eBay Inc ($EBAY) Q1 2026 Earnings Call

Thanks, John. Good afternoon and thank you all for joining us today. I am pleased to report we're off to a very strong start in 2026. Our first quarter results exceeded our guidance and consensus estimates across the board despite ongoing macroeconomic and geopolitical uncertainty across many of our major markets. During Q1, gross merchandise volume rose by 14% over $22 billion while revenue grew 17% to more than $3 billion. Strong flow-through of this top-line momentum led to 18% year-over-year growth in non-GAAP operating income, which reached over $900 million. And our non-GAAP earnings per share increased by 21% year-over-year to $1.66. These strong top and bottom line results were driven by a broad-based GMV acceleration across all of our major categories alongside improved year-over-year trends across most of our key geographies. Our most established strategic priorities now make up approximately 70% of our total GMV. This includes focus categories, our consumer-to-consumer or C2C business, and re-commerce, which is made up of pre-owned and refurbished items. These priority areas each individually grew faster than overall GMV in Q1, and collectively, they grew in the high teens year-over-year reflecting the impact of our strategic investments over the last several years.

Our focus categories continue to build momentum in Q1 with GMV growth accelerating to 24% reflecting the benefits of our continued investments in trust, product experience improvements, and full funnel marketing. The collectibles category was the largest contributor to GMV growth in Q1 reflecting broad-based momentum across the category. The 30th anniversary of Pokémon in late February fueled significant enthusiasm that translated into strong demand on our platform, which we supported through coordinated activations across our core marketplace, eBay Live, TCGplayer, and Goldin. Sports trading card GMV growth accelerated notably in Q1 and was a larger contributor to GMV growth than Pokémon as we benefited from strong late season demand for the NFL and NBA as well as 2026 releases from Major League Baseball. Outside of trading cards, we observed strong GMV growth across much of our broader collectibles offering including in right-to-win areas like collectible coins, toys, action figures, and comic books. We also saw a transitory boost to GMV growth from gold and silver bullion in response to precious metal prices, but this demand began to normalize in late Q1 as expected and should revert to historical levels in Q2.

Within our off-platform marketplaces, TCGplayer growth remained strong, and Goldin growth accelerated as it reached a new quarterly GMV record in Q1. Goldin facilitated several landmark sales during the quarter including a Pokémon Pikachu Illustrator card that sold for over $16 million officially becoming the most valuable trading card ever sold at auction. To further support our trading card enthusiasts, we continue to enhance our AI-powered card scanning feature, which recently surpassed 30 million cumulative scans. This tool allows users to scan a single photo to instantly identify cards, surfacing historical prices and population data to help enthusiasts trade with confidence. In Q1, we expanded the card scanning feature beyond sports to cover our top five collectible card game genres including Pokémon, Magic the Gathering, and One Piece. Overall, our continued investments in both on and off-platform experiences are deepening engagement with collectibles enthusiasts. Through our innovation across multiple sports, genres, buying formats, and price points, we are further solidifying eBay as a premier global shopping destination for the hobbyist community.

Importantly, the momentum we observed in Q1 extended well beyond collectibles as the remainder of our US business also delivered double-digit GMV growth and outpaced broader e-commerce benchmarks. Our motors parts and accessories business or P&A delivered its strongest quarter of year-over-year GMV growth since 2021 contributing approximately two points of growth to our overall marketplace in Q1. Our guaranteed fit program has meaningfully increased conversion on fitment-enabled listings in the US, UK, and German markets helping fuel the strongest quarter of P&A GMV growth we have seen in several years. Given the success we've seen in our initial markets, we recently expanded guaranteed fit to Australia helping further solidify our online P&A leadership in this market by giving motors enthusiasts the confidence to tackle their most complex projects knowing they'll have the right part for the job every time or their money back. We also recently strengthened our P&A value proposition with the acquisition of Aladdin Systems, a UK-based software provider for salvage yards. We expect this acquisition to bring more recycled P&A inventory onto the eBay platform, which provides value for cost-conscious consumers and supports the circular economy.

