Document and Entity Information
Document and Entity Information - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2016 | Feb. 02, 2017 | Jun. 30, 2016 | |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | PayPal Holdings, Inc. | ||
Entity Trading Symbol | PYPL | ||
Entity Central Index Key | 1,633,917 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Large Accelerated Filer | ||
Document Type | 10-K | ||
Document Period End Date | Dec. 31, 2016 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Common Stock, Shares Outstanding | 1,207,583,234 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 41 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 |
Current assets: | ||
Cash and cash equivalents | $ 1,590 | $ 1,393 |
Short-term investments | 3,385 | 2,018 |
Accounts receivable, net | 214 | 137 |
Loans and interest receivable, net of allowances of $339 in 2016 and $233 in 2015 | 5,348 | 4,184 |
Funds receivable and customer accounts | 14,363 | 12,261 |
Prepaid expenses and other current assets | 833 | 655 |
Total current assets | 25,733 | 20,648 |
Long-term investments | 1,539 | 2,348 |
Property and equipment, net | 1,482 | 1,344 |
Goodwill | 4,059 | 4,069 |
Intangible assets, net | 211 | 358 |
Other assets | 79 | 114 |
Total assets | 33,103 | 28,881 |
Current liabilities: | ||
Accounts payable | 192 | 145 |
Funds payable and amounts due to customers | 15,163 | 12,261 |
Accrued expenses and other current liabilities | 1,459 | 1,179 |
Income taxes payable | 64 | 32 |
Total current liabilities | 16,878 | 13,617 |
Deferred tax liability and other long-term liabilities | 1,513 | 1,505 |
Total liabilities | 18,391 | 15,122 |
Commitments and contingencies (Note 12) | ||
Equity: | ||
Common stock, $0.0001 par value; 4,000 shares authorized; 1,207 and 1,224 outstanding | 0 | 0 |
Treasury stock at cost, 27 shares as of December 31, 2016 | (995) | 0 |
Additional paid-in-capital | 13,579 | 13,100 |
Retained earnings | 2,069 | 668 |
Accumulated other comprehensive income (loss) | 59 | (9) |
Total equity | 14,712 | 13,759 |
Total liabilities and equity | $ 33,103 | $ 28,881 |
CONSOLIDATED BALANCE SHEETS (PA
CONSOLIDATED BALANCE SHEETS (PARENTHETICAL) - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts, loans and interest receivable | $ 339 | $ 233 |
Common stock, par value (in usd per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 4,000,000,000 | 4,000,000,000 |
Common stock, shares outstanding (in shares) | 1,207,000,000 | 1,224,000,000 |
Treasury stock, shares (in shares) | 27,300,000 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Statement [Abstract] | |||
Net revenues | $ 10,842,000,000 | $ 9,248,000,000 | $ 8,025,000,000 |
Operating expenses: | |||
Transaction expense | 3,346,000,000 | 2,610,000,000 | 2,170,000,000 |
Transaction and loan losses | 1,088,000,000 | 809,000,000 | 646,000,000 |
Customer support and operations | 1,267,000,000 | 1,110,000,000 | 991,000,000 |
Sales and marketing | 969,000,000 | 937,000,000 | 954,000,000 |
Product development | 834,000,000 | 792,000,000 | 747,000,000 |
General and administrative | 1,028,000,000 | 873,000,000 | 733,000,000 |
Depreciation and amortization | 724,000,000 | 608,000,000 | 516,000,000 |
Restructuring | 0 | 48,000,000 | 0 |
Total operating expenses | 9,256,000,000 | 7,787,000,000 | 6,757,000,000 |
Operating income | 1,586,000,000 | 1,461,000,000 | 1,268,000,000 |
Other income (expense), net | 45,000,000 | 27,000,000 | (7,000,000) |
Income before income taxes | 1,631,000,000 | 1,488,000,000 | 1,261,000,000 |
Income tax expense | 230,000,000 | 260,000,000 | 842,000,000 |
Net income | $ 1,401,000,000 | $ 1,228,000,000 | $ 419,000,000 |
Net income per share: | |||
Basic (in usd per share) | $ 1.16 | $ 1 | $ 0.34 |
Diluted (in usd per share) | $ 1.15 | $ 1 | $ 0.34 |
Weighted average shares: | |||
Basic (in shares) | 1,210 | 1,222 | 1,218 |
Diluted (in shares) | 1,218 | 1,229 | 1,224 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 1,401 | $ 1,228 | $ 419 |
Other comprehensive income (loss), net of reclassification adjustments: | |||
Foreign currency translation | (15) | (37) | (42) |
Unrealized gains (losses) on investments, net | 11 | (16) | 0 |
Tax (expense) benefit on unrealized gains/losses on investments, net | (1) | 3 | 0 |
Change in unrealized gains/losses on hedging activities, net | 74 | (69) | 217 |
Tax (expense) benefit on unrealized gains/losses on hedging activities, net | (1) | 0 | (4) |
Other comprehensive (loss) income, net of tax | 68 | (119) | 171 |
Comprehensive income | $ 1,469 | $ 1,109 | $ 590 |
CONSOLIDATED STATEMENTS OF EQUI
CONSOLIDATED STATEMENTS OF EQUITY - USD ($) shares in Millions, $ in Millions | Total | Common Stock Shares | Treasury Stock | Additional Paid-In Capital | Net Parent Investment | Accumulated Other Comprehensive Income (Loss) | Retained Earnings |
Beginning balance (in shares) at Dec. 31, 2013 | 1,218 | ||||||
Beginning balance at Dec. 31, 2013 | $ 7,390 | $ 0 | $ 0 | $ 7,451 | $ (61) | $ 0 | |
Increase (Decrease) in Stockholders' Equity | |||||||
Net income | 419 | 419 | |||||
Net transfers from eBay | 268 | 268 | |||||
Foreign currency translation | (42) | (42) | |||||
Unrealized losses on investments, net | 0 | ||||||
Tax benefit on unrealized losses on investments, net | 0 | ||||||
Change in unrealized gains/losses on hedging activities, net | 217 | 217 | |||||
Tax expense on unrealized gains on hedging activities, net | (4) | (4) | |||||
Ending balance (in shares) at Dec. 31, 2014 | 1,218 | ||||||
Ending balance at Dec. 31, 2014 | 8,248 | 0 | 0 | 8,138 | 110 | 0 | |
Increase (Decrease) in Stockholders' Equity | |||||||
Net income | 1,228 | 560 | 668 | ||||
Net transfers from eBay | 4,143 | 4,143 | |||||
Foreign currency translation | (37) | (37) | |||||
Unrealized losses on investments, net | (16) | (16) | |||||
Tax benefit on unrealized losses on investments, net | 3 | 3 | |||||
Change in unrealized gains/losses on hedging activities, net | (69) | (69) | |||||
Tax expense on unrealized gains on hedging activities, net | 0 | ||||||
Common stock and stock-based awards issued and assumed, net of shares withheld for employee taxes (in shares) | 6 | ||||||
Common stock and stock-based awards issued and assumed, net of shares withheld for employee taxes | 64 | 64 | |||||
Stock-based compensation | 185 | 185 | |||||
Stock-based compensation tax impact | 10 | 10 | |||||
Reclassification of net parent investment in connection with separation | $ 0 | 12,841 | (12,841) | ||||
Ending balance (in shares) at Dec. 31, 2015 | 1,224 | 1,224 | |||||
Ending balance at Dec. 31, 2015 | $ 13,759 | 0 | 13,100 | 0 | (9) | 668 | |
Increase (Decrease) in Stockholders' Equity | |||||||
Net income | 1,401 | 1,401 | |||||
Foreign currency translation | (15) | (15) | |||||
Unrealized losses on investments, net | 11 | 11 | |||||
Tax benefit on unrealized losses on investments, net | (1) | (1) | |||||
Change in unrealized gains/losses on hedging activities, net | 74 | 74 | |||||
Tax expense on unrealized gains on hedging activities, net | (1) | (1) | |||||
Common stock and stock-based awards issued and assumed, net of shares withheld for employee taxes (in shares) | 10 | ||||||
Common stock and stock-based awards issued and assumed, net of shares withheld for employee taxes | $ (10) | (10) | |||||
Common stock repurchased (in shares) | (27) | ||||||
Common stock repurchased | $ (995) | (995) | |||||
Stock-based compensation | 449 | 449 | |||||
Stock-based compensation tax impact | $ 40 | 40 | |||||
Ending balance (in shares) at Dec. 31, 2016 | 1,207 | 1,207 | |||||
Ending balance at Dec. 31, 2016 | $ 14,712 | $ (995) | $ 13,579 | $ 0 | $ 59 | $ 2,069 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Cash flows from operating activities: | |||
Net income | $ 1,401 | $ 1,228 | $ 419 |
Adjustments: | |||
Transaction and loan losses | 1,088 | 809 | 646 |
Depreciation and amortization | 724 | 608 | 516 |
Stock-based compensation | 438 | 346 | 299 |
Deferred income taxes | 52 | 127 | 680 |
Excess tax benefits from stock-based compensation | (40) | (26) | (41) |
Gain on sale of principal loans receivable held for sale, net | (24) | (40) | 0 |
Changes in assets and liabilities: | |||
Accounts receivable | (77) | (22) | (13) |
Receivable from eBay | 0 | 121 | (24) |
Principal loans receivable held for sale, net | 24 | 14 | 0 |
Transaction loss allowance for cash losses, net | (643) | (493) | (414) |
Other current assets and non-current assets | (145) | (384) | (38) |
Accounts payable | 11 | 12 | 42 |
Payable to eBay | 0 | (217) | (2) |
Income taxes payable | 69 | 40 | 37 |
Other current liabilities and non-current liabilities | 280 | 423 | 113 |
Net cash provided by operating activities | 3,158 | 2,546 | 2,220 |
Cash flows from investing activities: | |||
Purchases of property and equipment | (669) | (722) | (492) |
Proceeds from sales of property and equipment | 0 | 26 | 0 |
Changes in principal loans receivable, net | (1,523) | (819) | (1,023) |
Purchases of investments | (21,041) | (21,626) | (8,744) |
Maturities and sales of investments | 18,429 | 16,148 | 7,766 |
Acquisitions, net of cash acquired | (19) | (1,225) | (2) |
Funds receivable and customer accounts | (176) | (395) | (24) |
Notes payable and receivable from eBay | 0 | 575 | (362) |
Net cash used in investing activities | (4,999) | (8,038) | (2,881) |
Cash flows from financing activities: | |||
Proceeds from issuance of common stock | 109 | 75 | 0 |
Purchases of treasury stock | (995) | 0 | 0 |
Excess tax benefits from stock-based compensation | 40 | 26 | 41 |
Contribution from (to) eBay | 0 | 3,858 | (71) |
Tax withholdings related to net share settlements of restricted stock units and restricted stock awards | (118) | (18) | 0 |
Borrowings (repayments) under financing arrangements | (21) | (862) | (21) |
Funds payable and amounts due to customers | 3,023 | 1,649 | 1,335 |
Net cash provided by financing activities | 2,038 | 4,728 | 1,284 |
Effect of exchange rate changes on cash and cash equivalents | 0 | (44) | (26) |
Net increase (decrease) in cash and cash equivalents | 197 | (808) | 597 |
Cash and cash equivalents at beginning of period | 1,393 | 2,201 | 1,604 |
Cash and cash equivalents at end of period | 1,590 | 1,393 | 2,201 |
Supplemental cash flow disclosures: | |||
Cash paid for interest | 4 | 16 | 19 |
Cash paid for income taxes | $ 48 | $ 216 | $ 47 |
Overview and Summary of Signifi
Overview and Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Overview and Summary of Significant Accounting Policies | Overview and Summary of Significant Accounting Policies Overview and Organization PayPal Holdings, Inc. (“PayPal,” the “Company,” “we,” “us,” or “our”) was incorporated in Delaware in January 2015 and is a leading technology platform and digital payments company that enables digital and mobile payments on behalf of consumers and merchants worldwide. Our vision is to democratize financial services, as we believe that managing and moving money is a right for all people, not just the affluent. Our goal is to increase our relevance for consumers and merchants to manage and move their money anywhere in the world, anytime, on any platform and using any device. We provide safer and simpler ways for businesses of all sizes to accept payments from merchant websites, mobile devices and applications, and at offline retail locations through a wide range of payment solutions. We also facilitate person-to-person payments through PayPal, Venmo and Xoom. Our combined payment solutions, including our PayPal, PayPal Credit, Braintree, Venmo, Xoom, and Paydiant products, compose our proprietary Payments Platform. The terms “we,” “our,” “us,” “the Company,” and “PayPal” mean PayPal Holdings, Inc. and, unless otherwise expressly stated or the context requires, its subsidiaries. We operate globally and in a rapidly evolving regulatory environment characterized by a heightened regulatory focus on all aspects of the payments industry. Government regulation impacts key aspects of our business. We are subject to regulations that affect the payments industry in the markets in which we operate. Non-compliance with laws and regulations, increased penalties and enforcement actions related to non-compliance, changes in laws and regulations or their interpretation, and the enactment of new laws and regulations applicable to us could have a material adverse impact on our business, results of operations and financial condition. Significant Accounting Policies Basis of Presentation and Principles of Consolidation On July 17, 2015 (the “distribution date”), PayPal became an independent publicly traded company through the pro rata distribution by eBay Inc. (“eBay”) of 100% of the outstanding common stock of PayPal to eBay stockholders (which we refer to as the “separation” or the “distribution”). Each eBay stockholder of record as of the close of business on July 8, 2015 received one share of PayPal common stock for every share of eBay common stock held on the record date. Approximately 1.2 billion shares of PayPal common stock were distributed on July 17, 2015 to eBay stockholders. PayPal's common stock began “regular way” trading under the ticker symbol “PYPL” on The NASDAQ Stock Market on July 20, 2015. Prior to the separation, eBay transferred substantially all of the assets and liabilities and operations of eBay's payments business to PayPal, which was completed in June 2015 (the “capitalization”). The consolidated financial statements prior to the capitalization were prepared on a stand-alone basis and were derived from eBay's consolidated financial statements and accounting records. The consolidated financial statements reflect our financial position, results of operations, comprehensive income and cash flows as our business was operated as part of eBay prior to the capitalization. Following the capitalization, the consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All periods presented have been accounted for in conformity with U.S. generally accepted accounting principles (“GAAP”). For periods prior to the capitalization, the consolidated financial statements include expenses associated with real estate and information technology that were previously allocated to the payments business of eBay, and additional expenses related to certain corporate functions, including senior management, legal, human resources and finance. These expenses also include allocations related to stock-based compensation. The expenses that were incurred by eBay were allocated to us based on direct usage or benefit where identifiable, with the remainder allocated on a pro rata basis of revenue, headcount, or other systematic measure. We consider the expense allocation methodology and results to be reasonable for all periods presented. The consolidated financial statements also include certain assets and liabilities that were historically held at the eBay corporate level, but which are specifically identifiable and attributable to us. The consolidated financial position, results of operations and cash flows of PayPal prior to the distribution may not be indicative of our results had we been a separate stand-alone entity throughout the periods presented, nor are the results stated herein indicative of what the Company’s financial position, results of operations and cash flows may be in the future. All intercompany transactions and accounts have been eliminated. Transactions between the Company and eBay are included in these consolidated financial statements for all periods presented. Beginning with the first quarter of 2016, we reclassified certain operating expenses in our consolidated statements of income to better align our external and internal financial reporting. These classification changes relate primarily to real estate and information technology operating expenses that were previously allocated among customer support and operations expense, sales and marketing expense and product development expense. As of the first quarter of 2016, our management did not allocate these operating expenses for internal financial reporting and general management of the business and has therefore discontinued this allocation for external financial reporting purposes. As a result, starting with the first quarter of 2016, these operating expenses were reported as part of general and administrative expenses. These changes have no impact on the previously reported consolidated net income for prior periods, including total operating expenses, financial position or cash flows for any periods presented, and do not eliminate any of the costs allocated to us by eBay for any periods prior to the separation. Prior period amounts have been reclassified to conform to the current period presentation. The following tables presents the effects of the changes on the presentation of operating expenses to the previously reported consolidated statement of income: Year Ended December 31, 2015 (In millions) As Reported Adjustments Revised Transaction expense $ 2,610 $ — $ 2,610 Transaction and loan losses 809 — 809 Customer support and operations 1,220 (110 ) 1,110 Sales and marketing 985 (48 ) 937 Product development 947 (155 ) 792 General and administrative 560 313 873 Depreciation and amortization 608 — 608 Restructuring 48 — 48 Total operating expenses $ 7,787 $ — $ 7,787 Year Ended December 31, 2014 (In millions) As Reported Adjustments Revised Transaction expense $ 2,170 $ — $ 2,170 Transaction and loan losses 646 — 646 Customer support and operations 1,055 (64 ) 991 Sales and marketing 998 (44 ) 954 Product development 890 (143 ) 747 General and administrative 482 251 733 Depreciation and amortization 516 — 516 Restructuring — — — Total operating expenses $ 6,757 $ — $ 6,757 The accompanying consolidated financial statements include the financial statements of PayPal and our wholly and majority-owned subsidiaries. Investments in entities where we hold less than a 20% ownership interest are accounted for using the cost method of accounting, and our share of the investees’ results of operations is included in other income (expense), net on our consolidated statement of income to the extent dividends are received. Our investment balance is included in long-term investments on our consolidated balance sheet. In the opinion of management, these consolidated financial statements reflect all adjustments, consisting only of normal recurring adjustments, which are necessary for fair presentation of the consolidated financial statements for all periods presented. We have evaluated all subsequent events through the date the financial statements were issued. Certain amounts for prior years have been reclassified to conform to the financial statement presentation as of and for the year ended December 31, 2016 . Use of estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses, including allocations from eBay, during the reporting period. On an ongoing basis, we evaluate our estimates, including but not limited to those related to provisions for transaction and loan losses, legal contingencies, income taxes, revenue recognition, and the valuation of goodwill and intangible assets. We base our estimates on historical experience and on various other assumptions which we believe to be reasonable under the circumstances. Actual results could differ from these estimates. Cash and cash equivalents Cash and cash equivalents are short-term, highly liquid investments with original maturities of three months or less when purchased and are composed of primarily of bank deposits, government and agency securities and commercial paper. Investments Short-term investments, which include time deposits, government and agency securities and corporate debt securities with original maturities of greater than three months but less than one year when purchased, are classified as available-for-sale and are reported at fair value using the specific identification method. Unrealized gains and losses are excluded from earnings and reported as a component of other comprehensive income (loss), net of related estimated tax provisions or benefits. Long-term investments include corporate debt securities, government and agency securities and cost method investments with maturities exceeding one year. Debt securities, government and agency securities are classified as available-for-sale and are reported at fair value using the specific identification method. Unrealized gains and losses are excluded from earnings and reported as a component of other comprehensive income (loss), net of related estimated tax provisions or benefits. We elect to account for foreign currency denominated available-for-sale investments underlying funds receivable and customer accounts, short-term investments and long-term investments under the fair value option as further discussed in “Note 5—Funds Receivable and Customer Accounts” and “Note 6—Investments.” The changes in fair value related to initial measurement and subsequent changes in fair value are included in earnings as a component of other income (expense), net. Our cost method investments consist of investments in privately held companies where we do not have the ability to exercise significant influence, or have control over the investee. These investments are recorded at cost and are subject to periodic tests for other-than-temporary impairment. We assess whether an other-than-temporary impairment loss on our investments has occurred due to declines in fair value or other market conditions. If any impairment is considered other-than-temporary, we will write down the investment to its fair value and record the corresponding charge through other income (expense), net in our consolidated statements of income. With respect to our debt securities, this assessment takes into account the severity and duration of the decline in value, our intent to sell the security, whether it is more likely than not we will be required to sell the security before recovery of its amortized cost basis, and whether we expect to recover the entire amortized cost basis of the security (that is, whether a credit loss exists). Loans and interest receivable, net Loans and interest receivable, net represents consumer receivables originated under PayPal Credit consumer accounts and working capital advances to select small and medium-sized PayPal merchants through our PayPal Working Capital product. In the U.S., we work with independent chartered financial institutions that extend credit to the consumer or merchant using our PayPal credit products. For our consumer credit products outside the U.S., we extend credit through our Luxembourg banking subsidiary. For our merchant credit products outside the U.S., we extend working capital advances in the U.K. through our Luxembourg banking subsidiary, and we extend working capital advances in Australia through an Australian subsidiary. We purchase the related receivables extended by the independent chartered financial institution and are responsible for servicing functions related to all of our credit products. As part of the arrangement with the independent chartered financial institution in the U.S. that we work with, we sell back a participation interest in the pool of consumer receivables outstanding under PayPal Credit consumer accounts. For this arrangement, gains or losses on the sale of the participation interest are not material as the carrying amount of the participation interest sold approximates the fair value at time of transfer. However, we have a separate arrangement with certain investors under which we sell to these investors a participation interest in certain consumer loans receivable that we purchased, where the consideration received exceeds the carrying amount of the participation interest sold which results in a gain reflected as net revenues in our consolidated financial statements. See “Note 10—Loans and Interest Receivable, net” for additional information related to this arrangement. We apply a control-oriented, financial-components approach and account for the asset transfer as a sale and derecognize the portion of the participation interest for which control has been surrendered. Loans, advances and interest and fees receivable are reported at their outstanding principal balances, net of any participation interest sold and pro-rata allowances, including unamortized deferred origination costs and estimated collectible interest and fees. We maintain the servicing rights for the entire pool of consumer receivables outstanding and receive a fee approximating the fair value for servicing the assets underlying the participation interest sold. The terms of our consumer relationships require us to submit monthly bills to the consumer detailing loan repayment requirements. The terms also allow us to charge the consumer interest and fees in certain circumstances. Due to the relatively small dollar amount of individual loans and interest receivable, we do not require collateral on these balances. Allowance for loans and interest receivable The allowance for loans and interest receivable represents management’s estimate of probable incurred losses inherent in our PayPal Credit portfolio of receivables. Increases to the allowance for loans receivable are reflected as transaction and loan losses in our consolidated financial statements. The evaluation process to assess the adequacy of allowances is subject to numerous estimates and judgments. For our consumer loans receivable, the allowance is primarily based on forecasted principal balance delinquency rates (“roll rates”). Roll rates are the percentage of balances which we estimate will migrate from one stage of delinquency to the next based on our historical experience, as well as external factors such as estimated bankruptcies and levels of unemployment. Roll rates are applied to principal amount of our consumer receivables for each stage of delinquency, from current to 180 days past the payment due date, in order to estimate the principal loans which have incurred losses and are probable to be charged off. For merchant working capital advances, the allowance is primarily based on principal balances, forecasted delinquency rates and recoveries through the use of a vintage-based loss forecasting model. The determination of delinquency, from current to 180 days past due, for principal balances related to merchant working capital advances is based on the current expected repayment period of the advance and fixed fee as compared to the original expected repayment period. We calculate the repayment rate based on the merchant's expected future payment volume such that repayment of the advance and fixed fee is typically expected to occur within 9 to 12 months from the date of the advance. On a regular basis, we recalculate the repayment period based on the actual repayment activity on the receivable. As such, actual repayment periods are dependent on actual payment processing volumes. See “Note 10—Loans and Interest Receivable, Net” for additional information on the delinquency status of our PayPal Credit portfolio of receivables. The allowance for loss against interest receivable is primarily determined by applying historical average customer account roll rates to the interest receivable balance in each stage of delinquency to project the value of accounts that have incurred losses and are probable to be charged off. The allowance for fees receivable is primarily based on fee balances, forecasted delinquency rates and recoveries through the use of a vintage-based loss forecasting model. Increases to the allowance for interest receivable is reflected as a reduction of net revenues in our consolidated statement of income. Increases to the allowance for fees receivable is recognized as a reduction in deferred revenues in our consolidated balance sheet. We charge off consumer loan receivable balances in the month in which a customer balance becomes 180 days past the payment due date. We charge off the merchant receivable when the updated repayment period is 180 days past the original expected repayment period and the merchant has not made a payment in the last 60 days. We also charge off the receivable when the updated repayment period is 360 days past the original expected repayment period regardless of whether or not the merchant has made a payment within the last 60 days. Bankrupt accounts are charged off within 60 days of receiving notification from the bankruptcy courts. Consumer loans receivable past the payment due date continue to accrue interest until such time as they are charged off. Charge-offs that are recovered are recorded as a reduction to our allowance for loans and interest receivable. Customer accounts We hold all customer balances (both in the U.S. and internationally) as direct claims against us which are reflected on our consolidated balance sheet as a liability classified as amounts due to customers. Certain jurisdictions where PayPal operates require us to hold eligible liquid assets, as defined by the regulators in these jurisdictions, equal to at least 100% of the aggregate amount of all customer balances. Therefore, we use the assets underlying the customer balances to meet these regulatory requirements and separately classify the assets as customer accounts in our consolidated balance sheet. We classify the assets underlying the customer balances as current based on their purpose and availability to fulfill our direct obligation under amounts due to customers. In March 2016, as approved by management and our Luxembourg banking subsidiary Supervisory Board and as permitted within regulations set forth by the Luxembourg Commission de Surveillance du Secteur Financier (the “CSSF”), we designated $800 million of European customer balances held in our Luxembourg banking subsidiary to be used to extend credit to our European customers. This is consistent with our strategy of diversifying funding sources for our credit business and does not represent a change in our credit business development strategy or risk appetite. These funds are classified as cash and cash equivalents in our consolidated balance sheet and represent approximately 20% of European customer balances potentially available for corporate use by the Company at December 31, 2016 as determined by applying financial regulations maintained by the CSSF. The remaining assets underlying the customer balances remain separately classified as customer accounts in our consolidated balance sheet. We do not commingle these customer accounts with corporate funds and maintain these assets separately in interest and non-interest bearing bank deposits, time deposits, corporate debt securities and U.S. and foreign government and agency securities. See “Note 5—Funds Receivable and Customer Accounts” for additional information related to customer accounts. Due to the above approved plan, we have presented changes in funds receivable and customer accounts as cash flows from investing activities in our consolidated statements of cash flows based on the nature of the activity underlying our customer accounts. We have elected to conform the prior year statement of cash flows to the current period presentation to provide comparability. The following table presents the effects of the changes on the presentation of the statement of cash flows to the previously reported cash flows from investing activities and cash flows from financing activities in the consolidated statement of cash flows for the years ended December 31, 2015 and 2014 . These changes have no impact on the previously reported total net cash flows: Full Year December 31, 2015 (In millions) As Reported Adjustments Revised Cash flows from investing activities: Purchases of investments $ (7,542 ) $ (14,084 ) $ (21,626 ) Maturities and sales of investments 3,318 12,830 16,148 Funds receivable and customer accounts — (395 ) (395 ) Cash flows from financing activities: Funds receivable and customer accounts (1,649 ) 1,649 — Net change $ (5,873 ) $ — $ (5,873 ) Full Year December 31, 2014 (In millions) As Reported Adjustments Revised Cash flows from investing activities: Purchases of investments $ (76 ) $ (8,668 ) $ (8,744 ) Maturities and sales of investments 409 7,357 7,766 Funds receivable and customer accounts — (24 ) (24 ) Cash flows from financing activities: Funds receivable and customer accounts (1,335 ) 1,335 — Net change $ (1,002 ) $ — $ (1,002 ) Funds receivable and funds payable Funds receivable and funds payable arise due to the time required to initiate collection from and clear transactions through external payment networks. When customers fund their account using their bank account or a credit card or debit card, or withdraw funds from their PayPal account to their bank account or through a debit card transaction, there is a clearing period before the cash is received or settled, usually one to three business days for U.S. transactions and generally up to five business days for international transactions. Allowance for negative customer balances Negative customer balances occur primarily when there are insufficient funds in a customer’s PayPal account to cover charges applied for Automated Clearing House (“ACH”) returns, debit card transactions, chargebacks, nondelivery or unsatisfactory delivery of goods or services. Negative balances can be cured by the customer by adding funds to the account, receiving payments, or through back-up funding sources. We also utilize third-party collection agents. For negative customer balances that are not expected to be cured or otherwise collected, we provide an allowance for uncollectible accounts. The allowance is estimated based on known facts and circumstances, internal factors including our experience with similar cases, and historical trends involving collection and write-off patterns. Negative customer balances are included in other current assets, net of the allowance. Adjustments to the allowance for negative customer balances are recorded as a component of transaction and loan loss. The allowance for negative customer balances was $144 million and $119 million at December 31, 2016 and 2015 , respectively. Property and equipment Property and equipment consists primarily of computer equipment, software and website development costs, land and buildings and leasehold improvements. Property and equipment are stated at historical cost less accumulated depreciation. Depreciation and amortization are computed using the straight-line method over the estimated useful lives of the assets; generally, one to three years for computer equipment and software, including capitalized software and website development costs, three years for furniture and fixtures, up to thirty years for buildings and building improvements, and the shorter of five years or the non-cancelable term of the lease for leasehold improvements. Goodwill and intangible assets Goodwill is tested for impairment at a minimum on an annual basis. Goodwill is tested for impairment at the reporting unit level by first performing a qualitative assessment to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying value. If the reporting unit does not pass the qualitative assessment, then the reporting unit’s carrying value is compared to its fair value. Goodwill is considered impaired if the carrying value of the reporting unit exceeds its fair value. The fair value of the reporting unit is estimated using income and market approaches. The discounted cash flow method, a form of the income approach, uses expected future operating results and a market participant discount rate. The market approach uses comparable company prices and other relevant information generated by market transactions (either publicly traded entities or merger and acquisitions) to develop pricing metrics to be applied to historical and expected future operating results of the reporting unit. Failure to achieve these expected results, changes in the discount rate or market pricing metrics, may cause a future impairment of goodwill at the reporting unit level. We conducted our annual impairment test of goodwill as of August 31, 2016 and 2015. We determined that no adjustment to the carrying value of goodwill of our reporting unit was required. As of December 31, 2016, we determined that no events or circumstances from August 31, 2016 through December 31, 2016 indicated that a further assessment was necessary. Intangible assets consist of customer-related intangible assets, marketing related intangibles, developed technologies and other intangible assets including purchased partner relationships, purchased technology, patents and contractual agreements. Intangible assets are amortized over the period of estimated benefit using the straight-line method and estimated