mix, I think, has also changed between M&A, payments, shipping. But you have some tailwinds into the take rate as well. So when you kind of step back, what is the right long-term structure for this business? I mean, should we still think about it as being a low-30s EBIT margin profile or should we approach it differently now? Thank you.

As you can imagine, Nikhil, we haven't guided long-term margins. I think what I would say is I'm very encouraged by the earnings power of eBay, both from ultimately driving improved net earnings and ultimately strong free cash flow coming over the business. The things that we're thinking about as we go in '23, margin will be a function of the underlying GMV momentum, which is ultimately impacted by the macro environment that we operate in. As we’ve talked about, the impact of recent M&A where we’re leaning in on the EIS program, that will drive long-term increases in operating income for eBay will drive about 100 basis points of margin dilution in ‘23. And as we’ve said, we’re going to continue to lean into the short term and drive operational efficiencies through the structural cost program. And we’re well on track and slightly above the $100 million that we laid out for 2023. That enables us, as I said earlier, to reinvest in the business and drive long-term sustainable growth for eBay.

Thanks, Steve.

Your next question comes from the line of Eric Sheridan with Goldman Sachs. Your line is now open.

Thanks so much for taking the questions and hope everyone on the team is well. I wanted to come back to the comments you made on the focused category marketing spend, and maybe just a multi-parter on that one theme. Can you give us some greater level of granularity of what avenues of deploying those marketing spends are delivering sort of higher versus lower ROIs? And how should we be thinking about how that spend might evolve in the years ahead and when measuring that spend and trying to look at it from the outside in, what do you think we should be monitoring the most to qualify the sort of return on that spend? Is it enthusiast buyer growth? Is it enthusiast buyer behavior? How should we be thinking about what the return on that spend will be over a multiyear time frame? Thanks so much.

Yeah. Look, the first thing I'd point to, Eric is the 8-point outperformance of focused categories over the rest of the business. In these areas where we're investing in, we're seeing the right types of growth. When I look at a category like P&A, which is our largest full funnel marketing to date, you look at the results this quarter, where we're at market rates of growth and we're really excited by what we're seeing there. I think enthusiast buyers as well in the quarter and active buyers were strong. For the third straight quarter, we had an aggregate new and reactivated buyers growing positively. And our new buyer growth was positive for the first time in eight quarters. And let me give you an example of how that ties into marketing. So in P&A, where we've had this large full funnel marketing campaign, new and reactivated buyers actually grew double-digits faster than the overall marketplace during the quarter. So this has been a shift for us that we’ve been talking about all along, which is moving from just lower funnel optimization to more full funnel, driving long-term consideration, which takes a little bit of time. But the results that we’re seeing off of that spend are great and are creating a really healthy business as evidenced by what we’re seeing in the focused category outperformance.

Your next question comes from the line of Doug Anmuth with JPMorgan. Your line is now open.

Hey. Thanks for taking the question. This is Wes on for Doug. Maybe one for Steve and one for Jamie. I think the gross margins were a little bit of a bigger headwind sequentially this quarter than we were thinking on the EIS rollout. Did you roll it out faster than you had originally anticipated and how should we think about gross margins as we go through the rest of the year? And then maybe one for Jamie a little separately but had been talking a lot around eBay Live and kind of what you're doing in the collectible space. So was just hoping to learn a little bit more about what -- how you're looking to go after the category beyond trading cards and comics looking ahead. Thanks.

Yeah. Thanks for the question. Steve here. I'll pick up the first question. EIS is -- we fully ramped the program for the existing sellers on our global buying hub this quarter. And we're obviously at the very early stage of the global ramp. In terms of your specific question around gross margins, they are exactly in line with what we'd expected about a 50 basis point impact on gross margin in the quarter. The great thing about this program as you go forward, although it has an impact on gross margins because of the way that we account for EIS, it generates good bottom line momentum for eBay and it's strategically important, and it also gives us the ability to dial up our charges depending on what the costs we incur for the International Shipping. On a longer-term basis, we expect this program to be accretive to overall profit for the year. And at the end of the year, as we get to the fourth quarter, it will approach our core margin structure for the overall business.

