eBay Inc. (NASDAQ:EBAY)

The data reveals several distinct trends regarding the composition and valuation of intangible assets and goodwill over the five-year period ending December 31, 2018.

Customer Lists and User Base

The value attributed to customer lists and the user base experienced a sharp decline from 1641 million USD in 2014 to 419 million USD in 2015. Following this significant drop, values stabilized and showed a gradual increase each year, rising to 519 million USD by the end of 2018.

Marketing-related Intangible Assets

Marketing-related assets saw a general downward trend from 849 million USD in 2014 to 584 million USD in 2018, with some fluctuations—dipping to 594 million USD in 2015, then further decreasing and experiencing minor recoveries.

Developed Technologies

Developed technologies showed a steep drop from 579 million USD in 2014 to 238 million USD in 2015, followed by slight annual increases, reaching 278 million USD by 2018. The initial decline was significant, with subsequent years reflecting modest stabilization.

All Other Intangible Assets

This category declined from 279 million USD in 2014 to 157 million USD in 2015 and remained relatively stable thereafter, with minor gradual increases leading to 160 million USD in 2018.

Gross Carrying Amount of Intangible Assets

The total gross carrying amount of intangible assets mirrored the downward correction patterns of individual categories, decreasing drastically from 3348 million USD in 2014 to 1408 million USD in 2015. Thereafter, the figures edged upward steadily, culminating at 1541 million USD in 2018.

Accumulated Amortization

Accumulated amortization figures were consistently negative, reflecting ongoing amortization expenses. The absolute value decreased markedly from -2784 million USD in 2014 to -1318 million USD in 2015 and then remained relatively stable around -1400 million USD in subsequent years, indicating controlled amortization levels after the initial adjustment period.

Net Carrying Amount of Intangible Assets

Net intangible assets dropped sharply from 564 million USD in 2014 to a low of 69 million USD in 2017, followed by a modest recovery to 92 million USD in 2018. This indicates a significant write-down or amortization impact primarily between 2014 and 2017, with potential asset revaluations or additions contributing to the slight increase at the end of the period.

Goodwill

Goodwill exhibited a substantial reduction from 9094 million USD in 2014 to 4451 million USD in 2015, followed by a steady increase in the following years, reaching 5160 million USD by 2018. This pattern suggests an initial impairment or reclassification event in 2015, with subsequent growth likely due to acquisitions or reassessments.

Total Goodwill and Intangible Assets

The combined total of goodwill and intangible assets followed a similar trend, dropping from 9658 million USD in 2014 to 4541 million USD in 2015. After this sharp decline, there was a consistent but gradual increase. By 2018, the total amounted to 5252 million USD, reflecting recovery and asset growth post-2015.

Overall, the period was characterized by a significant reduction in the reported values of intangible assets and goodwill in 2015, likely due to impairments or revaluations. Post-2015, there is evidence of gradual asset recovery and growth, as demonstrated by increasing values in goodwill and net intangible assets. The stabilization in accumulated amortization and minor increases across asset categories suggest a more conservative and steady approach to asset management and valuation in later years.

The data indicates a fluctuating trend in both total assets and stockholders' equity over the analyzed periods, with distinct differences between reported and goodwill-adjusted values.

Total assets

The reported total assets declined sharply from 45,132 million USD in 2014 to 17,785 million USD in 2015. After this significant drop, assets showed a moderate increasing trend through 2017, reaching 25,981 million USD, before decreasing again to 22,819 million USD in 2018. The adjusted total assets, which presumably exclude goodwill, mirror this pattern but at lower absolute values, starting at 36,038 million USD in 2014, declining sharply to 13,334 million USD in 2015, then gradually increasing to 21,208 million USD in 2017 before falling to 17,659 million USD in 2018. This suggests that goodwill constituted a substantial portion of total assets initially and that adjustments significantly impact asset valuations.

Stockholders’ equity

The reported stockholders' equity experienced a considerable decline from 19,906 million USD in 2014 to 6,576 million USD in 2015. Following this, the equity increased to 10,539 million USD in 2016 but declined again subsequently to 8,063 million USD in 2017 and further to 6,281 million USD in 2018. The adjusted stockholders' equity presents a more pronounced downward trend, starting at 10,812 million USD in 2014 and dropping sharply to 2,125 million USD in 2015, followed by some recovery to 6,038 million USD in 2016, then declining steadily to 3,290 million USD in 2017, and reaching a low of 1,121 million USD in 2018. The divergent behavior of adjusted equity compared to the reported figures implies substantial goodwill write-offs or impairments affecting the net equity base.

Overall, the data suggests significant volatility in the company's financial structure over the analyzed timeframe. The sharp drop in both total assets and equity between 2014 and 2015 may indicate major disposals, impairments, or restatements. The subsequent partial recoveries denote asset growth or capital actions, but the downward trend persisting into 2018 particularly in adjusted figures highlights ongoing adjustments possibly related to asset impairments or decreased goodwill valuations. These patterns signal cautious considerations regarding the sustainability of equity levels after removing goodwill effects.