useful lives ranging from one to eight years. No significant residual value is estimated for intangible assets. Impairment of long-lived assets We evaluate long-lived assets (including intangible assets) for impairment whenever events or changes in circumstances indicate that the carrying amount of a long-lived asset may not be recoverable. An asset is considered impaired if its carrying amount exceeds the future net cash flow the asset is expected to generate. Allowance for transaction losses We are exposed to transaction losses due to credit card and other payment misuse as well as nonperformance of and credit losses from sellers who accept payments through PayPal. We establish an allowance for estimated losses arising from processing customer transactions, such as chargebacks for unauthorized credit card use and merchant-related chargebacks due to non-delivery of goods or services, ACH returns, buyer protection program claims, account takeovers, and account overdrafts. This allowance represents an accumulation of the estimated amounts necessary to provide for transaction losses incurred as of the reporting date, including those which we have not yet identified. The allowance is monitored regularly and is updated based on actual claims data reported by our claims processors and other actual data received. The allowance is based on known facts and circumstances, internal factors including experience with similar cases, historical trends involving loss payment patterns, and the mix of transaction and loss types. Additions to the allowance are reflected as transaction and loan losses in our consolidated statements of income. At December 31, 2016 and 2015, the allowance for transaction losses totaled $78 million and $66 million , respectively, and was included in accrued expenses and other current liabilities. Derivative instruments We have significant international revenues and costs denominated in foreign currencies, subjecting our operations to foreign currency risk. We enter into foreign currency exchange contracts that qualify as cash flow hedges, generally with maturities of 18 months or less, to reduce the volatility of cash flows primarily related to forecasted revenue denominated in certain foreign currencies. All outstanding derivatives are recognized on the balance sheet at fair value. The effective portion of the designated derivative’s gain or loss is initially reported as a component of accumulated other comprehensive income (loss) and is subsequently reclassified into the financial statement line item in which the hedged item is recorded in the period the forecasted transaction affects earnings. We also hedge our economic exposure to foreign currency denominated monetary assets and liabilities with foreign currency contracts. The gains and losses on the foreign exchange contracts economically offset transaction gains and losses on certain foreign currency denominated monetary assets and liabilities recognized in earnings. Accordingly, these outstanding non-designated derivatives are recognized on the balance sheet at fair value and changes in fair value from these contracts are recorded in other income (expense), net in the consolidated statement of income. Our hedging program is not designed or operated for trading or speculative purposes. Our derivative instruments expose us to credit risk to the extent counterparties may be unable to meet the terms of the agreements. We seek to mitigate this risk by limiting counterparties to major financial institutions and by spreading the risk across several major financial institutions. In addition, the potential risk of loss with one counterparty resulting from this type of credit risk is monitored on an ongoing basis. See “Note 8—Derivative Instruments” for additional information related to the derivative instruments. Fair value of financial instruments Our financial assets and liabilities are valued using market prices on both active markets (Level 1) and less active markets (Level 2). Level 1 instrument valuations are obtained from real-time quotes for transactions in active exchange markets involving identical assets. Level 2 instrument valuations are obtained from readily available pricing sources for comparable instruments, identical instruments in less active markets, or models using market observable inputs. As of December 31, 2016 , and 2015 we did not have any assets or liabilities requiring measurement at fair value without observable market values that would require a high level of judgment to determine fair value (Level 3). Our financial instruments, including cash, cash equivalents, accounts receivable, loans and interest receivable, funds receivable, certain customer accounts, accounts payable, and funds payable and amounts due to customers are carried at cost, which approximates their fair value due to the short-term maturity of these instruments. Concentrations of risk Our cash, cash equivalents, accounts receivable, loans and interest receivable, and funds receivable and customer accounts are potentially subject to concentration of credit risk. Cash, cash equivalents and customer accounts are placed with financial institutions that management believes are of high credit quality. In addition, funds receivable are generated primarily with financial institutions or credit card companies which management believes are of high credit quality. We invest our cash, cash equivalents and customer accounts primarily in highly liquid, highly rated instruments which are uninsured. From time to time, we may also have corporate deposit balances with financial services institutions which exceed the Federal Deposit Insurance Corporation (“FDIC”) insurance limit of $250,000. As part of our cash management process, we perform periodic evaluations of the relative credit standing of these financial institutions. Our accounts receivable are derived from revenue earned from customers located in the U.S. and internationally. Our loans and interest receivabl |
Net Income Per Share
Net Income Per Share | 12 Months Ended |
Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |
Net Income Per Share | Net Income Per Share The following table sets forth the computation of basic and diluted net income per share for the periods indicated: Year Ended December 31, 2016 2015 (1) 2014 (2) (In millions, except per share amounts) Numerator: Net income $ 1,401 $ 1,228 $ 419 Denominator: Weighted average shares of common stock - basic 1,210 1,222 1,218 Dilutive effect of equity incentive awards 8 7 6 Weighted average shares of common stock - diluted 1,218 1,229 1,224 Net income per share: Basic $ 1.16 $ 1.00 $ 0.34 Diluted $ 1.15 $ 1.00 $ 0.34 Common stock equivalents excluded from income per diluted share because their effect would have been anti-dilutive 8 12 2 1 The weighted average number of common shares outstanding for basic and diluted earnings per share for the year ended December 31, 2015 was based on the number of common shares distributed on July 17, 2015 for the period prior to distribution and the weighted average number of common shares outstanding for the period beginning after the distribution date. 2 Basic and diluted net income per share for the year ended December 31, 2014 was calculated using the number of common shares distributed on July 17, 2015. |
Business Combinations
Business Combinations | 12 Months Ended |
Dec. 31, 2016 | |
Business Combinations [Abstract] | |
Business Combinations | Business Combinations There were no acquisitions or divestitures completed in 2016 and 2014. During 2015 , we completed four acquisitions, reflecting 100% of the equity interests of the acquired companies, for an aggregate amount of $1.4 billion . During 2016, we finalized the allocation of the purchase consideration for Xoom, Paydiant, CyActive and one other acquisition, which resulted in a $10 million adjustment to goodwill primarily related to Xoom. Xoom We completed the acquisition of Xoom Corporation (“Xoom”) in November 2015 by acquiring all of the outstanding shares of Xoom for $25 per share in cash. We acquired Xoom to offer a broader range of services to our global customer base, increase customer engagement and accelerate our entrance into the international remittances markets. The total purchase price of $1.1 billion included cash consideration paid of approximately $961 million , net of cash acquired of $92 million , and the fair value of assumed unvested equity totaling $7 million . The following table summarizes the final allocation of the purchase consideration to the fair value of the assets acquired and liabilities assumed: (In millions) Goodwill $ 645 Intangibles 217 Cash 92 Short-term investments 72 Accounts receivable 40 Other net liabilities (6 ) Total purchase consideration $ 1,060 The intangibles acquired consists primarily of partner relationships, technology, trade name and customer-related intangible assets, with an estimated useful life of 2 to 5 years . The excess of the purchase consideration over the fair value of net tangible and identifiable intangible assets acquired was recorded as goodwill which is attributable to the workforce of Xoom and the synergies expected to arise from the acquisition. We do not expect goodwill to be deductible for income tax purposes. Paydiant We completed the acquisition of Paydiant, Inc. (“Paydiant”) in April 2015 for total consideration of approximately $230 million , net of cash acquired. We acquired Paydiant to expand our capabilities in mobile payments. The allocation of purchase consideration resulted in approximately $49 million of technology and customer-related intangible assets, net liabilities of approximately $6 million , and initial goodwill of approximately $187 million . We do not expect goodwill to be deductible for income tax purposes. CyActive We completed the acquisition of CyActive Security, Ltd. (“CyActive”) in April 2015 for total consideration of approximately $43 million , net of cash acquired. We acquired CyActive to further enhance our information security capabilities. The allocation of purchase consideration resulted in approximately $8 million of technology-related intangible assets, net liabilities of approximately $2 million , and initial goodwill of approximately $37 million . We do not expect goodwill to be deductible for income tax purposes. We have included the financial results of these acquired businesses in our consolidated financial statements from their respective dates of acquisition. Revenues and expenses related to these acquisitions for the year ended December 31, 2015 were not material. Pro forma results of operations have not been presented because the effect of these acquisitions were not material to our financial results. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill The following table presents goodwill balances and adjustments to those balances for the years ended December 31, 2016 and 2015 : December 31, 2014 Goodwill Acquired Adjustments December 31, 2015 Goodwill Acquired Adjustments December 31, 2016 (In millions) Total goodwill $ 3,189 $ 886 $ (6 ) $ 4,069 $ — $ (10 ) $ 4,059 The adjustments to goodwill during 2016 relate to measurement period adjustments related primarily to our acquisition of Xoom. The goodwill acquired in 2015 was due primarily to the four acquisitions that we completed in 2015 . The adjustments to goodwill during 2015 relate to foreign exchange rate translations. Intangible Assets The components of identifiable intangible assets are as follows: December 31, 2016 December 31, 2015 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Weighted Average Useful Life (Years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Weighted Average Useful Life (Years) (In millions, except years) Intangible assets: Customer lists and user base $ 605 $ (542 ) $ 63 4 $ 605 $ (501 ) $ 104 4 Marketing related 197 (190 ) 7 2 197 (150 ) 47 3 Developed technologies 245 (206 ) 39 3 245 (176 ) 69 3 All other 245 (143 ) 102 5 243 (105 ) 138 5 Intangible assets, net $ 1,292 $ (1,081 ) $ 211 $ 1,290 $ (932 ) $ 358 During the second and third quarters of 2015, eBay contributed intangible assets with a gross carrying amount of $37 million and a net book value of $18 million . All identifiable intangible assets are subject to amortization and no significant residual value is estimated for the intangible assets. Amortization expense for intangible assets was $150 million , $93 million and $84 million for the years ended December 31, 2016, 2015 and 2014 , respectively. Expected future intangible asset amortization as of December 31, 2016 is as follows (in millions): Fiscal years: 2017 $ 103 2018 68 2019 23 2020 17 $ 211 |
Funds Receivable and Customer A
Funds Receivable and Customer Accounts | 12 Months Ended |
Dec. 31, 2016 | |
Investments, Debt and Equity Securities [Abstract] | |
Funds Receivable and Customer Accounts | Funds Receivable and Customer Accounts The following table summarizes the assets underlying our funds receivable and customer accounts as of December 31, 2016 and December 31, 2015 . As of December 31, 2016 2015 (In millions) Cash and cash equivalents $ 4,319 $ 5,245 Government and agency securities 5,625 4,305 Time deposits 522 830 Corporate debt securities 1,093 180 Funds receivable 2,804 1,701 Total funds receivable and customer accounts $ 14,363 $ 12,261 At December 31, 2016 and December 31, 2015 , the estimated fair value of our investments classified as available-for-sale included within funds receivable and customer accounts was as follows: December 31, 2016 Gross Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value (In millions) Government and agency securities $ 5,198 $ — $ (2 ) $ 5,196 Time deposits 522 — — 522 Corporate debt securities 531 — — 531 Total $ 6,251 $ — $ (2 ) $ 6,249 December 31, 2015 Gross Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value (In millions) Government and agency securities $ 3,299 $ — $ (1 ) $ 3,298 Time deposits 830 — — 830 Total $ 4,129 $ — $ (1 ) $ 4,128 We elect to account for certain investments within customer accounts, including foreign-currency denominated available-for-sale investments, under the fair value option. As a result, any gains and losses from fair value changes on such investments are recognized in other income (expense), net on the consolidated statement of income. Election of the fair value option allows us to significantly reduce the accounting asymmetry that would otherwise arise when recognizing the changes in the fair value of available-for-sale investments and the corresponding foreign exchange gains and losses relating to customer liabilities. At December 31, 2016 and 2015, the estimated fair value of our investments included within funds receivable and customer accounts under the fair value option was $1.0 billion and $1.2 billion , respectively. In the years ended December 31, 2016 and 2015 , $66 million and $65 million of net losses from fair value changes, respectively, were recognized in other income (expense), net on the consolidated statement of income. The aggregate fair value of investments in an unrealized loss position was $4.1 billion as of December 31, 2016 . The aggregate gross unrealized loss on our short-term and long-term investments was not material as of December 31, 2016 . We believe the decline in value is due to temporary market conditions and expect to recover the entire amortized cost basis of these securities. We neither intend nor anticipate the need to sell these securities before recovery. We continue to monitor the performance of the investment portfolio and assess market and interest rate risk when evaluating whether other-than-temporary impairment exists. As of December 31, 2016 , we had no investments that have been in a continuous unrealized loss position for greater than 12 months. Amounts reclassified to earnings from unrealized gains and losses were not material for the years ended December 31, 2016 and 2015 . The estimated fair values of our investments classified as available-for-sale included within funds receivable and customer accounts by date of contractual maturity at December 31, 2016 were as follows: December 31, (In millions) One year or less $ 6,015 One year through two years 234 Total $ 6,249 |
Investments
Investments | 12 Months Ended |
Dec. 31, 2016 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | Investments At December 31, 2016 and 2015 , the estimated fair value of our short-term and long-term investments classified as available for sale was as follows: December 31, 2016 Gross Gross Gross Estimated (In millions) Short-term investments (1) : Corporate debt securities $ 2,867 $ 1 $ (1 ) $ 2,867 Government and agency securities 32 — — 32 Time deposits 122 — — 122 Long-term investments: Corporate debt securities 1,473 1 (4 ) 1,470 Government and agency securities 10 — — 10 Total (1) $ 4,504 $ 2 $ (5 ) $ 4,501 (1) Excludes short-term restricted cash of $17 million . December 31, 2015 Gross Gross Gross Estimated (In millions) Short-term investments (1) : Corporate debt securities $ 2,000 $ — $ (2 ) $ 1,998 Time deposits 2 — — 2 Long-term investments (1) : Corporate debt securities 2,328 — (14 ) 2,314 Total (1) $ 4,330 $ — $ (16 ) $ 4,314 (1) Excludes short-term restricted cash of $18 million and long-term restricted cash of $8 million . In the second quarter of 2016 , we elected to account for foreign denominated available-for-sale investments held in our Luxembourg banking subsidiary under the fair value option. Election of the fair value option allows us to recognize any gains and losses from fair value changes on such investments in other income (expense), net on the consolidated statement of income to offset certain foreign exchange gains and losses on our foreign denominated customer liabilities. As of December 31, 2016 , the estimated fair value of our investments included within short-term investments and long-term investments under the fair value option was $356 million . In the year ended December 31, 2016 , $48 million of net losses from fair value changes was recognized in other income (expense), net on the consolidated statement of income. We have short-term restricted cash that we intend to use to support our global sabbatical program. In addition, as of December 31, 2015, we had long-term restricted cash related to Xoom and required as collateral by payment processors and for licensing rules in India. The aggregate fair value of short-term and long-term investments in an unrealized loss position was $2.2 billion as of December 31, 2016. The aggregate gross unrealized loss on our short-term and long-term investments was $5 million as of December 31, 2016. We believe the decline in value is due to temporary market conditions and expect to recover the entire amortized cost basis of the securities. We neither intend nor anticipate the need to sell these securities before recovery. We continue to monitor the performance of the investment portfolio and assess market and interest rate risk when evaluating whether other-than-temporary impairment exists. We had no material short-term or long-term investments that have been in a continuous unrealized loss position for greater than 12 months as of December 31, 2016 and 2015 . Amounts reclassified to earnings from unrealized gains and losses were not material for the years ended December 31, 2016 and 2015 . The estimated fair values of our short-term and long-term investments classified as available for sale by date of contractual maturity at December 31, 2016 were as follows: December 31, 2016 (In millions) One year or less $ 3,021 One year through two years 715 Two years through three years 608 Three years through four years 89 Four years through five years 68 Total (1) $ 4,501 (1) Excludes short-term restricted cash of $17 million . Cost Method Investments We have made cost method investments which are reported in long-term investments on our consolidated balance sheet. As of December 31, 2016 and 2015 , our cost method investments totaled $50 million and $26 million , respectively. |
Fair Value Measurement of Finan
Fair Value Measurement of Financial Assets and Liabilities | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurement of Assets and Liabilities | Fair Value Measurement of Financial Assets and Liabilities Our financial assets and liabilities are valued using market prices on both active markets (Level 1) and less active markets (Level 2). Refer to “Note 1—Overview and Summary of Significant Accounting Policies” for additional information on how Level 1 and Level 2 instrument valuations are obtained. The following table summarizes our financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2016 and 2015 : Description Balances at Quoted Prices in Significant Other (In millions) Assets: Cash and cash equivalents (1) $ 268 $ — $ 268 Short-term investments: Restricted Cash 17 17 — Corporate debt securities 2,882 — 2,882 Government and agency securities 364 — 364 Time deposits 122 — 122 Total short-term investments $ 3,385 $ 17 $ 3,368 Funds receivable and customer accounts 7,420 — 7,420 Derivatives 223 — 223 Long-term investments: Corporate debt securities 1,479 — 1,479 Government and agency securities 10 — 10 Total long-term investments 1,489 — 1,489 Total financial assets $ 12,785 $ 17 $ 12,768 Liabilities: Derivatives $ 59 $ — $ 59 (1) Excludes cash of $1.3 billion . Description Balances at Quoted Prices in Significant Other (In millions) Assets: Cash and cash equivalents (1) $ 406 $ — $ 406 Short-term investments: Restricted Cash 18 18 — Corporate debt securities 1,998 — 1,998 Time deposits 2 — 2 Total short-term investments 2,018 18 2,000 Funds receivable and customer accounts 6,978 — 6,978 Derivatives 97 — 97 Long-term investments: Restricted Cash 8 8 — Corporate debt securities 2,314 — 2,314 Total long-term investments 2,322 8 2,314 Total financial assets $ 11,821 $ 26 $ 11,795 Liabilities: Derivatives $ 25 $ — $ 25 (1) Excludes cash of $987 million . Our financial assets and liabilities are valued using market prices on both active markets (Level 1) and less active markets (Level 2). Level 1 instrument valuations are obtained from real-time quotes for transactions in active exchange markets involving identical assets. Level 2 instrument valuations are obtained from readily available pricing sources for comparable instruments, identical instruments in less active markets, or models using market observable inputs. The majority of our derivative instruments are valued using pricing models that take into account the contract terms as well as multiple inputs where applicable, such as currency rates, interest rate yield curves, option volatility and equity prices. Our derivative instruments are primarily short-term in nature, generally one month to one year in duration. Certain foreign currency contracts designated as cash flow hedges may have a duration of up to 18 months. We did not have any transfers of financial instruments between valuation levels during the years ended December 31, 2016 and 2015 . As of December 31, 2016 , we did not have any assets or liabilities requiring measurement at fair value without observable market values that would require a high level of judgment to determine fair value (Level 3). Cash and cash equivalents are short-term, highly liquid investments with original maturities of three months or less when purchased and are composed primarily of bank deposits, government and agency securities and commercial paper. We elect to account for foreign currency denominated available-for-sale investments underlying funds receivable and customer accounts, short-term investments and long-term investments under the fair value option as further discussed in “Note 5—Funds Receivable and Customer Accounts” and “Note 6—Investments.” |
Derivative Instruments
Derivative Instruments | 12 Months Ended |
Dec. 31, 2016 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments | Derivative Instruments Summary of Derivative Instruments Our primary objective in holding derivatives is to reduce the volatility of earnings and cash flows associated with changes in foreign currency exchange rates. Our derivatives expose us to credit risk to the extent that our counterparties may be unable to meet the terms of the arrangement. We seek to mitigate such risk by limiting our counterparties to, and by spreading the risk across, major financial institutions. In addition, the potential risk of loss with any one counterparty resulting from this type of credit risk is monitored on an ongoing basis. Foreign Exchange Contracts We transact business in various foreign currencies and have significant international revenues as well as costs denominated in foreign currencies, which subjects us to foreign currency risk. We have a foreign currency exposure management program whereby we designate certain foreign currency exchange contracts, generally with maturities of 18 months or less, to reduce the volatility of cash flows primarily related to forecasted revenues and expenses denominated in foreign currencies. The objective of the foreign exchange contracts is to help mitigate the risk that the U.S. dollar-equivalent cash flows are adversely affected by changes in the applicable U.S. dollar/foreign currency exchange rate. These derivative instruments are designated as cash flow hedges and accordingly, the effective portion of the derivative’s gain or loss is initially reported as a component of accumulated other comprehensive income (loss) and subsequently reclassified into earnings in the same period the forecasted transaction affects earnings. The ineffective portion of the unrealized gains and losses on these contracts, if any, is recorded immediately in earnings. We evaluate the effectiveness of our foreign exchange contracts on a quarterly basis by comparing the change in the fair value of the derivative instruments with the change in the fair value of the forecasted cash flows of the hedged item. We do not use any foreign exchange contracts for trading or speculative purposes. For our derivative instruments designated as cash flow hedges, the amounts recognized in earnings related to the ineffective portion were not material in each of the periods presented, and we did not exclude any component of the changes in fair value of the derivative instruments from the assessment of hedge effectiveness. During the years ended December 31, 2016 , 2015 and 2014 we did not discontinue any cash flow hedges because it was probable that the original forecasted transaction would not occur and as such, did not reclassify any gains or losses to earnings. As of December 31, 2016 , we estimated that $123 million of net derivative gains related to our cash flow hedges included in accumulated other comprehensive income will be reclassified into earnings within the next 12 months. We have an additional foreign currency exposure management program whereby we use foreign exchange contracts to offset the foreign exchange risk on our assets and liabilities denominated in currencies other than the functional currency of our subsidiaries. These contracts are not designated as hedging instruments and reduce, but do not entirely eliminate, the impact of currency exchange rate movements on our assets and liabilities. The foreign currency gains and losses on our assets and liabilities are recorded in “Other income (expense), net,” which is offset by the gains and losses on the foreign exchange contracts. Fair Value of Derivative Contracts The fair value of our outstanding derivative instruments as of December 31, 2016 and 2015 was as follows: Balance Sheet Location As of December 31, 2016 2015 Derivative Assets: (In millions) Foreign exchange contracts designated as cash flow hedges Other Current Assets $ 135 $ 59 Foreign exchange contracts not designated as hedging instruments Other Current Assets 88 38 Total derivative assets $ 223 $ 97 Derivative Liabilities: Foreign exchange contracts designated as cash flow hedges Other Current Liabilities $ 4 $ 2 Foreign exchange contracts not designated as hedging instruments Other Current Liabilities 55 23 Total derivative liabilities $ 59 $ 25 Net fair value of derivative instruments $ 164 $ 72 Under the master netting agreements with the respective counterparties to our foreign exchange contracts, subject to applicable requirements, we are allowed to net settle transactions of the same type with a single net amount payable by one party to the other. However, we have elected to present the derivative assets and derivative liabilities on a gross basis in our balance sheet. As of December 31, 2016 , the potential effect of rights of setoff associated with our foreign exchange contracts would be an offset to both assets and liabilities by $59 million , resulting in net derivative assets of $164 million . We are not required to pledge, nor are we entitled to receive, cash collateral related to these derivative transactions. Effect of Derivative Contracts on Accumulated Other Comprehensive Income The following tables summarize the activity of derivative contracts that qualify for hedge accounting as of December 31, 2016 and December 31, 2015 , and the impact of designated derivative instruments on accumulated other comprehensive income for the twelve months ended December 31, 2016 and 2015 : December 31, 2015 Amount of gain recognized in other comprehensive income (effective portion) Less: Amount of gain reclassified from accumulated other comprehensive income to net revenue (effective portion) December 31, 2016 (In millions) Foreign exchange contracts designated as cash flow hedges $ 57 $ 193 $ 119 $ 131 December 31, 2014 Amount of gain recognized in other comprehensive income (effective portion) Less: Amount of gain reclassified from accumulated other comprehensive income to net revenue (effective portion) December 31, 2015 (In millions) Foreign exchange contracts designated as cash flow hedges $ 126 $ 113 $ 182 $ 57 Effect of Derivative Contracts on Consolidated Statements of Income The following table provides the location in the financial statements of the recognized gains or losses related to our derivative instruments: Year Ended December 31, 2016 2015 2014 (In millions) Foreign exchange contracts designated as cash flow hedges recognized in net revenues $ 119 $ 182 $ (36 ) Foreign exchange contracts not designated as cash flow hedges recognized in other income (expense), net 76 17 (2 ) Total gain (loss) recognized from derivative contracts in the consolidated statement of income $ 195 $ 199 $ (38 ) Notional Amounts of Derivative Contracts Derivative transactions are measured in terms of the notional amount, but this amount is not recorded on the balance sheet and is not, when viewed in isolation, a meaningful measure of the risk profile of the derivative instruments. The notional amount is generally not exchanged, but is used only as the underlying basis on which the value of foreign exchange payments under these contracts is determined. The following table provides the notional amounts of our outstanding derivatives: Year Ended December 31, 2016 2.015 (In millions) Foreign exchange contracts designated as cash flow hedges $ 1,865 $ 1,688 Foreign exchange contracts not designated as hedging instruments 4,612 2,802 Total $ 6,477 $ 4,490 |
Property and Equipment, Net
Property and Equipment, Net | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, Net | Property and Equipment, Net As of December 31, 2016 2015 (In millions) Property and equipment, net: Computer equipment and software $ 2,049 $ 1,818 Internal use software and website development costs 1,372 1,150 Land and buildings 357 352 Leasehold improvements 335 297 Furniture and fixtures 119 99 Development in progress and other 268 133 Total property and equipment, gross 4,500 3,849 Accumulated depreciation (3,018 ) (2,505 ) Total property and equipment, net $ 1,482 $ 1,344 During the second and third quarters of 2015, eBay contributed property and equipment to us with a gross carrying amount of $355 million and a net book value of $224 million . Additionally, we sold certain property and equipment to eBay with a gross carrying amount of $63 million and a net book value of $15 million for proceeds of approximately $26 million . The proceeds in excess of net book value were recorded as a contribution from eBay and resulted in an increase to net parent investment within stockholders' equity. Depreciation expense was $574 million in 2016 , $515 million in 2015 and $432 million in 2014 . The net change in purchase of property and equipment included in accounts payable was $35 million in 2016. The net change in purchase of property and equipment included in accounts payable was not material in 2015 and 2014. |
Loans and Interest Receivable,
Loans and Interest Receivable, Net | 12 Months Ended |
Dec. 31, 2016 | |
Receivables [Abstract] | |