Yeah. And then on live commerce, this is something we began experimenting with Q2 of last year, hosting a few pilots and experimenting with it throughout Q2. We did expand it into luxury in Q4 with some events for handbags and jewelry. We also created a central hub and discovery entry point for our live commerce events in Q4, which means now users can subscribe to a specific channel or receive updates and notifications of upcoming events. This year, we hosted about 15 eBay Live events with over $500,000 of in-event GMV across collectibles and luxuries. And at the end of March, we started hosting our first short auctions, think like 30 seconds for handbags and collectibles. In general, these are getting 5,000 and 15,000 buyers. We're seeing great engagement from that standpoint so we're going to continue to pilot and learn and experiment with this technology, but exciting initial results thus far.

Your next question comes from the line of Michael Morton with MoffettNathanson. Your line is now open.

Thank you. Thank you for the question. I was wondering if we could maybe dig a little bit deeper on the spend buckets you're clearly investing in the business and the returns you're seeing there. And also how it could be feeding into the improvement and the decline rate for active buyers? And any color you could give us on the buyer level maybe inflecting, starting to grow going forward? And then just the second question is, there's this macro environment we're all living in. Any changes in behavior you're seeing around your luxury products, trade down, new buyers coming who might have purchased new? Anything around that would be great. Thank you.

Mike, Steve here. Thank you for the question, Michael. I'll kick off with the first one and then Jamie can pick up the second one, perhaps. Specifically with regards to where the investments are going, as you would expect, it's in terms of identifying what customers want and building the products that delight them and turning them about then to our full funnel approach to marketing. And so the investments that we're taking forward is really developing tremendous products on eBay. In the last couple of years, we've really pivoted our marketing spend to full funnel. And you've seen the fruits of our labor. Think about Jamie's prepared comments around the fact that we're growing at market rates in parts and accessories. We're seeing high double-digit growth with regards to refurbished business for the second quarter on the balance as a result of the investments that we're making. There's obviously a good correlation between our enthusiast buyers and the focused categories that we're going forward with in terms of our frequency coming to eBay and the levels of spend going forward. But what we're delighted with in terms of, again, what we're seeing with the buyers is the reactivation of our NORBs or new or reactivated buyers as we call them at eBay, where they're coming back to our platform as a result of the investments that we're making. Jamie, perhaps you pick up on the luxury question.

Yeah. Just in general, our luxury and fashion focused categories and on aggregate accelerated in line with our business overall. We continue to expand brand coverage on the platform, et cetera. So think about kind of very similar to what I said last quarter, which is some, a little bit of ASP pressure really made up for by the volume that we’re seeing on the platform. In general, our shift to non-new-in-season and that focus has really helped us in this environment because people are looking for values. And the ones that they can get on our platform make us much more resilient from that standpoint.

Thank you.

Your next question comes from the line of Deepak Mathivanan with Wolfe Research. Your line is now open.

Great. Thanks for taking the questions. So first on EIS, we understand the accounting implications on margins, but can you elaborate on what's driving the profitability improvement from this program over the next few quarters? How do you think about kind of the long-term investments that's required to support this initiative? And then wanted to go back to the focused categories. It was nice to see that nicely outperform the total growth. But can you provide some color maybe on certain categories kind of on a same-store sales basis so that we can see how some of the categories where you launched these initiatives earlier or currently trending maybe like sneakers, handbags, luxury watches and so on? And then how should we sort of think about the sustainability of the strength in P&A for the next few quarters? Thank you so much.

