eBay 2005 Annual Report Download - page 5

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PART I
FORWARD LOOKING STATEMENTS
This report contains statements that involve expectations, plans or intentions (such as those relating to
future business or financial results, new features or services, or management strategies). These statements are
forward-looking and are subject to risks and uncertainties, so actual results may vary materially. You can
identify these forward-looking statements by words such as ""may,'' ""will,'' ""should,'' ""expect,'' ""anticipate,''
""believe,'' ""estimate,'' ""intend,'' ""plan'' and other similar expressions. You should consider our forward-
looking statements in light of the risks discussed in ""Item 1A: Risk Factors,'' as well as our consolidated
financial statements, related notes, and the other financial information appearing elsewhere in this report and
our other filings with the Securities and Exchange Commission, or the SEC. We assume no obligation to
update any forward-looking statements.
ITEM 1: BUSINESS
Overview
eBay Inc. was formed as a sole proprietorship in September 1995 and was incorporated in California in
May 1996. In April 1998, we reincorporated in Delaware and in September 1998 we completed the initial
public offering of our common stock. Our principal executive offices are located at 2145 Hamilton Avenue,
San Jose, California, 95125, and our telephone number is (408) 376-7400. When we refer to ""we,'' ""our'' or
""eBay'' in this Annual Report on Form 10-K, we mean the current Delaware corporation (eBay Inc.) and its
California predecessor, as well as all of our consolidated subsidiaries. When we refer to ""eBay.com'' we mean
the online marketplace located at www.ebay.com and its localized counterparts. When we refer to ""PayPal''
we mean the online payments platform located at www.paypal.com. When we refer to ""Skype'' we mean the
Voice over Internet Protocol (VoIP) offerings provided by our subsidiary Skype Technologies S.A.
(""Skype'') located at www.skype.com. Skype's offerings utilize VoIP technology to convert voice signals into
digital data packets for transmission over the Internet.
Our purpose is to pioneer new communities around the world built on commerce, sustained by trust, and
inspired by opportunity. We bring together millions of buyers and sellers every day on a local, national and
international basis through an array of websites. We provide online marketplaces for the sale of goods and
services, online payments services and online communication offerings to a diverse community of individuals
and businesses. We currently have three primary businesses: the eBay Marketplaces, Payments and
Communications. Our eBay Marketplaces provide the infrastructure to enable online commerce in a variety of
formats, including the traditional auction platform, along with our other online platforms, such as Rent.com,
Shopping.com, Kijiji, mobile.de, and Marktplaats.nl. Our Payments business, which consists of our PayPal
business, enables individuals or businesses to securely, easily and quickly send and receive payments online.
Our Communications business, which consists of our Skype business, enables VoIP calls between Skype users,
and also provides Skype users low-cost connectivity to traditional fixed-line and mobile telephones. Together,
we believe eBay Marketplaces, PayPal and Skype provide unparalleled e-commerce and communications
offerings for buyers and sellers around the world.
During 2005, we made a number of strategic acquisitions in order to expand and enhance our offerings to
our user community. In February 2005, we acquired Rent.com, which facilitated our expansion into the online
apartment rentals market and is consistent with our strategy of expanding the breadth of our global online
marketplaces. During the second quarter of 2005, we acquired three international classifieds websites, which
we believe will create a more efficient place for local consumers to come together online. In August 2005, we
acquired Shopping.com, a premier online comparison shopping resource. In October 2005, we acquired Skype,
which we believe can open up new lines of businesses, create significant new monetization opportunities, and
accelerate commerce on our websites. In November 2005, we acquired VeriSign's payment gateway business,
which provides a real-time scalable Internet payment platform that allows merchants to authorize, process,
and manage online payments.
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