Loans and Interest Receivable, Net | Loans and Interest Receivable, Net We offer credit products to consumers who choose PayPal Credit as their funding source at checkout and working capital advances to certain small and medium-sized PayPal merchants through our PayPal Working Capital product. In the U.S., we work with independent chartered financial institutions that extend credit to the consumer or merchant using our credit products. For our consumer credit products outside the U.S., we extend credit through our Luxembourg banking subsidiary. For our merchant credit products outside the U.S., we extend working capital advances in the U.K. through our Luxembourg banking subsidiary, and we extend working capital advances in Australia through an Australian subsidiary. We purchase the related receivables extended by an independent chartered financial institution in the U.S. and are responsible for servicing functions related to all our credit products. During the years ended December 31, 2016 and 2015 , we purchased approximately $8.4 billion and $7.4 billion , respectively, in credit receivables. As part of the arrangement with an independent chartered financial institution in the U.S., we sell back a participation interest in the pool of consumer receivables outstanding under PayPal Credit consumer accounts. For this arrangement, gains or losses on the sale of the participation interest are not material as the carrying amount of the participation interest sold approximates the fair value at time of transfer. However, we have a separate arrangement with certain investors under which we sell to these investors a participation interest in certain consumer loans receivable that we purchased, where the consideration received exceeded the carrying amount of the participation interest sold which results in a gain reflected as net revenues in our consolidated financial statements. Loans, advances and interest and fees receivable are reported at their outstanding principal balances, net of any participation interest sold and pro-rata allowances, including unamortized deferred origination costs and estimated collectible interest and fees. Consumer receivables As of December 31, 2016 , the total outstanding balance in our pool of consumer receivables was $5.1 billion , net of the participation interest sold to the independent chartered financial institution and other investors of $1.0 billion . As of December 31, 2015 , the total outstanding balance in our pool of consumer receivables was $4.0 billion , net of the participation interest sold to the independent chartered financial institution and other investors of $1.0 billion . The independent chartered financial institution and other investors have no recourse against us related to their participation interests for failure of debtors to pay when due. The participation interests held by the chartered financial institution and other investors have the same priority to the interests held by us and are subject to the same credit, prepayment, and interest rate risk associated with this pool of consumer receivables. All risks of loss are shared equally based on participation interests held amongst all participating stakeholders. We use a consumer's FICO score, where available, among other measures, in evaluating the credit quality of our U.S. PayPal Credit consumer receivables. A FICO score is a type of credit score that lenders use to assess an applicant's credit risk and whether to extend credit. Individual FICO scores generally are obtained each quarter in which the U.S. consumer has an outstanding consumer receivable owned by PayPal Credit. The weighted average U.S. consumer FICO scores related to our loans and interest receivable balance outstanding at December 31, 2016 and December 31, 2015 were 682 and 686 , respectively. As of December 31, 2016 and December 31, 2015 , approximately 52.1% and 53.6% , respectively, of the pool of U.S. consumer receivables and interest receivable balance was due from U.S. consumers with FICO scores greater than 680 , which is generally considered “prime” by the consumer credit industry. As of December 31, 2016 and December 31, 2015 , approximately 11.1% and 9.4% , respectively, of the pool of U.S. consumer receivables and interest receivable balance was due from U.S. customers with FICO scores below 599 . As of December 31, 2016 and December 31, 2015 , approximately 90.0% and 90.1% , respectively, of the portfolio of consumer receivables and interest receivable was current. The following table presents the principal amount of U.S. consumer loans and interest receivable segmented by a FICO score range: As of December 31, 2016 2015 (In millions) > 760 $ 665 $ 569 680-759 1,938 1,529 600-679 1,840 1,449 < 599 553 369 Total $ 4,996 $ 3,916 The table above excludes certain outstanding consumer loans outside of the U.S., for which no FICO scores are available, with an outstanding balance of $117 million and $70 million at December 31, 2016 and 2015 , respectively. The following tables present the delinquency status of the principal amount of consumer loans and interest receivable. The amounts shown below are based on the number of days past the billing date to the consumer. Current represents balances that are within 30 days of the billing date. December 31, 2016 (In millions) Current 30 - 59 Days 60 - 89 Days 90 - 180 Days Total Past 30 days Total $ 4,601 $ 219 $ 82 $ 211 $ 512 $ 5,113 December 31, 2015 (In millions) Current 30 - 59 Days 60 - 89 Days 90 - 180 Days Total Past 30 days Total $ 3,593 $ 172 $ 66 $ 155 $ 393 $ 3,986 We charge off consumer loan receivable balances in the month in which a customer balance becomes 180 days past the payment due date. Bankrupt accounts are charged off 60 days after receipt of notification of bankruptcy. Loans receivable past the payment due date continue to accrue interest until such time they are charged off. We record an allowance for loss against the interest and fees receivable. The following table summarizes the activity in the allowance for consumer loans and interest receivable, net of participation interest sold for years ended December 31, 2016 and 2015 : December 31, 2016 December 31, 2015 Consumer Loans Receivable Interest Receivable Total Allowance Consumer Loans Receivable Interest Receivable Total Allowance (In millions) Beginning Balance $ 179 $ 32 $ 211 $ 158 $ 30 $ 188 Reclassification from loans receivable to loans held for sale — — — (22 ) — (22 ) Provisions 388 116 504 270 86 356 Charge-offs (330 ) (108 ) (438 ) (251 ) (84 ) (335 ) Recoveries 28 — 28 24 — 24 Ending Balance $ 265 $ 40 $ 305 $ 179 $ 32 $ 211 The table above excludes receivables from other consumer credit products of $16 million and $8 million at December 31, 2016 and 2015, respectively, and allowances of $3 million and $1 million at December 31, 2016 and 2015, respectively. The provision for loan losses relating to our consumer loans receivable portfolio is recognized in transaction and loan losses and the provision for interest receivable on the interest and fees earned on our consumer loans receivable portfolio is recognized in net revenues from other value added services as a reduction in revenue. Merchant receivables We offer credit products to certain existing small and medium-sized merchants through our PayPal Working Capital product. We closely monitor credit quality for all working capital advances that we extend or purchase through that product to manage and evaluate our related exposure to credit risk. To assess a merchant seeking a PayPal Working Capital advance, we use, among other indicators, a risk model that we have internally developed that we refer to as our PayPal Working Capital Risk Model (“PRM”), as a credit quality indicator to help predict the merchant's ability to repay the principal balance and fixed fee related to the working capital advance. The PRM uses multiple variables as predictors of the merchant's ability to repay a working capital advance. Drivers of the model include the merchant's annual payment volume and payment processing history with PayPal, prior repayment history with the PayPal Working Capital product, and other measures. Merchants are assigned a PRM credit score within the range of 350 to 750 . We generally consider scores above 610 to be very good and to pose limited credit risk. We generally expect that merchants to which we extend a working capital advance will have PRM scores greater than 525 . We assess a participating merchant’s PRM score on a recurring basis for all outstanding working capital advances owned by PayPal. At December 31, 2016 and 2015 , the weighted average PRM score related to our PayPal Working Capital balances outstanding was 625 and 630 , respectively. The following table presents the principal amount of PayPal Working Capital advances and fees receivable segmented by our internal PRM score range: As of December 31, 2016 2015 (In millions) > 610 $ 378 $ 291 526-609 108 85 <525 72 45 Total $ 558 $ 421 Through our PayPal Working Capital product, merchants can borrow a certain percentage of their annual payment volume processed by PayPal and are charged a fixed fee for the advance, which approximates an Annual Percentage Rate (“APR”) based on the overall credit assessment of the merchant. Advances are repaid through a fixed percentage of the merchant's future payment volume that PayPal processes. The fee is fixed at the time the advance is extended and we estimate the repayment period based on PayPal's payment processing history with the merchant. There is no stated interest rate and there is a general requirement that at least 10% of the original amount advanced plus the fixed fee must be repaid every 90 days. We generally calculate the repayment rate of the merchant's future payment volume so that repayment of the advance and fixed fee is expected to occur within 9 to 12 months from the date of the advance. On a regular basis, we recalculate the repayment period based on the repayment activity on the receivable. As such, actual repayment periods are dependent on actual payment processing volumes. We monitor receivables with repayment periods greater than the original expected repayment period. We charge off the receivable when the updated repayment period is 180 days past the original expected repayment period and the merchant has not made a payment in the last 60 days. We also charge off the receivable when the updated repayment period is 360 days past the original expected repayment period regardless of whether or not the merchant has made a payment within the last 60 days. The following tables present our estimate of the principal amount of PayPal Working Capital advances and fees receivable past their original expected repayment period. In the second quarter of 2016, we refined our estimate of the original expected repayment period to take into account the variability in repayment patterns. Prior period amounts have been updated to reflect this change. December 31, 2016 (In millions) Within Original Expected Repayment Period 30 - 59 Days Greater 60 - 89 Days Greater 90 - 180 Days Greater 180+ Days Total Past Original Expected Repayment Period Total $ 462 $ 35 $ 19 $ 30 $ 12 $ 96 $ 558 December 31, 2015 (In millions) Within Original Expected Repayment Period 30 - 59 Days Greater 60 - 89 Days Greater 90 - 180 Days Greater 180+ Days Total Past Original Expected Repayment Period Total $ 367 $ 24 $ 13 $ 15 $ 2 $ 54 $ 421 The following table summarizes the activity in the allowance for PayPal Working Capital advances and fees receivable, for the years ended December 31, 2016 and 2015 : December 31, 2016 December 31, 2015 PayPal Working Capital Advances Fees Receivable Total Allowance PayPal Working Capital Advances Fees Receivable Total Allowance (In millions) Beginning Balance $ 19 $ 3 $ 22 $ 5 $ 2 $ 7 Provisions 45 6 51 28 1 29 Charge-offs (41 ) (6 ) (47 ) (16 ) — (16 ) Recoveries 5 — 5 2 — 2 Ending Balance $ 28 $ 3 $ 31 $ 19 $ 3 $ 22 The provision for loan losses relating to our PayPal Working Capital advances is recognized in transaction and loan losses and the provision for fees receivable is recognized in deferred revenues in our consolidated balance sheet as a reduction in deferred revenue. |
Segment and Geographical Inform
Segment and Geographical Information | 12 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
Segment and Geographical Information | Segment and Geographical Information We determine operating segments based on how our chief operating decision maker manages the business, including making operating decisions, deciding how to allocate resources and evaluating operating performance. Our chief operating decision-maker is our Chief Executive Officer who reviews our operating results on a consolidated basis. We operate in one segment and have one reportable segment. The following tables summarize the allocation of net revenues and long-lived assets based on geography: Year Ended December 31, 2016 2015 2014 (In millions) Net revenues: U.S. $ 5,760 $ 4,640 $ 3,877 U.K. 1,257 1,191 1,155 Other countries 3,825 3,417 2,993 Total net revenues $ 10,842 $ 9,248 $ 8,025 As of December 31, 2016 2015 (In millions) Long-lived assets: U.S. $ 1,391 $ 1,256 Other countries 91 88 Total long-lived assets $ 1,482 $ 1,344 Net revenues earned from transaction revenues are attributed to U.S., U.K. and other countries primarily based upon the country in which the merchant is located, or in the case of a cross-border transaction, may be earned from the country in which the consumer and the merchant respectively reside. Net revenues earned from value added services are typically attributed to the country in which either the customer or partner reside. Tangible long-lived assets for the years ended December 31, 2016 and 2015 consisted of property and equipment. Long-lived assets attributed to the U.S. and other countries are based upon the country in which the asset is located or owned. Information regarding net revenues by major products and services for the years ended December 31, 2016 , 2015 and 2014 was as follows: Year Ended December 31, 2016 2015 2014 (In millions) Transaction revenues $ 9,490 $ 8,128 $ 7,107 Other value added services: 1,352 1,120 918 Total net revenues $ 10,842 $ 9,248 $ 8,025 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Commitments As of December 31, 2016 , approximately $28.8 billion of unused credit was available to PayPal Credit account holders compared to $24.8 billion of unused credit as of December 31, 2015 . While this amount represents the total unused credit available, we have not experienced, and do not anticipate, that all of our PayPal Credit account holders will access their entire available credit at any given point in time. In addition, the individual lines of credit that make up this unused credit are subject to periodic review and termination by the chartered financial institution that is the issuer of PayPal Credit products based on, among other things, account usage and customer creditworthiness. When a consumer funds a purchase in the U.S. using a PayPal Credit product issued by a chartered financial institution, the chartered financial institution extends credit to the consumer, funds the extension of credit at the point of sale and advances funds to the merchant. We subsequently purchase the receivables related to the consumer loans extended by the chartered financial institution and, as a result of such purchase, bear the risk of loss in the event of loan defaults. Although the chartered financial institution continues to own each customer account, we own the related receivable (excluding participation interests sold) and are responsible for all servicing functions related to the account. In the third quarter of 2015, we entered into a credit agreement (“Credit Agreement”) that provides for an unsecured $2.0 billion , five -year revolving credit facility that includes a $150 million letter of credit sub-facility and a $150 million swingline sub-facility, with available borrowings under the revolving credit facility reduced by the amount of any letters of credit and swingline borrowings outstanding. Borrowings and other amounts payable under the Credit Agreement are guaranteed by PayPal, Inc. (the “Guarantor”). We may also, subject to the agreement of the applicable lenders, increase the commitments under the revolving credit facility by up to $500 million . Subject to specified conditions, we may designate one or more of our subsidiaries as additional borrowers under the Credit Agreement provided that we and the Guarantor guarantee all borrowings and other obligations of any such subsidiaries under the Credit Agreement. As of December 31, 2016 , no subsidiaries were designated as additional borrowers. Funds borrowed under the Credit Agreement may be used for working capital, capital expenditures, acquisitions and other general corporate purposes. As of December 31, 2016 , no borrowings or letters of credit were outstanding under the Credit Agreement. Accordingly, at December 31, 2016 , $2.0 billion of borrowing capacity was available for the purposes permitted by the Credit Agreement subject to customary conditions to borrowing. Lease Arrangements We have lease obligations under certain non-cancelable operating leases. Our non-cancelable operating lease agreements typically have terms between 3 - 10 years and generally contain multi-year renewal options. We recognize rent expense under such agreements on a straight-line basis. Future minimum rental payments under non-cancelable operating leases at December 31, 2016 , are as follows: Operating Leases (In millions) 2017 $ 102 2018 106 2019 93 2020 63 2021 47 Thereafter 141 Total minimum lease payments $ 552 Rent expense for the years ended December 31, 2016 , 2015 and 2014 totaled $76 million , $59 million and $43 million , respectively. The future minimum lease payments include the minimum commitments for our facilities. Litigation and Regulatory Matters Overview We are involved in legal and regulatory proceedings on an ongoing basis. Many of these proceedings are in early stages, and may seek an indeterminate amount of damages. If we believe that a loss arising from such matters is probable and can be reasonably estimated, we accrue the estimated liability in our financial statements. If only a range of estimated losses can be determined, we accrue an amount within the range that, in our judgment, reflects the most likely outcome; if none of the estimates within that range is a better estimate than any other amount, we accrue at the low end of the range. For those proceedings in which an unfavorable outcome is reasonably possible but not probable, we have disclosed an estimate of the reasonably possible loss or range of losses or we have concluded that an estimate of the reasonably possible loss or range of losses arising directly from the proceeding (i.e., monetary damages or amounts paid in judgment or settlement) are not material. If we cannot estimate the probable or reasonably possible loss or range of losses arising from a legal proceeding, we have disclosed that fact. In assessing the materiality of a legal proceeding, we evaluate, among other factors, the amount of monetary damages claimed, as well as the potential impact of non-monetary remedies sought by plaintiffs (e.g., injunctive relief) that may require us to change our business practices in a manner that could have a material adverse impact on our business. With respect to the matters disclosed in this Note 12, we are unable to estimate the possible loss or range of losses that could potentially result from the application of such non-monetary remedies. Amounts accrued for legal and regulatory proceedings for which we believe a loss is probable were not material for the year ended December 31, 2016 . Except as otherwise noted for the proceedings described in this Note 12, we have concluded, based on currently available information, that reasonably possible losses arising directly from these proceedings (i.e., monetary damages or amounts paid in judgment or settlement) in excess of our recorded accruals are also not material. However, legal and regulatory proceedings are inherently unpredictable and subject to significant uncertainties. If one or more matters were resolved against us in a reporting period for amounts in excess of management’s expectations, the impact on our operating results or financial condition for that reporting period could be material. Regulatory Proceedings We are subject to U.S. economic and trade sanctions administered by the U.S. Department of the Treasury’s Office of Foreign Assets Control (“OFAC”). We have self-reported to OFAC certain transactions that were inadvertently processed but subsequently identified as possible violations of U.S. economic and trade sanctions. In March 2015, we reached a settlement with OFAC regarding possible violations arising from our sanctions compliance practices between 2009 and 2013, prior to the implementation of our real-time transaction scanning program. Subsequently, we have self-reported additional transactions as possible violations, and we have received new subpoenas from OFAC seeking additional information about certain of these transactions. Such self-reported transactions could result in claims or actions against us, including litigation, injunctions, damage awards, fines or penalties, or require us to change our business practices in a manner that could result in a material loss, require significant management time, result in the diversion of significant operational resources or otherwise harm our business. On March 28, 2016, we received a Civil Investigative Demand (“CID”) from the Federal Trade Commission (“FTC”) as part of its investigation to determine whether we, through our Venmo service, have been or are engaged in deceptive or unfair practices in violation of the Federal Trade Commission Act. The CID requests the production of documents and answers to written questions related to our Venmo service. We are cooperating with the FTC in connection with the CID. The CID could lead to an enforcement action and/or one or more consent orders, which may result in substantial costs, including legal fees, fines, penalties, and remediation expenses and actions, and could require us to change the manner in which we operate Venmo. Legal Proceedings On December 28, 2016, a putative securities class action captioned Cho v. PayPal Holdings, Inc., et al. , Case No. 3:16-cv-07371, was filed in the U.S. District Court for the Northern District of California (the “Securities Case”). The Securities Case asserts claims allegedly relating to our disclosure in our Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2016, that on March 28, 2016, we received a Civil Investigative Demand from the FTC as part of its investigation to determine whether we, through our Venmo service, have been or are engaged in deceptive or unfair practices in violation of the Federal Trade Commission Act. The Securities Case purports to be brought on behalf of purchasers of eBay’s stock on or after December 19, 2013 who subsequently received the Company’s stock pursuant to eBay’s spin-off of the Company, effective as of July 17, 2015, and/or purchasers of the Company’s stock between July 20, 2015 and April 28, 2016, and asserts claims for violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) against the Company, its Chief Executive Officer, Chief Financial Officer, and former interim Chief Financial Officer, and eBay and certain of its former officers, including the Chairman of our Board of Directors. The Securities Case alleges that defendants made materially false and misleading statements or omissions regarding our compliance with applicable laws and regulations, including the failure to disclose that we were purportedly engaging in unfair trade practices through our Venmo service and that as a result of alleged false and misleading statements or omissions, our stock traded at artificially inflated prices. The Securities Case seeks unspecified compensatory damages on behalf of the putative class members. We believe the claims and allegations in the Securities Case are without merit and intend to defend the action vigorously. On January 12, 2017, a putative shareholder derivative action captioned Silverman v. Schulman, et al. , Case No. 5:17-cv-00162, was filed in the U.S. District Court for the Northern District of California based on substantially similar allegations underlying the Securities Case described above (the “Derivative Case”). The Derivative Case is purportedly brought on behalf of the Company and alleges that the Company’s Chief Executive Officer, Chief Financial Officer, former interim Chief Financial Officer, and members of its Board of Directors breached their fiduciary duties to the Company, violated Section 14(a) of the Exchange Act, and were unjustly enriched by, among other things, causing or permitting the Company to issue materially false and misleading statements or omissions regarding the Company’s compliance with applicable laws and regulation with respect to its Venmo service, as alleged in the Securities Case, and by permitting or causing the Company to engage in unfair trade practices through its Venmo service. The Derivative Case seeks, among other things, to recover unspecified compensatory damages on behalf of the Company arising out of the individual defendants’ alleged wrongful conduct. Although plaintiff in this action does not seek relief against the Company, we have certain indemnification obligations to the individual defendants. We have received subpoenas from the U.S. Department of Justice (“DOJ”) seeking the production of certain information related to our historical anti-money laundering program. We are cooperating with the DOJ in providing information in response to the subpoenas. We are unable to predict the outcome of the government's investigation. General Matters Other third parties have from time to time claimed, and others may claim in the future, that we have infringed their intellectual property rights. We are subject to patent disputes, and expect that we will increasingly be subject to additional patent infringement claims involving various aspects of our business as our products and services continue to expand in scope and complexity. Such claims may be brought directly or indirectly against our companies and/or against our customers (who may be entitled to contractual indemnification under their contracts with us), and we are subject to increased exposure to such claims as a result of our acquisitions, particularly in cases where we are entering into new lines of business in connection with such acquisitions. We have in the past been forced to litigate such claims, and we believe that additional lawsuits alleging such claims will be filed against us. Intellectual property claims, whether meritorious or not, are time consuming and costly to defend and resolve, could require expensive changes in our methods of doing business or could require us to enter into costly royalty or licensing agreements on unfavorable terms or make substantial payments to settle claims or to satisfy damages awarded by courts. From time to time, we are involved in other disputes or regulatory inquiries that arise in the ordinary course of business, including suits by our customers (individually or as class actions) alleging, among other things, improper disclosure of our prices, rules or policies, that our practices, prices, rules, policies or customer/user agreements violate applicable law or that we have acted unfairly and/or not acted in conformity with such prices, rules, policies or agreements. In addition to these types of disputes and regulatory inquiries, our operations are also subject to regulatory and/or legal review and/or challenges that tend to reflect the increasing global regulatory focus to which the payments industry is subject and, when taken as a whole with other regulatory and legislative action, such actions could result in the imposition of costly new compliance burdens on our business and customers and may lead to increased costs and decreased transaction volume and revenue. Further, the number and significance of these disputes and inquiries are increasing as our Company has grown larger, our business has expanded in scope (both in terms of the range of products and services that we offer and our geographical operations) and our products and services have increased in complexity. Any claims or regulatory actions against us, whether meritorious or not, could be time consuming, result in costly litigation, settlement payments, damage awards (including statutory damages for certain causes of action in certain jurisdictions), fines, penalties, injunctive relief or increased costs of doing business through adverse judgment or settlement, require us to change our business practices in expensive ways, require significant amounts of management time, result in the diversion of significant operational resources or otherwise harm our business. Indemnification Provisions We entered into a separation and distribution agreement and various other agreements with eBay to govern the separation and relationship of the two companies going forward. These agreements provide for specific indemnity and liability obligations and could lead to disputes between us and eBay, which may be significant. In addition, the indemnity rights we have against eBay under the agreements may not be sufficient to protect us and our indemnity obligations to eBay may be significant. In the ordinary course of business, we include limited indemnification provisions in certain of our agreements with parties with whom we have commercial relationships, including our standard marketing, promotions, and application-programming-interface license (API) agreements. Under these contracts, we generally indemnify, hold harmless, and agree to reimburse the indemnified party for losses suffered or incurred by the indemnified party in connection with claims by any third-party with respect to our domain names, trademarks, logos, and other branding elements to the extent that such marks are related to the subject agreement. In a limited number of agreements, we have provided an indemnity for other types of third-party claims, which are indemnities mainly related to intellectual property rights. We have also provided an indemnity to our payments processors in the event of certain third-party claims or card association fines against the processor arising out of conduct by us or our customers. It is not possible to determine the maximum potential loss under these indemnification provisions due to our limited history of prior indemnification claims and the unique facts and circumstances involved in each particular situation. To date, no significant costs have been incurred, either individually or collectively, in connection with our indemnification provisions. Off-Balance Sheet Arrangements As of December 31, 2016 and 2015 , we had no off-balance sheet arrangements that have, or are reasonably likely to have, a current or future material effect on our consolidated financial condition, results of operations, liquidity, capital expenditures or capital resources. Protection Programs We provide merchants and consumers with protection programs on substantially all transactions completed through our Payments Platform, except for transactions using our gateway and Paydiant products. These programs protect both merchants and consumers from loss primarily due to fraud and counterparty performance. Our Buyer Protection Program provides protection to consumers for qualifying purchases by reimbursing the consumer for the full amount of the purchase if a purchased item does not arrive or does not match the seller’s description. Our Seller Protection Programs provide protection to merchants against claims that a transaction was not authorized by the buyer or claims that an item was not received by covering the seller for the full amount of the payment on eligible sales. The maximum potential exposure under our protection programs is estimated to be the portion of total eligible transaction volume (TPV) for which buyer or seller protection claims may be raised under our existing user agreements. Since eligible transactions are typically completed in a period significantly shorter than the period under which disputes may be opened, and based on our historical losses to date, we do not believe that the maximum potential exposure is representative of our actual potential exposure. The actual amount of potential exposure cannot be quantified as we are unable to determine total eligible transactions where performance by a merchant or customer is incomplete or completed transactions that may result in a claim under our protection programs. We record a liability with respect to losses under these protection programs when they are probable and the amount can be reasonably estimated. The following table provides management's estimate of the maximum potential exposure related to our protection programs as of December 31, 2016 and December 31, 2015 : As of December 31, 2016 2015 (In millions) Maximum potential exposure $ 131,739 $ 109,496 The following table provides the amount of allowance for transaction losses related to our protection programs as of December 31, 2016 and December 31, 2015 : As of December 31, 2016 2015 (In millions) Allowance for transaction losses $ 222 $ 185 |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions As of December 31, 2016 , there were no material amounts payable to or amounts receivable from related parties. All contracts with related parties are at rates and terms that we believe are comparable with those that could be entered into with independent third parties. For all periods subsequent to the distribution, there were no material related party transactions. Prior to the distribution, our business comprised the Payments segment of eBay and thus our transactions with eBay were considered related party transactions. In connection with the separation , we entered into a separation and distribution agreement as well as various other agreements that govern our relationships with eBay going forward, including an operating agreement, transition services agreement, tax matters agreement, employee matters agreement, intellectual property matters agreement and colocation services agreements. Information included in this Note 13 with respect to eBay is strictly limited to our related party transactions with eBay prior to the separation (i.e., periods up to July 17, 2015). Following separation, transactions with eBay represent third-party transactions on an arms-length basis. We earned net revenues of $59 million and $113 million from eBay and its subsidiaries during the years ended December 31, 2015 and 2014 , respectively. Prior to the distribution, we recovered certain amounts from eBay related to customer protection programs offered on eligible eBay purchases made with PayPal. These costs included the actual transaction losses associated with customer-filed claims as well as an allocation of salary-related expenses for our customer support teams working on customer claims and disputes related to eligible eBay purchases. Recoveries associated with transaction losses incurred on eligible eBay purchases during the years ended December 31, 2015 and 2014 were $27 million and $43 million , respectively, which were recorded as a reduction to transaction and loan loss. Other costs recovered from eBay related to the customer protection programs during the years ended December 31, 2015 and 2014 were $12 million and $22 million , respectively, and were included as a reduction to customer support and operations and general and administrative expenses in our consolidated statement of income. Following the distribution, eBay's customer protection programs are no longer administered by us, and therefore these costs are no longer reimbursed by eBay. Prior to the distribution, we incurred user acquisition fees from eBay on payment volume which we processed from purchases made on eBay’s platform. User acquisition fees during the years ended December 31, 2015 and 2014 were $64 million and $119 million , respectively. Following the distribution, pursuant to the operating agreement, we incur referral services fees from eBay based on a fixed rate per new user. Prior to the distribution, these consolidated financial statements include expenses associated with workplace resources and information technology that were previously allocated to the Payments segment of eBay, and additional expenses related to certain corporate functions, including senior management, legal, human resources and finance. These expenses also include allocations related to share based compensation. These expenses allocated to us by eBay are based on direct usage or benefit where identifiable, with the remainder allocated on a pro rata basis of revenue, headcount, or other systematic measure. We consider the expense allocation methodology and results to be reasonable for all periods presented. The corporate costs and allocation of expenses to us from eBay included within customer support and operations, sales and marketing, product development, and general and administrative expenses were $303 million and $443 million for the years ended December 31, 2015 and 2014 , respectively. In the second and third quarter of 2015, pursuant to the Separation and Distribution Agreement between eBay and us, eBay transferred substantially all of the assets and liabilities and operations of eBay's payments business to PayPal, which was completed in June 2015 (the “capitalization”). As part of the capitalization, we received from eBay a contribution of cash of approximately $3.8 billion , as well as a related estimated deferred tax liability of $236 million associated with the foreign earnings that are not considered indefinitely reinvested. In the fourth quarter of 2015, we reassessed the measurement of the deferred tax liability and, based on updated valuation information, reduced the deferred tax liability balance to $172 million as of December 31, 2015. The adjustment to deferred tax liability was recorded as a contribution from eBay and resulted in an increase to net parent investment within stockholders' equity. During the second and third quarter of 2015, eBay also contributed property and equipment with a net book value of approximately $224 million and intangible assets with a net book value of approximately $18 million . Additionally, we sold certain property and equipment to eBay with a gross carrying amount of $63 million and a net book value of $15 million for proceeds of approximately $26 million . The proceeds in excess of net book value were recorded as a contribution from eBay and resulted in an increase to net parent investment within stockholders' equity. |
Stock Repurchase Program
Stock Repurchase Program | 12 Months Ended |
Dec. 31, 2016 | |
Equity [Abstract] | |
Stock Repurchase Program | Stock Repurchase Program In January 2016, our Board of Directors authorized a stock repurchase program that provides for the repurchase of up to $2 billion of our common stock, with no expiration from the date of authorization. This stock repurchase program is intended to offset the impact of dilution from our equity compensation programs and, subject to market conditions and other factors, may also be used to make opportunistic repurchases of our common stock to reduce outstanding share count. Any share repurchases under our stock repurchase program may be made through open market transactions, block trades, privately negotiated transactions or other means at times and in such amounts as management deems appropriate and will be funded from our working capital or other financing alternatives. However, any stock repurchases are subject to market conditions and other uncertainties and we cannot predict if or when any stock repurchases will be made. Moreover, we may terminate our stock repurchase program at any time without notice. The stock repurchase activity under our stock repurchase program during the year ended December 31, 2016 is summarized as follows: Shares Repurchased Average Price (1) Value of Shares Repurchased Remaining Amount Authorized (In millions, except per share amounts) Authorization of plan in January 2016 $ 2,000 Repurchases of shares of common stock for three months ended: March 31, 2016 16.9 $ 35.27 $ 596 $ 1,404 June 30, 2016 7.8 $ 38.67 $ 300 $ 1,104 September 30, 2016 1.3 $ 36.80 $ 49 $ 1,055 December 31, 2016 1.3 $ 38.92 $ 50 $ 1,005 Balance as of December 31, 2016 27.3 $ 995 $ 1,005 (1) Average price paid per share includes broker commissions. These repurchased shares of common stock were recorded as treasury stock and were accounted for under the cost method. No repurchased shares of common stock have been retired. |