No problem, Deepak. So in terms of eBay International Shipping, both got really great strategic benefits but also good sort of financial benefits. So if I take a step back, think about our cross-border trade, which accounts for about 20% of the sales that take place on eBay. And as we came into the eBay International Shipping program, only about 50% of our 1.8 billion listings on the platform are available for global trade. And so we looked through the lens of how do we increase the level of inventory to the global buyers on eBay? And eBay international Shipping certainly facilitates that. The beauty of the program is that we have gone from an agent to a principal. It gives us much greater control over the overall process. So it enables us to drive greater levels of trust, particularly for our sellers. It enables us, with the size and scale of eBay, to leverage much better contracts in terms of the shippers. And it also enables us to pass through any increases in cost through to the shipping program and the sales that go forward. And so as you said, there's an accounting change because of the agent to principal relationship where we recognize both the gross revenue and the cost. And previously, it was net revenue. But as we said in our prepared comments, it's a good -- it provides good earnings dollars growth for eBay, and we would expect by the fourth quarter for it to mirror the margin profile of the wider business at that point. Jamie, over to you.

Yeah. Just on focused categories, I'd say a couple of things. One is, overall, focused categories outperformed the rest of the business by 8 percentage points, so we're definitely seeing the impact of the strategy. A couple of standouts is one, we've already talked about it, but motors, parts and accessories hitting market rates of growth for us was really happening kind of sooner than we thought. I talked about luxury already kind of being a stable growth vector for us. And then maybe the other one I'd highlight for you is just refurbished. Our Refurbished business grew double digits in the quarter. That's really coming off of a healthy Q4 where we had our largest week ever with Refurbished and Cyber. And I think that's two-fold. One is the value proposition that we provide in that focused category is pretty compelling. And two is we're continuing to invest in bringing new brands, making the process easier for small businesses to come on with their refurbished products and we're backing it up with a great trust guarantee. On parts and accessories, I'd just say that we actually feel really good about the growth rates that we're seeing there, probably happening even sooner than we thought. We just launched Guaranteed Fit a few months ago. And I've always said these things take a couple of quarters to really have the impact on the consumer in really kind of changing the trust equation, but we're seeing a lot of great movement from that perspective already. So I talked about the buyers on the platform in P&A, New and reactivated buyers in that category are growing double digits faster than the overall marketplace. So it makes me really excited for the future of what we're going to do in P&A. And just like in other categories, we're not done investing. We'll continue to roll out new innovations that are really relevant for that parts and accessory buyer on eBay.

Great. Thank you so much.

Your next question comes from the line of Trevor Young with Barclays. Your line is now open.

Great. Thanks. First, just dovetailing on one of the earlier questions on luxury. Just bigger picture, what are like the two or three things that might bring luxe buyers and sellers to eBay versus some of the smaller competitor platforms that are focused on that category? Just trying to understand like what helps eBay win. And then on a different category, home and garden, I think it's still 1 of the top five on the platform but hasn't really migrated into focused. Is that an opportunity over the next two to three years to maybe carve out some pockets within, therefore some more curated selection and unique inventory or is that just too broad of a category to really drive those enthusiast buyers?

Yeah. So I'd say just first on the benefits of eBay, one is the scale. So when products coming to luxury on eBay, they're available in 190 different markets around the world with 130 million plus buyers from that standpoint. So that's a massive advantage. Now that we have authenticity guarantee across our handbags, it basically takes trust off of the table and makes eBay an amazing destination to buy those items. The third thing I'd say is, we have really competitive fees from that standpoint. So if you're looking to sell those products, it's very attractive. I was talking to one of our sellers in handbags who did a live commerce event with us this past quarter and was just really excited by the results and the buyer demand that we were able to bring to something like that. The other unique benefit that we have on eBay is across categories. So we're bringing in buyers not just from handbag buyers but buyers across other categories on the platform and bringing them into handbags. So for our business, the average handbag buyer who buys a handbag over $500, they're going to spend $2,600 in handbags, but then they're going to end up spending $5,600 in other categories in the platform, and that's a really unique advantage for us on the platform. In terms of your questions on home and garden, I'd go back to what I said at Investor Day, which is we have five categories that are over 10 billion, home and garden being one of them, fashion being another, P&A. And so P&A was the largest one we've taken on to date and we've seen really good results. And I've said that every focused category -- I mean, every category that we have, we believe that we can apply the playbook to over time on the platform. So we don't like to get ahead of announcing where we're going for competitive reasons. But we believe this playbook and, in fact, is what we're seeing in P&A is applicable to even our largest categories.