Our acquisition of Caramel a little over a year ago is helping us bring a more comprehensive eBay motors offering by combining the strength of our scaled P&A business with our nascent but fast-growing vehicles business. We see meaningful opportunities for synergies between these businesses as they are highly complementary. Each vehicle sold on eBay creates a natural opportunity for future engagement in P&A as buyers return to the marketplace to maintain, repair, and personalize their vehicles. In vehicles, our secure fully digital transaction capabilities are driving improvements across the purchase funnel, and we are seeing encouraging traction as we expand from our initial focus on C2C transactions to begin serving small dealerships as well. While it's far earlier in its journey than P&A, vehicles continues to scale month over month and exited Q1 at an annualized GMV run rate in the hundreds of millions of dollars.

In fashion, we are building on the momentum we initially created by enhancing trust across high ASP categories like watches, handbags, jewelry, sneakers, and streetwear through authenticity guarantee. More recently, we've expanded authenticity guarantee eligibility to a wider selection of pre-loved and luxury apparel, shoes, and accessories for a more complete head-to-toe value proposition for fashion enthusiasts. After diversifying our brand and inventory coverage in the UK and Germany last year, we followed suit in the US during Q1 by expanding authenticity guarantee to more than 70 shoe and fashion accessory brands. We've also improved our value proposition for fashion re-commerce by streamlining calibrating garment sizing across global standards. These changes have simplified the listing process for sellers, removed a major point of friction for buyers, and contributed to measurable increases in quality views, bought items, and conversion velocity in fashion. Our breadth and depth of selection in branded pre-loved fashion inventory is also key to our relevance in the category.

Our AI tools like the latest generation of magical listing experience are making it dramatically simpler for sellers to list pre-loved fashion items on eBay, helping drive a mid-teens year-over-year increase in casual fashion listers in Q1. At the same time, we are strengthening our position in fashion by using community to build greater awareness and consideration with enthusiasts. eBay Live is becoming a meaningful driver of GMV in certain fashion categories, and in March, we held our first direct-from-brand live shopping event with Marks & Spencer in the UK. Our second annual Vogue Vintage Market events in the US and UK were another strong example of how curated events elevate eBay's relevance in pre-loved fashion. We are consistently showing up at the cultural moments that matter most to fashion enthusiasts, including the Grammys, the Oscars, and Berlin Fashion Week during Q1. We've also driven engagement through our sponsorships of the new Saturday Night Live and Love Island All Stars programming in the UK. Taken together, these efforts are making eBay a more compelling destination for enthusiasts and helped accelerate overall fashion GMV growth in Q1, including healthy double-digit growth across our fashion-focused categories in aggregate.

Our consumer-to-consumer or C2C business remains one of the most important strategic priorities. C2C sellers bring the unique, hard-to-find inventory that differentiates eBay and strengthens our position in re-commerce. Multiple years of investment have reduced friction and helped reinvigorate growth in a segment that makes up more than 1/4 of our total GMV. We saw that momentum continue in Q1 as C2C delivered double-digit GMV growth across the US, UK, and Germany, meaningfully outpacing B2C growth in those markets. We believe this momentum reflects the enhanced value proposition for consumer sellers in these markets with reduced transactional friction driving a healthier sell-to-buy flywheel. In May, we plan to revamp our consumer selling experience in Australia, our fourth largest market by demand. We will remove selling fees for consumer sellers in Australia and introduce a buyer-facing fee on C2C transactions, while also tailoring our seller segmentation and managed shipping service to cater to local market dynamics. Similar to our C2C initiatives in the UK and Germany, our goal is to reduce friction for casual sellers, increase our supply of differentiated inventory, and ultimately unlock a larger addressable market opportunity.

Another area where we are seeing strong momentum is eBay Live. In categories where trust, storytelling, and community are central to the purchase experience, eBay Live gives sellers a powerful way to showcase unique inventory and engage buyers in real time, while helping us bring more customers into high-value enthusiast experiences. Now operating in seven markets globally, eBay Live continues to scale rapidly with an annual GMV run rate more than eight times higher year-over-year in recent weeks. We supported that momentum in Q1 through strong growth in programming across a diverse mix of categories and improved event discovery throughout the eBay mobile app, including the recent addition of an eBay Live button on the bottom navigation for US users on iOS. In Q1, we hosted our first live stream shopping event outside of the holidays as our 48 Hours of Drops event in the US set a new daily record for eBay Live GMV with each day outpacing our previous record on Black Friday by 60%. We also saw impressive results internationally where local 24-hour events in the UK and Germany each reached seven-figure daily GMV milestones, proving that our live stream playbook is effectively capturing enthusiast demand across geographies.

