Cover Page
Cover Page - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2020 | Jan. 29, 2021 | Jun. 30, 2020 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2020 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 001-36859 | ||
Entity Registrant Name | PayPal Holdings, Inc. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 47-2989869 | ||
Entity Address, Address Line One | 2211 North First Street | ||
Entity Address, City or Town | San Jose, | ||
Entity Address, State or Province | CA | ||
Entity Address, Postal Zip Code | 95131 | ||
City Area Code | 408 | ||
Local Phone Number | 967-1000 | ||
Title of 12(b) Security | Common stock, $0.0001 par value per share | ||
Entity Trading Symbol | PYPL | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 204.2 | ||
Entity Common Stock, Shares Outstanding (in shares) | 1,171,175,760 | ||
Documents Incorporated by Reference | Portions of the registrant’s definitive proxy statement for its 2021 Annual Meeting of Stockholders are incorporated herein by reference in Part III of this Annual Report on Form 10-K to the extent stated herein. Such proxy statement will be filed with the Securities and Exchange Commission within 120 days of the registrant’s fiscal year ended December 31, 2020. | ||
Entity Central Index Key | 0001633917 | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 4,794 | $ 7,349 |
Short-term investments | 8,289 | 3,412 |
Accounts receivable, net | 577 | 435 |
Loans and interest receivable, net of allowances of $838 and $258 as of December 31, 2020 and 2019, respectively | 2,769 | 3,972 |
Funds receivable and customer accounts | 33,418 | 22,527 |
Prepaid expenses and other current assets | 1,148 | 800 |
Total current assets | 50,995 | 38,495 |
Long-term investments | 6,089 | 2,863 |
Property and equipment, net | 1,807 | 1,693 |
Goodwill | 9,135 | 6,212 |
Intangible assets, net | 1,048 | 778 |
Other assets | 1,305 | 1,292 |
Total assets | 70,379 | 51,333 |
Current liabilities: | ||
Accounts payable | 252 | 232 |
Funds payable and amounts due to customers | 35,418 | 24,527 |
Accrued expenses and other current liabilities | 2,648 | 2,087 |
Income taxes payable | 129 | 73 |
Total current liabilities | 38,447 | 26,919 |
Deferred tax liability and other long-term liabilities | 2,930 | 2,520 |
Long-term debt | 8,939 | 4,965 |
Total liabilities | 50,316 | 34,404 |
Commitments and contingencies (Note 13) | ||
Equity: | ||
Common stock, $0.0001 par value; 4,000 shares authorized; 1,172 and 1,173 shares outstanding as of December 31, 2020 and 2019, respectively | 0 | 0 |
Preferred stock, $0.0001 par value; 100 shares authorized, unissued | 0 | 0 |
Treasury stock at cost, 117 and 105 shares as of December 31, 2020 and 2019, respectively | (8,507) | (6,872) |
Additional paid-in-capital | 16,644 | 15,588 |
Retained earnings | 12,366 | 8,342 |
Accumulated other comprehensive income (loss) | (484) | (173) |
Total PayPal Stockholders’ equity | 20,019 | 16,885 |
Noncontrolling interest | 44 | 44 |
Total equity | 20,063 | 16,929 |
Total liabilities and equity | $ 70,379 | $ 51,333 |
CONSOLIDATED BALANCE SHEETS (PA
CONSOLIDATED BALANCE SHEETS (PARENTHETICAL) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Loans and interest receivable, allowances | $ 838 | $ 258 |
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) | 1,172,000,000 | 1,173,000,000 |
Preferred stock, par value (in usd per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Treasury stock, shares (in shares) | 117,000,000 | 105,000,000 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Statement [Abstract] | |||
Net revenues | $ 21,454 | $ 17,772 | $ 15,451 |
Operating expenses: | |||
Transaction expense | 7,934 | 6,790 | 5,581 |
Transaction and credit losses | 1,741 | 1,380 | 1,274 |
Customer support and operations | 1,778 | 1,615 | 1,407 |
Sales and marketing | 1,861 | 1,401 | 1,314 |
Technology and development | 2,642 | 2,085 | 1,831 |
General and administrative | 2,070 | 1,711 | 1,541 |
Restructuring and other charges | 139 | 71 | 309 |
Total operating expenses | 18,165 | 15,053 | 13,257 |
Operating income | 3,289 | 2,719 | 2,194 |
Other income (expense), net | 1,776 | 279 | 182 |
Income before income taxes | 5,065 | 2,998 | 2,376 |
Income tax expense | 863 | 539 | 319 |
Net income | $ 4,202 | $ 2,459 | $ 2,057 |
Net income per share: | |||
Basic (in usd per share) | $ 3.58 | $ 2.09 | $ 1.74 |
Diluted (in usd per share) | $ 3.54 | $ 2.07 | $ 1.71 |
Weighted average shares: | |||
Basic (in shares) | 1,173 | 1,174 | 1,184 |
Diluted (in shares) | 1,187 | 1,188 | 1,203 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 4,202 | $ 2,459 | $ 2,057 |
Other comprehensive income (loss), net of reclassification adjustments: | |||
Foreign currency translation adjustments (“CTA”) | (48) | (57) | (68) |
Net investment hedge CTA gain (loss) | 55 | (31) | 0 |
Unrealized (losses) gains on cash flow hedges, net | (329) | (176) | 293 |
Tax benefit (expense) on unrealized (losses) gains on cash flow hedges, net | 4 | 3 | (5) |
Unrealized gains (losses) on investments, net | 9 | 15 | (1) |
Tax (expense) benefit on unrealized gains (losses) on investments, net | (2) | (5) | 1 |
Other comprehensive income (loss), net of tax | (311) | (251) | 220 |
Comprehensive income | $ 3,891 | $ 2,208 | $ 2,277 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) shares in Millions, $ in Millions | Total | Cumulative Effect, Period of Adoption, Adjustment | Common Stock Shares | Treasury Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings | Retained EarningsCumulative Effect, Period of Adoption, Adjustment | Noncontrolling Interest |
Accounting Standards Update [Extensible List] | us-gaap:AccountingStandardsUpdate201602Member | ||||||||
Beginning balance (in shares) at Dec. 31, 2017 | 1,200 | ||||||||
Beginning balance at Dec. 31, 2017 | $ 15,994 | $ (2,001) | $ 14,314 | $ (142) | $ 3,823 | $ 0 | |||
Increase (Decrease) in Stockholders' Equity | |||||||||
Net income | 2,057 | 2,057 | |||||||
Foreign CTA | (68) | (68) | |||||||
Net investment hedge CTA gain (loss) | 0 | ||||||||
Unrealized (losses) gains on cash flow hedges, net | 293 | 293 | |||||||
Tax benefit (expense) on unrealized (losses) gains on cash flow hedges, net | (5) | (5) | |||||||
Unrealized gains (losses) on investments, net | (1) | (1) | |||||||
Tax (expense) benefit on unrealized gains (losses) on investments, net | 1 | 1 | |||||||
Common stock and stock-based awards issued and assumed, net of shares withheld for employee taxes (in shares) | 18 | ||||||||
Common stock and stock-based awards issued and assumed, net of shares withheld for employee taxes | $ (251) | (251) | |||||||
Common stock repurchased (in shares) | (44) | (44) | |||||||
Common stock repurchased | $ (3,525) | (3,510) | (15) | ||||||
Stock-based compensation | 891 | 891 | |||||||
Ending balance (in shares) at Dec. 31, 2018 | 1,174 | ||||||||
Ending balance at Dec. 31, 2018 | $ 15,386 | $ 3 | (5,511) | 14,939 | 78 | 5,880 | $ 3 | 0 | |
Accounting Standards Update [Extensible List] | us-gaap:AccountingStandardsUpdate201613Member | ||||||||
Increase (Decrease) in Stockholders' Equity | |||||||||
Net income | $ 2,459 | 2,459 | |||||||
Foreign CTA | (57) | (57) | |||||||
Net investment hedge CTA gain (loss) | (31) | (31) | |||||||
Unrealized (losses) gains on cash flow hedges, net | (176) | (176) | |||||||
Tax benefit (expense) on unrealized (losses) gains on cash flow hedges, net | 3 | 3 | |||||||
Unrealized gains (losses) on investments, net | 15 | 15 | |||||||
