eBay 2002 Annual Report Download - page 115

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eBay Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Ì (CONTINUED)
Goodwill and Intangible Assets
Goodwill information for each reportable segment is as follows (in thousands):
December 31, Goodwill Goodwill December 31,
2001 Acquired Disposed of Adjustments 2002
Segments:
U.S. ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $ 14,915 $ 107,810 $(3,241) $ (835) $ 118,649
InternationalÏÏÏÏÏÏÏÏÏÏÏÏ 172,914 93,005 Ì 28,842 294,761
Payments ÏÏÏÏÏÏÏÏÏÏÏÏÏÏ Ì 1,061,867 Ì Ì 1,061,867
$187,829 $1,262,682 $(3,241) $28,007 $1,475,277
The increase in goodwill during the year ended December 31, 2002, resulted from business
acquisitions and from foreign currency translation adjustments relating to goodwill associated with prior
period acquisitions, partially oÅset by the disposal of goodwill in connection with the sale of our
ButterÑelds and Kruse subsidiaries. Goodwill of $1.1 billion resulted from our acquisition of PayPal,
$62.3 million resulted from our acquisition of the remaining 50% interest in eBay Australia and New
Zealand, $35.8 million resulted from our acquisition of the remaining 35% minority interest in Billpoint,
$19.3 million resulted from our acquisition of a 38% interest in EachNet, and $9.8 million resulted from
our acquisition of NeoCom. Foreign currency translation adjustments are included in the adjustments
column.
We account for our investment in EachNet using the equity method of accounting and the total
investment, including identiÑable intangible assets, deferred tax liabilities and goodwill, is classiÑed on our
balance sheet as a long-term investment. As of December 31, 2002, the goodwill related to our acquisition
of EachNet totaled $19.3 million.
The following table summarizes the pro forma impact of excluding goodwill amortization from our
operating results (in thousands, except per share amounts):
Year Ended Year Ended
December 31, 2000 December 31, 2001
Net income as reported ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $48,294 $ 90,448
Add: Goodwill amortization expense ÏÏÏÏÏÏÏÏÏÏÏÏ 620 32,586
Net income, pro forma ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $48,914 $123,034
Basic net income per share:
As reported ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $ 0.19 $ 0.34
Pro forma ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $ 0.19 $ 0.46
Diluted net income per share:
As reported ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $ 0.17 $ 0.32
Pro forma ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ $ 0.17 $ 0.44
113