EBAY · 10-Q · 2026Q2 · Full report

Income Tax Rate Changes

EBAY INC · 2026-08-06 · Importance 47 · Surprise 48 · In source text

The effective income tax rate declined to 17.1% in both the three- and six-month periods ended June 30, 2026, from 22.6% and 21.4%, respectively, in 2025. Income tax provision was $113 million for the quarter and $219 million for six months, compared with $107 million and $235 million in the prior-year periods. The lower rate primarily reflected increased excess tax benefits from stock-based compensation. The 2025 comparison also included a non-recurring remeasurement of deferred tax liabilities related to Illinois legislation on the taxability of foreign earnings.

Key facts

• Assets classified as cash and cash equivalents and investments included $1.1 billion held in certain foreign operations as of June 30, 2026 that will be subject to income taxes and foreign withholding taxes upon repatriation; deferred taxes have been accrued for repatriation effect. source
• Decrease in effective tax rate for three and six months ended June 30, 2026 was primarily due to an increase in excess tax benefits on stock-based compensation and a non-recurring remeasurement of deferred tax liabilities due to enacted Illinois legislation regarding taxability of foreign earnings in 2025. source
• Provision for income taxes for the three months ended June 30, 2026: $(113) million and for the three months ended June 30, 2025: $(107) million; for the six months ended June 30, 2026: $(219) million compared to $(235) million in 2025. source
• Effective tax rate for the three months ended June 30, 2026: 17.1% compared to 22.6% in 2025; for the six months ended June 30, 2026: 17.1% compared to 21.4% in 2025. source

Impact estimates