Tax (expense) benefit on unrealized gains (losses) on investments, net | (5) | (5) | |||||||
Common stock and stock-based awards issued and assumed, net of shares withheld for employee taxes (in shares) | 13 | ||||||||
Common stock and stock-based awards issued and assumed, net of shares withheld for employee taxes | $ (365) | (365) | |||||||
Common stock repurchased (in shares) | (14) | (14) | |||||||
Common stock repurchased | $ (1,406) | (1,361) | (45) | ||||||
Stock-based compensation | 1,059 | 1,059 | |||||||
Purchase of noncontrolling interest | $ 44 | 44 | |||||||
Ending balance (in shares) at Dec. 31, 2019 | 1,173 | 1,173 | |||||||
Ending balance at Dec. 31, 2019 | $ 16,929 | $ (178) | (6,872) | 15,588 | (173) | 8,342 | $ (178) | 44 | |
Increase (Decrease) in Stockholders' Equity | |||||||||
Net income | 4,202 | 4,202 | |||||||
Foreign CTA | (48) | (48) | |||||||
Net investment hedge CTA gain (loss) | 55 | 55 | |||||||
Unrealized (losses) gains on cash flow hedges, net | (329) | (329) | |||||||
Tax benefit (expense) on unrealized (losses) gains on cash flow hedges, net | 4 | 4 | |||||||
Unrealized gains (losses) on investments, net | 9 | 9 | |||||||
Tax (expense) benefit on unrealized gains (losses) on investments, net | (2) | (2) | |||||||
Common stock and stock-based awards issued and assumed, net of shares withheld for employee taxes (in shares) | 11 | ||||||||
Common stock and stock-based awards issued and assumed, net of shares withheld for employee taxes | $ (365) | (365) | |||||||
Common stock repurchased (in shares) | (12) | (12) | |||||||
Common stock repurchased | $ (1,635) | (1,635) | |||||||
Stock-based compensation | $ 1,421 | 1,421 | |||||||
Ending balance (in shares) at Dec. 31, 2020 | 1,172 | 1,172 | |||||||
Ending balance at Dec. 31, 2020 | $ 20,063 | $ (8,507) | $ 16,644 | $ (484) | $ 12,366 | $ 44 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Cash flows from operating activities: | |||
Net income | $ 4,202 | $ 2,459 | $ 2,057 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Transaction and credit losses | 1,741 | 1,380 | 1,274 |
Depreciation and amortization | 1,189 | 912 | 776 |
Stock-based compensation | 1,376 | 1,021 | 853 |
Deferred income taxes | 165 | (269) | (171) |
Cost basis adjustments to loans and interest receivable held for sale | 0 | 0 | 244 |
Net gains on strategic investments | (1,914) | (208) | (87) |
Other | 47 | (149) | (85) |
Changes in assets and liabilities: | |||
Accounts receivable | (100) | (120) | (59) |
Changes in loans and interest receivable held for sale, net | 0 | 4 | 1,407 |
Transaction loss allowance for cash losses, net | (1,120) | (1,079) | (1,046) |
Other current assets and non-current assets | (498) | (566) | (93) |
Accounts payable | (4) | 4 | 26 |
Income taxes payable | (230) | (40) | (44) |
Other current liabilities and non-current liabilities | 1,000 | 722 | 428 |
Net cash provided by operating activities | 5,854 | 4,071 | 5,480 |
Cash flows from investing activities: | |||
Purchases of property and equipment | (866) | (704) | (823) |
Proceeds from sales of property and equipment | 120 | 17 | 3 |
Changes in principal loans receivable, net | 294 | (1,631) | 3,121 |
Purchases of investments | (41,513) | (27,881) | (22,381) |
Maturities and sales of investments | 30,908 | 24,878 | 21,898 |
Acquisitions, net of cash and restricted cash acquired | (3,609) | (70) | (2,124) |
Funds receivable | (1,552) | (351) | 1,127 |
Net cash (used in) provided by investing activities | (16,218) | (5,742) | 821 |
Cash flows from financing activities: | |||
Proceeds from issuance of common stock | 137 | 138 | 144 |
Purchases of treasury stock | (1,635) | (1,411) | (3,520) |
Tax withholdings related to net share settlements of restricted stock units and restricted stock awards | (521) | (504) | (419) |
Borrowings under financing arrangements | 6,966 | 5,471 | 2,075 |
Repayments under financing arrangements | (3,000) | (2,516) | (1,115) |
Funds payable and amounts due to customers | 10,597 | 3,009 | 1,595 |
Other financing activities | (52) | 0 | 0 |
Net cash provided by (used in) financing activities | 12,492 | 4,187 | (1,240) |
Effect of exchange rate changes on cash, cash equivalents, and restricted cash | 169 | (6) | (113) |
Net change in cash, cash equivalents, and restricted cash | 2,297 | 2,510 | 4,948 |
Cash, cash equivalents, and restricted cash at beginning of period | 15,743 | 13,233 | 8,285 |
Cash, cash equivalents, and restricted cash at end of period | 18,040 | 15,743 | 13,233 |
Supplemental cash flow disclosures: | |||
Cash paid for interest | 190 | 78 | 69 |
Cash paid for income taxes, net | 565 | 665 | 328 |
The below table reconciles cash, cash equivalents, and restricted cash as reported in the consolidated balance sheets to the total of the same amounts shown in the consolidated statements of cash flows: | |||
Total cash, cash equivalents, and restricted cash shown in the consolidated statements of cash flows | $ 18,040 | $ 13,233 | $ 8,285 |
OVERVIEW AND SUMMARY OF SIGNIFI
OVERVIEW AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2020 | |
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 merchants and consumers worldwide. PayPal is committed to democratizing financial services to improve the financial health of individuals and to increase economic opportunity for entrepreneurs and business of all sizes around the world. Our goal is to enable our merchants and consumers to manage and move their money anywhere in the world, anytime, on any platform, and using any device when sending payments or getting paid. We also facilitate person-to-person (“P2P”) payments through our PayPal, Venmo, and Xoom products and services and simplify and personalize shopping experiences for our consumers through our Honey Platform. Our combined payment solutions, including our core PayPal, PayPal Credit, Braintree, Venmo, Xoom, iZettle, and Hyperwallet products and services, comprise 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 focus by regulators globally on all aspects of the payments industry, including countering terrorist financing, anti-money laundering, privacy, cybersecurity, and consumer protection. The laws and regulations applicable to us, including those enacted prior to the advent of digital and mobile payments, are continuing to evolve through legislative and regulatory action and judicial interpretation. New or changing laws and regulations, including the changes to their interpretation and implementation, as well as increased penalties and enforcement actions related to non-compliance, could have a material adverse impact on our business, results of operations, and financial condition. We monitor these areas closely and are focused on designing compliant solutions for our customers. SIGNIFICANT ACCOUNTING POLICIES Basis of presentation and principles of consolidation The accompanying consolidated financial statements include the financial statements of PayPal and our wholly- and majority-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Noncontrolling interest reported as a component of equity on our consolidated balance sheets represents the equity interests not owned by PayPal and is recorded for consolidated entities we control and of which we own less than 100%. Noncontrolling interest is not presented separately on our consolidated statements of income as the amount is de minimis. Investments in entities where we have the ability to exercise significant influence, but not control, over the investee are accounted for using