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Free Example of EBay Essay

EBay was founded in September, 1995 in the Pierre Omidyar's San Jose living room. It was the beginning of the marketplace for the sale of goods for the individuals. The co-founder Jeff Skoll and Pierre Omidyar's went to the Meg Whitman to sustain this new business. Meg culled her senior staff from the famous companies Pepsico and Disney, created a very experienced management staff for this new company. This company has started as a garage sale in 1995 and grown very rapidly. The EBay offers the online sale of the latest antiques and video games and sale of cars. The EBay hosts 500,000 e-stores worldwide. Initially it was a personnel website and created to trust the both seller and buyer through the online payment system. EBay also provides the facilities of PayPal. It was a time when all PayPal income was coming from the EBay. EBay includes the sites Wiki, blog, eBay better than eBay, Skype and eBay pulse.

The audit committee consists of at least three members of the Board of Directors. Every member of the auditing firm of the EBay is independent. Rules of the SEC are applicable in sense of the audit. Audit team does not get any compensation from the company other than directors. Audit team is chosen after evaluation of their independence, qualification and experience.

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The exchange provides a great opportunity to access the public venture capital to sustain and facilitate the company’s growth. Under a proposed program that employee will swap underwater options for stock at a set ratio due to declining stock price. It was told that global, financial and economic crises have hammered it. The main purpose of the program was to motivate and retain the employees. If abundant stock is available, it provides the incentives to employees to work and share in profits. EBay had warned it would incur about $142.5 million over the next three years of compensation expenses if the proposal was not accepted by shareholders. According to Dow EBay stock is now close to 52-weeks high and this problem relates to employees and EBay has announced it will follow the stock option exchange program. This program will allow the employees to trade underwater options. It will result in the loyalty of employees and their retention. Shareholders are reluctant to approve the stock option exchange program. This increases the faith of the company leaders in recovery of stock price, as these stock options provides the employees incentive retention. To understand that how stock exchange does work is very complex. EBay like companies not only sell the products but also invite the people to invest in the shares. So EBay takes the care of its employees, therefore manpower of eBay

Analysts are impressed by the EBay’s early profitability.

Financial results for its quarter that has ended March 31, 2010 and first quarter revenue of $2.2 billion, up 9% year over year. This increase in revenue was due to growth in payments and marketplace business.  The company recorded net income on GAAP basis of $ 397.7 million for the first quarter 2010. GAAP margin increased to 22.2% for the quarter as compared to 20.9% for the same period last year. During the first quarter EBay Inc. has generated $418.3 million of operating cash flow and $266.0 millions of free cash flow. Financial highlights are given in the attached files with this paper.

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