The data reveals notable fluctuations and distinct patterns across the evaluated financial metrics over the five-year period.

Total Asset Turnover

The reported total asset turnover ratio exhibits moderate variability, starting at 0.40 in 2014, peaking at 0.48 in 2015, followed by a decline to 0.37 in 2017, and a rebound to 0.47 by 2018. The adjusted total asset turnover presents a similar trend but consistently higher values, ranging from 0.50 in 2014 to 0.61 in 2018, with a notable peak in 2015 at 0.64. This indicates that after adjusting for goodwill, asset efficiency appears stronger but experiences comparable fluctuations year-over-year.

Financial Leverage

Reported financial leverage demonstrates an upward trend from 2.27 in 2014 to 3.63 in 2018, with a dip in 2016 to 2.26 followed by a significant increase in 2017. The adjusted financial leverage shows extreme volatility with values starting at 3.33, dramatically rising to 6.27 in 2015, falling back to 3.2 in 2016, and then escalating sharply to 15.75 by 2018. This pronounced increase suggests substantial changes in the capital structure or asset base once goodwill adjustments are considered, indicating greater reliance on debt or equity financing relative to adjusted assets.

Return on Equity (ROE)

Reported ROE exhibits substantial swings: a minimal 0.23% in 2014, a sharp increase to 68.94% in 2016, a negative return of -12.6% in 2017, and recovering to 40.28% in 2018. The adjusted ROE amplifies these changes, showing an exceptionally high peak of 120.34% in 2016 and a deep trough of -30.88% in 2017, culminating in an impressive 225.69% in 2018. These variations imply significant volatility in profitability relative to shareholder equity, intensifying after adjusting for goodwill effects.

Return on Assets (ROA)

Reported ROA follows a similar pattern with an increase from 0.1% in 2014 to 30.47% in 2016, negative performance at -3.91% in 2017, and a partial recovery to 11.09% in 2018. Adjusted ROA values are higher across all years, peaking at 37.56% in 2016, declining to -4.79% in 2017, and reaching 14.33% in 2018. The data suggests profitability relative to total assets is positively influenced when excluding goodwill, but still reflects substantial instability during the period examined.

Overall, the financial indicators reveal considerable volatility, especially in profitability and leverage, with adjusted figures highlighting more pronounced extremes. The significant jumps and declines in ROE and ROA between 2016 and 2017 suggest operating or market challenges during that time, while the marked increase in adjusted financial leverage by 2018 could signal strategic financial decisions impacting the company’s risk profile and capital structure.

The financial data reveals notable fluctuations in total assets over the five-year period. Both reported and goodwill adjusted total assets exhibit a general downward trend from 2014 to 2018, with reported total assets declining from 45,132 million US dollars in 2014 to 22,819 million US dollars in 2018. Similarly, adjusted total assets decrease from 36,038 million US dollars to 17,659 million US dollars over the same timeframe. The sharp drop between 2014 and 2015 suggests a major asset reduction or restructuring event. Following this decline, total assets show moderate growth until 2017 before declining again in 2018.

Regarding asset utilization, the reported total asset turnover ratio initially increases from 0.4 in 2014 to 0.48 in 2015, indicating improved efficiency in generating revenues from assets. However, this metric declines over the next two years, reaching 0.37 in 2017, before rising sharply to 0.47 in 2018. The adjusted total asset turnover ratio follows a similar, though more pronounced, pattern. It climbs from 0.5 in 2014 to 0.64 in 2015, declines over 2016 and 2017 to 0.45, and then rebounds significantly to 0.61 in 2018.

These trends suggest that after a significant adjustment in asset base around 2015, operational efficiency initially improved but faced challenges in subsequent years, losing some momentum in 2016 and 2017. The resurgence in turnover ratios in 2018 reflects enhanced asset utilization, potentially due to operational improvements or a more streamlined asset base. The consistently higher turnover ratios on an adjusted basis indicate that excluding goodwill results in a more efficient use of tangible and other adjusted assets.

Total Assets

Substantial reduction between 2014 and 2015, followed by moderate growth until 2017, then a decrease in 2018 for both reported and adjusted figures.

Asset Turnover Ratios

Improvement from 2014 to 2015, decline in 2016 and 2017, significant recovery in 2018, with adjusted turnover consistently higher than reported turnover.

Operational Insights

Patterns indicate restructuring or divestments impacting asset base in 2015, variable asset utilization efficiency thereafter, with evidence of enhanced operational performance in 2018.

The analysis of the annual financial data reveals several notable trends and patterns over the five-year period.

Total Assets

Reported total assets experienced a significant reduction from 45,132 million US dollars in 2014 to 22,819 million US dollars in 2018. The value saw a steep decline in 2015 to 17,785 million US dollars, followed by a gradual increase through 2017 before slightly declining again in 2018. Adjusted total assets, which account for goodwill adjustments, followed a similar pattern but remained consistently lower than the reported figures. The adjusted assets decreased from 36,038 million US dollars in 2014 to 17,659 million US dollars in 2018, exhibiting a decline in 2015 and a gradual recovery until 2017 before decreasing again in 2018.