the equity method of accounting. For such investments, our share of the investee’s results of operations is included in other income (expense), net on our consolidated statements of income and our investment balance is included in long-term investments on our consolidated balance sheets. Investments in entities where we do not have the ability to exercise significant influence over the investee are accounted for at fair value or cost minus impairment, if any, adjusted for changes resulting from observable price changes, which are included in other income (expense), net on our consolidated statements of income. Our investment balance is included in long-term investments on our consolidated balance sheets. We determine at the inception of each investment, and re-evaluate if certain events occur, whether an entity in which we have made an investment is considered a variable interest entity (“VIE”). If we determine an investment is a VIE, we then assess if we are the primary beneficiary, which would require consolidation. As of December 31, 2020, none of these VIEs qualified for consolidation as the structures of these entities do not provide us with the ability to direct the activities that would significantly impact their economic performance. The carrying value of our investments that are VIEs was de minimis and included as non-marketable equity securities accounted for using the equity method of accounting in long-term investments on our consolidated balance sheets. Our maximum exposure to loss, including the carrying value of the investments and any future funding commitments, was $105 million as of December 31, 2020. In the opinion of management, these consolidated financial statements reflect all adjustments, consisting only of normal recurring adjustments, which are necessary for a fair statement of the consolidated financial statements for all periods presented. Certain amounts for prior years have been reclassified to conform to the financial statement presentation as of and for the year ended December 31, 2020. Reclassifications Beginning with the fourth quarter of 2020, we reclassified certain cash flows related to customer balances from cash flows from operating activities to cash flows from investing activities and cash flows from financing activities within the consolidated statements of cash flows. Prior period amounts have been reclassified to conform to the current period presentation. These changes have no impact on our previously reported consolidated net income, financial position, net change in cash, cash equivalents, and restricted cash, or total cash, cash equivalents, and restricted cash as reported on our consolidated statements of cash flows. The current period presentation classifies all changes in funds receivable and customer accounts and funds payable and amounts due to customers consistently on our consolidated statement of cash flows as cash flows from investing activities and cash flows from financing activities, respectively, regardless of which product the cash flows relate to on our Payments Platform. The current period presentation provides a more meaningful representation of the cash flows related to the movement of customer funds due to the restrictions on and use of those funds. The following tables present the effects of the changes on the presentation of these cash flows to the previously reported consolidated statements of cash flows: Year Ended December 31, 2019 (In millions) As Previously Reported (1) Adjustments Reclassified Net cash provided by (used in): Operating activities (2) $ 4,561 $ (490) $ 4,071 Investing activities (3) (5,733) (9) (5,742) Financing activities (4) 3,688 499 4,187 Effect of exchange rates on cash, cash equivalents, and restricted cash (6) — (6) Net increase in cash, cash equivalents, and restricted cash $ 2,510 $ — $ 2,510 (1) As reported in our 2019 Form 10-K filed with the SEC on February 6, 2020. (2) Financial statement lines impacted in operating activities were “Funds receivable” and “Funds payable and amounts due to customers,” which increased by $9 million and decreased by $499 million, respectively, to arrive at the reclassified amounts. (3) Financial statement line impacted in investing activities was “Funds receivable.” (4) Financial statement line impacted in financing activities was “Funds payable and amounts due to customers.” Year Ended December 31, 2018 (In millions) As Previously Reported (1) Adjustments Reclassified Net cash provided by (used in): Operating activities (2) $ 5,483 $ (3) $ 5,480 Investing activities (3) 840 (19) 821 Financing activities (4) (1,262) 22 (1,240) Effect of exchange rates on cash, cash equivalents, and restricted cash (113) — (113) Net increase in cash, cash equivalents, and restricted cash $ 4,948 $ — $ 4,948 (1) As reported in our 2019 Form 10-K filed with the SEC on February 6, 2020. (2) Financial statement lines impacted in operating activities were “Funds receivable” and “Funds payable and amounts due to customers,” which increased by $19 million and decreased by $22 million, respectively, to arrive at the reclassified amounts. (3) Financial statement line impacted in investing activities was “Funds receivable.” (4) Financial statement line impacted in financing activities was “Funds payable and amounts due to customers.” Use of estimates The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles (“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 during the reporting period. On an ongoing basis, we evaluate our estimates, including those related to provisions for transaction and credit losses, loss contingencies, income taxes, revenue recognition, and the valuation of goodwill and intangible assets. We base our estimates on historical experience and various other assumptions which we believe to be reasonable under the circumstances. These estimates may change as new events occur, and as additional information surrounding the continued impact of the novel coronavirus (“COVID-19”) pandemic becomes available. Actual results could differ from these estimates and any such differences may be material to our financial statements. 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 bank deposits, government and agency securities, and commercial paper. Investments Short-term investments 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 or maturities of less than one year on the reporting date. Long-term investments include time deposits, government and agency securities, corporate debt securities, and asset-backed securities with maturities exceeding one year, and our strategic investments. Government and agency securities, corporate debt securities, and asset-backed securities are classified as available-for-sale and are reported at fair value using the specific identification method. Unrealized gains and losses are 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 9—Fair Value Measurement of Assets and Liabilities.” 