Stock-Based and Employee Saving
Stock-Based and Employee Savings Plans | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-Based and Employee Savings Plans | Stock-Based and Employee Savings Plans Prior to the separation (i.e., periods up to July 17, 2015), PayPal employees participated in eBay's equity incentive plans, including stock options, restricted stock units (“RSUs”) and performance-based restricted stock units (“PBRSUs”). In addition, certain PayPal employees participated in eBay's employee stock purchase plan. All awards granted under these plans consisted of eBay common shares. PayPal's consolidated statement of income reflected compensation expense for these stock-based plans associated with the portion of eBay's equity incentive plans in which PayPal employees participated. Following separation, outstanding awards granted to PayPal employees under eBay's equity incentive plans were converted into PayPal awards under PayPal's equity incentive plans based on a conversion ratio. This conversion ratio was determined as the closing per-share price of eBay shares on the last regular trading session prior to separation divided by the opening per-share price of PayPal shares on the first regular trading session after separation. There was no significant incremental stock-based compensation expense recorded as a result of the share conversions. Equity Incentive Plans The Board of Directors adopted the PayPal Holdings, Inc. 2015 Equity Incentive Award Plan (the “Plan”) on June 16, 2015. Under the terms of the Plan, equity awards, including stock options, RSUs, restricted stock awards, PBRSUs, deferred stock units, and stock payments may be granted to our directors, officers and employees. At December 31, 2016 , we had 92 million shares authorized under our equity incentive plans and 61 million shares were available for future grant. Shares issued as a result of stock option exercises and the release of stock awards were funded primarily with the issuance of new shares of common stock. All stock options granted under these plans generally vest 12.5% six months from the date of grant (or 25% one year from the date of hire for grants to new employees) with the remainder vesting at a rate of 2.08% per month thereafter, and generally expire seven to ten years from the date of grant. The cost of stock options is determined using the Black-Scholes option pricing model on the date of grant. RSUs are granted to eligible employees under our equity incentive plans. In general, RSUs vest in equal annual installments over a period of three to four years, are subject to an employee's continuing service to us and do not have an expiration date. The cost of RSUs granted prior to the separation was determined using the fair value of eBay's common stock on the date of grant. For RSUs granted following separation, the cost of RSUs was determined using the fair value of PayPal's common stock on the date of grant. Certain of our executives are eligible to receive performance-based restricted stock units (“PBRSUs”). PBRSUs are equity awards that may be earned based on an initial target number with the final number of PBRSUs that may be vested and settled determined based on the Company’s performance against pre-established performance metrics over a predefined performance period. PBRSUs granted under eBay's equity incentive plans generally have two -year performance periods with one-half of the grant vesting in March following the end of the performance period and the remaining one-half vesting more than one year following the completion of the performance period. In the first quarter of 2016, the Compensation Committee approved a revised structure for PBRSUs granted under PayPal's 2015 Equity Incentive Award Plan to officers and certain employees providing services to the Company. PBRSUs granted under PayPal's 2015 Equity Incentive Award Plan have three -year performance periods with cliff vesting following the completion of the performance period, subject to the Committee's approval of the level of achievement against the pre-established performance targets. Over the performance period, the number of PBRSUs that may be issued and related stock-based compensation expense that is recognized is adjusted upward or downward based upon the probability of achieving the approved performance targets against the performance metrics. Depending on the probability of achieving the pre-established performance targets, the PBRSUs issued could range from 0% to 200% of the target amount. Employee Stock Purchase Plan Prior to separation, eligible employees participated in eBay’s employee stock purchase plan. Effective July 17, 2015, the Board of Directors adopted the PayPal Holdings, Inc. Employee Stock Purchase Plan (“ESPP”). Under the terms of this plan, shares of our common stock may be purchased over an offering period with a maximum duration of two years at 85% of the lower of the fair market value on the first day of the applicable offering period or on the last business day of each six -month purchase period within the offering period. Employees may purchase shares between 2% and 10% of their gross compensation during an offering period but not more than the statutory limitation of $25,000 per year. The company stock purchased through the ESPP is considered outstanding and is included in the weighted-average outstanding shares for purposes of computing basic and diluted earnings per share. For the year ended December 31, 2016 , our employees purchased 2.7 million shares of PayPal common stock at an average price of $29.49 . For the year ended December 31, 2015 , our employees purchased 0.9 million shares of eBay common stock at an average price of $44.37 and 1.2 million shares of PayPal common stock at an average price of $28.12 . Under eBay's employee stock purchase plan for the year ended December 31, 2014 our employees purchased approximately 1.5 million shares of eBay common stock at an average price of $42.16 . As of December 31, 2016 , approximately 8.1 million shares were reserved for future issuance under the Purchase Plan. Stock Option Activity The following table summarizes stock option activity of our employees under our equity incentive plans for the year ended December 31, 2016 : Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term (Years) Aggregate Intrinsic Value (In thousands, except per share amounts and years) Outstanding at January 1, 2016 6,008 $ 25.94 Granted 124 $ 36.32 Exercised (1,557 ) $ 18.39 Forfeited/expired/canceled (287 ) $ 30.82 Outstanding at December 31, 2016 4,288 $ 28.65 4.14 $ 47,510 Expected to vest 1,424 $ 29.17 5.27 $ 15,059 Options exercisable 2,727 $ 28.30 3.47 $ 31,166 The weighted average grant date fair value of options granted to our employees during the years 2016 , 2015 and 2014 was $8.79 , $11.20 and $13.38 , respectively. The aggregate intrinsic value was calculated as the difference between the exercise price of the underlying awards and the quoted price of our common stock at December 31, 2016. During the years 2016 , 2015 and 2014 , the aggregate intrinsic value of options exercised under eBay's and PayPal's equity incentive plans was $31 million , $72 million and $57 million , respectively, determined as of the date of option exercise. At December 31, 2016 , 4.2 million options were in-the-money. Restricted Stock Unit Activity The following table summarizes the restricted stock units (including performance-based restricted stock units) granted under our equity incentive plans as of December 31, 2016 and changes during the year ended December 31, 2016 : Units Weighted Average Grant-Date Fair Value (per share) (In thousands, except per share amounts) Outstanding at January 1, 2016 28,761 $ 34.63 Awarded 14,120 $ 39.13 Vested (9,784 ) $ 33.28 Forfeited (3,912 ) $ 36.13 Outstanding at December 31, 2016 29,185 $ 37.06 Expected to vest 25,565 During the years 2016 , 2015 and 2014 , the aggregate intrinsic value of restricted stock units vested under eBay's and PayPal's equity incentive plans were $378 million , $315 million and $292 million , respectively. Stock-Based Compensation Expense T he impact on our results of operations of recording stock-based compensation expense under eBay's and PayPal's equity incentive plans for the years ended December 31, 2016 , 2015 and 2014 was as follows: Year Ended December 31, 2016 2015 2014 (In millions) Customer support and operations $ 85 $ 62 $ 52 Sales and marketing 84 52 59 Product development 139 132 108 General and administrative 130 94 75 Depreciation and amortization 6 7 4 Total stock-based compensation expense $ 444 $ 347 $ 298 Capitalized as part of internal use software and website development costs $ 13 $ 7 $ 10 Income tax benefit recognized for stock-based compensation arrangements $ 127 $ 98 $ 77 As of December 31, 2016 , there was approximately $707 million of unearned stock-based compensation estimated to be expensed from 2017 through 2019. If there are any modifications or cancellations of the underlying unvested awards, we may be required to accelerate, increase or cancel all or a portion of the remaining unearned stock-based compensation expense. Future unearned stock-based compensation will increase to the extent we grant additional equity awards, change the mix of grants between stock options and RSUs or assume unvested equity awards in connection with acquisitions. Stock Option Valuation Assumptions We calculated the fair value of each option award on the date of grant using the Black-Scholes option pricing model. The following weighted average assumptions were used for the years ended December 31, 2016 , 2015 and 2014 : Year Ended December 31, 2016 2015 2014 Risk-free interest rate 1.5 % 1.4 % 1.2 % Expected life (in years) 4.6 4.3 4.1 Dividend yield — — — Expected volatility 25 % 26 % 29 % For periods prior to separation, our computation of expected volatility was based on a combination of historical and market-based implied volatility from traded options on eBay’s stock. The computation of expected life was determined based on historical experience of similar awards, giving consideration to the contractual terms of the stock-based awards, vesting schedules, and expectations of future employee behavior. The interest rate for periods within the contractual life of the award was based on the U.S. Treasury yield curve in effect at the time of grant. For periods subsequent to the separation, the risk-free interest rate for periods within the contractual life of the award was based upon the U.S. Treasury yield curve in effect at the time of the grant. Due to our limited history of stock option exercises, we estimated the expected term of options granted based on the midpoint between the vesting date and the end of the contractual term using the “simplified” method under the SEC guidance. The computation of expected volatility for our employee stock option awards was based on the historical volatility of selected peer companies. Employee Saving Plans Prior to separation, eligible U.S. employees participated in eBay's savings plan, which qualifies under Section 401(k) of the Code. Effective July 17, 2015, the Board of Directors adopted the PayPal Holdings, Inc. Deferred Compensation Plan. Under the terms of this plan, participating U.S. employees may contribute up to 50% of their eligible compensation, but not more than statutory limits. In 2016 , 2015 and 2014 , under PayPal's and eBay's savings plans, eligible employees received one dollar for each dollar contributed, up to 4% of each employee’s eligible salary, subject to a maximum employer contribution of $10,600 , $10,600 and $10,400 , respectively, per employee. Our non-U.S. employees are covered by other savings plans. For the years ended December 31, 2016 , 2015 and 2014 , the matching contribution expense for our U.S. and international savings plans were approximately $42 million , $42 million and $37 million , respectively. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes For periods ended on or prior to July 17, 2015, we were a member of the eBay consolidated group and our U.S. taxable income was included in the consolidated U.S. federal income tax return of eBay as well as in returns filed by eBay with certain state and local taxing jurisdictions. Our foreign income tax returns were filed on a separate company basis. For periods ended on or prior to July 17, 2015, our income tax liability has been computed and presented herein under the “separate return method” as if we were a separate tax paying entity, as modified by the benefits-for-loss approach. Accordingly, our operating losses and other tax attributes are characterized as utilized when those attributes have been utilized by other members of the eBay consolidated group; however, the benefits-for-loss approach does not impact our tax expense. Federal and unitary state income taxes incurred for periods ended on or prior to July 17, 2015 are remitted to eBay pursuant to a tax sharing agreement between the companies. In connection with the distribution, eBay and PayPal entered into various agreements that govern the relationship between the parties going forward, including a tax matters agreement. The tax matters agreement was entered into on the distribution date. Under the tax matters agreement, eBay generally is responsible for all additional taxes (and will be entitled to all related refunds of taxes) imposed on eBay and its subsidiaries (including subsidiaries that were transferred to PayPal pursuant to the separation) arising after the distribution date with respect to the taxable periods (or portions thereof) ended on or prior to July 17, 2015, except for those taxes for which PayPal has reflected an unrecognized tax benefit in its financial statements on the distribution date. The components of income (loss) before income taxes are as follows: Year Ended December 31, 2016 2015 2014 (In millions) United States $ (342 ) $ (253 ) $ (111 ) International 1,973 1,741 1,372 Income before income taxes $ 1,631 $ 1,488 $ 1,261 The income tax expense is composed of the following: Year Ended December 31, 2016 2015 2014 (In millions) Current: Federal $ 44 $ 34 $ 90 State and local 19 (5 ) 13 Foreign 115 104 59 $ 178 $ 133 $ 162 Deferred: Federal $ 90 $ 126 $ 699 State and local (35 ) 1 (3 ) Foreign (3 ) — (16 ) 52 127 680 Income tax expense $ 230 $ 260 $ 842 The following is a reconciliation of the difference between the effective income tax rate and the federal statutory rate. Year Ended December 31, 2016 2015 2014 Federal statutory rate 35.0 % 35.0 % 35.0 % State taxes, net of federal benefit (1.0 )% (0.3 )% 0.8 % Foreign income taxed at different rates (23.2 )% (20.9 )% (22.2 )% Prior year foreign earnings no longer considered indefinitely reinvested — — % 50.8 % Stock-based compensation expense 1.6 % 1.5 % 1.5 % Tax credits (1.0 )% (0.7 )% (0.8 )% Change in valuation allowances 0.5 % 0.3 — % Other 2.2 % 2.6 % 1.7 % Effective income tax rate 14.1 % 17.5 % 66.8 % The difference between the effective income tax rate and the federal statutory rate of 35.0% to income before income taxes is primarily the result of foreign income taxed at different rates and, for the year ended December 31, 2014, the accrual of U.S. income tax on undistributed foreign profits for 2013 and prior years previously indefinitely reinvested outside of the U.S. Deferred tax assets and liabilities are recognized for the future tax consequences of differences between the carrying amounts of assets and liabilities and their respective tax basis using enacted tax rates in effect for the year in which the differences are expected to reverse. Significant deferred tax assets and liabilities consist of the following: As of December 31, 2016 2015 (In millions) Deferred tax assets: Net operating loss and credit carryforwards $ 84 $ 90 Accruals and allowances 187 153 Partnership investment 15 14 Stock-based compensation 99 82 Net unrealized (gains) losses 14 16 Total deferred tax assets 399 355 Valuation allowance (24 ) (13 ) Net deferred tax assets $ 375 $ 342 Deferred tax liabilities: Unremitted foreign earnings $ (1,246 ) $ (1,156 ) Fixed assets and other intangibles (226 ) (191 ) Acquired intangibles (95 ) (131 ) Net unrealized losses (gains) (2 ) (1 ) Total deferred tax liabilities (1,569 ) (1,479 ) Net deferred tax assets (liabilities) $ (1,194 ) $ (1,137 ) The following table shows the deferred tax assets and liabilities within our consolidated balance sheet. Balance Sheet Location As of December 31, 2016 2015 (In millions) Total deferred tax assets (non-current) Other assets $ 21 $ 38 Total deferred tax liabilities (non-current) Long-term liabilities (1,215 ) (1,175 ) Total net deferred tax assets (liabilities) $ (1,194 ) $ (1,137 ) In 2015, the FASB issued Accounting Standards Update (“ASU”) 2015-17, “Balance Sheet Classification of Deferred Taxes”, which simplifies the presentation of deferred income taxes. This guidance requires that deferred tax liabilities and assets be classified as non-current in a classified statement of financial position. We early adopted the FASB's new accounting guidance effective for the year ended December 31, 2015. In 2015, pursuant to the Separation and Distribution Agreement between eBay and us, we received from eBay a contribution of cash of approximately $3.8 billion , as well as a related estimated deferred tax liability of $172 million associated with foreign earnings that are not considered indefinitely reinvested. The adjustment to deferred tax liability was recorded as a contribution from eBay and resulted in an increase to net parent investment within stockholders' equity. As of December 31, 2016 , our federal, state and foreign net operating loss carryforwards for income tax purposes were approximately $110 million , $281 million , and $54 million , respectively. The federal and state net operating loss carryforwards are subject to various limitations under Section 382 of the Code. If not utilized, the federal net operating loss carryforwards will begin to expire in 2019 , and the state net operating loss carryforwards will begin to expire in 2017 . The majority of the foreign net operating loss carryforwards have no expiration date and may be carried forward indefinitely. As of December 31, 2016 , our federal and state tax credit carryforwards for income tax purposes were approximately $5 million and $60 million , respectively. The federal tax credits will begin to expire in 2032. Most of the state tax credits carry forward indefinitely. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that all or some portion of the deferred tax assets will not be realized. At December 31, 2016 , we maintained a valuation allowance with respect to certain of our deferred tax assets relating to operating losses in certain states and foreign jurisdictions and tax credits in certain states that we believe are not likely to be realized. At December 31, 2015 , we maintained a valuation allowance related to deferred tax assets for operating losses in certain states and foreign jurisdictions that we believe are not likely to be realized. At December 31, 2013, we had approximately $3.4 billion of indefinitely reinvested foreign earnings for which we had not provided U.S. income or applicable foreign withholding taxes. During 2014, we altered our capital allocation strategy, which included changing our intent with regard to the indefinite reinvestment of foreign earnings from certain of our foreign subsidiaries for 2013 and prior years. As a result, we provided taxes and recorded a deferred tax liability of approximately $650 million on $1.9 billion of undistributed foreign earnings of certain of our foreign subsidiaries for 2013 and prior years. We have not provided for U.S. federal income and foreign withholding taxes on $4.6 billion of our non-U.S. subsidiaries’ undistributed earnings as of December 31, 2016 , because such earnings are intended to be indefinitely reinvested in our international operations. We do not know the time or manner in which we would repatriate those funds; therefore, we cannot quantify the tax liability associated with the future repatriation of such earnings. In cases where we do not intend to indefinitely reinvest a portion of our foreign subsidiaries’ undistributed earnings, we provide U.S. taxes on such earnings and such taxes are included in deferred taxes or tax payable liabilities depending upon the planned timing and manner of such repatriation. We benefit from tax rulings concluded in several different jurisdictions, most significantly Singapore and Luxembourg. These rulings result in significantly lower rates of taxation on certain classes of income and require various thresholds of investment and employment in those jurisdictions. We review our compliance on an annual basis to ensure we continue to meet our obligations under these tax rulings. These rulings resulted in tax savings of approximately $310 million , $285 million and $217 million in 2016 , 2015 and 2014 , respectively. The benefit of these tax rulings on our net income per share (diluted) was approximately $0.25 , $0.23 and $0.18 in 2016 , 2015 and 2014 , respectively. These tax rulings expire over periods ranging from 2020 to 2021. On July 27, 2015, the U.S. Tax Court, in Altera Corp. v. Commissioner, invalidated part of a Treasury Regulation requiring stock-based compensation to be included in a qualified intercompany cost sharing arrangement. A final decision was entered by the U.S. Tax Court on December 1, 2015. On February 19, 2016, the Internal Revenue Service filed a notice of appeal to the Ninth Circuit Court of Appeals, with follow up briefs filed by both Altera and the Internal Revenue Service to the appeals court during the second half of 2016. We have reviewed this case and its impact on PayPal and concluded that no adjustment to the consolidated financial statements is appropriate at this time. We will continue to monitor ongoing developments and potential impacts to our consolidated financial statements. The following table reflects changes in unrecognized tax benefits since January 1, 2014: Year Ended December 31, 2016 2015 2014 (In millions) Gross amounts of unrecognized tax benefits as of the beginning of the period $ 267 $ 165 $ 134 Increases related to prior period tax positions 14 39 7 Decreases related to prior period tax positions (18 ) (4 ) (2 ) Increases related to current period tax positions 51 68 31 Settlements (1 ) (1 ) (5 ) Statute of limitation expirations (1 ) — — Gross amounts of unrecognized tax benefits as of the end of the period $ 312 $ 267 $ 165 If the remaining balance of unrecognized tax benefits were realized in a future period, it would result in a tax benefit of $271 million . During all years presented, we recognized interest and penalties related to uncertain tax positions in income tax expense. In 2016 we recognized net interest and penalties of $13 million in income tax expense. The amount of interest and penalties accrued as of December 31, 2016 and 2015 was approximately $67 million and $54 million , respectively. We are subject to taxation in the U.S. and various state and foreign jurisdictions. We are currently under examination by certain tax authorities for the 2003 to 2015 tax years. The material jurisdictions in which we are subject to examination by tax authorities for tax years after 2002 primarily include the U.S. (Federal and California), France, Germany, India, Israel, Italy, Singapore and United Kingdom. We believe that adequate amounts have been reserved for any adjustments that may ultimately result from these examinations. Although the timing of the resolution of these audits is uncertain, we do not expect the total amount of unrecognized tax benefits as of December 31, 2016 will materially change in the next 12 months. However, given the number of years remaining subject to examination and the number of matters being examined, we are unable to estimate the full range of possible adjustments to the balance of gross unrecognized tax benefits. |
Restructuring
Restructuring | 12 Months Ended |
Dec. 31, 2016 | |
Restructuring and Related Activities [Abstract] | |
Restructuring | Restructuring In January 2015, at a regular meeting of the eBay board of directors (the “eBay Board”), the eBay Board approved a plan to implement a strategic reduction of its existing global workforce. The reduction was completed by the end of 2015. We recognized $48 million of restructuring expenses during the year ended December 31, 2015, all of which were paid by the end of 2015. No restructuring expenses were recognized during the years ended December 31, 2016 and 2014. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive (Loss) Income | 12 Months Ended |
Dec. 31, 2016 | |
Equity [Abstract] | |
Accumulated Other Comprehensive (Loss) Income | Accumulated Other Comprehensive (Loss) Income The following table summarizes the changes in accumulated balances of other comprehensive income for the year ended December 31, 2016 : Unrealized Gains (Losses) on Cash Flow Hedges Unrealized Gains (Losses) on Investments Foreign Currency Translation Estimated Tax (Expense) Benefit Total (In millions) Beginning balance $ 57 $ (16 ) $ (53 ) $ 3 $ (9 ) Other comprehensive income (loss) before reclassifications 193 7 (15 ) (2 ) 183 Less: Amount of gain (loss) reclassified from accumulated other comprehensive income 119 (4 ) — — 115 Net current period other comprehensive income 74 11 (15 ) (2 ) 68 Ending balance $ 131 $ (5 ) $ (68 ) $ 1 $ 59 The following table summarizes the changes in accumulated balances of other comprehensive income for the year ended December 31, 2015 : Unrealized Gains (Losses) on Cash Flow Hedges Unrealized Gains (Losses) on Investments Foreign Currency Translation Estimated Tax Total (In millions) Beginning balance $ 126 $ — $ (16 ) $ — $ 110 Other comprehensive income (loss) before reclassifications 113 (16 ) (37 ) 3 63 Less: Amount of gain reclassified from accumulated other comprehensive income 182 — — — 182 Net current period other comprehensive income (loss) (69 ) (16 ) (37 ) 3 (119 ) Ending balance $ 57 $ (16 ) $ (53 ) $ 3 $ (9 ) The following table provides details about reclassifications out of accumulated other comprehensive income for the years ended December 31, 2016 and 2015 : Details about Accumulated Other Comprehensive Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income Affected Line Item in the Statement of Income Year Ended December 31, 2016 2015 (In millions) Gains on cash flow hedges-foreign exchange contracts $ 119 $ 182 Net revenues Unrealized losses on investments (4 ) — Other income (expense), net $ 115 $ 182 Income before income taxes — — Income tax expense Total reclassifications for the period $ 115 $ 182 Net income |
Quarterly Unaudited Financial D
Quarterly Unaudited Financial Data | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Unaudited Financial Data | Supplementary Data — Quarterly Unaudited Financial Data The following tables present certain unaudited consolidated quarterly financial information for the years ended December 31, 2016 and 2015 . The fourth quarter of 2015 was the first full quarter post separation and represents our actual results as an independent public company. Results for the first three quarters of 2015 include allocations from eBay and may not be indicative of our results had we been a separate stand-alone entity during those periods. 2016 Quarter Ended March 31 June 30 September 30 December 31 (Unaudited, in millions, except per share amounts) Net revenues $ 2,544 $ 2,650 $ 2,667 $ 2,981 Net income $ 365 $ 323 $ 323 $ 390 Net income per share-basic $ 0.30 $ 0.27 $ 0.27 $ 0.32 Net income per share-diluted $ 0.30 $ 0.27 $ 0.27 $ 0.32 Weighted-average shares: Basic 1,216 1,210 1,207 1,207 Diluted 1,225 1,215 1,214 1,216 2015 Quarter Ended (Unaudited, in millions, except per share amounts) March 31 (1) June 30 (1) September 30 (2) December 31 (2) Net revenues $ 2,137 $ 2,297 $ 2,258 $ 2,556 Net income $ 255 $ 305 $ 301 $ 367 Net income per share-basic $ 0.21 $ 0.25 $ 0.25 $ 0.30 Net income per share-diluted $ 0.21 $ 0.25 $ 0.25 $ 0.30 Weighted-average shares: (1)(2) Basic 1,218 1,218 1,221 1,223 Diluted 1,224 1,224 1,227 1,230 1 On July 17, 2015, the distribution date, eBay stockholders of record as of the close of business on July 8, 2015 received one share of PayPal common stock for every share of eBay common stock held as of the record date. Basic and diluted net income per share for the first two quarters of 2015 is calculated using the number of common shares distributed on July 17, 2015. Refer to Note 2 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for information regarding net income per share. 2 Basic and diluted net income per share for the third and fourth quarters of 2015 is calculated using the weighted average number of common shares outstanding for the period beginning after the distribution date. Refer to Note 2 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for information regarding net income per share. |
FINANCIAL STATEMENT SCHEDULE
FINANCIAL STATEMENT SCHEDULE | 12 Months Ended |
Dec. 31, 2016 | |
Valuation and Qualifying Accounts [Abstract] | |
FINANCIAL STATEMENT SCHEDULE | FINANCIAL STATEMENT SCHEDULE The Financial Statement Schedule II—VALUATION AND QUALIFYING ACCOUNTS is filed as part of this Annual Report on Form 10-K. Balance at Beginning of Period Charged/ (Credited) to Net Income Charges Utilized/ (Write-offs) Balance at End of Period (In millions) Allowance for Transaction Losses Year Ended December 31, 2014 $ 137 $ 408 $ (379 ) $ 166 Year Ended December 31, 2015 166 511 (492 ) 185 Year Ended December 31, 2016 $ 185 $ 655 $ (618 ) $ 222 Allowance for Loans and Interest Receivable Year Ended December 31, 2014 $ 146 $ 333 $ (284 ) $ 195 Year Ended December 31, 2015 195 385 (347 ) 233 Year Ended December 31, 2016 $ 233 $ 555 $ (449 ) $ 339 |
Overview and Summary of Signi28
Overview and Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of presentation | Basis of Presentation and Principles of Consolidation On July 17, 2015 (the “distribution date”), PayPal became an independent publicly traded company through the pro rata distribution by eBay Inc. (“eBay”) of 100% of the outstanding common stock of PayPal to eBay stockholders (which we refer to as the “separation” or the “distribution”). Each eBay stockholder of record as of the close of business on July 8, 2015 received one share of PayPal common stock for every share of eBay common stock held on the record date. Approximately 1.2 billion shares of PayPal common stock were distributed on July 17, 2015 to eBay stockholders. PayPal's common stock began “regular way” trading under the ticker symbol “PYPL” on The NASDAQ Stock Market on July 20, 2015. Prior to the separation, eBay transferred substantially all of the assets and liabilities and operations of eBay's payments business to PayPal, which was completed in June 2015 (the “capitalization”). The consolidated financial statements prior to the capitalization were prepared on a stand-alone basis and were derived from eBay's consolidated financial statements and accounting records. The consolidated financial statements reflect our financial position, results of operations, comprehensive income and cash flows as our business was operated as part of eBay prior to the capitalization. Following the capitalization, the consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All periods presented have been accounted for in conformity with U.S. generally accepted accounting principles (“GAAP”). For periods prior to the capitalization, the consolidated financial statements include expenses associated with real estate and information technology that were previously allocated to the payments business of eBay, and additional expenses related to certain corporate functions, including senior management, legal, human resources and finance. These expenses also include allocations related to stock-based compensation. The expenses that were incurred by eBay were allocated to us based on direct usage or benefit where identifiable, with the remainder allocated on a pro rata basis of revenue, headcount, or other systematic measure. We consider the expense allocation methodology and results to be reasonable for all periods presented. The consolidated financial statements also include certain assets and liabilities that were historically held at the eBay corporate level, but which are specifically identifiable and attributable to us. The consolidated financial position, results of operations and cash flows of PayPal prior to the distribution may not be indicative of our results had we been a separate stand-alone entity throughout the periods presented, nor are the results stated herein indicative of what the Company’s financial position, results of operations and cash flows may be in the future. All intercompany transactions and accounts have been eliminated. Transactions between the Company and eBay are included in these consolidated financial statements for all periods presented. Beginning with the first quarter of 2016, we reclassified certain operating expenses in our consolidated statements of income to better align our external and internal financial reporting. These classification changes relate primarily to real estate and information technology operating expenses that were previously allocated among customer support and operations expense, sales and marketing expense and product development expense. As of the first quarter of 2016, our management did not allocate these operating expenses for internal financial reporting and general management of the business and has therefore discontinued this allocation for external financial reporting purposes. As a result, starting with the first quarter of 2016, these operating expenses were reported as part of general and administrative expenses. These changes have no impact on the previously reported consolidated net income for prior periods, including total operating expenses, financial position or cash flows for any periods presented, and do not eliminate any of the costs allocated to us by eBay for any periods prior to the separation. Prior period amounts have been reclassified to conform to the current period presentation. |