That’s helpful. Thank you, Jamie.

Your next question comes from the line of Lauren Schenk with Morgan Stanley. Your line is now open.

Great. Thanks. And two, if I can. Just one on the expense side. Is there a way that you could help us think about what percentage of your expense base is not denominated in U.S. dollars? I just thought it would be a relatively small portion. And then secondly, it's encouraging to see that new and reactivated customer growth is up. But just given the slight decline in buyers, I mean, consistent with last quarter, does that imply churn? Is that as well? And if so, is that isolated in any specific categories? Thanks very much.

Hi, Lauren. I'll pick up the first point. We don't disclose the mix of our sort of currencies. I'd refer you to the overall shape of the business from a global perspective and think about the fact that roughly half of our overall business is generated out of International and half out of the U.S. But we don't specifically disclose the dynamics of that. We obviously talk about the impacts of currency on the overall business, which you can probably triangulate back into. Jamie, go to the question.

Yeah. Lauren, I would say our active buyer count is exactly where we expected it to be. I’ve been talking for several quarters about some near-term pressure that we thought we would see based on the macro environment, but that I thought we would see stabilization in the metric, and that’s exactly what we’re seeing here is that we’re acquiring buyers in the right way now. We’re building and turning them into enthusiast buyers, and our enthusiast buyers are buying 70% of the GMV on the platform. And so we’re excited that we saw kind of a more modest change in stabilization. And the P&A stats that I talked about with buyers is also really encouraging because it shows when we invest, we’re actually seeing what we want to see with new and reactivated buyers on the platform. So as things change from that standpoint, we’ll continue to update you, but we actually feel really great about what’s happening on the buying side.

Great. Thank you.

Your next question comes from the line of Stephen Ju with Credit Suisse. Your line is now open.

Okay. Thank you so much. So I think you talked about the case for International Shipping to be a profit center by the end of the year. But on the other hand, there are a lot of companies out there that use shipping savings as a promotional tool. So do you think there are opportunities for you to underwrite some of these costs to do the same or maybe come up with tools to aid the seller to run shipping discounts as an incremental way to promote their listings on eBay? Thanks.

Yeah. Look, we've always considered shipping as variable, so we can pass through those expenses to the seller from that standpoint. What we give them is the benefits of scale. So when you look at eBay's scale advantages in being able to work with providers from that standpoint and being able to manage things efficiently. When you buy your label through eBay as an example, you're getting a very good discount versus what you would pay if you just walked in and tried to do those shipments on your own. And so we're going to continue to bring our scale to benefits like this. This one is really about opening up that inventory. So we wanted to almost be invisible to the seller based in the geography that they're shipping internationally. So the example I talked about is, if I'm sitting in Manhattan, I can ship a product that's actually going to Spain, but it will feel like I'm shipping a product to Albany because we take care of everything in the background. So it's really about that 20% of GMV that we do in cross-border. As Steve said, less than half of our inventory is available to go across borders. And this is really about creating that unlock. And it's, frankly, one of the powerful weapons of eBay is because as even a casual seller on the platform, we open up such massive worldwide scale demand for you in 190 different countries. So think about the EIS kind of similar to ads or payments. It's us leveraging our scale for the benefit of our sellers.

Thank you.

Your next question comes from the line of Lee Horowitz with Deutsche Bank. Your line is now open.

Great. Thanks. One on the macro, maybe one on ads if I could. So I guess how, if at all, have you seen consumer patterns shift in the wake of the recent banking crisis? And if there's been any sort of different reaction either more or less pronounced in the U.S. versus international markets, that would be helpful. And then maybe on the advertising side of the business. Jim, you talked about growing the number of services in which you were able to place CPC ads as a driver of Promoted Listings Advanced in the quarter. When you think about the path forward from here, how far are you into the journey, would you say, in terms of rolling out CPC-enabled ads across the entire eBay platform? I guess said differently, how much more runway do you see for CPC-enabled ad load growth from here?