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 strategic investments consist of marketable equity securities, which are publicly traded, and non-marketable equity securities, which are investments in privately held companies. Marketable equity securities have readily determinable fair values with changes in fair value recorded in other income (expense), net. Non-marketable equity securities include investments that do not have a readily determinable fair value, as well as equity method investments. The investments that do not have readily determinable fair value are measured at cost minus impairment, if any, adjusted for changes resulting from observable price changes in orderly transactions for an identical or similar investment in the same issuer (the “Measurement Alternative”). All gains and losses on these investments, realized and unrealized, are recorded in other income (expense), net on our consolidated statements of income. Our investments where we have the ability to exercise significant influence, but not control, over the investee are accounted for as equity method investments and our share of the investee’s results of operations is included in other income (expense), net. We assess whether an impairment loss on our non-marketable equity securities and an other-than-temporary impairment loss on our equity method investments (and available-for-sale debt securities, prior to 2020) has occurred due to declines in fair value or other market conditions. If any impairment is identified for non-marketable equity securities or impairment is considered other-than-temporary for our equity method investments (and available-for-sale debt securities, prior to 2020), we 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 available-for-sale debt securities, prior to 2020, this assessment took into account the severity and duration of the decline in value, our intent to sell the security, whether it was more likely than not we would be required to sell the security before recovery of its amortized cost basis, and whether we expected to recover the entire amortized cost basis of the security (that is, whether a credit loss existed). Beginning in 2020, our available-for-sale debt securities in an unrealized loss position will be written down to fair value through a charge to other income (expense), net in our consolidated statements of income if we intend to sell the security or it is more likely than not we will be required to sell the security before recovery of its amortized cost basis. For the remaining available-for-sale debt securities in an unrealized loss position, if we identify that the decline in fair value has resulted from credit losses, taking into consideration changes to the rating of the security by rating agencies, implied yields versus benchmark yields, and the extent to which fair value is less than amortized cost, among other factors, we will estimate the present value of cash flows expected to be collected. If the present value of cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an allowance for credit losses is recorded, limited by the amount that the fair value is less than the amortized cost basis. Any portion of impairment not related to credit losses is recognized in other comprehensive income. Loans and interest receivable, net Loans and interest receivable, net represents merchant receivables originated under our PayPal Working Capital (“PPWC”) product and PayPal Business Loan (“PPBL”) product and consumer loans originated under our PayPal Credit and installment credit products. In the U.S., we partner with an independent chartered financial institution that extends credit to merchants using our PPWC product or PPBL product and purchase the related receivables extended by the independent chartered financial institution. For our merchant credit products outside the U.S., we extend working capital advances in the U.K. and loans in Germany through our Luxembourg banking subsidiary, and working capital loans in Australia through an Australian subsidiary. In the U.S., we extend installment loans to consumers through a U.S. subsidiary. For our international consumer credit products, we extend credit through our Luxembourg banking subsidiary. As part of our arrangement with the independent chartered financial institution in the U.S., we sell back a participation interest in the pool of merchant receivables. The independent chartered financial institution has 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 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 merchant receivables. All risks of loss are shared pro rata based on participation interests held among all participating stakeholders. We account for the asset transfer as a sale and derecognize the portion of the participation interests for which control has been surrendered. For this arrangement, gains or losses on the sale of the participation interests are not material as the carrying amount of the participation interest sold approximates the fair value at time of transfer. In instances where a merchant is able to demonstrate that they are experiencing financial difficulty, there may be a modification of the loans or advances and the related interest receivable for which it is probable that, without modification, we will be unable to collect all amounts due, therefore resulting in a troubled debt restructuring (“TDR”). Refer to “Note 11—Loans and Interest Receivable” for further information related to TDRs. Loans, advances, and interest and fees receivable are reported at their outstanding balances, net of any participation interests sold and pro rata current expected credit losses, including unamortized deferred origination costs. We maintain the servicing rights for the entire pool of consumer and merchant receivables outstanding and receive a fee approximating the fair value for servicing the assets underlying the participation interest sold. We offer both revolving and installment credit products to our consumers. 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. U.S. Consumer Credit Portfolio In November 2017, we reached an agreement to sell our U.S. consumer credit receivables portfolio to Synchrony Bank (“Synchrony”). Following the closing of this transaction in July 2018, Synchrony became the exclusive issuer of the PayPal Credit online consumer financing program in the U.S. We no longer hold an ownership interest in the receivables generated through the program and thus, no longer record these receivables on our consolidated financial statements. PayPal earns a revenue share on the portfolio of consumer receivables owned by Synchrony, which includes both the sold and newly generated receivables, and it is recorded in revenues from other value added services on our consolidated statements of income. Through the closing of the transaction with Synchrony, we continued to work with an independent chartered financial institution to extend credit to U.S. consumers using our PayPal Credit product. We purchased the related receivables extended by the independent chartered financial institution until July 2018. As part of the arrangements we had with the independent chartered financial institution in the U.S., we sold back a participation interest in the pool of U.S. consumer receivables outstanding under PayPal Credit consumer accounts. For these arrangements, gains or losses on the sale of the participation interest were not material as the carrying amount of the participation interest sold approximated the fair value at time of transfer. Allowance for loans and interest receivable The allowance for loans and interest receivable represents our estimate of current expected credit losses inherent in our portfolio of loans and interest receivables. Increases to the allowance for loans receivable are reflected as a component of transaction and credit losses on our consolidated statements of income. Increases to the allowance for interest and fees receivable are reflected as a reduction of net revenues on our consolidated statements of income, or as a reduction of deferred revenue