Principles of combination and consolidation | Basis of Presentation and Principles of Consolidation On July 17, 2015 (the “distribution date”), PayPal became an independent publicly traded company through the pro rata distribution by eBay Inc. (“eBay”) of 100% of the outstanding common stock of PayPal to eBay stockholders (which we refer to as the “separation” or the “distribution”). Each eBay stockholder of record as of the close of business on July 8, 2015 received one share of PayPal common stock for every share of eBay common stock held on the record date. Approximately 1.2 billion shares of PayPal common stock were distributed on July 17, 2015 to eBay stockholders. PayPal's common stock began “regular way” trading under the ticker symbol “PYPL” on The NASDAQ Stock Market on July 20, 2015. Prior to the separation, eBay transferred substantially all of the assets and liabilities and operations of eBay's payments business to PayPal, which was completed in June 2015 (the “capitalization”). The consolidated financial statements prior to the capitalization were prepared on a stand-alone basis and were derived from eBay's consolidated financial statements and accounting records. The consolidated financial statements reflect our financial position, results of operations, comprehensive income and cash flows as our business was operated as part of eBay prior to the capitalization. Following the capitalization, the consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All periods presented have been accounted for in conformity with U.S. generally accepted accounting principles (“GAAP”). For periods prior to the capitalization, the consolidated financial statements include expenses associated with real estate and information technology that were previously allocated to the payments business of eBay, and additional expenses related to certain corporate functions, including senior management, legal, human resources and finance. These expenses also include allocations related to stock-based compensation. The expenses that were incurred by eBay were allocated to us based on direct usage or benefit where identifiable, with the remainder allocated on a pro rata basis of revenue, headcount, or other systematic measure. We consider the expense allocation methodology and results to be reasonable for all periods presented. The consolidated financial statements also include certain assets and liabilities that were historically held at the eBay corporate level, but which are specifically identifiable and attributable to us. The consolidated financial position, results of operations and cash flows of PayPal prior to the distribution may not be indicative of our results had we been a separate stand-alone entity throughout the periods presented, nor are the results stated herein indicative of what the Company’s financial position, results of operations and cash flows may be in the future. All intercompany transactions and accounts have been eliminated. Transactions between the Company and eBay are included in these consolidated financial statements for all periods presented. Beginning with the first quarter of 2016, we reclassified certain operating expenses in our consolidated statements of income to better align our external and internal financial reporting. These classification changes relate primarily to real estate and information technology operating expenses that were previously allocated among customer support and operations expense, sales and marketing expense and product development expense. As of the first quarter of 2016, our management did not allocate these operating expenses for internal financial reporting and general management of the business and has therefore discontinued this allocation for external financial reporting purposes. As a result, starting with the first quarter of 2016, these operating expenses were reported as part of general and administrative expenses. These changes have no impact on the previously reported consolidated net income for prior periods, including total operating expenses, financial position or cash flows for any periods presented, and do not eliminate any of the costs allocated to us by eBay for any periods prior to the separation. Prior period amounts have been reclassified to conform to the current period presentation. |
Equity and cost method investments | The accompanying consolidated financial statements include the financial statements of PayPal and our wholly and majority-owned subsidiaries. Investments in entities where we hold less than a 20% ownership interest are accounted for using the cost method of accounting, and our share of the investees’ results of operations is included in other income (expense), net on our consolidated statement of income to the extent dividends are received. Our investment balance is included in long-term investments on our consolidated balance sheet. In the opinion of management, these consolidated financial statements reflect all adjustments, consisting only of normal recurring adjustments, which are necessary for fair presentation of the consolidated financial statements for all periods presented. We have evaluated all subsequent events through the date the financial statements were issued. Certain amounts for prior years have been reclassified to conform to the financial statement presentation as of and for the year ended December 31, 2016 . |
Use of estimates | Use of estimates The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses, including allocations from eBay, during the reporting period. On an ongoing basis, we evaluate our estimates, including but not limited to those related to provisions for transaction and loan losses, legal contingencies, income taxes, revenue recognition, and the valuation of goodwill and intangible assets. We base our estimates on historical experience and on various other assumptions which we believe to be reasonable under the circumstances. Actual results could differ from these estimates. |
Cash and cash equivalents | Cash and cash equivalents Cash and cash equivalents are short-term, highly liquid investments with original maturities of three months or less when purchased and are composed of primarily of bank deposits, government and agency securities and commercial paper. |
Investments | Investments Short-term investments, which include time deposits, government and agency securities and corporate debt securities with original maturities of greater than three months but less than one year when purchased, are classified as available-for-sale and are reported at fair value using the specific identification method. Unrealized gains and losses are excluded from earnings and reported as a component of other comprehensive income (loss), net of related estimated tax provisions or benefits. Long-term investments include corporate debt securities, government and agency securities and cost method investments with maturities exceeding one year. Debt securities, government and agency securities are classified as available-for-sale and are reported at fair value using the specific identification method. Unrealized gains and losses are excluded from earnings and reported as a component of other comprehensive income (loss), net of related estimated tax provisions or benefits. We elect to account for foreign currency denominated available-for-sale investments underlying funds receivable and customer accounts, short-term investments and long-term investments under the fair value option as further discussed in “Note 5—Funds Receivable and Customer Accounts” and “Note 6—Investments.” The changes in fair value related to initial measurement and subsequent changes in fair value are included in earnings as a component of other income (expense), net. Our cost method investments consist of investments in privately held companies where we do not have the ability to exercise significant influence, or have control over the investee. These investments are recorded at cost and are subject to periodic tests for other-than-temporary impairment. We assess whether an other-than-temporary impairment loss on our investments has occurred due to declines in fair value or other market conditions. If any impairment is considered other-than-temporary, we will write down the investment to its fair value and record the corresponding charge through other income (expense), net in our consolidated statements of income. With respect to our debt securities, this assessment takes into account the severity and duration of the decline in value, our intent to sell the security, whether it is more likely than not we will be required to sell the security before recovery of its amortized cost basis, and whether we expect to recover the entire amortized cost basis of the security (that is, whether a credit loss exists). |
Loans and interest receivable, net | Loans and interest receivable, net Loans and interest receivable, net represents consumer receivables originated under PayPal Credit consumer accounts and working capital advances to select small and medium-sized PayPal merchants through our PayPal Working Capital product. In the U.S., we work with independent chartered financial institutions that extend credit to the consumer or merchant using our PayPal credit products. For our consumer credit products outside the U.S., we extend credit through our Luxembourg banking subsidiary. For our merchant credit products outside the U.S., we extend working capital advances in the U.K. through our Luxembourg banking subsidiary, and we extend working capital advances in Australia through an Australian subsidiary. We purchase the related receivables extended by the independent chartered financial institution and are responsible for servicing functions related to all of our credit products. As part of the arrangement with the independent chartered financial institution in the U.S. that we work with, we sell back a participation interest in the pool of consumer receivables outstanding under PayPal Credit consumer accounts. For this arrangement, gains or losses on the sale of the participation interest are not material as the carrying amount of the participation interest sold approximates the fair value at time of transfer. However, we have a separate arrangement with certain investors under which we sell to these investors a participation interest in certain consumer loans receivable that we purchased, where the consideration received exceeds the carrying amount of the participation interest sold which results in a gain reflected as net revenues in our consolidated financial statements. See “Note 10—Loans and Interest Receivable, net” for additional information related to this arrangement. We apply a control-oriented, financial-components approach and account for the asset transfer as a sale and derecognize the portion of the participation interest for which control has been surrendered. Loans, advances and interest and fees receivable are reported at their outstanding principal balances, net of any participation interest sold and pro-rata allowances, including unamortized deferred origination costs and estimated collectible interest and fees. We maintain the servicing rights for the entire pool of consumer receivables outstanding and receive a fee approximating the fair value for servicing the assets underlying the participation interest sold. The terms of our consumer relationships require us to submit monthly bills to the consumer detailing loan repayment requirements. The terms also allow us to charge the consumer interest and fees in certain circumstances. Due to the relatively small dollar amount of individual loans and interest receivable, we do not require collateral on these balances. |
Allowance for loans and interest receivable | Allowance for loans and interest receivable The allowance for loans and interest receivable represents management’s estimate of probable incurred losses inherent in our PayPal Credit portfolio of receivables. Increases to the allowance for loans receivable are reflected as transaction and loan losses in our consolidated financial statements. The evaluation process to assess the adequacy of allowances is subject to numerous estimates and judgments. For our consumer loans receivable, the allowance is primarily based on forecasted principal balance delinquency rates (“roll rates”). Roll rates are the percentage of balances which we estimate will migrate from one stage of delinquency to the next based on our historical experience, as well as external factors such as estimated bankruptcies and levels of unemployment. Roll rates are applied to principal amount of our consumer receivables for each stage of delinquency, from current to 180 days past the payment due date, in order to estimate the principal loans which have incurred losses and are probable to be charged off. For merchant working capital advances, the allowance is primarily based on principal balances, forecasted delinquency rates and recoveries through the use of a vintage-based loss forecasting model. The determination of delinquency, from current to 180 days past due, for principal balances related to merchant working capital advances is based on the current expected repayment period of the advance and fixed fee as compared to the original expected repayment period. We calculate the repayment rate based on the merchant's expected future payment volume such that repayment of the advance and fixed fee is typically expected to occur within 9 to 12 months from the date of the advance. On a regular basis, we recalculate the repayment period based on the actual repayment activity on the receivable. As such, actual repayment periods are dependent on actual payment processing volumes. See “Note 10—Loans and Interest Receivable, Net” for additional information on the delinquency status of our PayPal Credit portfolio of receivables. The allowance for loss against interest receivable is primarily determined by applying historical average customer account roll rates to the interest receivable balance in each stage of delinquency to project the value of accounts that have incurred losses and are probable to be charged off. The allowance for fees receivable is primarily based on fee balances, forecasted delinquency rates and recoveries through the use of a vintage-based loss forecasting model. Increases to the allowance for interest receivable is reflected as a reduction of net revenues in our consolidated statement of income. Increases to the allowance for fees receivable is recognized as a reduction in deferred revenues in our consolidated balance sheet. We charge off consumer loan receivable balances in the month in which a customer balance becomes 180 days past the payment due date. We charge off the merchant receivable when the updated repayment period is 180 days past the original expected repayment period and the merchant has not made a payment in the last 60 days. We also charge off the receivable when the updated repayment period is 360 days past the original expected repayment period regardless of whether or not the merchant has made a payment within the last 60 days. Bankrupt accounts are charged off within 60 days of receiving notification from the bankruptcy courts. Consumer loans receivable past the payment due date continue to accrue interest until such time as they are charged off. Charge-offs that are recovered are recorded as a reduction to our allowance for loans and interest receivable. |
Customer accounts | Customer accounts We hold all customer balances (both in the U.S. and internationally) as direct claims against us which are reflected on our consolidated balance sheet as a liability classified as amounts due to customers. Certain jurisdictions where PayPal operates require us to hold eligible liquid assets, as defined by the regulators in these jurisdictions, equal to at least 100% of the aggregate amount of all customer balances. Therefore, we use the assets underlying the customer balances to meet these regulatory requirements and separately classify the assets as customer accounts in our consolidated balance sheet. We classify the assets underlying the customer balances as current based on their purpose and availability to fulfill our direct obligation under amounts due to customers. In March 2016, as approved by management and our Luxembourg banking subsidiary Supervisory Board and as permitted within regulations set forth by the Luxembourg Commission de Surveillance du Secteur Financier (the “CSSF”), we designated $800 million of European customer balances held in our Luxembourg banking subsidiary to be used to extend credit to our European customers. This is consistent with our strategy of diversifying funding sources for our credit business and does not represent a change in our credit business development strategy or risk appetite. These funds are classified as cash and cash equivalents in our consolidated balance sheet and represent approximately 20% of European customer balances potentially available for corporate use by the Company at December 31, 2016 as determined by applying financial regulations maintained by the CSSF. The remaining assets underlying the customer balances remain separately classified as customer accounts in our consolidated balance sheet. We do not commingle these customer accounts with corporate funds and maintain these assets separately in interest and non-interest bearing bank deposits, time deposits, corporate debt securities and U.S. and foreign government and agency securities. See “Note 5—Funds Receivable and Customer Accounts” for additional information related to customer accounts. Due to the above approved plan, we have presented changes in funds receivable and customer accounts as cash flows from investing activities in our consolidated statements of cash flows based on the nature of the activity underlying our customer accounts. We have elected to conform the prior year statement of cash flows to the current period presentation to provide comparability. |
Funds receivable and funds payable | Funds receivable and funds payable Funds receivable and funds payable arise due to the time required to initiate collection from and clear transactions through external payment networks. When customers fund their account using their bank account or a credit card or debit card, or withdraw funds from their PayPal account to their bank account or through a debit card transaction, there is a clearing period before the cash is received or settled, usually one to three business days for U.S. transactions and generally up to five business days for international transactions. |
Allowance for negative customer balances | Allowance for negative customer balances Negative customer balances occur primarily when there are insufficient funds in a customer’s PayPal account to cover charges applied for Automated Clearing House (“ACH”) returns, debit card transactions, chargebacks, nondelivery or unsatisfactory delivery of goods or services. Negative balances can be cured by the customer by adding funds to the account, receiving payments, or through back-up funding sources. We also utilize third-party collection agents. For negative customer balances that are not expected to be cured or otherwise collected, we provide an allowance for uncollectible accounts. The allowance is estimated based on known facts and circumstances, internal factors including our experience with similar cases, and historical trends involving collection and write-off patterns. Negative customer balances are included in other current assets, net of the allowance. Adjustments to the allowance for negative customer balances are recorded as a component of transaction and loan loss. |
Property and equipment | Property and equipment Property and equipment consists primarily of computer equipment, software and website development costs, land and buildings and leasehold improvements. Property and equipment are stated at historical cost less accumulated depreciation. Depreciation and amortization are computed using the straight-line method over the estimated useful lives of the assets; generally, one to three years for computer equipment and software, including capitalized software and website development costs, three years for furniture and fixtures, up to thirty years for buildings and building improvements, and the shorter of five years or the non-cancelable term of the lease for leasehold improvements. |
Goodwill and intangible assets | Goodwill and intangible assets Goodwill is tested for impairment at a minimum on an annual basis. Goodwill is tested for impairment at the reporting unit level by first performing a qualitative assessment to determine whether it is more likely than not that the fair value of the reporting unit is less than its carrying value. If the reporting unit does not pass the qualitative assessment, then the reporting unit’s carrying value is compared to its fair value. Goodwill is considered impaired if the carrying value of the reporting unit exceeds its fair value. The fair value of the reporting unit is estimated using income and market approaches. The discounted cash flow method, a form of the income approach, uses expected future operating results and a market participant discount rate. The market approach uses comparable company prices and other relevant information generated by market transactions (either publicly traded entities or merger and acquisitions) to develop pricing metrics to be applied to historical and expected future operating results of the reporting unit. Failure to achieve these expected results, changes in the discount rate or market pricing metrics, may cause a future impairment of goodwill at the reporting unit level. We conducted our annual impairment test of goodwill as of August 31, 2016 and 2015. We determined that no adjustment to the carrying value of goodwill of our reporting unit was required. As of December 31, 2016, we determined that no events or circumstances from August 31, 2016 through December 31, 2016 indicated that a further assessment was necessary. Intangible assets consist of customer-related intangible assets, marketing related intangibles, developed technologies and other intangible assets including purchased partner relationships, purchased technology, patents and contractual agreements. Intangible assets are amortized over the period of estimated benefit using the straight-line method and estimated useful lives ranging from one to eight years. No significant residual value is estimated for intangible assets. |
Impairment of long-lived assets | Impairment of long-lived assets We evaluate long-lived assets (including intangible assets) for impairment whenever events or changes in circumstances indicate that the carrying amount of a long-lived asset may not be recoverable. An asset is considered impaired if its carrying amount exceeds the future net cash flow the asset is expected to generate. |
Allowance for transaction losses | Allowance for transaction losses We are exposed to transaction losses due to credit card and other payment misuse as well as nonperformance of and credit losses from sellers who accept payments through PayPal. We establish an allowance for estimated losses arising from processing customer transactions, such as chargebacks for unauthorized credit card use and merchant-related chargebacks due to non-delivery of goods or services, ACH returns, buyer protection program claims, account takeovers, and account overdrafts. This allowance represents an accumulation of the estimated amounts necessary to provide for transaction losses incurred as of the reporting date, including those which we have not yet identified. The allowance is monitored regularly and is updated based on actual claims data reported by our claims processors and other actual data received. The allowance is based on known facts and circumstances, internal factors including experience with similar cases, historical trends involving loss payment patterns, and the mix of transaction and loss types. Additions to the allowance are reflected as transaction and loan losses in our consolidated statements of income. |
Derivative instruments | Derivative instruments We have significant international revenues and costs denominated in foreign currencies, subjecting our operations to foreign currency risk. We enter into foreign currency exchange contracts that qualify as cash flow hedges, generally with maturities of 18 months or less, to reduce the volatility of cash flows primarily related to forecasted revenue denominated in certain foreign currencies. All outstanding derivatives are recognized on the balance sheet at fair value. The effective portion of the designated derivative’s gain or loss is initially reported as a component of accumulated other comprehensive income (loss) and is subsequently reclassified into the financial statement line item in which the hedged item is recorded in the period the forecasted transaction affects earnings. We also hedge our economic exposure to foreign currency denominated monetary assets and liabilities with foreign currency contracts. The gains and losses on the foreign exchange contracts economically offset transaction gains and losses on certain foreign currency denominated monetary assets and liabilities recognized in earnings. Accordingly, these outstanding non-designated derivatives are recognized on the balance sheet at fair value and changes in fair value from these contracts are recorded in other income (expense), net in the consolidated statement of income. Our hedging program is not designed or operated for trading or speculative purposes. Our derivative instruments expose us to credit risk to the extent counterparties may be unable to meet the terms of the agreements. We seek to mitigate this risk by limiting counterparties to major financial institutions and by spreading the risk across several major financial institutions. In addition, the potential risk of loss with one counterparty resulting from this type of credit risk is monitored on an ongoing basis. See “Note 8—Derivative Instruments” for additional information related to the derivative instruments. |
Fair value of financial instruments | Fair value of financial instruments Our financial assets and liabilities are valued using market prices on both active markets (Level 1) and less active markets (Level 2). Level 1 instrument valuations are obtained from real-time quotes for transactions in active exchange markets involving identical assets. Level 2 instrument valuations are obtained from readily available pricing sources for comparable instruments, identical instruments in less active markets, or models using market observable inputs. As of December 31, 2016 , and 2015 we did not have any assets or liabilities requiring measurement at fair value without observable market values that would require a high level of judgment to determine fair value (Level 3). Our financial instruments, including cash, cash equivalents, accounts receivable, loans and interest receivable, funds receivable, certain customer accounts, accounts payable, and funds payable and amounts due to customers are carried at cost, which approximates their fair value due to the short-term maturity of these instruments. |
Concentrations of risk | Concentrations of risk Our cash, cash equivalents, accounts receivable, loans and interest receivable, and funds receivable and customer accounts are potentially subject to concentration of credit risk. Cash, cash equivalents and customer accounts are placed with financial institutions that management believes are of high credit quality. In addition, funds receivable are generated primarily with financial institutions or credit card companies which management believes are of high credit quality. We invest our cash, cash equivalents and customer accounts primarily in highly liquid, highly rated instruments which are uninsured. From time to time, we may also have corporate deposit balances with financial services institutions which exceed the Federal Deposit Insurance Corporation (“FDIC”) insurance limit of $250,000. As part of our cash management process, we perform periodic evaluations of the relative credit standing of these financial institutions. Our accounts receivable are derived from revenue earned from customers located in the U.S. and internationally. Our loans and interest receivable are derived from consumer and merchant financing activities for customers located in the U.S. and internationally. |
Revenue recognition | Revenue recognition We earn net revenues primarily from fees charged to customers on the volume of activity processed through our Payments Platform. Net transaction revenues resulting from a payment processing transaction are recognized once the transaction is complete. Based on historical experience, specified credits are made at the time revenue is recognized and recorded as a reduction to revenue. In certain circumstances, we are required to record payments to a customer as a reduction to revenue. These payments to customers primarily originate from certain customer acquisition arrangements. We also earn net revenues from other value added services, including interest and fees earned on our PayPal Credit loans receivable portfolio, subscription fees, gateway fees, gain on sale of participation interest in certain consumer loans receivable, revenue share we earn through partnerships, interest earned on certain PayPal customer account balances, fees earned through our Paydiant products and other services that we provide to our consumers and merchants. Net revenues earned from other value added services are recognized over the period services are performed and when amounts are deemed to be fixed or determinable. Interest and fees earned on the PayPal Credit portfolio of loans receivable are computed and recognized based on contractual interest and fee rates, and are net of any required reserves and amortization of deferred origination costs. |
Advertising expense | Advertising expense We expense the cost of producing advertisements at the time production occurs and expense the cost of communicating advertisements in the period during which the advertising space or airtime is used as sales and marketing expense. Online advertising expenses are recognized based on the terms of the individual agreements, which is generally over the greater of the ratio of the number of impressions delivered over the total number of contracted impressions, on a pay-per-click basis, or on a straight-line basis over the term of the contract. |
Internal use software and website development costs | Internal use software and website development costs Direct costs incurred to develop software for internal use and website development costs are capitalized and amortized over an estimated useful life of one to three years and are recorded as depreciation and amortization. PayPal capitalized $341 million and $254 million of internally developed software and website development costs for the years ended December 31, 2016 and 2015 , respectively. Amortization expense for these capitalized costs was $208 million , $166 million and $129 million for the years ended December 31, 2016 , 2015 and 2014 , respectively. Costs related to the maintenance of internal use software and website development costs are expensed as incurred. |
Defined contribution savings plans | Defined contribution savings plans We have a defined contribution savings plan in the U.S. which qualifies under Section 401(k) of the Internal Revenue Code (the “Code”). Our non-U.S. employees are covered by other savings plans. Expenses related to our defined contribution savings plans are recorded when services are rendered by our employees. |
Stock-based compensation | Stock-based compensation Prior to the separation, our employees participated in eBay’s equity incentive plans, including stock options, restricted stock units and performance-based restricted stock units and the employee stock purchases made under eBay's employee stock purchase plan. All awards granted under these plans consisted of eBay common shares. Our consolidated statement of income reflected compensation expense for these stock-based plans associated with the portion of eBay's incentive plans in which our employees participated as well as an allocation of stock-based compensation of certain employees of eBay who provided general and administrative services on our behalf. Upon separation, outstanding awards granted to PayPal employees under eBay's equity incentive plans were converted into PayPal awards under PayPal's equity incentive plans based on a conversion ratio. This conversion ratio was determined as the closing per-share price of eBay shares on the last regular trading session prior to separation divided by the opening per-share price of PayPal shares on the first regular trading session after separation. There was no significant incremental stock-based compensation expense recorded as a result of the share conversions. For periods up to separation, we determined compensation expense associated with restricted stock units based on the fair value of eBay’s common stock on the date of grant. Following separation, we determine compensation expense associated with restricted stock units based on the fair value of our common stock on the date of grant. We determine compensation expense associated with stock options based on the estimated grant date fair value method using the Black-Scholes valuation model. We generally recognize compensation expense using a straight-line amortization method over the respective vesting period for awards that are ultimately expected to vest. Accordingly, stock-based compensation expense for the years ended December 31, 2016 , 2015 and 2014 has been reduced for estimated forfeitures. When estimating forfeitures, we consider voluntary termination behavior of our employees as well as trends of actual option forfeitures. |
Foreign currency | Foreign currency Most of our foreign subsidiaries use the local currency of their respective countries as their functional currency. Assets and liabilities are translated at exchange rates prevailing at the balance sheet dates. Revenues, costs and expenses are translated into U.S. dollars using daily exchange rates. Gains and losses resulting from the translation of our consolidated balance sheet are recorded as a component of accumulated other comprehensive income. Gains and losses from foreign currency transactions are recognized as other income (expense), net. |
Income taxes | Income taxes We account for income taxes using an asset and liability approach which requires the recognition of taxes payable or refundable for the current year and deferred tax liabilities and assets for the future tax consequences of events that have been recognized in the financial statements or tax returns. The measurement of current and deferred tax assets and liabilities is based on provisions of enacted tax laws; the effects of future changes in tax laws or rates are not anticipated. If necessary, the measurement of deferred tax assets is reduced by the amount of any tax benefits that are not expected to be realized based on available evidence. We report a liability for unrecognized tax benefits resulting from uncertain tax positions taken or expected to be taken in a tax return. We recognize interest and penalties, if any, related to unrecognized tax benefits in income tax expense. |