We continue to leverage our AI capabilities to reimagine core experiences across the marketplace. For sellers, the latest generation of our magical listing experience uses our proprietary models, product knowledge graph, and 30 years of marketplace data to do much of the hard work of creating a listing, from guiding sellers on which photos to take to generating key details like titles, categories, item specifics, and pricing. The US rollout of this experience has been one of the most impactful launches we've had in years as it has driven a greater than 50% increase in new listing creation rate, double-digit percentage increases in sold items and GMV per lister, stronger retention, and a material increase in estimated customer lifetime value for these sellers. Based on these compelling results in the US market, we began expanding this experience to new and reactivated listers in Germany in April, where early AB tests are showing directionally similar uplift on key seller KPIs as the US launch, which gives us confidence to extend this experience to more countries and seller segments in the coming months.

For buyers, our generative search beta is creating a more intuitive and conversational way to shop by allowing customers to refine results through natural language and a multi-turn dialogue, much like working with a personal shopper that understands their sizes, styles, and brand preferences. While still early, we have observed some encouraging learnings from the beta as we're seeing approximately 50% more search engagement in sessions utilizing AI-powered refinements, which is ultimately translating into double-digit percentage increases in purchase behavior. These innovations are just two examples of our transition to an AI-native marketplace. By embedding these capabilities into the core of our platform, we are fundamentally changing the pace at which we can remove friction, unlock supply, and drive long-term value for our enthusiasts.

We are also extending the reach of our marketplace through partnerships. Following a successful pilot of eBay inventory in Facebook Marketplace search results last quarter, this integration has transitioned to general availability. eBay inventory is now enabled in the search box for the majority of Facebook Marketplace users in the US, Germany, and France. This integration further enhances the visibility of our differentiated inventory to Facebook's scaled audience, which can drive qualified incremental traffic to our sellers' eBay listings. Our search integration complements our existing presence in the marketplace feed for a subset of users where we continue to iterate on the experience and gather valuable learnings.

Now turning to shipping. Shipping solutions are a major focus for us this year as we leverage our scale and expertise to help sellers tap into demand across borders amid an increasingly complex trade policy landscape. In Q1, we continued to scale eBay International Shipping in Canada following its Q4 launch, and we expanded access to SpeedPAK for sellers in Germany and six other markets. Our SpeedPAK partnership continues to perform well in Greater China and Japan as these capabilities are becoming increasingly important as cross-border trade grows more complex.

Before concluding my prepared remarks, I'm proud to share that eBay was once again recognized as one of Fortune's most innovative companies. In January, we also released eBay's inaugural climate transition plan, a company-wide roadmap to reach net-zero greenhouse gas emissions by 2045. This plan reflects how we are well-positioned to drive sustainable commerce at scale and as a result creating enduring value for our customers, communities, and the planet. In closing, we delivered a very strong start to 2026 with results that exceeded our expectations and reflected broad-based momentum across the marketplace. A few key themes stand out from the quarter. First, our strategic priorities are driving the majority of our GMV growth. Focused categories, C2C, and re-commerce now represent approximately 70% of our total GMV and continue to gain share through our disciplined execution, which enhances our long-term resilience and strengthens the structural growth profile of our marketplace. Second, our GMV growth is broad-based and extends well beyond any single category. While collectibles continues to outperform, we saw improved trends across all of our major categories, including accelerating GMV growth across eBay Motors, Electronics, and Fashion. eBay Live continues to scale rapidly across a diverse group of categories, and we're in the early stages of realizing valuable synergies between P&A and Vehicles. Third, we are progressing from AI-powered optimizations to building fully AI-native experiences on eBay. We're increasingly embedding AI into foundational elements of our marketplace to remove friction, unlock supply at scale, and deliver more personalized and relevant products to our customers. While the macro environment remains dynamic, as I look toward the balance of 2026, I'm confident in the sustainability of our underlying business trends and the durable foundation we've established to support long-term growth. With that, I'll turn the call over to Peggy to provide more details on our financial performance. Peggy, over to you.