when interest and fees are billed at the inception of a loan or advance. The evaluation process to assess the adequacy of allowances is subject to numerous estimates and judgments. Beginning in 2020, the allowance for loans and interest receivable is primarily based on expectations of credit losses based on historical lifetime loss data as well as macroeconomic forecasts applied to the portfolio, which is segmented by factors such as geographic region, delinquency, and vintage. Loss curves are generated using historical loss data for each loan portfolio and are applied to segments of each portfolio, categorized by factors such as geographic region, first borrowing versus reuse, delinquency, credit rating, and vintage, which vary by portfolio. We then apply macroeconomic factors such as forecasted trends in unemployment and benchmark credit card charge-off rates, which are sourced externally, using a single scenario that we believe is most appropriate to the economic conditions applicable to a particular period. Projected loss rates, inclusive of historical loss data and macroeconomic factors, are applied to the principal amount of our consumer and merchant receivables. We also include qualitative adjustments that incorporate incremental information not captured in the quantitative estimates of our current expected credit losses. Our consumer receivables are primarily revolving in nature and do not have a contractual term; however, the reasonable and supportable forecast period we have included in our projected loss rates based on externally sourced data is approximately seven years. Our merchant receivables vary in contractual term; however, the reasonable and supportable forecast period considered for projected loss rates is approximately 2.5 to 3.5 years, depending upon the product. The allowance for credit losses on interest and fees receivable is determined primarily by applying loss curves to each portfolio by geography, delinquency, and period of origination, among other factors. Prior to 2020, the allowance for our consumer loans receivable was primarily based on forecasted principal balance delinquency rates (“roll rates”). Roll rates are the percentage of balances which we estimate would 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 were applied to the principal amount of our consumer receivables for each stage of delinquency, from current to 179 days past the payment due date, in order to estimate the principal loans which had incurred losses and were probable to be charged off. For merchant loans and advances receivable, the allowance was 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 179 days past due, for principal balances related to merchant receivables outstanding was based on the current expected or contractual repayment period of the loan or advance and interest or fixed fee as compared to the original expected or contractual repayment period. The allowance for loss against interest receivable was 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 had incurred losses and were probable to be charged off. The allowance for fees receivable was primarily based on fee balances, forecasted delinquency rates, and recoveries through the use of a vintage-based loss forecasting model. In connection with our agreement to sell our U.S. consumer credit receivables to Synchrony and the designation of that portfolio as held for sale, in November 2017, we reversed the corresponding allowances against those loans and interest receivable balances. Such allowances on any newly originated U.S. consumer loans and interest receivables, held for sale were not established. Adjustments to the cost basis of this portfolio until the sale was completed in July 2018, which were primarily driven by charge-offs, were recorded in restructuring and other charges on our consolidated statements of income. 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 sheets as a liability classified as amounts due to customers. Certain jurisdictions where PayPal operates require us to hold eligible liquid assets, as defined by applicable regulatory requirements and commercial law in these jurisdictions, equal to at least 100% of the aggregate amount of all customer balances. Therefore, we restrict the use of the assets underlying the customer balances to meet these regulatory requirements and separately classify the assets as customer accounts in our consolidated balance sheets. 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. Customer funds for which PayPal is an agent and custodian on behalf of our customers are not reflected on our consolidated balance sheets. These funds include U.S. dollar funds which are deposited at one or more third-party financial institutions insured by the Federal Deposit Insurance Corporation (“FDIC”) and are eligible for FDIC pass-through insurance (subject to applicable limits). We act as an agent in facilitating cryptocurrency transactions on behalf of our customers. Cryptocurrencies held on behalf of our customers are not PayPal’s assets and therefore are not reflected on our consolidated balance sheets. In June 2018, the Luxembourg Commission de Surveillance du Secteur Financier (the “CSSF”) agreed that PayPal’s management may designate up to 35% of European customer balances held in our Luxembourg banking subsidiary to be used for European and U.S. credit activities. As of December 31, 2020, the cumulative amount approved by management to be designated for credit activities aggregated to $2.0 billion and represented approximately 21% of European customer balances potentially available for our corporate use at that date, as determined by applying financial regulations maintained by the CSSF. At the time PayPal’s management designates the European customer balances held in our Luxembourg banking subsidiary to be used to extend credit, the balances are classified as cash and cash equivalents and no longer classified as customer accounts on our consolidated balance sheets. The remaining assets underlying the customer balances remain separately classified as customer accounts on our consolidated balance sheets. 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, government and agency securities, and asset-backed securities. See “Note 8—Funds Receivable and Customer Accounts and Investments” for additional information related to customer accounts. We present 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. 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 PayPal account using their bank account, credit card, 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 three five 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 and amortization. Depreciation and amortization are computed using the straight-line method over the estimated useful lives of the assets; generally, one Leases We determine whether an arrangement is a lease for accounting purposes at contract inception. Operating leases are recorded as right-of-use (“ROU”) assets, which are included in other assets, and lease liabilities, which are included in accrued expenses and other current liabilities and deferred tax liability and other long-term liabilities on our consolidated balance sheets. For sale-leaseback transactions, we evaluate the sale and the lease arrangement based on our conclusion as to whether control of the underlying asset has been transferred and recognize the sale-leaseback as either a sale transaction or under the financing method. The financing method requires the asset to remain on our consolidated balance sheets throughout the term of the lease and the proceeds to be recognized as a financing obligation. As of December 31, 2020, we had no finance leases. