eBay 2011 Annual Report Download - page 70

to gains on the sale of Skype and acquisitions and non-cash charges to earnings partially offset by changes in working capital. Non-
cash charges to
earnings included depreciation and amortization on our long-term assets, stock-based compensation, loss on a divestiture of a business and the
provision for transaction and loan losses. The increase in cash provided by operating activities in 2011 compared to 2010 was due primarily to a
decrease in cash paid for taxes in 2011. Cash paid for taxes in 2010 included a cash payment for taxes of approximately $207.4 million related
primarily to a legal entity restructuring completed in the fourth quarter 2009.
The decrease in cash provided by operating activities in 2010 compared to 2009 was due primarily to an increase in cash paid for taxes of
$303.6 million related primarily to a legal entity restructuring completed in the fourth quarter of 2009 and the settlement of uncertain tax positions
in the fourth quarter of 2010.
Cash paid for income taxes in 2011 , 2010 and 2009 was $372.5 million , $645.8 million and $342.2 million , respectively.
Investing Activities
The net cash used in investing activities of $3.3 billion in 2011 was due primarily to net cash paid for acquisition of businesses of $3.2
billion , purchases of investments of $2.3 billion , purchases of property and equipment, net, of $963.5 million and the purchase of consumer loan
receivables (net of collections) originated through our Bill Me Later merchant network of $586.5 million , partially offset by proceeds of $2.3
billion related to the sale of our remaining 30 percent interest in Skype and $1.6 billion from maturities and sales of investments.
The net cash used in investing activities of $2.3 billion in 2010 was due primarily to cash paid for purchases of investments of $2.6 billion,
purchases of property and equipment, net, of $723.9 million and the purchase of consumer loan receivables (net of collections) originated through
our Bill Me Later merchant network of $379.7 million, partially offset by proceeds of $1.4 billion from maturities and sales of investments.
Financing Activities
The net cash used in financing activities of $838.5 million in 2011 was due primarily to $1.1 billion
in cash paid to repurchase our common
stock and $147.1 million in cash paid for tax withholdings related to net share settlements of restricted stock units and nonvested share awards,
partially offset by proceeds from net borrowings under the commercial paper program of $250.0 million , $242.2 million from the issuance of
common stock in connection with the exercise of stock options and our employee stock purchase plan and $79.7 million in excess tax benefits
from stock-based compensation.
The net cash provided by financing activities of $1.2 billion in 2010 was due primarily to cash proceeds from our sale of $1.5 billion of
senior unsecured debt securities in October 2010 and $300.0 million of net borrowings under a commercial paper program that we implemented in
November 2010, $235.5 million in proceeds from the issuance of common stock upon the exercise of stock options, and $41.9 million of excess
tax benefits from stock-based compensation. These proceeds were partially offset by cash outflows of $711.1 million to repurchase our common
stock and $120.6 million paid for tax withholdings related to the net share settlements of restricted stock awards and units.
The negative effect of currency exchange rates on cash and cash equivalents during 2011 , 2010 and 2009 was due to the strengthening of
the U.S. dollar against certain foreign currencies, primarily the Euro.
Stock Repurchases
In September 2010, our Board authorized a stock repurchase program that provides for the repurchase of up to $2.0 billion of our common stock,
with no expiration from the date of authorization, for the purpose of offsetting the impact of dilution from our equity compensation programs.
During 2011, we repurchased approximately $1.1 billion of our common stock under this stock repurchase program. As of December 31, 2011 ,
approximately $880.5 million remained for further repurchases of our common stock under this stock repurchase program.
Our stock repurchase programs may be limited or terminated at any time without prior notice. Stock repurchases under these programs may
be made through a variety of open market and privately negotiated transactions, including structured stock repurchase transactions or other
derivative transactions, at times and in such amounts as management deems appropriate and may be funded from our working capital or other
financing alternatives. The timing and actual number of shares repurchased will depend on a variety of factors including corporate and regulatory
requirements, price and other market conditions and management's determination as to the appropriate use of our cash. The programs are intended
to comply with the volume, timing and other limitations set forth in Rule 10b-18 under the Securities Exchange Act of 1934.
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