As I noted earlier, we expect our pending acquisition of Depop to close by the end of Q3. Given the updated timeline, we expect Depop to contribute approximately one percentage point to total FX-neutral GMB growth year-over-year in 2026. From a profitability perspective, we expect the acquisition would represent a low single-digit headwind to the 9% to 11% operating income growth we anticipate for the core eBay marketplace, which includes planned investments in Depop and integration costs. We would also expect the Depop acquisition to dilute our non-GAAP earnings per share growth by low single digits with the EPS impact modestly higher than operating income due to foregone interest income from the cash used for this transaction. In closing, we're encouraged by our strong start to the year and the broad-based momentum across the business. Our results reflect continued execution within our established strategic priorities and strong returns on our investments in emerging growth vectors like eBay live and vehicles. As we look ahead, we remain committed to balancing disciplined investments in areas that can strengthen our business over time with continued earnings growth and thoughtful capital allocation. Overall, we feel very good about the path ahead and our ability to create long-term value for our shareholders.

Yeah, it is. And we're encouraged by what we're seeing with our buyers. And we see even more positive signals when you look at the underlying trend. So, while global active buyers increased by 1% year-over-year and enthusiast buyers grew by 2% year-over-year, that really doesn't tell the whole story. Our US buyer growth has been much stronger at 6% year-over-year. And US enthusiast buyers grew even faster at 8%. We've also talked about our mid-value buyers, Nikhil, and what we've seen is they've also grown year-over-year every quarter since the beginning of 2024, consistently outpacing our total active buyer growth, which really suggests strong trends beneath the surface. That's somewhat counterbalanced by some of the trends that we're seeing internationally mitigated by the macro pressure. So, overall, what I would say is I'm actually very pleased with the strength we're seeing across the board, the improvements in buyer count, the cohort mix, the engagement, and the spend. And it's really balanced. Like when you look at the US GMB, Nikhil, it's balanced between active buyers, sold items, and ASP, which is I think a healthy place to be.

Yeah, look, we continue to see a dynamic global macro environment with a divergence between the US and international. In the US for our business, consumer demand continues to be resilient so far despite the volatility in trade policy and geopolitics. And strength was really broad-based across the board in Q1, including collectibles, motors, and fashion. I would say it's a different story in Europe where it's more challenging as reflected in the consumer confidence and some of the macro data. Though the investments we've been making in the region have really helped offset that. And our international year-over-year growth improved from Q4 over to Q1, as did CBT and our other solutions. So, we've kind of maintained a status quo or kind of thought about things in the status quo. Our ability to incrementally guide Q2 and raise the year is based on the confidence we're seeing in our marketplace. Remember Nathan that we're a bit more resilient because even in more challenging times people turn to eBay to find value in used or refurbished or that perspective. So, we feel more well-positioned because of that.

You know, we feel really good about the momentum that we're seeing overall. And so, Peggy talked about the real kind of divergence that you see between Q2 and Q1 is just due to the number of factors that she called out, whether that be bullion or some of the lapping dynamics. But, what we continue to see is a strong consumer. And more importantly than that, what we see is a great return on the investments that we're making in the business. So, when you look this quarter at the focus category growth of 24% and the areas that we've invested in and we're seeing it really resonate with consumers. And so, we feel good about the back half and the strong two-year stack and we feel great about what we're seeing in the consumer right now and just the underlying growth in the business.