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. Our leases do not provide an implicit rate and therefore we use an incremental borrowing rate for specific terms on a collateralized basis based on the information available on the commencement date in determining the present value of lease payments. The ROU asset calculation includes lease payments to be made and excludes lease incentives. The ROU asset and lease liability may include amounts attributed to options to extend or terminate the lease when it is reasonably certain we will exercise that option. When we reach a decision to exercise a lease renewal or termination option, we recognize the associated impact to the ROU asset and lease liability. Lease expense for operating leases is recognized on a straight-line basis over the lease term. We evaluate ROU assets related to leases for indicators of impairment whenever events or changes in circumstances indicate that the carrying amount of an ROU asset may not be recoverable. When a decision has been made to exit a lease prior to the contractual term or to sublease that space, we evaluate the asset for impairment and recognize the associated impact to the ROU asset and related expense, if applicable. The evaluation is performed at the asset group level initially and when appropriate, at the lowest level of identifiable cash flows, which is at the individual lease level. Undiscounted cash flows expected to be generated by the related ROU assets are estimated over the ROU assets’ useful lives. If the evaluation indicates that the carrying amount of the ROU assets may not be recoverable, any potential impairment is measured based upon the fair value of the related ROU asset or asset group as determined by appropriate valuation techniques. We have lease agreements with lease and non-lease components. We have elected to apply the practical expedient and account for the lease and non-lease components as a single lease component for all leases, where applicable. In addition, we have elected the practical expedients related to lease classification, hindsight, and land easement. We apply a single portfolio approach to account for the ROU assets and lease liabilities. The Company adopted Accounting Standards Update (“ASU”) 2016-02, Leases (Topic 842) effective January 1, 2019, using a modified retrospective basis and applied the optional practical expedients related to the transition. Goodwill and intangible assets Goodwill is tested for impairment, at a minimum, on an annual basis 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 may be 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 mergers 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 impairm |
REVENUE
REVENUE | 12 Months Ended |
Dec. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE | REVENUE PayPal enables its customers to send and receive payments. We earn revenue primarily by completing payment transactions for our customers on our Payments Platform and from other value added services. Our revenues are classified into two categories: transaction revenues and revenues from other value added services. TRANSACTION REVENUES We earn transaction revenues primarily from fees charged to merchants and consumers on a transaction basis. These fees may have a fixed and variable component. The variable component is generally a percentage of the value of the payment amount and is known at the time the transaction is processed. For a portion of our transactions, the variable component of the fee is eligible for reimbursement when the underlying transaction is approved for a refund. We estimate the amount of fee refunds that will be processed each quarter and record a provision against our net revenues. The volume of activity processed on our Payments Platform, which results in transaction revenue, is referred to as Total Payment Volume (“TPV”). We earn additional fees on transactions where we perform currency conversion, when we enable cross-border transactions (i.e., transactions where the merchant and consumer are in different countries), to facilitate the instant transfer of funds for our customers from their PayPal or Venmo account to their debit card or bank account, and other miscellaneous fees. Our contracts with our customers are usually open-ended and can be terminated by either party without a termination penalty after the notice period has lapsed. Therefore, our contracts are defined at the transaction level and do not extend beyond the service already provided. Our contracts generally renew automatically without any significant material rights. Some of our contracts include tiered pricing, based primarily on volume. The fee charged per transaction is adjusted up or down if the volume processed for a specified period is different from prior period defined volumes. We have concluded that this volume-based pricing approach does not constitute a future material right since the discount is within a range typically offered to a class of customers with similar volume. We do not have any capitalized contract costs, and do not carry any material contract balances. Our primary service comprises a single performance obligation to complete payments on our Payments Platform for our customers. Using our risk assessment tools, we perform a transaction risk assessment on individual transactions to determine whether a transaction should be authorized for completion on our Payments Platform. When we authorize a transaction, we become obligated to our customer to complete the payment transaction. We recognize fees charged to our customers primarily on a gross basis as transaction revenue when we are the principal in respect of completing a payment transaction. As a principal to the transaction, we control the service of completing payments on our Payments Platform. We bear primary responsibility for the fulfillment of the payment service, contract directly with our customers, control the product specifications, and define the value proposal from our services. Further, we have full discretion in determining the fee charged to our customers, which is independent of the costs we incur in instances where we may utilize payment processors or other financial institutions to perform services on our behalf. We therefore bear full margin risk when completing a payment transaction. These fees paid to payment processors and other financial institutions are recognized as transaction expense. We are also responsible for providing customer support. We provide merchants and consumers with protection programs for certain transactions completed on our Payments Platform. These programs are intended to 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 the purchased item is not received 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 a purchased item was not received by covering the seller for the full amount of the payment on eligible sales. These protection programs do not provide a separate service to our customers and we estimate and record associated costs in transaction and credit losses during the period the payment transaction is completed. REVENUES FROM OTHER VALUE ADDED SERVICES We earn revenues from other value added services, which is comprised primarily of revenue earned through partnerships, referral fees, subscription fees, gateway fees, and other services that we provide