eBay 2004 Annual Report Download - page 2

steps into classiÑeds, which set the stage for the launch of our own local classiÑeds websites in select
international markets, under the brand name Kijiji, in February 2005.
PayPal also had a strong year, adding 23 million new accounts in 2004 for a total of 64 million user
accounts. PayPal now has more accounts than the total cardholder base of Discover and the account base of
Bank of America. Total payment volume, the dollar volume of payments through the PayPal system, totaled
$18.9 billion, an increase of 55% over the prior year. In just Ñve years, PayPal is already the most visited
Ñnancial services website in the U.S. and the United Kingdom.
eBay communities around the world have enthusiastically welcomed PayPal. In the last two years, we
have localized in 10 countries. Today, users from 45 countries can use their PayPal account as buyers. In 23 of
those countries, we also enable sellers to do cross-border trade. We believe PayPal's Merchant Services, or oÅ-
eBay opportunity, has great potential. By oÅering an extremely compelling value proposition for online
payments to merchants of all sizes, we have signed up more merchant accounts in Ñve years than the industry
has in 30. By meeting the needs of buyers and sellers both on and oÅ eBay, PayPal is fast becoming the wallet
of a generation of online shoppers.
Our conÑdence in the vibrancy of the eBay marketplace, the continued growth of PayPal, the
opportunities ahead for both, and our ability to manage these businesses has never been stronger. Helping our
community members thrive remains our highest priority. Their success is critical to our own, and we remain
focused on providing our users with the best tools for trading online.
Investments and ProÑtability
In addition to the strength of our core business, new opportunities are emerging rapidly. As a result, we
plan to invest signiÑcantly in strategic investment opportunities in 2005, most notably in China and PayPal. In
the past year eBay EachNet more than doubled its user base, strengthening its position as China's number one
e-commerce site. We see great opportunity to consolidate our position in China and set the stage for long-term
growth. PayPal is still in an early stage of development, and we see a great deal of untapped potential in the
U.S., both on eBay and among merchants oÅ eBay, and throughout eBay's global platform. With greater
investment in PayPal in 2005 we can lay the foundation for future growth and come closer to making PayPal
the online payment standard around the world.
It has always been a part of eBay's management philosophy that investments in future growth must be
balanced against generating real gains on the bottom line. As a result, we are focused on realizing the full
margin potential of the business, so that we can deliver increasing proÑts while also generating the capacity to
fund these investments. We believe this strategy of prioritizing top-line growth with eBay's cost leverage will
translate into higher cash Öows and value for our stockholders.
eBay's accomplishments in 2004 could not have been achieved alone. We would like to acknowledge our
partners, employees, and stockholders for their ongoing support and conÑdence. And, we would also like to
extend our appreciation and gratitude to eBay's community of users worldwide. These passionate and inventive
men and women have built our marketplace. Their support, guidance and dedication are at the heart of all we
achieve.
Pierre Omidyar Meg Whitman
Founder and Chairman of the Board President and CEO