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Discontinued Operations
 3 Months Ended
Mar. 31, 2021
Discontinued Operations and Disposal Groups [Abstract]  
Discontinued Operations Discontinued Operations
StubHub

On November 24, 2019, we entered into a stock purchase agreement with an affiliate of viagogo to sell our StubHub business. On February 13, 2020, we completed the sale of our StubHub business to an affiliate of viagogo for a purchase price of $4.05 billion in cash, subject to certain adjustments specified in the purchase agreement, including adjustments for indebtedness, cash, working capital and transaction expenses of StubHub at the closing of the transaction. The sale was completed for $4.1 billion in proceeds ($3.2 billion, net of income taxes of approximately $900 million) and a pre-tax gain of $3.9 billion within income from discontinued operations, both subject to working capital adjustments.

In connection with the sale of StubHub, we entered into a transition service agreement (“TSA”) with viagogo pursuant to which we are providing services, including, but not limited to, business support services for StubHub after the divestiture. These agreements commenced with the close of the transaction and have minimum initial
terms ranging from 12 to 18 months and can be extended by viagogo for a maximum of 12 months. The estimated related fees in 2021 are $27 million for support services.

Classifieds

On July 20, 2020, we entered into a definitive agreement with Adevinta to transfer our Classifieds business to Adevinta for $2.5 billion in cash, subject to certain adjustments, and approximately 540 million shares in Adevinta. Together, the total consideration payable under the definitive agreement is valued at approximately $9.2 billion, based on the closing trading price of Adevinta’s outstanding shares on the Oslo Stock Exchange on July 17, 2020. We believe the transaction will close in the second quarter of 2021. Completion of the transaction is subject to certain conditions, including receipt of certain regulatory approvals and other customary closing conditions. We have classified the results of our Classifieds business as discontinued operations in our condensed consolidated statement of income for the periods presented. Additionally, the related assets and liabilities associated with the discontinued operations are classified as held for sale in our condensed consolidated balance sheet. The assets and liabilities as of March 31, 2021 are classified as current in our condensed consolidated balance sheet as we expect to close the transaction discussed above within one year.

The following table presents financial results from discontinued operations, net of income taxes in our condensed consolidated statement of income (in millions):

 Three Months Ended
March 31,
 2021
2020 (1)
Classifieds income from discontinued operations, net of income taxes$72 $54 
StubHub income from discontinued operations, net of income taxes
— 2,928 
PayPal and Enterprise (loss) from discontinued operations, net of income taxes— (1)
Income from discontinued operations, net of income taxes$72 $2,981 
(1) Includes StubHub financial results from January 1, 2020 to February 13, 2020, and includes the gain on sale recorded for the StubHub transaction.

The following table presents cash flows for discontinued operations (in millions):
 Three Months Ended
March 31,
 2021
2020 (1)
Classifieds net cash provided by discontinued operating activities
$104 $88 
StubHub net cash provided by (used in) discontinued operating activities— (110)
Net cash provided by (used in) discontinued operating activities$104 $(22)
Classifieds net cash (used in) discontinued investing activities
$(1)$(1)
StubHub net cash provided by (used in) discontinued investing activities— 4,075 
Net cash provided by (used in) discontinued investing activities $(1)$4,074 
Classifieds net cash (used in) discontinued financing activities
$— $(2)
Net cash (used in) discontinued financing activities$— $(2)
(1) Includes StubHub financial results from January 1, 2020 to February 13, 2020, and includes the gain on sale recorded for the StubHub transaction.
The financial results of StubHub are presented as income from discontinued operations, net of income taxes on our condensed consolidated statement of income. The following table presents the financial results of StubHub (in millions):
 Three Months Ended
March 31,
 2021
2020(1)
Net revenues$— $100 
Cost of net revenues— 31 
Gross profit— 69 
Operating expenses:
Sales and marketing— 51 
Product development— 29 
General and administrative— 33 
Provision for transaction losses— 3 
Amortization of acquired intangible assets— 1 
Total operating expenses— 117 
Income (loss) from operations of discontinued operations— (48)
Pre-tax gain (loss) on sale— 3,876 
Income (loss) from discontinued operations before income taxes— 3,828 
Income tax benefit (provision)— (900)
Income (loss) from discontinued operations, net of income taxes$— $2,928 
(1) Includes StubHub financial results from January 1, 2020 to February 13, 2020, and includes the gain on sale recorded for the StubHub transaction.

The financial results of Classifieds are presented as income from discontinued operations, net of income taxes on our condensed consolidated statement of income. Each period presented below includes the impact of intercompany revenue agreements that will continue with eBay subsequent to the completion of the transfer of the Classifieds business. The impact of these intercompany revenue agreements to net revenues and cost of net revenues were $2 million and $4 million for the three months ended March 31, 2021 and 2020. The expected continuing cash flows are not considered to be significant. The following table presents the financial results of Classifieds (in millions):
 Three Months Ended
March 31,
 20212020
Net revenues$276 $245 
Cost of net revenues30 24 
Gross profit246 221 
Operating expenses:
Sales and marketing87 87 
Product development43 35 
General and administrative27 27 
Provision for transaction losses2 6 
Amortization of acquired intangible assets— 2 
Total operating expenses159 157 
Income from operations of discontinued operations87 64 
Interest and other, net1 1 
Income from discontinued operations before income taxes88 65 
Income tax provision(16)(11)
Income from discontinued operations, net of income taxes$72 $54 
For the three months ended March 31, 2021 and 2020, the discontinued operations activity related to our former PayPal and Enterprise businesses was immaterial.

The following table presents the aggregate carrying amounts of held for sale assets and liabilities related to Classifieds in the condensed consolidated balance sheet (in millions):
 March 31, 2021December 31, 2020
Carrying amounts of assets included as part of held for sale:
Cash and cash equivalents$31 $23 
Accounts receivable, net113 117 
Other current assets34 30 
Long-term investments32 32 
Property and equipment, net34 31 
Goodwill454 465 
Intangible assets, net35 35 
Operating lease right-of-use assets23 20 
Deferred tax assets415 435 
Total assets classified as held for sale in the condensed consolidated balance sheet$1,171 $1,188 
Carrying amounts of liabilities included as part of held for sale:
Accounts payable$37 $18 
Accrued expenses and other current liabilities100 104 
Deferred revenue5 4 
Income taxes payable37 35 
Operating lease liabilities14 11 
Deferred tax liabilities268 278 
Other liabilities2 2 
Total liabilities classified as held for sale in the condensed consolidated balance sheet
$463 $452