to our merchants and consumers. These contracts typically have one performance obligation which is provided and recognized over the term of the contract. The transaction price is generally fixed and known at the end of each reporting period; however, for some agreements, it may be necessary to estimate the transaction price using the expected value method. In our partnership agreement with Synchrony, in addition to the revenue share we earn, we also recognized revenue for transition servicing activities which we performed on their behalf through the second quarter of 2019 using a relative selling price determined through the adjusted market assessment approach. We record revenue earned in revenues from other value added services on a net basis when we are considered the agent with respect to processing transactions. We also earn revenues from interest and fees earned primarily on our portfolio of loans receivable, and interest earned on certain assets underlying customer balances. Interest and fees earned on the portfolio of loans receivable are computed and recognized based on the effective interest method and are presented net of any required reserves and amortization of deferred origination costs. DISAGGREGATION OF REVENUE We determine operating segments based on how our chief operating decision maker (“CODM”) manages the business, makes operating decisions around the allocation of resources, and evaluates operating performance. Our CODM is our Chief Executive Officer, who reviews our operating results on a consolidated basis. We operate as one segment and have one reportable segment. Based on the information provided to and reviewed by our CODM, we believe that the nature, amount, timing, and uncertainty of our revenue and cash flows and how they are affected by economic factors are most appropriately depicted through our primary geographical markets and type of revenue categories (transaction revenues and revenues from other value added services). Revenues recorded within these categories are earned from similar services for which the nature of associated fees and the related revenue recognition models are substantially the same. The following table presents our revenue disaggregated by primary geographical market and category: Year Ended December 31, 2020 2019 2018 (In millions) Primary geographical markets United States (“U.S.”) $ 11,013 $ 9,417 $ 8,324 United Kingdom (“U.K.”) 2,340 1,872 1,658 Other countries (1) 8,101 6,483 5,469 Total revenues (2) $ 21,454 $ 17,772 $ 15,451 Revenue category Transaction revenues $ 19,918 $ 16,099 $ 13,709 Revenues from other value added services 1,536 1,673 1,742 Total revenues (2) $ 21,454 $ 17,772 $ 15,451 (1) No single country included in the other countries category generated more than 10% of total revenue. (2) Total revenues include $597 million, $1.1 billion and $1.2 billion for the years ended December 31, 2020, 2019, and 2018, respectively, which do not represent revenues recognized in the scope of Accounting Standards Codification Topic 606, Revenue from contracts with customers. Such revenues relate to interest, fees, and gains earned on loans and interest receivables, as well as hedging gains or losses and interest earned on certain assets underlying customer balances. Net revenues are attributed to 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. Revenues earned from other value added services are typically attributed to the country in which either the customer or partner reside. |
NET INCOME PER SHARE
NET INCOME PER SHARE | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
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. 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. The following table sets forth the computation of basic and diluted net income per share for the periods indicated: Year Ended December 31, 2020 2019 2018 (In millions, except per share amounts) Numerator: Net income $ 4,202 $ 2,459 $ 2,057 Denominator: Weighted average shares of common stock — basic 1,173 1,174 1,184 Dilutive effect of equity incentive awards 14 14 19 Weighted average shares of common stock — diluted 1,187 1,188 1,203 Net income per share: Basic $ 3.58 $ 2.09 $ 1.74 Diluted $ 3.54 $ 2.07 $ 1.71 Common stock equivalents excluded from income per diluted share because their effect would have been anti-dilutive 1 2 1 |
BUSINESS COMBINATIONS
BUSINESS COMBINATIONS | 12 Months Ended |
Dec. 31, 2020 | |
Business Combinations [Abstract] | |
BUSINESS COMBINATIONS | BUSINESS COMBINATIONS ACQUISITIONS COMPLETED IN 2020 During the year ended December 31, 2020, we completed one acquisition reflecting 100% of the equity interests of the acquired company, for a purchase price of $3.6 billion. Honey Science Corporation We completed our acquisition of Honey Science Corporation (“Honey”) in January 2020 by acquiring all outstanding shares for total consideration of approximately $4.0 billion, consisting of approximately $3.6 billion in cash and approximately $400 million in assumed restricted stock, restricted stock units, and options, subject to vesting conditions. We believe our acquisition of Honey will enhance our value proposition by allowing us to further simplify and personalize shopping experiences for consumers while driving conversion and increasing consumer engagement and sales for merchants. 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 $ 2,962 Customer lists and user base 115 Marketing related 30 Developed technology 572 Total intangibles $ 717 Accounts receivable, net 50 Deferred tax liabilities, net (58) Other net liabilities (36) Total purchase price $ 3,635 The intangible assets acquired consist primarily of customer contracts, trade name/trademarks, and developed technology with estimated useful lives of three years. The excess of the purchase consideration over the fair value of net tangible and identifiable intangible assets acquired was recorded as goodwill, and is attributable to the workforce of Honey and the synergies expected to arise from the acquisition through continued customer acquisition, cross selling initiatives, and product enhancements. Goodwill was not considered deductible for income tax purposes. In association with the acquisition, we assumed restricted stock, restricted stock units, and options with an approximate grant date fair value of $400 million, which represents post business combination expense. The equity granted is a combination of shares issued to certain former Honey employees subject to a holdback arrangement and assumed Honey employee grants, which vest over a period of up to four years and are subject to continued employment. We have included the financial results of the acquired business in our consolidated financial statements from the date of acquisition. Revenues and expenses related to the acquisition and pro forma results of operations have not been presented for the year ended December 31, 2020 because the effects of this acquisition were not material to our overall operations. ACQUISITIONS COMPLETED IN 2019 There were no acquisitions accounted for as business combinations or divestitures completed in 2019. ACQUISITIONS COMPLETED IN 2018 During the year ended December 31, 2018, we completed four acquisitions reflecting 100% of the equity interests of the acquired companies, for an aggregate purchase price of $2.7 billion. Hyperwallet We completed the acquisition of HWLT Holdings Inc. (“Hyperwallet”) in November 2018 by acquiring all outstanding shares for a total purchase price of approximately $400 million, consisting of cash consideration. We acquired Hyperwallet to enhance our payout capabilities and improve our ability to provide an integrated suite of payment solutions to e-commerce platforms and marketplaces around the world. The allocation of purchase consideration resulted in approximately $100 million of customer-related intangible assets, approximately $30 million of developed technology intangible assets, and approximately $2 million of marketing related intangible assets with estimated useful lives ranging from three iZettle We completed the acquisition of iZettle AB (publ) (“iZettle”) in September 2018 by acquiring all outstanding shares for a total purchase price of $2.2 billion, consisting of cash consideration paid of approximately $2.1 billion (net of cash acquired of $103 million) and restricted shares of PayPal with a fair value of approximately $22 million. We acquired iZettle to expand our in-store presence and strengthen our Payments Platform to help small businesses around the world grow and thrive in an omnichannel retail environment. 