Yeah, look, we continue to have a very strong C2C business around the globe. And US is amongst our strongest businesses in C2C. And we saw really healthy growth there. We've been operating in a very competitive global landscape for fashion e-commerce for years. And it's really raised the bar for the customer experience and helped unlock the total addressable market that's locked up in closets, attics, basements, and garages. What we're seeing as we roll out things like magical listing and we're using AI for listings which is now up to 500 million listings, is we're seeing more listings per lister, great seller metrics because of our ability to kind of unlock all that inventory. And so, that's had a meaningful impact on our performance. If you look at just total GMV growth in fashion, it accelerated sequentially in Q1. Our fashion focus categories contributed roughly a point of growth to our overall marketplace with luxury growing at healthy double digits. And our improved C2C value proposition has been impactful in fashion and frankly across the board. And what we've seen is double-digit growth in each of our top three markets by demand, the US, UK, and Germany. So, overall we feel really great about the momentum that we're seeing in fashion. And our pending acquisition of Depop indicates that we're really leveraging our build, buy, and partner playbook just like we did in collectibles to enhance the fashion experience for enthusiasts. Peggy, do you want to talk about the full funnel marketing that we're doing?

Yeah, Eric, we're going to continue to invest in the areas that are really driving kind of healthy growth across the business. We're going to continue invest in the focus categories. You're obviously seeing the nice return from the investments that we've made there. We're leveraging AI throughout the entire product experience, really taking the friction out of the experience. And you're seeing more and more of that with the Agentech search beta that we have going on with the incremental improvements in the new magical listing. We've been investing in live and seeing really nice returns from that. We're growing in the last few weeks 8X year-on-year in that format. And it's really engaging buyers and sellers in a new and different way. And while a little bit earlier, vehicles as well is going to be kind of another area for us to continue invest in over the course of this year. But, we're really pleased with the ROI that we're seeing off of those investments that we're making. When you think about our marketing plan, we've been using a full funnel marketing approach that's been really working well. And you've seen more kind of mid and lower supported by the upper funnel that we're doing. We've been driving really interesting activations across social media. We're at all the popular events from the Grammys to the Oscars. We're sponsoring Saturday Night Live to Berlin's Fashion Week driving all the way down to kind of putting products that are most relevant inside of people's social feed. Facebook's a good example of that. We've got some new tests with them going on in addition to putting the items inside of Facebook Marketplace in the search experience. So, we're going to continue to push forward. What's great is that AI is giving us a ton of new capabilities there, Eric. The ability to create creative at incredibly low cost and build a lot more of a test and learn infrastructure is really compelling to see the ROI on things like that that we're getting. It's also helping us in our own marketing and our CRM. Yesterday I was looking at a personalized glass with a dog paw. I was going to put my dog name on it. I forgot about it and I got an email this morning that said, 'Celebrate with new beer glasses.' So, AI had kind of written this really compelling subject line. And things like that, we're seeing numbers like 40% more engagement. So, what I feel really good too is how our marketing team is embracing those new AI technologies to really kind of speak to the long tail of inventory and opportunities that we have on eBay.

Yeah, it's really broad-based across the board is what we're seeing. In our year-over-year growth across all of our major categories sequentially with the strongest growth in focus categories within collectibles, motors, and fashion. And while US GMV was particularly strong at 27%, we also saw improvements in our international trends. When you look at our specific strategic areas, you asked about C2C, but focus category C2C and re-commerce now make up about 70% of total GMV. And individually, they each saw double-digit growth. So, that kind of gives you a sense of how broad-based the growth is. The strength that we're seeing in C2C is coming a lot from, A, we're doing some really significant and helpful marketing about magical listing and the value proposition that we have there. And we're finding that the KPIs are really fantastic. It's got a customer satisfaction of 95%. We're seeing 50% more listings per lister and more engagement. And it's driving a higher customer lifetime value for the sellers that are using it. This is why we're expanding it to new geographies and we'll expand it to additional seller segments over time. But, that's really helping us drive that part of the business. But, when you look at it, it's really across all of those priorities that we're seeing really nice double-digit growth.