Net income per share | Net income per share Basic net income per share is computed by dividing net income for the period by the weighted average number of common shares outstanding during the period. The weighted average number of common shares outstanding for basic and diluted earnings per share for the year ended December 31, 2016 was based on the weighted average number of common shares outstanding for the period. The weighted average number of common shares outstanding for basic and diluted earnings per share for the year ended December 31, 2015 was based on the number of common shares distributed on July 17, 2015 for the period prior to distribution and the weighted average number of common shares outstanding for the period beginning after the distribution date. The weighted average number of common shares outstanding for basic and diluted earnings per share for the years ended December 31, 2014 was based on the number of shares of PayPal common stock outstanding on the distribution date. On July 17, 2015, the distribution date, eBay stockholders of record as of the close of business on July 8, 2015 received one share of PayPal common stock for every share of eBay common stock held as of the record date. Diluted net income per share is computed by dividing net income for the period by the weighted average number of shares of common stock and potentially dilutive common stock outstanding for the period. The dilutive effect of outstanding options and equity incentive awards is reflected in diluted net income per share by application of the treasury stock method. The calculation of diluted net income per share excludes all anti-dilutive common shares. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In 2014, the Financial Accounting Standards Board (“FASB”) issued new accounting guidance related to revenue recognition. This new standard will replace all current GAAP guidance on this topic and eliminate all industry-specific guidance. The new revenue recognition guidance provides a unified model to determine when and how revenue is recognized. The core principle is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration for which the entity expects to be entitled in exchange for those goods or services. In 2015, the FASB deferred the effective date to fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. In 2016, the FASB updated the guidance for reporting revenue gross versus net to improve the implementation guidance on principal versus agent considerations, and for identifying performance obligations and the accounting of intellectual property licenses. In addition, the FASB introduced practical expedients and made narrow scope improvements to the new accounting guidance. We have evaluated the impact of this new standard and have concluded that our financial statements will not be materially impacted upon adoption. We will adopt the guidance on January 1, 2018. Either of the following transition methods is permitted: (i) a full retrospective approach reflecting the application of the new standard in each prior reporting period, or (ii) a modified retrospective approach with a cumulative-effect adjustment to the opening balance of retained earnings in the year the new standard is first applied. We are continuing to evaluate the approach we will use when transitioning to this new guidance. In 2016, the FASB issued new accounting guidance related to the classification and measurement of financial instruments. This new standard makes limited amendments to the guidance in GAAP by requiring equity investments to be measured at fair value with changes in fair value recognized in net income. This new standard also amends the presentation of certain fair value changes for financial liabilities measured at fair value and it also amends certain disclosure requirements associated with the fair value of financial instruments. The new standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017. Early adoption is permitted in limited situations. We are required to apply the new guidance on a modified retrospective basis to all outstanding instruments, with a cumulative effect adjustment as of the date of adoption. Based on our current portfolio of cost method investments, the adoption of this standard is not expected to have a material impact on our financial statements. In 2016, the FASB issued new accounting guidance related to accounting for leases, which will require lessees to recognize lease assets and lease liabilities on the balance sheet for the rights and obligations created by all leases with terms greater than twelve months. As we are not a lessor, other changes in the standard applicable to lessors do not apply. The standard is effective for fiscal years and interim periods within those years beginning after December 15, 2018, with early adoption permitted. We are required to adopt the guidance using a modified retrospective basis and can elect to apply optional practical expedients. We are evaluating the impact and approach to adopting this new accounting guidance on our financial statements. In 2016, the FASB issued new accounting guidance to simplify the analysis for embedded derivatives. The new guidance clarifies that when assessing whether a contingent call or put option qualifies as a separate derivative from the host contract (e.g., the debt instrument), the nature of the exercise contingency would be excluded from the assessment. The new standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016, with early adoption permitted. We are required to apply the new guidance on a modified retrospective basis to all existing debt instruments as of the beginning of the fiscal year for which the amendments are effective. The adoption of this standard is not expected to have a material impact on our financial statements. In 2016, the FASB issued new accounting guidance on investments that qualify for the equity method of accounting as a result of an increase in the level of ownership interest or degree of influence. The new guidance eliminates the requirement for retrospective adjustment of the investment, results of operations and retained earnings as if the equity method had been in effect during all the previous periods that the investment had been held. Instead, under the new guidance, the cost of acquiring the additional interest in the investee would be added to the current basis of the previously held interest and equity method accounting would be adopted as of the date the investment becomes qualified for equity method accounting. The new standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016, with early adoption permitted. The guidance should be applied prospectively after adoption. The adoption of this standard is not expected to have a material impact on our financial statements. In 2016, the FASB issued new guidance on the accounting for share-based payment compensation. The new guidance makes amendments to the following areas: accounting for income taxes upon vesting or settlement of awards, presentation of excess tax benefits or tax deficiencies on the statement of cash flows, accounting for forfeitures, minimum statutory withholding requirements and presentation of employee taxes paid on the statement of cash flows when an employer withholds shares to meet minimum statutory withholding requirements. The new standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016 with early adoption permitted. We will adopt the new guidance effective January 1, 2017. As a result of the adoption, stock-based compensation (“SBC”) excess tax benefits or tax deficiencies will be reflected in the consolidated statement of income within the provision for income taxes rather than in the consolidated balance sheet within additional paid-in capital. This change will be applied prospectively. The amount of the impact to the provision for income taxes will depend on the difference between the market value of share-based awards at vesting or settlement and the grant date fair value recognized through SBC. Additionally, we will present the cash flows related to the applicable SBC excess tax benefits or tax deficiencies in operating activities along with other income tax cash flows rather than in financing activities on a prospective basis. Finally, we will continue to utilize an estimate of forfeitures as our approach when determining SBC. The remaining amendments are not expected to have a material impact on our financial statements. In 2016, the FASB issued new guidance on the measurement of credit losses on financial instruments. Credit losses on loans, trade and other receivables, held-to-maturity debt securities and other instruments will reflect our current estimate of the expected credit losses (CECL). CECL requires loss estimates for the remaining estimated life of the financial instrument using historical experience, current conditions, and reasonable and supportable forecasts. Generally we expect that CECL will result in the earlier recognition of allowances for losses compared to the current approach of estimating probable incurred losses. Credit losses on available-for-sale debt securities with unrealized losses will be recognized as allowances for credit losses limited to the amount by which fair value is below amortized cost. Additional disclosures will be required, including information used to track credit quality by year of origination for most financing receivables. The new standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019, with early adoption permitted. We are required to apply the standard’s provisions as a cumulative effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is adopted with impairment of available-for-sale debt securities applied prospectively after adoption. We are evaluating the impact and approach to adopting this new accounting guidance on our financial statements. In 2016, the FASB issued new guidance on classifying certain cash receipts and cash payments on the statement of cash flows. The new guidance addresses the classification of cash flows related to: debt prepayment or extinguishment costs, settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing, contingent consideration payments made after a business combination, proceeds from the settlement of insurance claims, proceeds from the settlement of corporate-owned life insurance, including bank-owned life insurance, distributions received from equity method investees and beneficial interests in securitization transactions. The guidance also clarifies how the predominance principle should be applied when cash receipts and cash payments have aspects of more than one class of cash flows. The new standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017, with early adoption permitted. The guidance should be applied retrospectively after adoption. The adoption of this standard is not expected to have a material impact on our financial statements. In 2016, the FASB issued new guidance on the accounting for the income tax consequences of intra-entity transfers of assets other than inventory. The new guidance requires the recognition of the income tax consequences of an intra-entity transfer of an asset, other than inventory, when the transfer occurs. The new standard is effective for fiscal years and interim periods beginning after December 15, 2017, with early adoption permitted in the first interim period. A modified retrospective basis of application of the new guidance is required. We intend to adopt the new guidance effective January 1, 2017. As a result of the adoption, we will record a decrease of approximately $42 million in retained earnings as of the beginning of the period of adoption, with a corresponding decrease in prepaid taxes related to the unamortized tax expense attributed to intra-entity transfers of assets (other than inventory) previously deferred. Upon adoption, when any new intra-entity transfer of assets other than inventory occurs, we will recognize the income tax consequences associated with this activity in the consolidated statement of income in the period when the transaction takes place. In 2016, the FASB issued new guidance on restricted cash on the statement of cash flows. The new guidance requires the classification and presentation of changes in restricted cash and cash equivalents in the statement of cash flows. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning and ending balances shown on the statement of cash flows. The new standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017, with early adoption permitted. The guidance should be applied retrospectively after adoption. The adoption of this standard is not expected to have a material impact on our financial statements. In 2017, the FASB issued new guidance to clarify the definition of a business to assist companies with evaluating whether transactions should be accounted for as acquisitions of assets or businesses. The new guidance requires a company to evaluate if substantially all of the fair value of the gross assets acquired (or disposed of) is concentrated in a single identifiable asset or a group of similar identifiable assets; if so, the set of assets and activities is not a business. The guidance also requires a business to include at least one substantive process and narrows the definition of outputs by more closely aligning it with how outputs are described in the guidance for revenue from contracts with customers. The new standard is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2017, with early adoption permitted. The guidance should be applied prospectively to any transactions occurring within the period of adoption. The adoption of this standard is not expected to have a material impact on our financial statements. In 2017, the FASB issued new guidance to simplify the accounting for goodwill impairment. T he guidance simplifies the measurement of goodwill impairment by removing step 2 of the goodwill impairment test, which requires the determination of the fair value of individual assets and liabilities of a reporting unit. The new guidance requires goodwill impairment to be measured as the amount by which a reporting unit’s carrying value exceeds its fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. The amendments should be applied on a prospective basis. The new standard is effective for fiscal years beginning after December 15, 2019 with early adoption permitted for interim or annual goodwill impairment tests performed after January 1, 2017. We are evaluating the impact this new accounting guidance will have on our financial statements. |
Overview and Summary of Signi29
Overview and Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Error Corrections and Prior Period Adjustments | The following tables presents the effects of the changes on the presentation of operating expenses to the previously reported consolidated statement of income: Year Ended December 31, 2015 (In millions) As Reported Adjustments Revised Transaction expense $ 2,610 $ — $ 2,610 Transaction and loan losses 809 — 809 Customer support and operations 1,220 (110 ) 1,110 Sales and marketing 985 (48 ) 937 Product development 947 (155 ) 792 General and administrative 560 313 873 Depreciation and amortization 608 — 608 Restructuring 48 — 48 Total operating expenses $ 7,787 $ — $ 7,787 Year Ended December 31, 2014 (In millions) As Reported Adjustments Revised Transaction expense $ 2,170 $ — $ 2,170 Transaction and loan losses 646 — 646 Customer support and operations 1,055 (64 ) 991 Sales and marketing 998 (44 ) 954 Product development 890 (143 ) 747 General and administrative 482 251 733 Depreciation and amortization 516 — 516 Restructuring — — — Total operating expenses $ 6,757 $ — $ 6,757 The following table presents the effects of the changes on the presentation of the statement of cash flows to the previously reported cash flows from investing activities and cash flows from financing activities in the consolidated statement of cash flows for the years ended December 31, 2015 and 2014 . These changes have no impact on the previously reported total net cash flows: Full Year December 31, 2015 (In millions) As Reported Adjustments Revised Cash flows from investing activities: Purchases of investments $ (7,542 ) $ (14,084 ) $ (21,626 ) Maturities and sales of investments 3,318 12,830 16,148 Funds receivable and customer accounts — (395 ) (395 ) Cash flows from financing activities: Funds receivable and customer accounts (1,649 ) 1,649 — Net change $ (5,873 ) $ — $ (5,873 ) Full Year December 31, 2014 (In millions) As Reported Adjustments Revised Cash flows from investing activities: Purchases of investments $ (76 ) $ (8,668 ) $ (8,744 ) Maturities and sales of investments 409 7,357 7,766 Funds receivable and customer accounts — (24 ) (24 ) Cash flows from financing activities: Funds receivable and customer accounts (1,335 ) 1,335 — Net change $ (1,002 ) $ — $ (1,002 ) |
Net Income Per Share (Tables)
Net Income Per Share (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Earnings Per Share [Abstract] | |
Schedule of earnings per share, basic and diluted | The following table sets forth the computation of basic and diluted net income per share for the periods indicated: Year Ended December 31, 2016 2015 (1) 2014 (2) (In millions, except per share amounts) Numerator: Net income $ 1,401 $ 1,228 $ 419 Denominator: Weighted average shares of common stock - basic 1,210 1,222 1,218 Dilutive effect of equity incentive awards 8 7 6 Weighted average shares of common stock - diluted 1,218 1,229 1,224 Net income per share: Basic $ 1.16 $ 1.00 $ 0.34 Diluted $ 1.15 $ 1.00 $ 0.34 Common stock equivalents excluded from income per diluted share because their effect would have been anti-dilutive 8 12 2 1 The weighted average number of common shares outstanding for basic and diluted earnings per share for the year ended December 31, 2015 was based on the number of common shares distributed on July 17, 2015 for the period prior to distribution and the weighted average number of common shares outstanding for the period beginning after the distribution date. 2 Basic and diluted net income per share for the year ended December 31, 2014 was calculated using the number of common shares distributed on July 17, 2015. |
Business Combinations (Tables)
Business Combinations (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Business Combinations [Abstract] | |
Schedule of Business Acquisitions, by Acquisition | The following table summarizes the final allocation of the purchase consideration to the fair value of the assets acquired and liabilities assumed: (In millions) Goodwill $ 645 Intangibles 217 Cash 92 Short-term investments 72 Accounts receivable 40 Other net liabilities (6 ) Total purchase consideration $ 1,060 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill balances and adjustments | The following table presents goodwill balances and adjustments to those balances for the years ended December 31, 2016 and 2015 : December 31, 2014 Goodwill Acquired Adjustments December 31, 2015 Goodwill Acquired Adjustments December 31, 2016 (In millions) Total goodwill $ 3,189 $ 886 $ (6 ) $ 4,069 $ — $ (10 ) $ 4,059 |
Components of identifiable intangible assets | The components of identifiable intangible assets are as follows: December 31, 2016 December 31, 2015 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Weighted Average Useful Life (Years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Weighted Average Useful Life (Years) (In millions, except years) Intangible assets: Customer lists and user base $ 605 $ (542 ) $ 63 4 $ 605 $ (501 ) $ 104 4 Marketing related 197 (190 ) 7 2 197 (150 ) 47 3 Developed technologies 245 (206 ) 39 3 245 (176 ) 69 3 All other 245 (143 ) 102 5 243 (105 ) 138 5 Intangible assets, net $ 1,292 $ (1,081 ) $ 211 $ 1,290 $ (932 ) $ 358 |
Expected future intangible asset amortization | Expected future intangible asset amortization as of December 31, 2016 is as follows (in millions): Fiscal years: 2017 $ 103 2018 68 2019 23 2020 17 $ 211 |
Funds Receivable and Customer33
Funds Receivable and Customer Accounts (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of assets underlying our funds receivable and customer accounts | The following table summarizes the assets underlying our funds receivable and customer accounts as of December 31, 2016 and December 31, 2015 . As of December 31, 2016 2015 (In millions) Cash and cash equivalents $ 4,319 $ 5,245 Government and agency securities 5,625 4,305 Time deposits 522 830 Corporate debt securities 1,093 180 Funds receivable 2,804 1,701 Total funds receivable and customer accounts $ 14,363 $ 12,261 |
Estimated fair value of our investments classified as available for sale included within funds receivable and customer accounts | At December 31, 2016 and December 31, 2015 , the estimated fair value of our investments classified as available-for-sale included within funds receivable and customer accounts was as follows: December 31, 2016 Gross Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value (In millions) Government and agency securities $ 5,198 $ — $ (2 ) $ 5,196 Time deposits 522 — — 522 Corporate debt securities 531 — — 531 Total $ 6,251 $ — $ (2 ) $ 6,249 December 31, 2015 Gross Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value (In millions) Government and agency securities $ 3,299 $ — $ (1 ) $ 3,298 Time deposits 830 — — 830 Total $ 4,129 $ — $ (1 ) $ 4,128 |
The estimated fair values of our investments classified as available for sale included within funds receivable and customer accounts by date of contractual maturity | The estimated fair values of our investments classified as available-for-sale included within funds receivable and customer accounts by date of contractual maturity at December 31, 2016 were as follows: December 31, (In millions) One year or less $ 6,015 One year through two years 234 Total $ 6,249 The estimated fair values of our short-term and long-term investments classified as available for sale by date of contractual maturity at December 31, 2016 were as follows: December 31, 2016 (In millions) One year or less $ 3,021 One year through two years 715 Two years through three years 608 Three years through four years 89 Four years through five years 68 Total (1) $ 4,501 (1) Excludes short-term restricted cash of $17 million . |
Investments (Tables)
Investments (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Investments, Debt and Equity Securities [Abstract] | |
Estimated fair value of short and long-term investments classified as available for sale | At December 31, 2016 and 2015 , the estimated fair value of our short-term and long-term investments classified as available for sale was as follows: December 31, 2016 Gross Gross Gross Estimated (In millions) Short-term investments (1) : Corporate debt securities $ 2,867 $ 1 $ (1 ) $ 2,867 Government and agency securities 32 — — 32 Time deposits 122 — — 122 Long-term investments: Corporate debt securities 1,473 1 (4 ) 1,470 Government and agency securities 10 — — 10 Total (1) $ 4,504 $ 2 $ (5 ) $ 4,501 (1) Excludes short-term restricted cash of $17 million . December 31, 2015 Gross Gross Gross Estimated (In millions) Short-term investments (1) : Corporate debt securities $ 2,000 $ — $ (2 ) $ 1,998 Time deposits 2 — — 2 Long-term investments (1) : Corporate debt securities 2,328 — (14 ) 2,314 Total (1) $ 4,330 $ — $ (16 ) $ 4,314 (1) Excludes short-term restricted cash of $18 million and long-term restricted cash of $8 million . |
Estimated fair values of our short-term and long-term investments classified as available for sale by date of contractual maturity | The estimated fair values of our investments classified as available-for-sale included within funds receivable and customer accounts by date of contractual maturity at December 31, 2016 were as follows: December 31, (In millions) One year or less $ 6,015 One year through two years 234 Total $ 6,249 The estimated fair values of our short-term and long-term investments classified as available for sale by date of contractual maturity at December 31, 2016 were as follows: December 31, 2016 (In millions) One year or less $ 3,021 One year through two years 715 Two years through three years 608 Three years through four years 89 Four years through five years 68 Total (1) $ 4,501 (1) Excludes short-term restricted cash of $17 million . |
Fair Value Measurement of Fin35
Fair Value Measurement of Financial Assets and Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Summary of financial assets and liabilities measured at fair value on a recurring basis | The following table summarizes our financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2016 and 2015 : Description Balances at Quoted Prices in Significant Other (In millions) Assets: Cash and cash equivalents (1) $ 268 $ — $ 268 Short-term investments: Restricted Cash 17 17 — Corporate debt securities 2,882 — 2,882 Government and agency securities 364 — 364 Time deposits 122 — 122 Total short-term investments $ 3,385 $ 17 $ 3,368 Funds receivable and customer accounts 7,420 — 7,420 Derivatives 223 — 223 Long-term investments: Corporate debt securities 1,479 — 1,479 Government and agency securities 10 — 10 Total long-term investments 1,489 — 1,489 Total financial assets $ 12,785 $ 17 $ 12,768 Liabilities: Derivatives $ 59 $ — $ 59 (1) Excludes cash of $1.3 billion . Description Balances at Quoted Prices in Significant Other (In millions) Assets: Cash and cash equivalents (1) $ 406 $ — $ 406 Short-term investments: Restricted Cash 18 18 — Corporate debt securities 1,998 — 1,998 Time deposits 2 — 2 Total short-term investments 2,018 18 2,000 Funds receivable and customer accounts 6,978 — 6,978 Derivatives 97 — 97 Long-term investments: Restricted Cash 8 8 — Corporate debt securities 2,314 — 2,314 Total long-term investments 2,322 8 2,314 Total financial assets $ 11,821 $ 26 $ 11,795 Liabilities: Derivatives $ 25 $ — $ 25 (1) Excludes cash of $987 million . |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Fair value of outstanding derivative instruments | The fair value of our outstanding derivative instruments as of December 31, 2016 and 2015 was as follows: Balance Sheet Location As of December 31, 2016 2015 Derivative Assets: (In millions) Foreign exchange contracts designated as cash flow hedges Other Current Assets $ 135 $ 59 Foreign exchange contracts not designated as hedging instruments Other Current Assets 88 38 Total derivative assets $ 223 $ 97 Derivative Liabilities: Foreign exchange contracts designated as cash flow hedges Other Current Liabilities $ 4 $ 2 Foreign exchange contracts not designated as hedging instruments Other Current Liabilities 55 23 Total derivative liabilities $ 59 $ 25 Net fair value of derivative instruments $ 164 $ 72 |
Schedule of cash flow hedges included in accumulated other comprehensive income | The following tables summarize the activity of derivative contracts that qualify for hedge accounting as of December 31, 2016 and December 31, 2015 , and the impact of designated derivative instruments on accumulated other comprehensive income for the twelve months ended December 31, 2016 and 2015 : December 31, 2015 Amount of gain recognized in other comprehensive income (effective portion) Less: Amount of gain reclassified from accumulated other comprehensive income to net revenue (effective portion) December 31, 2016 (In millions) Foreign exchange contracts designated as cash flow hedges $ 57 $ 193 $ 119 $ 131 December 31, 2014 Amount of gain recognized in other comprehensive income (effective portion) Less: Amount of gain reclassified from accumulated other comprehensive income to net revenue (effective portion) December 31, 2015 (In millions) Foreign exchange contracts designated as cash flow hedges $ 126 $ 113 $ 182 $ 57 |
Recognized gains or losses related to derivative instruments | The following table provides the location in the financial statements of the recognized gains or losses related to our derivative instruments: Year Ended December 31, 2016 2015 2014 (In millions) Foreign exchange contracts designated as cash flow hedges recognized in net revenues $ 119 $ 182 $ (36 ) Foreign exchange contracts not designated as cash flow hedges recognized in other income (expense), net 76 17 (2 ) Total gain (loss) recognized from derivative contracts in the consolidated statement of income $ 195 $ 199 $ (38 ) |
Schedule of notional amounts of outstanding derivatives | The following table provides the notional amounts of our outstanding derivatives: Year Ended December 31, 2016 2.015 (In millions) Foreign exchange contracts designated as cash flow hedges $ 1,865 $ 1,688 Foreign exchange contracts not designated as hedging instruments 4,612 2,802 Total $ 6,477 $ 4,490 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, Net | As of December 31, 2016 2015 (In millions) Property and equipment, net: Computer equipment and software $ 2,049 $ 1,818 Internal use software and website development costs 1,372 1,150 Land and buildings 357 352 Leasehold improvements 335 297 Furniture and fixtures 119 99 Development in progress and other 268 133 Total property and equipment, gross 4,500 3,849 Accumulated depreciation (3,018 ) (2,505 ) Total property and equipment, net $ 1,482 $ 1,344 |
Loans and Interest Receivable38
Loans and Interest Receivable, Net (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Receivables [Abstract] | |
Principal amount of loans and interest receivable segmented by a FICO score range | The following table presents the principal amount of PayPal Working Capital advances and fees receivable segmented by our internal PRM score range: As of December 31, 2016 2015 (In millions) > 610 $ 378 $ 291 526-609 108 85 <525 72 45 Total $ 558 $ 421 The following table presents the principal amount of U.S. consumer loans and interest receivable segmented by a FICO score range: As of December 31, 2016 2015 (In millions) > 760 $ 665 $ 569 680-759 1,938 1,529 600-679 1,840 1,449 < 599 553 369 Total $ 4,996 $ 3,916 |
Delinquency status of the principal amount of loans and interest receivable | The following tables present the delinquency status of the principal amount of consumer loans and interest receivable. The amounts shown below are based on the number of days past the billing date to the consumer. Current represents balances that are within 30 days of the billing date. December 31, 2016 (In millions) Current 30 - 59 Days 60 - 89 Days 90 - 180 Days Total Past 30 days Total $ 4,601 $ 219 $ 82 $ 211 $ 512 $ 5,113 December 31, 2015 (In millions) Current 30 - 59 Days 60 - 89 Days 90 - 180 Days Total Past 30 days Total $ 3,593 $ 172 $ 66 $ 155 $ 393 $ 3,986 The following tables present our estimate of the principal amount of PayPal Working Capital advances and fees receivable past their original expected repayment period. In the second quarter of 2016, we refined our estimate of the original expected repayment period to take into account the variability in repayment patterns. Prior period amounts have been updated to reflect this change. December 31, 2016 (In millions) Within Original Expected Repayment Period 30 - 59 Days Greater 60 - 89 Days Greater 90 - 180 Days Greater 180+ Days Total Past Original Expected Repayment Period Total $ 462 $ 35 $ 19 $ 30 $ 12 $ 96 $ 558 December 31, 2015 (In millions) Within Original Expected Repayment Period 30 - 59 Days Greater 60 - 89 Days Greater 90 - 180 Days Greater 180+ Days Total Past Original Expected Repayment Period Total $ 367 $ 24 $ 13 $ 15 $ 2 $ 54 $ 421 |
Allowance for loans and interest receivable, net of participating interest sold | The following table summarizes the activity in the allowance for PayPal Working Capital advances and fees receivable, for the years ended December 31, 2016 and 2015 : December 31, 2016 December 31, 2015 PayPal Working Capital Advances Fees Receivable Total Allowance PayPal Working Capital Advances Fees Receivable Total Allowance (In millions) Beginning Balance $ 19 $ 3 $ 22 $ 5 $ 2 $ 7 Provisions 45 6 51 28 1 29 Charge-offs (41 ) (6 ) (47 ) (16 ) — (16 ) Recoveries 5 — 5 2 — 2 Ending Balance $ 28 $ 3 $ 31 $ 19 $ 3 $ 22 The following table summarizes the activity in the allowance for consumer loans and interest receivable, net of participation interest sold for years ended December 31, 2016 and 2015 : December 31, 2016 December 31, 2015 Consumer Loans Receivable Interest Receivable Total Allowance Consumer Loans Receivable Interest Receivable Total Allowance (In millions) Beginning Balance $ 179 $ 32 $ 211 $ 158 $ 30 $ 188 Reclassification from loans receivable to loans held for sale — — — (22 ) — (22 ) Provisions 388 116 504 270 86 356 Charge-offs (330 ) (108 ) (438 ) (251 ) (84 ) (335 ) Recoveries 28 — 28 24 — 24 Ending Balance $ 265 $ 40 $ 305 $ 179 $ 32 $ 211 The following table provides management's estimate of the maximum potential exposure related to our protection programs as of December 31, 2016 and December 31, 2015 : As of December 31, 2016 2015 (In millions) Maximum potential exposure $ 131,739 $ 109,496 |
Segment and Geographical Info39
Segment and Geographical Information (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Segment Reporting [Abstract] | |
Schedule of net revenues and long-lived assets, by geographical areas | The following tables summarize the allocation of net revenues and long-lived assets based on geography: Year Ended December 31, 2016 2015 2014 (In millions) Net revenues: U.S. $ 5,760 $ 4,640 $ 3,877 U.K. 1,257 1,191 1,155 Other countries 3,825 3,417 2,993 Total net revenues $ 10,842 $ 9,248 $ 8,025 As of December 31, 2016 2015 (In millions) Long-lived assets: U.S. $ 1,391 $ 1,256 Other countries 91 88 Total long-lived assets $ 1,482 $ 1,344 |
Net revenues by major products and services | Information regarding net revenues by major products and services for the years ended December 31, 2016 , 2015 and 2014 was as follows: Year Ended December 31, 2016 2015 2014 (In millions) Transaction revenues $ 9,490 $ 8,128 $ 7,107 Other value added services: 1,352 1,120 918 Total net revenues $ 10,842 $ 9,248 $ 8,025 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Future minimum rental payments under noncancelable operating leases | We have lease obligations under certain non-cancelable operating leases. Our non-cancelable operating lease agreements typically have terms between 3 - 10 years and generally contain multi-year renewal options. We recognize rent expense under such agreements on a straight-line basis. Future minimum rental payments under non-cancelable operating leases at December 31, 2016 , are as follows: Operating Leases (In millions) 2017 $ 102 2018 106 2019 93 2020 63 2021 47 Thereafter 141 Total minimum lease payments $ 552 |
Allowance for transaction losses related to protection programs | The following table summarizes the activity in the allowance for PayPal Working Capital advances and fees receivable, for the years ended December 31, 2016 and 2015 : December 31, 2016 December 31, 2015 PayPal Working Capital Advances Fees Receivable Total Allowance PayPal Working Capital Advances Fees Receivable Total Allowance (In millions) Beginning Balance $ 19 $ 3 $ 22 $ 5 $ 2 $ 7 Provisions 45 6 51 28 1 29 Charge-offs (41 ) (6 ) (47 ) (16 ) — (16 ) Recoveries 5 — 5 2 — 2 Ending Balance $ 28 $ 3 $ 31 $ 19 $ 3 $ 22 The following table summarizes the activity in the allowance for consumer loans and interest receivable, net of participation interest sold for years ended December 31, 2016 and 2015 : December 31, 2016 December 31, 2015 Consumer Loans Receivable Interest Receivable Total Allowance Consumer Loans Receivable Interest Receivable Total Allowance (In millions) Beginning Balance $ 179 $ 32 $ 211 $ 158 $ 30 $ 188 Reclassification from loans receivable to loans held for sale — — — (22 ) — (22 ) Provisions 388 116 504 270 86 356 Charge-offs (330 ) (108 ) (438 ) (251 ) (84 ) (335 ) Recoveries 28 — 28 24 — 24 Ending Balance $ 265 $ 40 $ 305 $ 179 $ 32 $ 211 The following table provides management's estimate of the maximum potential exposure related to our protection programs as of December 31, 2016 and December 31, 2015 : As of December 31, 2016 2015 (In millions) Maximum potential exposure $ 131,739 $ 109,496 |
Management's estimate of the maximum potential exposure related to protection programs | The following table provides the amount of allowance for transaction losses related to our protection programs as of December 31, 2016 and December 31, 2015 : As of December 31, 2016 2015 (In millions) Allowance for transaction losses $ 222 $ 185 |
Stock Repurchase Program (Table
Stock Repurchase Program (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Equity [Abstract] | |
Summary of stock repurchase activity | The stock repurchase activity under our stock repurchase program during the year ended December 31, 2016 is summarized as follows: Shares Repurchased Average Price (1) Value of Shares Repurchased Remaining Amount Authorized (In millions, except per share amounts) Authorization of plan in January 2016 $ 2,000 Repurchases of shares of common stock for three months ended: March 31, 2016 16.9 $ 35.27 $ 596 $ 1,404 June 30, 2016 7.8 $ 38.67 $ 300 $ 1,104 September 30, 2016 1.3 $ 36.80 $ 49 $ 1,055 December 31, 2016 1.3 $ 38.92 $ 50 $ 1,005 Balance as of December 31, 2016 27.3 $ 995 $ 1,005 (1) Average price paid per share includes broker commissions. |
Stock-Based and Employee Savi42
Stock-Based and Employee Savings Plans (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of stock option activity | The following table summarizes stock option activity of our employees under our equity incentive plans for the year ended December 31, 2016 : Shares Weighted Average Exercise Price Weighted Average Remaining Contractual Term (Years) Aggregate Intrinsic Value (In thousands, except per share amounts and years) Outstanding at January 1, 2016 6,008 $ 25.94 Granted 124 $ 36.32 Exercised (1,557 ) $ 18.39 Forfeited/expired/canceled (287 ) $ 30.82 Outstanding at December 31, 2016 4,288 $ 28.65 4.14 $ 47,510 Expected to vest 1,424 $ 29.17 5.27 $ 15,059 Options exercisable 2,727 $ 28.30 3.47 $ 31,166 |
Schedule of restricted stock units | The following table summarizes the restricted stock units (including performance-based restricted stock units) granted under our equity incentive plans as of December 31, 2016 and changes during the year ended December 31, 2016 : Units Weighted Average Grant-Date Fair Value (per share) (In thousands, except per share amounts) Outstanding at January 1, 2016 28,761 $ 34.63 Awarded 14,120 $ 39.13 Vested (9,784 ) $ 33.28 Forfeited (3,912 ) $ 36.13 Outstanding at December 31, 2016 29,185 $ 37.06 Expected to vest 25,565 |
Schedule of stock-based compensation expense | T he impact on our results of operations of recording stock-based compensation expense under eBay's and PayPal's equity incentive plans for the years ended December 31, 2016 , 2015 and 2014 was as follows: Year Ended December 31, 2016 2015 2014 (In millions) Customer support and operations $ 85 $ 62 $ 52 Sales and marketing 84 52 59 Product development 139 132 108 General and administrative 130 94 75 Depreciation and amortization 6 7 4 Total stock-based compensation expense $ 444 $ 347 $ 298 Capitalized as part of internal use software and website development costs $ 13 $ 7 $ 10 Income tax benefit recognized for stock-based compensation arrangements $ 127 $ 98 $ 77 |
Schedule of stock option valuation assumptions | The following weighted average assumptions were used for the years ended December 31, 2016 , 2015 and 2014 : Year Ended December 31, 2016 2015 2014 Risk-free interest rate 1.5 % 1.4 % 1.2 % Expected life (in years) 4.6 4.3 4.1 Dividend yield — — — Expected volatility 25 % 26 % 29 % |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Components of pretax income (loss) | The components of income (loss) before income taxes are as follows: Year Ended December 31, 2016 2015 2014 (In millions) United States $ (342 ) $ (253 ) $ (111 ) International 1,973 1,741 1,372 Income before income taxes $ 1,631 $ 1,488 $ 1,261 |