Stockholders’ Equity

Reported stockholders’ equity showed a sharp decline from 19,906 million US dollars in 2014 to 6,281 million US dollars in 2018. The most significant drop occurred in 2015, narrowing from nearly 20,000 million to 6,576 million US dollars, with some recovery in 2016 and a subsequent decrease in the following years. Adjusted stockholders’ equity figures also declined substantially from 10,812 million US dollars in 2014 to a minimal 1,121 million US dollars in 2018, with notable volatility, particularly between 2015 and 2017, where values fluctuated before plunging further in 2018.

Financial Leverage

Reported financial leverage ratios fluctuated within a range but generally trended upward from 2.27 times in 2014 to 3.63 times in 2018, signaling an increasing reliance on debt financing relative to equity. Notably, there was a spike to 3.22 in 2017 following a dip in 2016. Adjusted financial leverage ratios, which consider adjustments for goodwill, demonstrated much greater volatility and an increasing trend over the years. The ratio escalated from 3.33 in 2014 to an elevated 15.75 in 2018, with particularly sharp increases seen in 2015 and again from 2017 to 2018.

Overall, the data indicates a steady decrease in both assets and equity over the five-year span when adjustments for goodwill are considered. The increasing financial leverage, especially the adjusted ratio’s sharp rise, suggests a growing dependence on debt financing amid declining equity bases, which could imply increasing financial risk. The volatility in adjusted metrics also points to potential impacts from goodwill impairments or revaluations affecting the company's underlying financial strength and capital structure.

The analysis of the financial data reveals several noteworthy trends and fluctuations in both the reported and goodwill-adjusted figures over the five-year period.

Stockholders’ Equity

Both the reported and adjusted stockholders' equity exhibit a general declining trend from 2014 to 2018. The reported equity starts at 19,906 million US dollars in 2014, drops significantly to 6,576 million in 2015, partially recovers to 10,539 million in 2016, and then decreases again to 6,281 million by 2018. Similarly, adjusted equity declines from 10,812 million in 2014 to just 1,121 million by the end of 2018, with notable decreases in 2015 and 2017. Overall, the adjustments for goodwill result in considerably lower equity values compared to the reported figures.

Return on Equity (ROE)

The reported ROE shows considerable volatility throughout the period. It begins very low at 0.23% in 2014, rises sharply to a peak of 68.94% in 2016, then experiences a negative value of -12.6% in 2017, followed by a recovery to 40.28% in 2018. The adjusted ROE, which accounts for goodwill, presents even more pronounced fluctuations. Although starting similarly low at 0.43% in 2014, it escalates dramatically to 81.18% in 2015 and reaches an exceptional 120.34% in 2016. Subsequently, it dips into a negative -30.88% in 2017 before surging to an extreme 225.69% in 2018. These oscillations suggest volatile profitability relative to equity, with the adjusted measure amplifying the extent of variation.

Overall Insights

The data indicate substantial instability in equity values and returns over the period analyzed. The marked declines in adjusted equity highlight the impact of goodwill adjustments, which reduce the equity base and thereby inflate the ROE metrics. The sharp swings in ROE, including episodes of negative returns, imply challenges in sustaining profitability. Furthermore, the extremely high adjusted ROE in 2018 suggests an outsized return relative to a much lower equity base, warranting careful examination of underlying factors such as asset impairments, goodwill write-downs, or operational performance shifts.

The annual financial data reveals significant fluctuations across the reported and goodwill-adjusted metrics over the five-year period observed.

Total Assets

Reported total assets show a marked decrease from 45,132 million US dollars in 2014 to 22,819 million US dollars in 2018, representing nearly a 50% reduction over the period. This trend is similarly reflected in the adjusted total assets, which declined from 36,038 million to 17,659 million US dollars during the same timeframe. The adjusted figures consistently remain lower than the reported ones, indicating the impact of goodwill adjustments on asset valuation.

Return on Assets (ROA)

Displayed as percentages, the reported ROA exhibits volatility across the years: beginning at a minimal 0.1% in 2014, increasing to a strong performance of 30.47% by 2016, then sharply declining to negative territory at -3.91% in 2017 before rebounding to 11.09% in 2018. The adjusted ROA follows a similar pattern but with higher values at each point, ranging from 0.13% in 2014 up to 37.56% in 2016, then declining to -4.79% in 2017, and recovering to 14.33% in 2018. This suggests that the exclusion of goodwill enhances the perceived profitability relative to the asset base.

Insights

The asset base experienced a significant contraction over the years, which may be attributed to divestitures, asset impairments, or other strategic realignments. Despite the reduction in assets, the company demonstrated an ability to generate variable returns, with particularly noteworthy performance peaks in 2016. The dip into negative ROA in 2017 indicates a challenging year in terms of asset profitability, which was followed by a recovery in 2018. The consistently higher adjusted ROA compared to reported ROA reflects the influence of goodwill adjustments, underscoring the importance of assessing profitability on a goodwill-neutral basis.