Yeah, look, we see agentic AI as a real structural tailwind for eBay and it plays right into our core strengths. First, our innovations leveraging AI are already having a meaningful benefit for our business today. Take magical listing. We've talked about the compelling stats I just mentioned that we're seeing and sellers have created half a billion listings using our AI tools. And our agentic search beta, which I realize I didn't fully answer that question, so I'll come back to that. But what we've seen there is higher engagement and increased purchase behavior off of that early test. So, we're going to continue to bring the latest agentic technologies to eBay to make it easier for sellers to list and for buyers to find the things they love. Second, eBay offers really unmatched breadth and depth of unique and differentiated inventory. 90% of our 2 and 1/2 billion listings are non-new and in season, where items are more likely to be one-of-a-kind. And in our strategic priority areas, we've optimized the end-to-end experience to make it more seamless and enjoyable for buyers and sellers. Third and most importantly, what really differentiates eBay is the trust and enablement layer we've built over decades. The capabilities we've built like our global network of authentication centers, our suite of proprietary global shipping solutions, regulatory compliance, guaranteed fit, just to name a few. All these provide a trusted experience for everything from a trading card to a designer dress to a vintage car sold across state lines. And importantly, all three of these areas are enhanced by our 30 years of proprietary data, which gives us powerful insights that no one else has. So, overall, we see AI as a powerful force multiplier for our business and it's already supporting the accelerated GMB we're seeing today. When I look specifically at agentic search that you asked about, it's early innings, but there's encouraging early proof points about the quality of that traffic that's coming over. And even though it's very, very small, what we find is traffic that finds us, new buyers that find us via AI, the majority of the time they actually come back directly organically to eBay. So, we're going to continue to test and learn. You see us doing the Open AI ads pilot. We've expanded our more inventory to Facebook Marketplace as the space evolves.

Yeah, look, it's more than just AG. It's really trust across the board that we're looking at. So, that's AG. It's guaranteed fit in motors. It's eBay money-back guarantee. It's warranties against refurbished. It's secure checkout that we're building in vehicles and on and on. Having that kind of real trust layer at eBay is incredibly important to us and incredibly important to our consumers. And we're going to continue invest in that. You just saw us roll out more authentication to 70 clothes and shoes and accessory brands in the US driving that program further and further to really kind of build trust in. And it's more than just shipping. It's all of the selling services that we provide, whether that's eBay international shipping, which we just expanded into Canada last quarter. It's SpeedPAK, which we've been expanding from China and Japan to now Germany and six more markets. It's our forward deployment centers. It's really kind of handling all of those end-to-end pieces. That's making it really easy for sellers. We're going to continue invest in our payments technology to make it easier. We continue invest in areas like seller financing and other elements that help buyers grow their business with their working capital and helping them with compliance and protections and really being able to make sure that we run an incredibly trusted marketplace there. We're seeing really nice AI efficiency, giving our teams leverage so that we can innovate more on behalf of our seller community. I think it's why we're seeing great response to a lot of the tools that we're building and our seller CSAT is pretty strong is because of what we're able to provide. So, we're going to continue to invest in that and make eBay that great destination where you can not only get started but build a strong business on the platform.

Oh, I was just curious about headcount growth as well?

Yeah, you've seen this be strong in kind of Asian markets and we're seeing kind of real excitement and momentum with live shopping in our Western markets. After our recent expansion now, eBay live is available across seven countries and it's becoming a more meaningful contributor to growth, particularly in our collectibles and fashion categories. That's part of why we saw such strong growth in focus categories. We've been doing pretty meaningful activations around eBay live this quarter. We did a 48 hours of drops in the US and we did the same thing in UK and Germany where we did 24 hours of drop. And that really helped kind of drive engagement and boost sales with each market reaching a single-day milestone as a result. And that gives you a sense of the size and scale of even our newest markets, UK and Germany, saw a seven-figure day on that day. We continue to scale it by adding new sellers, growing content density, expanding entry points. This quarter we actually put it in the bottom of navigation for all mobile iOS users in the US, helping to increase discoverability. And what we're hearing is that buying inventory on eBay is different. There's an engagement, there's a community, there's an excitement that comes with it. And many of our sellers are finding that streaming on live, they're able to kind of bring that community together, drive that excitement, and it not only drives new business for them in terms of live, but it's actually driving more visits and buyers to their core business as a result of them seeing them on live. So, we feel like our scale, our global buyer base, and the high bar for trust that we have really differentiates us in live commerce. And while it's still early, we believe live can be a meaningful growth factor over time, and increasingly important part of how enthusiasts shop on our platform.