Hi, Lee. I'll pick up the macro question. Obviously, we've extensively talked about the impacts of macro on our first quarter earnings, the perspectives of the guide for the second. We haven't seen any discernible change in the underlying dynamic macro environment. From a geographical perspective, as you recall, as we came into the end of the first quarter last year and the awful events of the war in Ukraine, and Europe started to get impacted sooner than the U.S., particularly because of energy prices and the levels of consumer discretionary spend pressure. Obviously, that's caused some differential in the lapping behaviors. We've gone through and start to go through 2023. But no underlying discernible change in the overall macro environment.

Yeah. And Lee, what I'd say on the PL Advanced or our CPC-based business is, in Q1, we updated our [indiscernible] model, training it on CPC-specific data. That helped us present higher quality impressions and more GMV for the same number of impressions on the site. We also expanded CPC to the second row of ad placements within search results, which was previously only available to CPA. So it's still early in our CPC development. We're excited about these innovations. We also built some new technologies this quarter that helped us do better real-time evaluation between CPA and CPC. But what I would say is that we're well on track to the numbers that we outlined at Investor Day. And we think a big component of that in terms of new products is the Product Listings Advanced product and happy with the continued innovation quarter-after-quarter to kind of drive towards those targets.

Operator, can we do one last question, please?

Certainly, your last question comes from the line of Ygal Arounian with Citigroup. Your line is now open.

Hey, guys. Thanks for squeezing me in. One more on the advertising side and then maybe I'll just ask about buybacks. So advertising is coming in really nicely ahead of GMV. It looks like it's accelerated nicely ahead of our expectations. And obviously, we've got the legacy products and some of the newer products coming on. But has your outlook on the opportunity changed? Is it being pulled forward to a certain extent, maybe the macro environment leading to more sellers spending more on advertising to try to drive sales? So any incremental color on kind of what's moving the needle there? And then just on buybacks, expectations or use for the rest of the year, how you guys are thinking about it? Just any other color there.

Yeah. Look, advertising once again outpaced volume by 33 percentage points, driven by what we're doing in optimizing product listings across both standard and our more advanced products. We continue to think we have a long runway ahead of us for advertising. And I'd point to a couple of things. One is, we continue to see nice quarter-over-quarter growth in our new advertising products, that's External Express and Promoted Listings Advanced. The second thing I'd say is that we have a variable model where sellers can set their rates. And we're seeing really good ROAS for our sellers. So when we look at the return on ad spend that they're seeing, once they start using our ad products, their sales are basically seeing a double-digit increase. And more importantly, when you look at the ROAS that they can get on eBay, it's very attractive relative to industry standards. So as I said before, we feel like we're on track and executing towards the goals that we laid out. We feel like we're doing a nice job of balancing the buying experience and keeping that incredibly healthy and strong conversion while continuing to drive our ads business. And finally, we're just making the product easier to use. So quarter-after-quarter, we've built new products. Most recently, we've built a quick setup, a product for our CPC-based product to make that easier to use. And we continue to build up new reporting tools for our advertising sellers. So we're excited by where we are and the potential that's ahead. Steve, do you want to take the next part?

Yeah. Hi, Ygal. What I would say is that our first priority, as we always say is to invest in the long-term growth of the business through our build, buy, partner framework and because we see that as the best opportunities to drive long-term returns for shareholders. The beauty of the eBay model is because of the strength of the financial model and the strong free cash flow that we [indiscernible] gives us the ability to do both in terms of investing in the business and return capital. As you know, we returned $250 million to investors through buybacks in the first quarter in addition to the $0.25 dividend. We haven't guided our capital returns for the rest of the year, but we will continue to be balanced and thoughtful about the approach. We have committed to offset dilution and we'll continue to do that through the year. And then beyond that, we'll be opportunistic in both the timing and magnitude of any further capital returns.

Thank you.

This concludes today's conference call. Thank you for attending. You may now disconnect.