Provision for income taxes | The income tax expense is composed of the following: Year Ended December 31, 2016 2015 2014 (In millions) Current: Federal $ 44 $ 34 $ 90 State and local 19 (5 ) 13 Foreign 115 104 59 $ 178 $ 133 $ 162 Deferred: Federal $ 90 $ 126 $ 699 State and local (35 ) 1 (3 ) Foreign (3 ) — (16 ) 52 127 680 Income tax expense $ 230 $ 260 $ 842 |
Effective Income Tax Rate Reconciliation | The following is a reconciliation of the difference between the effective income tax rate and the federal statutory rate. Year Ended December 31, 2016 2015 2014 Federal statutory rate 35.0 % 35.0 % 35.0 % State taxes, net of federal benefit (1.0 )% (0.3 )% 0.8 % Foreign income taxed at different rates (23.2 )% (20.9 )% (22.2 )% Prior year foreign earnings no longer considered indefinitely reinvested — — % 50.8 % Stock-based compensation expense 1.6 % 1.5 % 1.5 % Tax credits (1.0 )% (0.7 )% (0.8 )% Change in valuation allowances 0.5 % 0.3 — % Other 2.2 % 2.6 % 1.7 % Effective income tax rate 14.1 % 17.5 % 66.8 % |
Schedule of Deferred Tax Assets and Liabilities | The following table shows the deferred tax assets and liabilities within our consolidated balance sheet. Balance Sheet Location As of December 31, 2016 2015 (In millions) Total deferred tax assets (non-current) Other assets $ 21 $ 38 Total deferred tax liabilities (non-current) Long-term liabilities (1,215 ) (1,175 ) Total net deferred tax assets (liabilities) $ (1,194 ) $ (1,137 ) Significant deferred tax assets and liabilities consist of the following: As of December 31, 2016 2015 (In millions) Deferred tax assets: Net operating loss and credit carryforwards $ 84 $ 90 Accruals and allowances 187 153 Partnership investment 15 14 Stock-based compensation 99 82 Net unrealized (gains) losses 14 16 Total deferred tax assets 399 355 Valuation allowance (24 ) (13 ) Net deferred tax assets $ 375 $ 342 Deferred tax liabilities: Unremitted foreign earnings $ (1,246 ) $ (1,156 ) Fixed assets and other intangibles (226 ) (191 ) Acquired intangibles (95 ) (131 ) Net unrealized losses (gains) (2 ) (1 ) Total deferred tax liabilities (1,569 ) (1,479 ) Net deferred tax assets (liabilities) $ (1,194 ) $ (1,137 ) |
Schedule of Unrecognized Tax Benefits | The following table reflects changes in unrecognized tax benefits since January 1, 2014: Year Ended December 31, 2016 2015 2014 (In millions) Gross amounts of unrecognized tax benefits as of the beginning of the period $ 267 $ 165 $ 134 Increases related to prior period tax positions 14 39 7 Decreases related to prior period tax positions (18 ) (4 ) (2 ) Increases related to current period tax positions 51 68 31 Settlements (1 ) (1 ) (5 ) Statute of limitation expirations (1 ) — — Gross amounts of unrecognized tax benefits as of the end of the period $ 312 $ 267 $ 165 |
Accumulated Other Comprehensi44
Accumulated Other Comprehensive (Loss) Income (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Equity [Abstract] | |
Schedule of accumulated other comprehensive income | The following table summarizes the changes in accumulated balances of other comprehensive income for the year ended December 31, 2016 : Unrealized Gains (Losses) on Cash Flow Hedges Unrealized Gains (Losses) on Investments Foreign Currency Translation Estimated Tax (Expense) Benefit Total (In millions) Beginning balance $ 57 $ (16 ) $ (53 ) $ 3 $ (9 ) Other comprehensive income (loss) before reclassifications 193 7 (15 ) (2 ) 183 Less: Amount of gain (loss) reclassified from accumulated other comprehensive income 119 (4 ) — — 115 Net current period other comprehensive income 74 11 (15 ) (2 ) 68 Ending balance $ 131 $ (5 ) $ (68 ) $ 1 $ 59 The following table summarizes the changes in accumulated balances of other comprehensive income for the year ended December 31, 2015 : Unrealized Gains (Losses) on Cash Flow Hedges Unrealized Gains (Losses) on Investments Foreign Currency Translation Estimated Tax Total (In millions) Beginning balance $ 126 $ — $ (16 ) $ — $ 110 Other comprehensive income (loss) before reclassifications 113 (16 ) (37 ) 3 63 Less: Amount of gain reclassified from accumulated other comprehensive income 182 — — — 182 Net current period other comprehensive income (loss) (69 ) (16 ) (37 ) 3 (119 ) Ending balance $ 57 $ (16 ) $ (53 ) $ 3 $ (9 ) |
Reclassifications out of accumulated other comprehensive income | The following table provides details about reclassifications out of accumulated other comprehensive income for the years ended December 31, 2016 and 2015 : Details about Accumulated Other Comprehensive Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income Affected Line Item in the Statement of Income Year Ended December 31, 2016 2015 (In millions) Gains on cash flow hedges-foreign exchange contracts $ 119 $ 182 Net revenues Unrealized losses on investments (4 ) — Other income (expense), net $ 115 $ 182 Income before income taxes — — Income tax expense Total reclassifications for the period $ 115 $ 182 Net income |
Quarterly Unaudited Financial45
Quarterly Unaudited Financial Data (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Schedule of unaudited combined and consolidated quarterly financial information | The following tables present certain unaudited consolidated quarterly financial information for the years ended December 31, 2016 and 2015 . The fourth quarter of 2015 was the first full quarter post separation and represents our actual results as an independent public company. Results for the first three quarters of 2015 include allocations from eBay and may not be indicative of our results had we been a separate stand-alone entity during those periods. 2016 Quarter Ended March 31 June 30 September 30 December 31 (Unaudited, in millions, except per share amounts) Net revenues $ 2,544 $ 2,650 $ 2,667 $ 2,981 Net income $ 365 $ 323 $ 323 $ 390 Net income per share-basic $ 0.30 $ 0.27 $ 0.27 $ 0.32 Net income per share-diluted $ 0.30 $ 0.27 $ 0.27 $ 0.32 Weighted-average shares: Basic 1,216 1,210 1,207 1,207 Diluted 1,225 1,215 1,214 1,216 2015 Quarter Ended (Unaudited, in millions, except per share amounts) March 31 (1) June 30 (1) September 30 (2) December 31 (2) Net revenues $ 2,137 $ 2,297 $ 2,258 $ 2,556 Net income $ 255 $ 305 $ 301 $ 367 Net income per share-basic $ 0.21 $ 0.25 $ 0.25 $ 0.30 Net income per share-diluted $ 0.21 $ 0.25 $ 0.25 $ 0.30 Weighted-average shares: (1)(2) Basic 1,218 1,218 1,221 1,223 Diluted 1,224 1,224 1,227 1,230 1 On July 17, 2015, the distribution date, eBay stockholders of record as of the close of business on July 8, 2015 received one share of PayPal common stock for every share of eBay common stock held as of the record date. Basic and diluted net income per share for the first two quarters of 2015 is calculated using the number of common shares distributed on July 17, 2015. Refer to Note 2 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for information regarding net income per share. 2 Basic and diluted net income per share for the third and fourth quarters of 2015 is calculated using the weighted average number of common shares outstanding for the period beginning after the distribution date. Refer to Note 2 to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for information regarding net income per share. |
Overview and Summary of Signi46
Overview and Summary of Significant Accounting Policies - Basis of Presentation (Details) | Jul. 17, 2015shares |
Class of Stock [Line Items] | |
Common stock, shares issued | 1,200,000,000 |
Common Stock Shares | |
Class of Stock [Line Items] | |
Number of PayPal shares distributed for every eBay common stock held | 1 |
Common Stock Shares | eBay | |
Class of Stock [Line Items] | |
Shares distributed to parent company stockholders, percentage | 100.00% |
Overview and Summary of Signi47
Overview and Summary of Significant Accounting Policies - Effects of Changes in the Presentation of Financial Statements (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Operating expenses: | |||
Transaction expense | $ 3,346,000,000 | $ 2,610,000,000 | $ 2,170,000,000 |
Transaction and loan losses | 1,088,000,000 | 809,000,000 | 646,000,000 |
Customer support and operations | 1,267,000,000 | 1,110,000,000 | 991,000,000 |
Sales and marketing | 969,000,000 | 937,000,000 | 954,000,000 |
Product development | 834,000,000 | 792,000,000 | 747,000,000 |
General and administrative | 1,028,000,000 | 873,000,000 | 733,000,000 |
Depreciation and amortization | 724,000,000 | 608,000,000 | 516,000,000 |
Restructuring | 0 | 48,000,000 | 0 |
Total operating expenses | 9,256,000,000 | 7,787,000,000 | 6,757,000,000 |
Cash flows from investing activities: | |||
Purchases of investments | (21,041,000,000) | (21,626,000,000) | (8,744,000,000) |
Maturities and sales of investments | 18,429,000,000 | 16,148,000,000 | 7,766,000,000 |
Funds receivable and customer accounts | $ (176,000,000) | (395,000,000) | (24,000,000) |
Cash flows from financing activities: | |||
Funds receivable and customer accounts | 0 | 0 | |
Net change | (5,873,000,000) | (1,002,000,000) | |
As Reported | |||
Operating expenses: | |||
Transaction expense | 2,610,000,000 | 2,170,000,000 | |
Transaction and loan losses | 809,000,000 | 646,000,000 | |
Customer support and operations | 1,220,000,000 | 1,055,000,000 | |
Sales and marketing | 985,000,000 | 998,000,000 | |
Product development | 947,000,000 | 890,000,000 | |
General and administrative | 560,000,000 | 482,000,000 | |
Depreciation and amortization | 608,000,000 | 516,000,000 | |
Restructuring | 48,000,000 | 0 | |
Total operating expenses | 7,787,000,000 | 6,757,000,000 | |
Cash flows from investing activities: | |||
Purchases of investments | (7,542,000,000) | (76,000,000) | |
Maturities and sales of investments | 3,318,000,000 | 409,000,000 | |
Funds receivable and customer accounts | 0 | 0 | |
Cash flows from financing activities: | |||
Funds receivable and customer accounts | (1,649,000,000) | (1,335,000,000) | |
Net change | (5,873,000,000) | (1,002,000,000) | |
Adjustments | |||
Operating expenses: | |||
Transaction expense | 0 | 0 | |
Transaction and loan losses | 0 | 0 | |
Customer support and operations | (110,000,000) | (64,000,000) | |
Sales and marketing | (48,000,000) | (44,000,000) | |
Product development | (155,000,000) | (143,000,000) | |
General and administrative | 313,000,000 | 251,000,000 | |
Depreciation and amortization | 0 | 0 | |
Restructuring | 0 | 0 | |
Total operating expenses | 0 | 0 | |
Cash flows from investing activities: | |||
Purchases of investments | (14,084,000,000) | (8,668,000,000) | |
Maturities and sales of investments | 12,830,000,000 | 7,357,000,000 | |
Funds receivable and customer accounts | (395,000,000) | (24,000,000) | |
Cash flows from financing activities: | |||
Funds receivable and customer accounts | 1,649,000,000 | 1,335,000,000 | |
Net change | $ 0 | $ 0 |
Overview and Summary of Signi48
Overview and Summary of Significant Accounting Policies - Allowances for Receivables and Customer Accounts (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Threshold period, write-off of receivables | 180 days | ||
Threshold period, write-off of Bankrupt Accounts | 60 days | ||
Minimum aggregate customer balances required to be covered by eligible liquid assets held, percentage | 100.00% | ||
Allowance for negative customer balances | $ 144 | $ 119 | |
Merchant Receivables | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Threshold period, write-off of receivables | 180 days | ||
Merchant Receivables | Minimum | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Expected period of repayment | 9 months | ||
Merchant Receivables | Maximum | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Expected period of repayment | 12 months | ||
Consumer Receivables | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Threshold period, write-off of receivables | 180 days | ||
Threshold period, write-off of Bankrupt Accounts | 60 days | ||
Europe | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Funds receivable and customer accounts designated for credit funding, percentage | 20.00% | ||
U.S. | Minimum | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Clearing period for funds receivable and funds payable transactions | 1 day | ||
U.S. | Maximum | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Clearing period for funds receivable and funds payable transactions | 3 days | ||
Other countries | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Clearing period for funds receivable and funds payable transactions | 5 days | ||
Cash and cash equivalents | Europe | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Funds receivable and customer accounts designated for credit funding | $ 800 |
Overview and Summary of Signi49
Overview and Summary of Significant Accounting Policies - Property and Equipment, Goodwill and Intangible Assets and Derivatives (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Derivative Instruments | ||
Maximum maturity of foreign currency exchange contracts | 18 months | |
Accrued expenses and other current liabilities | ||
Goodwill and intangible assets | ||
Allowance for transaction losses | $ 78 | $ 66 |
Minimum | ||
Goodwill and intangible assets | ||
Weighted Average Useful Life (Years) | 1 year | |
Maximum | ||
Goodwill and intangible assets | ||
Weighted Average Useful Life (Years) | 8 years | |
Computer equipment, software & website development costs | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives | 1 year | |
Computer equipment, software & website development costs | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives | 3 years | |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives | 3 years | |
Building and building improvements | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives | 30 years | |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Estimated useful lives | 5 years |
Overview and Summary of Signi50
Overview and Summary of Significant Accounting Policies - Concentrations of Risk (Details) - customer | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Accounts Receivable | Customer Concentration Risk | |||
Concentration Risk [Line Items] | |||
Customer risk, number of customers | 2 | 3 | |
Accounts Receivable | Customer Concentration Risk | Customer 1 | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 29.00% | 19.00% | |
Accounts Receivable | Customer Concentration Risk | Customer 2 | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 24.00% | 15.00% | |
Accounts Receivable | Customer Concentration Risk | Customer 3 | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 13.00% | ||
Revenue | Product Concentration Risk | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 22.00% | 26.00% | 29.00% |
Overview and Summary of Signi51
Overview and Summary of Significant Accounting Policies - Advertising and Internal Use Software and Website Development Costs (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Advertising expense | $ 350 | $ 303 | $ 272 |
Property, Plant and Equipment [Line Items] | |||
Capitalized internally developed software and website development costs | 341 | 254 | |
Amortization expense of previously capitalized internally developed software and website development costs | $ 208 | $ 166 | $ 129 |
Minimum | Internal use software and website development costs | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful lives | 1 year | ||
Maximum | Internal use software and website development costs | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful lives | 3 years |
Overview and Summary of Signi52
Overview and Summary of Significant Accounting Policies - Net Income Per Share (Details) - USD ($) $ in Millions | Jan. 01, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | Jul. 17, 2015 |
Class of Stock [Line Items] | ||||
Common stock, shares issued | 1,200,000,000 | |||
Retained earnings | $ 2,069 | $ 668 | ||
Common Stock Shares | ||||
Class of Stock [Line Items] | ||||
Number of PayPal shares distributed for every eBay common stock held | 1 | |||
Accounting Standards Update 2016-16 | Subsequent Event | ||||
Class of Stock [Line Items] | ||||
Retained earnings | $ (42) |
Net Income Per Share - Computat
Net Income Per Share - Computation of Basic and Diluted Earnings per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Numerator: | |||||||||||
Net income | $ 390 | $ 323 | $ 323 | $ 365 | $ 367 | $ 301 | $ 305 | $ 255 | $ 1,401 | $ 1,228 | $ 419 |
Denominator: | |||||||||||
Weighted average shares of common stock - basic | 1,207 | 1,207 | 1,210 | 1,216 | 1,223 | 1,221 | 1,218 | 1,218 | 1,210 | 1,222 | 1,218 |
Dilutive effect of equity incentive awards (in shares) | 8 | 7 | 6 | ||||||||
Weighted average shares of common stock - diluted | 1,216 | 1,214 | 1,215 | 1,225 | 1,230 | 1,227 | 1,224 | 1,224 | 1,218 | 1,229 | 1,224 |
Net income per share: | |||||||||||
Basic (in usd per share) | $ 0.32 | $ 0.27 | $ 0.27 | $ 0.30 | $ 0.30 | $ 0.25 | $ 0.25 | $ 0.21 | $ 1.16 | $ 1 | $ 0.34 |
Diluted (in usd per share) | $ 0.32 | $ 0.27 | $ 0.27 | $ 0.30 | $ 0.30 | $ 0.25 | $ 0.25 | $ 0.21 | $ 1.15 | $ 1 | $ 0.34 |
Common stock equivalents excluded from income per diluted share because their effect would have been anti-dilutive (in shares) | 8 | 12 | 2 |
Business Combinations - Narrati
Business Combinations - Narrative (Details) $ / shares in Units, $ in Millions | 1 Months Ended | 12 Months Ended | |||
Nov. 30, 2015USD ($)$ / shares | Apr. 30, 2015USD ($) | Dec. 31, 2016USD ($)business | Dec. 31, 2015USD ($)business | Dec. 31, 2014USD ($)business | |
Business Acquisition [Line Items] | |||||
Number of businesses acquired | business | 0 | 4 | 0 | ||
Number of business divestitures | business | 0 | 0 | |||
Acquisitions, percentage acquired | 100.00% | ||||
Adjustment to goodwill | $ 10 | ||||
Total consideration transferred | $ 1,400 | ||||
Payments to acquire businesses, net of cash acquired | 19 | 1,225 | $ 2 | ||
Goodwill | $ 4,059 | $ 4,069 | $ 3,189 | ||
Xoom Corporation | |||||
Business Acquisition [Line Items] | |||||
Price per share (in dollars per share) | $ / shares | $ 25 | ||||
Total consideration transferred | $ 1,100 | ||||
Payments to acquire businesses, net of cash acquired | 961 | ||||
Cash acquired from acquisition | 92 | ||||
Fair value of assume unvested equity | 7 | ||||
Intangibles | 217 | ||||
Liabilities assumed | 6 | ||||
Goodwill | $ 645 | ||||
Paydiant | |||||
Business Acquisition [Line Items] | |||||
Payments to acquire businesses, net of cash acquired | $ 230 | ||||
Intangibles | 49 | ||||
Liabilities assumed | 6 | ||||
Goodwill | 187 | ||||
CyActive Security, Ltd | |||||
Business Acquisition [Line Items] | |||||
Payments to acquire businesses, net of cash acquired | 43 | ||||
Intangibles | 8 | ||||
Liabilities assumed | 2 | ||||
Goodwill | $ 37 | ||||
Minimum | |||||
Business Acquisition [Line Items] | |||||
Useful life | 1 year | ||||
Minimum | Xoom Corporation | |||||
Business Acquisition [Line Items] | |||||
Useful life | 2 years | ||||
Maximum | |||||
Business Acquisition [Line Items] | |||||
Useful life | 8 years | ||||
Maximum | Xoom Corporation | |||||
Business Acquisition [Line Items] | |||||
Useful life | 5 years |
Business Combinations - Recogni
Business Combinations - Recognized Identifiable Assets Acquired, Goodwill, and Liabilities Assumed (Details) - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 | Nov. 30, 2015 | Dec. 31, 2014 |
Business Acquisition [Line Items] | ||||
Goodwill | $ 4,059 | $ 4,069 | $ 3,189 | |
Xoom Corporation | ||||
Business Acquisition [Line Items] | ||||
Goodwill | $ 645 | |||
Intangibles | 217 | |||
Cash | 92 | |||
Short-term investments | 72 | |||
Accounts receivable | 40 | |||
Other net liabilities | (6) | |||
Total purchase consideration | $ 1,060 |
Goodwill and Intangible Asset56
Goodwill and Intangible Assets - Goodwill Balances and Adjustments (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016USD ($)business | Dec. 31, 2015USD ($)business | Dec. 31, 2014USD ($)business | |
Total Goodwill | |||
Beginning balance | $ 4,069 | $ 3,189 | |
Goodwill Acquired | 0 | 886 | |
Adjustments | (10) | (6) | |
Ending balance | $ 4,059 | $ 4,069 | $ 3,189 |
Number of businesses acquired | business | 0 | 4 | 0 |
Goodwill and Intangible Asset57
Goodwill and Intangible Assets - Components of Identifiable Intangible Assets (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 1,292 | $ 1,290 |
Accumulated Amortization | (1,081) | (932) |
Net Carrying Amount | 211 | 358 |
Customer lists and user base | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 605 | 605 |
Accumulated Amortization | (542) | (501) |
Net Carrying Amount | $ 63 | $ 104 |
Weighted Average Useful Life (Years) | 4 years | 4 years |
Marketing related | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 197 | $ 197 |
Accumulated Amortization | (190) | (150) |
Net Carrying Amount | $ 7 | $ 47 |
Weighted Average Useful Life (Years) | 2 years | 3 years |
Developed technologies | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 245 | $ 245 |
Accumulated Amortization | (206) | (176) |
Net Carrying Amount | $ 39 | $ 69 |
Weighted Average Useful Life (Years) | 3 years | 3 years |
All other | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 245 | $ 243 |
Accumulated Amortization | (143) | (105) |
Net Carrying Amount | $ 102 | $ 138 |
Weighted Average Useful Life (Years) | 5 years | 5 years |
Goodwill and Intangible Asset58
Goodwill and Intangible Assets - Additional Information (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | ||
Sep. 30, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Finite-Lived Intangible Assets [Line Items] | ||||
Amortization expense for intangible assets | $ 150 | $ 93 | $ 84 | |
eBay | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Contributions from eBay, intangible assets, gross | $ 37 | |||
Contributions from eBay, intangible assets, net | $ 18 |
Goodwill and Intangible Asset59
Goodwill and Intangible Assets - Expected Future Intangible Asset Amortization (Details) - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity | ||
2,017 | $ 103 | |
2,018 | 68 | |
2,019 | 23 | |
2,020 | 17 | |
Net Carrying Amount | $ 211 | $ 358 |
Funds Receivable and Customer60
Funds Receivable and Customer Accounts - Assets Underlying Funds Receivable and Customer Accounts (Details) - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 |
Investment [Line Items] | ||
Total funds receivable and customer accounts | $ 14,363 | $ 12,261 |
Cash and cash equivalents | ||
Investment [Line Items] | ||
Total funds receivable and customer accounts | 4,319 | 5,245 |
Government and agency securities | ||
Investment [Line Items] | ||
Total funds receivable and customer accounts | 5,625 | 4,305 |
Time deposits | ||
Investment [Line Items] | ||
Total funds receivable and customer accounts | 522 | 830 |
Corporate debt securities | ||
Investment [Line Items] | ||
Total funds receivable and customer accounts | 1,093 | 180 |
Funds receivable | ||
Investment [Line Items] | ||
Total funds receivable and customer accounts | $ 2,804 | $ 1,701 |
Funds Receivable and Customer61
Funds Receivable and Customer Accounts - Estimated Fair Value of Investments Classified as Available for Sale (Details) - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 |
Schedule of Available-for-sale Securities [Line Items] | ||
Gross Amortized Cost | $ 4,504 | $ 4,330 |
Gross Unrealized Gains | 2 | 0 |
Gross Unrealized Losses | (5) | (16) |
Estimated Fair Value | 4,501 | 4,314 |
Funds Receivable and Customer Accounts | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Gross Amortized Cost | 6,251 | 4,129 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (2) | (1) |
Estimated Fair Value | 6,249 | 4,128 |
Funds Receivable and Customer Accounts | Government and agency securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Gross Amortized Cost | 5,198 | 3,299 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (2) | (1) |
Estimated Fair Value | 5,196 | 3,298 |
Funds Receivable and Customer Accounts | Time deposits | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Gross Amortized Cost | 522 | 830 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 522 | $ 830 |
Funds Receivable and Customer Accounts | Corporate debt securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Gross Amortized Cost | 531 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | 0 | |
Estimated Fair Value | $ 531 |
Funds Receivable and Customer62
Funds Receivable and Customer Accounts - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Total funds receivable and customer accounts | $ 14,363 | $ 12,261 |
Aggregate fair value of investments in an unrealized loss position | 2,200 | |
Funds Receivable and Customer Accounts | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Aggregate fair value of investments in an unrealized loss position | 4,100 | |
Fair Value Option, Foreign Currency Denominated Investments | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Total funds receivable and customer accounts | 1,000 | 1,200 |
Fair Value Option, Foreign Currency Denominated Investments | Funds Receivable and Customer Accounts | ||
Fair Value, Option, Quantitative Disclosures [Line Items] | ||
Net gain (loss) from fair value changes | $ (66) | $ (65) |
Funds Receivable and Customer63
Funds Receivable and Customer Accounts - Estimated Fair Values of Investments Classified as Available for Sale by Contractual Maturity (Details) $ in Millions | Dec. 31, 2016USD ($) |
Schedule of Available-for-sale Securities [Line Items] | |
One year or less | $ 3,021 |
One year through two years | 715 |
Total | 4,501 |
Funds Receivable and Customer Accounts | |
Schedule of Available-for-sale Securities [Line Items] | |
One year or less | 6,015 |
One year through two years | 234 |
Total | $ 6,249 |
Investments - Estimated Fair Va
Investments - Estimated Fair Values of Investments Classified as Available for Sale (Details) - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 |
Schedule of Available-for-sale Securities [Line Items] | ||
Gross Amortized Cost | $ 4,504 | $ 4,330 |
Gross Unrealized Gains | 2 | 0 |
Gross Unrealized Losses | (5) | (16) |
Estimated Fair Value | 4,501 | 4,314 |
Short-term investments | Corporate debt securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Gross Amortized Cost | 2,867 | 2,000 |
Gross Unrealized Gains | 1 | 0 |
Gross Unrealized Losses | (1) | (2) |
Estimated Fair Value | 2,867 | 1,998 |
Short-term investments | Government and agency securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Gross Amortized Cost | 32 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | 0 | |
Estimated Fair Value | 32 | |
Short-term investments | Time deposits | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Gross Amortized Cost | 122 | 2 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 122 | 2 |
Long-term investments | Corporate debt securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Gross Amortized Cost | 1,473 | 2,328 |
Gross Unrealized Gains | 1 | 0 |
Gross Unrealized Losses | (4) | (14) |
Estimated Fair Value | 1,470 | $ 2,314 |
Long-term investments | Government and agency securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Gross Amortized Cost | 10 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | 0 | |
Estimated Fair Value | $ 10 |
Investments - Narrative Details
Investments - Narrative Details (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Schedule of Available-for-sale Securities [Line Items] | ||
Short-term restricted cash | $ 17 | $ 18 |
Long-term restricted cash | 8 | |
Available-for-sale Securities | 4,501 | 4,314 |
Fair value of investments in an unrealized loss position | 2,200 | |
Gross unrealized losses on short-term and long-term investments | (5) | (16) |
Cost method investments | 50 | $ 26 |
Fair Value Option, Foreign Currency Denominated Investments | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-for-sale Securities | 356 | |
Other Nonoperating Income (Expense) [Member] | Fair Value Option, Foreign Currency Denominated Investments | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Net gain (loss) from fair value changes | $ (48) |
Investments - Estimated Fair 66
Investments - Estimated Fair Values of Short-term and Long-term Investments Classified as Available for Sale by Date of Contractual Maturity (Details) $ in Millions | Dec. 31, 2016USD ($) |
Investments, Debt and Equity Securities [Abstract] | |
One year or less | $ 3,021 |
One year through two years | 715 |
Two years through three years | 608 |
Three years through four years | 89 |
Four years through five years | 68 |
Total | $ 4,501 |
Fair Value Measurement of Fin67
Fair Value Measurement of Financial Assets and Liabilities - Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 |
Assets: | ||
Funds receivable and customer accounts | $ 14,363 | $ 12,261 |
Derivatives | 164 | |
Liabilities: | ||
Cash | 1,300 | 987 |
Fair value, measurements, recurring basis | ||
Assets: | ||
Cash and cash equivalents | 268 | 406 |
Funds receivable and customer accounts | 7,420 | 6,978 |
Derivatives | 223 | 97 |
Total financial assets | 12,785 | 11,821 |
Liabilities: | ||
Derivatives | 59 | 25 |
Fair value, measurements, recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets: | ||
Cash and cash equivalents | 0 | 0 |
Funds receivable and customer accounts | 0 | 0 |
Derivatives | 0 | 0 |
Total financial assets | 17 | 26 |
Liabilities: | ||
Derivatives | 0 | 0 |
Fair value, measurements, recurring basis | Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Cash and cash equivalents | 268 | 406 |
Funds receivable and customer accounts | 7,420 | 6,978 |
Derivatives | 223 | 97 |
Total financial assets | 12,768 | 11,795 |
Liabilities: | ||
Derivatives | 59 | 25 |
Corporate debt securities | ||
Assets: | ||
Funds receivable and customer accounts | 1,093 | 180 |
Government and agency securities | ||
Assets: | ||
Funds receivable and customer accounts | 5,625 | 4,305 |
Time deposits | ||
Assets: | ||
Funds receivable and customer accounts | 522 | 830 |
Short-term investments | Fair value, measurements, recurring basis | ||
Assets: | ||
Investments | 3,385 | 2,018 |
Short-term investments | Fair value, measurements, recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets: | ||
Investments | 17 | 18 |
Short-term investments | Fair value, measurements, recurring basis | Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Investments | 3,368 | 2,000 |
Short-term investments | Restricted cash | Fair value, measurements, recurring basis | ||
Assets: | ||
Investments | 17 | 18 |
Short-term investments | Restricted cash | Fair value, measurements, recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets: | ||
Investments | 17 | 18 |
Short-term investments | Restricted cash | Fair value, measurements, recurring basis | Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Investments | 0 | 0 |
Short-term investments | Corporate debt securities | Fair value, measurements, recurring basis | ||
Assets: | ||
Investments | 2,882 | 1,998 |
Short-term investments | Corporate debt securities | Fair value, measurements, recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets: | ||
Investments | 0 | 0 |
Short-term investments | Corporate debt securities | Fair value, measurements, recurring basis | Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Investments | 2,882 | 1,998 |
Short-term investments | Government and agency securities | Fair value, measurements, recurring basis | ||
Assets: | ||
Investments | 364 | |
Short-term investments | Government and agency securities | Fair value, measurements, recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets: | ||
Investments | 0 | |
Short-term investments | Government and agency securities | Fair value, measurements, recurring basis | Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Investments | 364 | |
Short-term investments | Time deposits | Fair value, measurements, recurring basis | ||
Assets: | ||
Investments | 122 | 2 |
Short-term investments | Time deposits | Fair value, measurements, recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets: | ||
Investments | 0 | 0 |
Short-term investments | Time deposits | Fair value, measurements, recurring basis | Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Investments | 122 | 2 |
Long-term investments | Fair value, measurements, recurring basis | ||
Assets: | ||
Investments | 1,489 | 2,322 |
Long-term investments | Fair value, measurements, recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets: | ||
Investments | 0 | 8 |
Long-term investments | Fair value, measurements, recurring basis | Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Investments | 1,489 | 2,314 |
Long-term investments | Restricted cash | Fair value, measurements, recurring basis | ||
Assets: | ||
Investments | 8 | |
Long-term investments | Restricted cash | Fair value, measurements, recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets: | ||
Investments | 8 | |
Long-term investments | Restricted cash | Fair value, measurements, recurring basis | Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Investments | 0 | |
Long-term investments | Corporate debt securities | Fair value, measurements, recurring basis | ||
Assets: | ||
Investments | 1,479 | 2,314 |
Long-term investments | Corporate debt securities | Fair value, measurements, recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets: | ||
Investments | 0 | 0 |
Long-term investments | Corporate debt securities | Fair value, measurements, recurring basis | Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Investments | 1,479 | $ 2,314 |
Long-term investments | Government and agency securities | Fair value, measurements, recurring basis | ||
Assets: | ||
Investments | 10 | |
Long-term investments | Government and agency securities | Fair value, measurements, recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets: | ||
Investments | 0 | |
Long-term investments | Government and agency securities | Fair value, measurements, recurring basis | Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Investments | $ 10 |
Fair Value Measurement of Fin68
Fair Value Measurement of Financial Assets and Liabilities - Additional Information (Details) | 12 Months Ended |
Dec. 31, 2016 | |
Minimum | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Derivative instruments, duration | 1 month |
Maximum | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Derivative instruments, duration | 1 year |
Maximum | Cash Flow Hedging | Foreign Exchange Contract | Designated as Hedging Instrument | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Derivative instruments, duration | 18 months |
Derivative Instruments - Additi
Derivative Instruments - Additional Information (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Foreign Exchange Contracts | |
Maximum maturity of foreign currency exchange contracts | 18 months |
Net derivative gains related to cash flow hedges to be reclassified into earnings within the next 12 months | $ 123 |
Fair Value of Derivative Contracts | |
Derivative asset, offset | 59 |
Derivative liability, offset | 59 |
Net derivative assets | $ 164 |
Derivative Instruments - Fair V
Derivative Instruments - Fair Value of Outstanding Derivative Instruments (Details) - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 |
Derivatives, Fair Value [Line Items] | ||
Derivative assets | $ 223 | $ 97 |
Derivative liabilities | 59 | 25 |
Total fair value of derivative instruments | 164 | 72 |
Foreign Exchange Contract | Not Designated as Hedging Instrument | Other Current Assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets | 88 | 38 |
Foreign Exchange Contract | Not Designated as Hedging Instrument | Other Current Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liabilities | 55 | 23 |
Cash Flow Hedging | Foreign Exchange Contract | Designated as Hedging Instrument | Other Current Assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets | 135 | 59 |
Cash Flow Hedging | Foreign Exchange Contract | Designated as Hedging Instrument | Other Current Liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liabilities | $ 4 | $ 2 |
Derivative Instruments - Cash F
Derivative Instruments - Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Details) - Foreign Exchange Contract - Designated as Hedging Instrument - Cash Flow Hedging - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Impact of Designated Derivative Instruments on Accumulated Other Comprehensive Income | ||
Foreign exchange contracts designated as cash flow hedges, beginning balance | $ 57 | $ 126 |
Amount of gain recognized in other comprehensive income (effective portion) | 193 | 113 |
Less: Amount of gain reclassified from accumulated other comprehensive income to net revenue (effective portion) | 119 | 182 |
Foreign exchange contracts designated as cash flow hedges, ending balance | $ 131 | $ 57 |
Derivative Instruments - Recogn
Derivative Instruments - Recognized Gains or Losses Related to Derivative Instruments (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Derivative Instruments, Gain (Loss) [Line Items] | |||
Recognized gains or losses related to derivative instruments | $ 195 | $ 199 | $ (38) |
Foreign Exchange Contract | Net Revenues | Designated as Hedging Instrument | Cash Flow Hedging | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Recognized gains or losses related to derivative instruments | 119 | 182 | (36) |
Foreign Exchange Contract | Nonoperating Income (Expense) | Not Designated as Hedging Instrument | |||
Derivative Instruments, Gain (Loss) [Line Items] | |||
Recognized gains or losses related to derivative instruments | $ 76 | $ 17 | $ (2) |
Derivative Instruments - Schedu
Derivative Instruments - Schedule of Notional Amounts of Outstanding Derivatives (Details) - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 |
Derivatives, Fair Value [Line Items] | ||
Notional amounts | $ 6,477 | $ 4,490 |
Foreign Exchange Contract | Not Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Notional amounts | 4,612 | 2,802 |
Cash Flow Hedging | Foreign Exchange Contract | Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Notional amounts | $ 1,865 | $ 1,688 |
Property and Equipment, Net (De
Property and Equipment, Net (Details) - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 4,500 | $ 3,849 |
Accumulated depreciation | (3,018) | (2,505) |
Property and equipment, net | 1,482 | 1,344 |
Computer equipment and software | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 2,049 | 1,818 |
Internal use software and website development costs | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 1,372 | 1,150 |
Land and buildings | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 357 | 352 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 335 | 297 |
Furniture and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | 119 | 99 |
Development in progress and other | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, gross | $ 268 | $ 133 |
Property and Equipment, Net - A
Property and Equipment, Net - Additional Information (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | ||
Sep. 30, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Property, Plant and Equipment [Line Items] | ||||
Proceeds from sales of property and equipment | $ 0 | $ 26 | $ 0 | |
Depreciation | 574 | 515 | 432 | |
Net change in property and equipment included in accounts payable | $ 35 | $ 0 | $ 0 | |
eBay | ||||
Property, Plant and Equipment [Line Items] | ||||
Contributions from eBay, property and equipment, gross | $ 355 | |||
Contributions from eBay, property and equipment, net | 224 | |||
Property and equipment sold to eBay, gross | 63 | |||
Property and equipment sold to eBay, net | 15 | |||
Proceeds from sales of property and equipment | $ 26 |
Loans and Interest Receivable76
Loans and Interest Receivable, Net - Additional Information (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
Financing Receivable, Recorded Investment [Line Items] | |||
Purchased consumer receivables | $ 8,400 | $ 7,400 | |
Threshold period, write-off of receivables | 180 days | ||
Threshold period, write-off of Bankrupt Accounts | 60 days | ||
Consumer Receivables | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Loan and interest receivables | $ 5,113 | 3,986 | |
Participation interest sold, value | $ 1,000 | $ 1,000 | |
Weighted average consumer FICO score | 682 | 686 | |
Credit score, prime (greater than) | 680 | 680 | |
Percentage of loans and interest receivable, FICO score below 599 | 11.10% | 9.40% | |
Credit score | 599 | 599 | |
Percentage of loans and interest receivable, current | 90.00% | 90.10% | |
Threshold period, write-off of receivables | 180 days | ||
Threshold period, write-off of Bankrupt Accounts | 60 days | ||
Allowance for transaction losses | $ 305 | $ 211 | $ 188 |
Consumer Receivables | Greater than 680 | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Percentage of loans and interest receivable, prime | 52.10% | 53.60% | |
Consumer Receivables | Other countries | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Loan and interest receivables | $ 117 | $ 70 | |
Merchant Receivables | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Loan and interest receivables | $ 558 | 421 | |
Threshold period, write-off of receivables | 180 days | ||
Allowance for transaction losses | $ 31 | $ 22 | $ 7 |
Expected merchant PRM score (greater than) | 525 | ||
Required percentage of original loan payments every 90 Days | 10.00% | ||
Merchant Receivables | Minimum | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Assigned PRM score | 350 | ||
Expected period of repayment | 9 months | ||
Merchant Receivables | Maximum | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Assigned PRM score | 750 | ||
Expected period of repayment | 12 months | ||
Merchant Receivables | Prime | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Credit score, prime (greater than) | 610 | ||
Weighted average internal credit assessment score | 625 | 630 | |
Other Consumer Credit Products | Consumer Receivables | |||
Financing Receivable, Recorded Investment [Line Items] | |||
Loan and interest receivables | $ 16 | $ 8 | |
Allowance for transaction losses | $ 3 | $ 1 |
Loans and Interest Receivable77
Loans and Interest Receivable, Net - Loans and Interest Receivables by FICO Score (Details) - Consumer Receivables - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 |
Financing Receivable, Recorded Investment [Line Items] | ||
Consumer loans and interest receivable | $ 4,996 | $ 3,916 |
Greater than 760 | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Consumer loans and interest receivable | 665 | 569 |
680 - 759 | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Consumer loans and interest receivable | 1,938 | 1,529 |
600 - 679 | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Consumer loans and interest receivable | 1,840 | 1,449 |
Less Than 599 | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Consumer loans and interest receivable | $ 553 | $ 369 |
Loans and Interest Receivable78
Loans and Interest Receivable, Net - Delinquency Status of the Principal Amount of Loans and Interest Receivables (Details) - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 |
Consumer Receivables | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Loan and interest receivable, current | $ 4,601 | $ 3,593 |
Loan and interest receivable, past due | 512 | 393 |
Total Consumer Receivables | 5,113 | 3,986 |
Consumer Receivables | 30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Loan and interest receivable, past due | 219 | 172 |
Consumer Receivables | 60-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Loan and interest receivable, past due | 82 | 66 |
Consumer Receivables | 90-180 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Loan and interest receivable, past due | 211 | 155 |
Merchant Receivables | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Loan and interest receivable, current | 462 | 367 |
Loan and interest receivable, past due | 96 | 54 |
Total Consumer Receivables | 558 | 421 |
Merchant Receivables | 30-59 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Loan and interest receivable, past due | 35 | 24 |
Merchant Receivables | 60-89 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Loan and interest receivable, past due | 19 | 13 |
Merchant Receivables | 90-180 Days Past Due | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Loan and interest receivable, past due | 30 | 15 |
Merchant Receivables | 180 Plus Days | ||
Financing Receivable, Recorded Investment, Past Due [Line Items] | ||
Loan and interest receivable, past due | $ 12 | $ 2 |
Loans and Interest Receivable79
Loans and Interest Receivable, Net - Allowance for Loans and Interest Receivable (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Allowance for loans and interest receivable | |||
Provisions | $ 1,088 | $ 809 | $ 646 |
Consumer Receivables | |||
Allowance for loans and interest receivable | |||
Beginning balance | 211 | 188 | |
Reclassification from loans receivable to loans held for sale | 0 | (22) | |
Provisions | 504 | 356 | |
Charge-offs | (438) | (335) | |
Recoveries | 28 | 24 | |
Ending balance | 305 | 211 | 188 |
Merchant Receivables | |||
Allowance for loans and interest receivable | |||
Beginning balance | 22 | 7 | |
Provisions | 51 | 29 | |
Charge-offs | (47) | (16) | |
Recoveries | 5 | 2 | |
Ending balance | 31 | 22 | 7 |
Consumer Loans Receivable | Consumer Receivables | |||
Allowance for loans and interest receivable | |||
Beginning balance | 179 | 158 | |
Reclassification from loans receivable to loans held for sale | 0 | (22) | |
Provisions | 388 | 270 | |
Charge-offs | (330) | (251) | |
Recoveries | 28 | 24 | |
Ending balance | 265 | 179 | 158 |
Consumer Loans Receivable | Merchant Receivables | |||
Allowance for loans and interest receivable | |||
Beginning balance | 19 | 5 | |
Provisions | 45 | 28 | |
Charge-offs | (41) | (16) | |
Recoveries | 5 | 2 | |
Ending balance | 28 | 19 | 5 |
Interest Receivable | Consumer Receivables | |||
Allowance for loans and interest receivable | |||
Beginning balance | 32 | 30 | |
Reclassification from loans receivable to loans held for sale | 0 | 0 | |
Provisions | 116 | 86 | |
Charge-offs | (108) | (84) | |
Recoveries | 0 | 0 | |
Ending balance | 40 | 32 | 30 |
Interest Receivable | Merchant Receivables | |||
Allowance for loans and interest receivable | |||
Beginning balance | 3 | 2 | |
Provisions | 6 | 1 | |
Charge-offs | (6) | 0 | |
Recoveries | 0 | 0 | |
Ending balance | $ 3 | $ 3 | $ 2 |
Loans and Interest Receivable80
Loans and Interest Receivable, Net - Loans and Interest Receivable by Internal PRM Score (Details) - Merchant Receivables - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 |
Financing Receivable, Recorded Investment [Line Items] | ||
Loan and interest receivables | $ 558 | $ 421 |
PRM Score, greater than 610 | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan and interest receivables | 378 | 291 |
PRM Score, 526-609 | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan and interest receivables | 108 | 85 |
PRM Score, Less than 525 | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loan and interest receivables | $ 72 | $ 45 |
Segment and Geographical Info81
Segment and Geographical Information - Net Revenues and Long-Lived Assets by Geographical Areas (Details) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016USD ($) | Sep. 30, 2016USD ($) | Jun. 30, 2016USD ($) | Mar. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Sep. 30, 2015USD ($) | Jun. 30, 2015USD ($) | Mar. 31, 2015USD ($) | Dec. 31, 2016USD ($)segment | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
Segment Reporting [Abstract] | |||||||||||
Number of operating segments | segment | 1 | ||||||||||
Number of reportable segments | segment | 1 | ||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Net revenues | $ 2,981 | $ 2,667 | $ 2,650 | $ 2,544 | $ 2,556 | $ 2,258 | $ 2,297 | $ 2,137 | $ 10,842 | $ 9,248 | $ 8,025 |
Long-lived assets | 1,482 | 1,344 | 1,482 | 1,344 | |||||||
U.S. | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Net revenues | 5,760 | 4,640 | 3,877 | ||||||||
Long-lived assets | 1,391 | 1,256 | 1,391 | 1,256 | |||||||
U.K. | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Net revenues | 1,257 | 1,191 | 1,155 | ||||||||
Other countries | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Net revenues | 3,825 | 3,417 | $ 2,993 | ||||||||
Other countries | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Long-lived assets | $ 91 | $ 88 | $ 91 | $ 88 |
Segment and Geographical Info82
Segment and Geographical Information - Net Revenues by Major Products and Services (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Revenue from External Customer [Line Items] | |||||||||||
Net revenues | $ 2,981 | $ 2,667 | $ 2,650 | $ 2,544 | $ 2,556 | $ 2,258 | $ 2,297 | $ 2,137 | $ 10,842 | $ 9,248 | $ 8,025 |
Transaction revenues | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Net revenues | 9,490 | 8,128 | 7,107 | ||||||||
Other value added services | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Net revenues | $ 1,352 | $ 1,120 | $ 918 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Commitments and Contingencies Disclosure [Abstract] | |||
Unused credit available to accountholders | $ 28,800 | $ 24,800 | |
Rent expense | $ 76 | $ 59 | $ 43 |
Commitments and Contingencies84
Commitments and Contingencies - Credit Agreement (Details) - USD ($) | 3 Months Ended | |
Sep. 30, 2015 | Dec. 31, 2016 | |
Revolving Credit Facility | ||
Line of Credit Facility [Line Items] | ||
Maximum borrowing capacity | $ 2,000,000,000 | |
Credit facility, term | 5 years | |
Accordion feature, increase in maximum borrowing capacity | $ 500,000,000 | |
Borrowings outstanding | $ 0 | |
Available borrowing capacity | $ 2,000,000,000 | |
Letter of Credit Sub-Facility | ||
Line of Credit Facility [Line Items] | ||
Maximum borrowing capacity | 150,000,000 | |
Swingline Sub-Facility | ||
Line of Credit Facility [Line Items] | ||
Maximum borrowing capacity | $ 150,000,000 |
Commitments and Contingencies85
Commitments and Contingencies - Schedule of Future Minimum Rental Payments Under Noncancelable Operating Leases (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2016USD ($) | |
Operating Leased Assets [Line Items] | |
2,017 | $ 102 |
2,018 | 106 |
2,019 | 93 |
2,020 | 63 |
2,021 | 47 |
Thereafter | 141 |
Total minimum lease payments | $ 552 |
Minimum | |
Operating Leased Assets [Line Items] | |
Term of lease contract | 3 years |
Maximum | |
Operating Leased Assets [Line Items] | |
Term of lease contract | 10 years |
Commitments and Contingencies86
Commitments and Contingencies - Estimate of the Maximum Potential Exposure and Allowance for Transaction Losses Related to Protection Products (Details) - Protection Programs - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 |
Loss Contingencies [Line Items] | ||
Maximum potential exposure | $ 131,739 | $ 109,496 |
Allowance for transaction losses | $ 222 | $ 185 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) $ in Millions | 1 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2015 | Sep. 30, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Related Party Transaction [Line Items] | |||||
Amounts payable to related parties | $ 0 | ||||
Amounts receivable from related parties | 0 | ||||
User acquisition fees | 969 | $ 937 | $ 954 | ||
Expenses from transactions with related party | 9,256 | 7,787 | 6,757 | ||
Contribution from (to) eBay | 0 | 3,858 | (71) | ||
Proceeds from sales of property and equipment | $ 0 | 26 | 0 | ||
eBay | |||||
Related Party Transaction [Line Items] | |||||
Net revenues | 59 | 113 | |||
User acquisition fees | 64 | 119 | |||
Expenses from transactions with related party | 303 | 443 | |||
Contribution from (to) eBay | $ 3,800 | 3,800 | |||
Deferred tax liability related to foreign cash contributed by eBay | $ 236 | 172 | |||
Contributions from eBay, property and equipment, net | $ 224 | ||||
Contributions from eBay, intangible assets, net | 18 | ||||
Property and equipment sold to eBay, gross | 63 | ||||
Property and equipment sold to eBay, net | 15 | ||||
Proceeds from sales of property and equipment | $ 26 | ||||
eBay | Transaction Losses | |||||
Related Party Transaction [Line Items] | |||||
Recoveries | 27 | 43 | |||
eBay | Protection Programs | |||||
Related Party Transaction [Line Items] | |||||
Recoveries | $ 12 | $ 22 |
Stock Repurchase Program (Detai
Stock Repurchase Program (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Jan. 31, 2016 | |
Equity [Abstract] | ||||||||
Stock repurchase program, authorized amount | $ 2,000,000,000 | |||||||
Shares Repurchased | 1,300,000 | 1,300,000 | 7,800,000 | 16,900,000 | 27,000,000 | |||
Treasury stock, shares (in shares) | 27,300,000 | 27,300,000 | ||||||
Average Price per Share (in usd per share) | $ 38.92 | $ 36.80 | $ 38.67 | $ 35.27 | ||||
Value of Shares Repurchased | $ 50,000,000 | $ 49,000,000 | $ 300,000,000 | $ 596,000,000 | $ 995,000,000 | |||
Balance at end of period, value of shares repurchased | 995,000,000 | 995,000,000 | $ 0 | |||||
Remaining Amount Authorized | ||||||||
Authorization of plan, beginning balance | 2,000,000,000 | |||||||
Repurchases of shares of common stock | 1,005,000,000 | $ 1,055,000,000 | $ 1,104,000,000 | $ 1,404,000,000 | 995,000,000 | $ 0 | $ 0 | |
Ending balance | $ 1,005,000,000 | $ 1,005,000,000 | ||||||
Common Stock Shares | ||||||||
Equity, Class of Treasury Stock [Line Items] | ||||||||
Repurchased shares retired during period | 0 |
Stock-Based and Employee Savi89
Stock-Based and Employee Savings Plans - Additional Information (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Unearned stock-based compensation | $ 707,000,000 | |||
Other Postretirement Benefit Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Employer matching contribution, maximum percentage of eligible employee salary | 4.00% | 4.00% | 4.00% | |
Maximum annual contributions per employee, percent of eligible compensation | 50.00% | |||
Employer matching contribution, maximum annual contributions per employee | $ 10,600 | $ 10,600 | $ 10,400 | |
Matching contribution expense | $ 42,000,000 | $ 42,000,000 | $ 37,000,000 | |
Restricted Stock Units (RSUs) | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Deferred stock units outstanding (in shares) | 29,185,000 | 28,761,000 | ||
2015 Paypal Equity Incentive Award Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Number of shares authorized | 92,000,000 | |||
Number of shares available for grant | 61,000,000 | |||
2015 Paypal Equity Incentive Award Plan | Employee Stock Option | Vesting period 2 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Award vesting rights, percentage | 2.08% | |||
2015 Paypal Equity Incentive Award Plan | Employee Stock Option | Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Expiration period from date of grant | 7 years | |||
2015 Paypal Equity Incentive Award Plan | Employee Stock Option | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Expiration period from date of grant | 10 years | |||
2015 Paypal Equity Incentive Award Plan | Restricted Stock Units (RSUs) | Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Award vesting period | 3 years | |||
2015 Paypal Equity Incentive Award Plan | Restricted Stock Units (RSUs) | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Award vesting period | 4 years | |||
2015 Paypal Equity Incentive Award Plan | Performance Shares | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Award performance period | 3 years | 2 years | ||
2015 Paypal Equity Incentive Award Plan | Performance Shares | Vesting period 1 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Award vesting rights, percentage | 50.00% | |||
2015 Paypal Equity Incentive Award Plan | Performance Shares | Vesting period 2 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Award vesting rights, percentage | 50.00% | |||
2015 Paypal Equity Incentive Award Plan | Performance Shares | Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Awards to be issued, percentage of target amount | 0.00% | |||
2015 Paypal Equity Incentive Award Plan | Performance Shares | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Awards to be issued, percentage of target amount | 200.00% | |||
2015 Paypal Equity Incentive Award Plan | Existing Employee | Employee Stock Option | Vesting period 1 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Award vesting rights, percentage | 12.50% | |||
2015 Paypal Equity Incentive Award Plan | New Employee | Employee Stock Option | Vesting period 1 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Award vesting rights, percentage | 25.00% | |||
Paypal Employee Stock Purchase Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Maximum duration of common stock purchasing period | 2 years | |||
Purchase price of common stock, percent of fair market value | 85.00% | |||
Purchase period | 6 months | |||
Purchased number of shares under the employee stock purchase plan | 2,700,000 | 1,200,000 | ||
Average price of shares purchased under the employee stock purchase plan (usd per share) | $ 29.49 | $ 28.12 | ||
Paypal Employee Stock Purchase Plan | Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Employee subscription rate | 2.00% | |||
Paypal Employee Stock Purchase Plan | Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Employee subscription rate | 10.00% | |||
eBay Employee Stock Purchase Plan | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||||
Number of shares available for grant | 8,100,000 | |||
Purchased number of shares under the employee stock purchase plan | 900,000 | 1,500,000 | ||
Average price of shares purchased under the employee stock purchase plan (usd per share) | $ 44.37 | $ 42.16 |
Stock-Based and Employee Savi90
Stock-Based and Employee Savings Plans - Summary of Stock Option Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Stock Options, Additional Disclosures | |||
Options in-the-money (in shares) | 4,200 | ||
Employee Stock Option | |||
Stock Options, shares | |||
Outstanding balance, beginning of period (in shares) | 6,008 | ||
Granted (in shares) | 124 | ||
Exercised (in shares) | (1,557) | ||
Forfeited/expired/canceled (in shares) | (287) | ||
Outstanding balance, end of period (in shares) | 4,288 | 6,008 | |
Expected to vest (in shares) | 1,424 | ||
Options exercisable (in shares) | 2,727 | ||
Weighted Average Exercise Price | |||
Outstanding balance, beginning of period (usd per share) | $ 25.94 | ||
Granted and assumed (usd per share) | 36.32 | ||
Exercised (usd per share) | 18.39 | ||
Forfeited/expired/canceled (usd per share) | 30.82 | ||
Outstanding balance, end of period (usd per share) | 28.65 | $ 25.94 | |
Expected to vest, weighted average exercise price (usd per share) | 29.17 | ||
Options exercisable, weighted average exercise price (usd per share) | $ 28.30 | ||
Stock Options, Additional Disclosures | |||
Weighted Average Remaining Contractual Term (Years) | 4 years 1 month 21 days | ||
Expected to vest, weighted average remaining contractual term (years) | 5 years 3 months 7 days | ||
Options, exercisable, weighted average remaining contractual term (years) | 3 years 5 months 20 days | ||
Aggregate Intrinsic Value | $ 47,510 | ||
Expected to vest, aggregate intrinsic value | 15,059 | ||
Options exercisable, aggregate intrinsic value | $ 31,166 | ||
eBay's and Paypal's Equity Incentive Plan | Employee Stock Option | |||
Stock Options, Additional Disclosures | |||
Weighted average grant date fair value of options granted to employees (usd per share) | $ 8.79 | $ 11.20 | $ 13.38 |
Aggregate intrinsic value of options exercised | $ 31,000 | $ 72,000 | $ 57,000 |
Stock-Based and Employee Savi91
Stock-Based and Employee Savings Plans - Summary of Restricted Stock Units (Details) - Restricted Stock Units (RSUs) - USD ($) $ / shares in Units, shares in Thousands, $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Restricted stock units, shares | |||
Outstanding balance, beginning of period (in shares) | 28,761 | ||
Awarded (in shares) | 14,120 | ||
Vested (in shares) | (9,784) | ||
Forfeited (in shares) | (3,912) | ||
Outstanding balance, end of period (in shares) | 29,185 | 28,761 | |
Expected to vest at the end of period (in shares) | 25,565 | ||
Weighted Average Grant-Date Fair Value | |||
Outstanding balance, beginning of period (usd per share) | $ 34.63 | ||
Awarded (usd per share) | 39.13 | ||
Vested (usd per share) | 33.28 | ||
Forfeited (usd per share) | 36.13 | ||
Outstanding balance, end of period (usd per share) | $ 37.06 | $ 34.63 | |
eBay's and Paypal's Equity Incentive Plan | |||
Weighted Average Grant-Date Fair Value | |||
Aggregate intrinsic value of vested restricted stock units | $ 378 | $ 315 | $ 292 |
Stock-Based and Employee Savi92
Stock-Based and Employee Savings Plans - Schedule of Stock-Based Compensation Expense (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | $ 444 | $ 347 | $ 298 |
Capitalized as part of internal use software and website development costs | 13 | 7 | 10 |
Income tax benefit recognized for stock-based compensation arrangements | 127 | 98 | 77 |
Customer support and operations | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | 85 | 62 | 52 |
Sales and marketing | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | 84 | 52 | 59 |
Product development | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | 139 | 132 | 108 |
General and administrative | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | 130 | 94 | 75 |
Depreciation and amortization | |||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | |||
Stock-based compensation expense | $ 6 | $ 7 | $ 4 |
Stock-Based and Employee Savi93
Stock-Based and Employee Savings Plans - Stock Options Valuation Assumptions (Details) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Risk-free interest rate | 1.50% | 1.40% | 1.20% |
Expected life (in years) | 4 years 6 months 29 days | 4 years 3 months 18 days | 4 years 1 month 6 days |
Dividend yield | 0.00% | 0.00% | 0.00% |
Expected volatility | 25.00% | 26.00% | 29.00% |
Income Taxes - Components of Pr
Income Taxes - Components of Pretax Income (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||
United States | $ (342) | $ (253) | $ (111) |
International | 1,973 | 1,741 | 1,372 |
Income before income taxes | $ 1,631 | $ 1,488 | $ 1,261 |
Income Taxes - Provision for In
Income Taxes - Provision for Income Taxes (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Current: | |||
Federal | $ 44 | $ 34 | $ 90 |
State and local | 19 | (5) | 13 |
Foreign | 115 | 104 | 59 |
Current income taxes | 178 | 133 | 162 |
Deferred: | |||
Federal | 90 | 126 | 699 |
State and local | (35) | 1 | (3) |
Foreign | (3) | 0 | (16) |
Deferred income taxes | 52 | 127 | 680 |
Income tax expense | $ 230 | $ 260 | $ 842 |
Income Taxes - Effective Income
Income Taxes - Effective Income Tax Rate Reconciliation (Details) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Income Tax Disclosure [Abstract] | |||
Federal statutory rate | 35.00% | 35.00% | 35.00% |
State taxes, net of federal benefit | (1.00%) | (0.30%) | 0.80% |
Foreign income taxed at different rates | (23.20%) | (20.90%) | (22.20%) |
Prior year foreign earnings no longer considered indefinitely reinvested | 0.00% | 0.00% | 50.80% |
Stock-based compensation expense | 1.60% | 1.50% | 1.50% |
Tax credits | (1.00%) | (0.70%) | (0.80%) |
Change in valuation allowances | 0.50% | 0.30% | 0.00% |
Other | 2.20% | 2.60% | 1.70% |
Effective income tax rate | 14.10% | 17.50% | 66.80% |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 12 Months Ended | |||
Jun. 30, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Income Tax Disclosure [Abstract] | |||||
U.S. Federal statutory income tax rate, percentage | 35.00% | 35.00% | 35.00% | ||
Operating Loss Carryforwards [Line Items] | |||||
Total Deferred tax liabilities | $ 1,194 | $ 1,137 | |||
Contributions from eBay, cash | 0 | 3,858 | $ (71) | ||
Indefinitely reinvested foreign earnings | 4,600 | $ 3,400 | |||
Deferred tax liability, undistributed foreign earnings no longer considered indefinitely reinvested | 1,246 | 1,156 | 650 | ||
Income tax savings | $ 310 | $ 285 | $ 217 | ||
Benefit of tax rulings on net income per share (in usd per share) | $ 0.25 | $ 0.23 | $ 0.18 | ||
Unrecognized tax benefits that would impact effective tax rate, if realized | $ 271 | ||||
Interest and penalties related to uncertain tax positions recognized in income tax expense | 13 | ||||
Interest and penalties accrued | 67 | $ 54 | |||
Tax Year 2013 And Earlier | |||||
Operating Loss Carryforwards [Line Items] | |||||
Undistributed foreign earnings no longer considered indefinitely reinvested | $ 1,900 | ||||
Federal | |||||
Operating Loss Carryforwards [Line Items] | |||||
Net operating loss carryforwards | 110 | ||||
Tax credit carryforward | 5 | ||||
State | |||||
Operating Loss Carryforwards [Line Items] | |||||
Net operating loss carryforwards | 281 | ||||
Tax credit carryforward | 60 | ||||
Foreign | |||||
Operating Loss Carryforwards [Line Items] | |||||
Net operating loss carryforwards | $ 54 | ||||
eBay | |||||
Operating Loss Carryforwards [Line Items] | |||||
Contributions from eBay, cash | $ 3,800 | 3,800 | |||
Deferred tax liability related to foreign cash contributed by eBay | $ 236 | $ 172 |
Income Taxes - Deferred Tax Ass
Income Taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 |
Deferred tax assets: | |||
Net operating loss and credit carryforwards | $ 84 | $ 90 | |
Accruals and allowances | 187 | 153 | |
Partnership investment | 15 | 14 | |
Stock-based compensation | 99 | 82 | |
Net unrealized (gains) losses | 14 | 16 | |
Total deferred tax assets | 399 | 355 | |
Valuation allowance | (24) | (13) | |
Net deferred tax assets | 375 | 342 | |
Deferred tax liabilities: | |||
Unremitted foreign earnings | (1,246) | (1,156) | $ (650) |
Fixed assets and other intangibles | (226) | (191) | |
Acquired intangibles | (95) | (131) | |
Net unrealized losses (gains) | (2) | (1) | |
Total deferred tax liabilities | (1,569) | (1,479) | |
Net deferred tax assets (liabilities) | $ (1,194) | $ (1,137) |
Income Taxes - Deferred Tax A99
Income Taxes - Deferred Tax Assets and Liabilities by Jurisdiction (Details) - USD ($) $ in Millions | Dec. 31, 2016 | Dec. 31, 2015 |
Deferred Tax [Line Items] | ||
Total deferred tax assets (non-current) | $ 375 | $ 342 |
Total deferred tax liabilities (non-current) | (1,569) | (1,479) |
Net deferred tax assets (liabilities) | (1,194) | (1,137) |
Other assets | ||
Deferred Tax [Line Items] | ||
Total deferred tax assets (non-current) | 21 | 38 |
Long-term liabilities | ||
Deferred Tax [Line Items] | ||
Total deferred tax liabilities (non-current) | $ (1,215) | $ (1,175) |
Income Taxes - Unrecognized Tax
Income Taxes - Unrecognized Tax Benefits (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Changes in unrecognized tax benefits | |||
Gross amounts of unrecognized tax benefits as of the beginning of the period | $ 267 | $ 165 | $ 134 |
Increases related to prior period tax positions | 14 | 39 | 7 |
Decreases related to prior period tax positions | (18) | (4) | (2) |
Increases related to current period tax positions | 51 | 68 | 31 |
Settlements | (1) | (1) | (5) |
Statute of limitation expirations | (1) | 0 | 0 |
Gross amounts of unrecognized tax benefits as of the end of the period | $ 312 | $ 267 | $ 165 |
Restructuring (Details)
Restructuring (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Restructuring and Related Activities [Abstract] | |||
Restructuring expenses | $ 0 | $ 48,000,000 | $ 0 |
Accumulated Other Comprehens102
Accumulated Other Comprehensive (Loss) Income - Summary of Changes in Accumulated Other Comprehensive Income Balances (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Accumulated Balances of Other Comprehensive Income, Tax | |||
AOCI tax, beginning balance | $ 3 | $ 0 | |
Other comprehensive income (loss) before reclassifications, tax | (2) | 3 | |
Less: Amount of gain (loss) reclassified from accumulated other comprehensive income, tax | 0 | 0 | |
Net current period other comprehensive income, tax | (2) | 3 | |
AOCI tax, ending balance | 1 | 3 | $ 0 |
Accumulated Balances of Other Comprehensive Income, Net of Tax | |||
AOCI, net of tax, beginning balance | (9) | 110 | |
Other comprehensive income (loss) before reclassifications, net of tax | 183 | 63 | |
Less: Amount of gain (loss) reclassified from accumulated other comprehensive income, net of tax | 115 | 182 | |
Other comprehensive (loss) income, net of tax | 68 | (119) | 171 |
AOCI, net of tax, ending balance | 59 | (9) | 110 |
Unrealized Gains (Losses) on Cash Flow Hedges | |||
Accumulated Balances of Other Comprehensive Income, Before Tax | |||
AOCI before tax, beginning balance | 57 | 126 | |
Other comprehensive income (loss) before reclassifications, before tax | 193 | 113 | |
Less: Amount of gain (loss) reclassified from accumulated other comprehensive income, before tax | 119 | 182 | |
Net current period other comprehensive income, before tax | 74 | (69) | |
AOCI before tax, ending balance | 131 | 57 | 126 |
Unrealized Gains (Losses) on Investments | |||
Accumulated Balances of Other Comprehensive Income, Before Tax | |||
AOCI before tax, beginning balance | (16) | 0 | |
Other comprehensive income (loss) before reclassifications, before tax | 7 | (16) | |
Less: Amount of gain (loss) reclassified from accumulated other comprehensive income, before tax | (4) | 0 | |
Net current period other comprehensive income, before tax | 11 | (16) | |
AOCI before tax, ending balance | (5) | (16) | 0 |
Foreign Currency Translation | |||
Accumulated Balances of Other Comprehensive Income, Before Tax | |||
AOCI before tax, beginning balance | (53) | (16) | |
Other comprehensive income (loss) before reclassifications, before tax | (15) | (37) | |
Less: Amount of gain (loss) reclassified from accumulated other comprehensive income, before tax | 0 | 0 | |
Net current period other comprehensive income, before tax | (15) | (37) | |
AOCI before tax, ending balance | $ (68) | $ (53) | $ (16) |
Accumulated Other Comprehens103
Accumulated Other Comprehensive (Loss) Income - Reclassifications Out of Other Accumulated Other Comprehensive Income (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||||||||
Net revenues | $ 2,981 | $ 2,667 | $ 2,650 | $ 2,544 | $ 2,556 | $ 2,258 | $ 2,297 | $ 2,137 | $ 10,842 | $ 9,248 | $ 8,025 |
Other income (expense), net | 45 | 27 | (7) | ||||||||
Income before income taxes | 1,631 | 1,488 | 1,261 | ||||||||
Provision for income taxes | (230) | (260) | (842) | ||||||||
Net income | $ 390 | $ 323 | $ 323 | $ 365 | $ 367 | $ 301 | $ 305 | $ 255 | 1,401 | 1,228 | $ 419 |
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income | |||||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||||||||
Net income | 115 | 182 | |||||||||
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income | Gains on cash flow hedges-foreign exchange contracts | |||||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||||||||
Net revenues | 119 | 182 | |||||||||
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income | Unrealized losses on investments | |||||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||||||||
Other income (expense), net | (4) | 0 | |||||||||
Income before income taxes | 115 | 182 | |||||||||
Provision for income taxes | $ 0 | $ 0 |
Quarterly Unaudited Financia104
Quarterly Unaudited Financial Data (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Jul. 17, 2015 | |
Quarterly Financial Information Disclosure [Abstract] | ||||||||||||
Net revenues | $ 2,981 | $ 2,667 | $ 2,650 | $ 2,544 | $ 2,556 | $ 2,258 | $ 2,297 | $ 2,137 | $ 10,842 | $ 9,248 | $ 8,025 | |
Net income | $ 390 | $ 323 | $ 323 | $ 365 | $ 367 | $ 301 | $ 305 | $ 255 | $ 1,401 | $ 1,228 | $ 419 | |
Net income per share-basic (in usd per share) | $ 0.32 | $ 0.27 | $ 0.27 | $ 0.30 | $ 0.30 | $ 0.25 | $ 0.25 | $ 0.21 | $ 1.16 | $ 1 | $ 0.34 | |
Net income per share-diluted (in usd per share) | $ 0.32 | $ 0.27 | $ 0.27 | $ 0.30 | $ 0.30 | $ 0.25 | $ 0.25 | $ 0.21 | $ 1.15 | $ 1 | $ 0.34 | |
Weighted average shares: | ||||||||||||
Basic (in shares) | 1,207,000,000 | 1,207,000,000 | 1,210,000,000 | 1,216,000,000 | 1,223,000,000 | 1,221,000,000 | 1,218,000,000 | 1,218,000,000 | 1,210,000,000 | 1,222,000,000 | 1,218,000,000 | |
Diluted (in shares) | 1,216,000,000 | 1,214,000,000 | 1,215,000,000 | 1,225,000,000 | 1,230,000,000 | 1,227,000,000 | 1,224,000,000 | 1,224,000,000 | 1,218,000,000 | 1,229,000,000 | 1,224,000,000 | |
Common Stock Shares | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Number of PayPal shares distributed for every eBay common stock held | 1 |
FINANCIAL STATEMENT SCHEDULE (D
FINANCIAL STATEMENT SCHEDULE (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Allowance for Transaction Losses | |||
Movement in Valuation Allowances and Reserves | |||
Balance at Beginning of Period | $ 185 | $ 166 | $ 137 |
Charged/ (Credited) to Net Income | 655 | 511 | 408 |
Charges Utilized/ (Write-offs) | (618) | (492) | (379) |
Balance at End of Period | 222 | 185 | 166 |
Allowance for Loans and Interest Receivable | |||
Movement in Valuation Allowances and Reserves | |||
Balance at Beginning of Period | 233 | 195 | 146 |
Charged/ (Credited) to Net Income | 555 | 385 | 333 |
Charges Utilized/ (Write-offs) | (449) | (347) | (284) |
Balance at End of Period | $ 339 | $ 233 | $ 195 |