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 $ 1,600 Customer lists and user base 426 Marketing related 102 Developed technology 121 All other 1 Total intangibles $ 650 Cash 103 Funds receivable and customer accounts 47 Funds payable and amounts due to customers (47) Deferred tax liabilities, net (116) Other net liabilities (55) Total purchase price $ 2,182 The intangible assets acquired consist primarily of merchant relationships, trade name/trademarks, developed technology, and existing acquirer relationships with estimated useful lives ranging from three Simility We completed the acquisition of Simility, Inc. (“Simility”) in July 2018 by acquiring all outstanding shares for a total purchase price of $107 million, consisting of cash consideration. We acquired Simility to enhance our ability to deliver fraud prevention and risk management solutions to merchants globally. The allocation of purchase consideration resulted in approximately $18 million of developed technology intangible assets with an estimated useful life of three years, net assets of approximately $10 million, and goodwill of approximately $79 million, which is attributable to the workforce of Simility and the synergies expected to arise from the acquisition. Goodwill was not considered deductible for income tax purposes. Other Acquisitions In May 2018, we completed an acquisition which was accounted for as a business combination. The total purchase price for this acquisition was $16 million, consisting of cash consideration. The allocation of purchase consideration resulted in approximately $13 million of developed technology intangible assets with an estimated useful life of two years, net liabilities of $1 million, and goodwill of approximately $4 million, which is attributable to the workforce of the acquired company and the synergies expected to arise from the acquisition. Goodwill was not considered deductible for income tax purposes. |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS | 12 Months Ended |
Dec. 31, 2020 | |
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, 2020 and 2019: December 31, 2018 Goodwill Adjustments December 31, 2019 Goodwill Adjustments December 31, 2020 (In millions) Total goodwill $ 6,284 $ — $ (72) $ 6,212 $ 2,962 $ (39) $ 9,135 The goodwill acquired during 2020 was associated with the acquisition of Honey. The adjustments to goodwill during 2020 and 2019 pertained to foreign currency translation adjustments. INTANGIBLE ASSETS The components of identifiable intangible assets are as follows: December 31, 2020 December 31, 2019 Gross Accumulated Net Weighted Gross Accumulated Net Weighted (In millions, except years) Intangible assets: Customer lists and user base $ 1,206 $ (797) $ 409 6 $ 1,114 $ (700) $ 414 7 Marketing related 321 (278) 43 3 294 (239) 55 3 Developed technology 999 (577) 422 3 445 (343) 102 3 All other 449 (275) 174 7 436 (229) 207 7 Intangible assets, net $ 2,975 $ (1,927) $ 1,048 $ 2,289 $ (1,511) $ 778 Amortization expense for intangible assets was $451 million, $211 million, and $149 million for the years ended December 31, 2020, 2019, and 2018, respectively. In the fourth quarter of 2019, we completed the acquisition of a 70 percent equity interest in Guofubao Information Technology Co. (GoPay), Ltd. (“GoPay”), a holder of payment business licenses in China. This transaction was accounted for as an asset acquisition because substantially all the fair value of the gross assets acquired is concentrated in the form of licenses. We recorded $190 million of other intangible assets with a weighted average useful life of seven years. Expected future intangible asset amortization as of December 31, 2020 is as follows: Fiscal years: (In millions) 2021 $ 400 2022 338 2023 100 2024 99 2025 83 Thereafter 28 $ 1,048 |
LEASES
LEASES | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
LEASES | LEASES PayPal enters into various leases, which are primarily real estate operating leases. We use these properties for executive and administrative offices, data centers, product development offices, and customer service and operations centers. While a majority of lease payments are based on the stated rate in the lease, some lease payments are subject to annual changes based on the Consumer Price Index or another referenced index. In the event of changes to the relevant index, lease liabilities are not remeasured and instead are treated as variable lease payments and recognized in the period in which the obligation for those payments is incurred. All of PayPal’s variable lease payments are based on an index or rate. The short-term lease exemption has been adopted for all leases with a duration of less than 12 months. PayPal’s lease portfolio contains a small number of subleases. A sublease situation can arise when currently leased real estate space is available and is surplus to operational requirements. The components of lease expense were as follows: Year Ended December 31, 2020 2019 (In millions) Lease expense Operating lease expense $ 166 $ 136 Sublease income (6) (6) Total lease expense $ 160 $ 130 Supplemental cash flow information related to leases were as follows: Year Ended December 31, 2020 2019 (In millions) Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 159 $ 131 Right-of-use assets obtained in exchange for operating lease liabilities (1) $ 345 $ 598 (1) Includes opening balance additions of $498 million for operating leases as a result of the adoption of the new lease accounting guidance effective January 1, 2019. Supplemental balance sheet information related to leases was as follows: As of December 31, 2020 2019 (In millions, except weighted-average figures) Operating lease right-of-use assets $ 707 $ 479 Other current lease liabilities 144 104 Operating lease liabilities 642 403 Total operating lease liabilities $ 786 $ 507 Weighted-average remaining lease term — operating leases 6.9 years 5.8 years Weighted-average discount rate — operating leases 3 % 5 % Future minimum lease payments for our operating leases as of December 31, 2020 were as follows: Operating Leases Fiscal years: (In millions) 2021 $ 165 2022 132 2023 116 2024 106 2025 94 Thereafter 266 Total $ 879 Less: present value discount (93) Lease liability $ 786 Operating lease amounts include minimum lease payments under our non-cancelable operating leases primarily for office and data center facilities. The amounts presented are consistent with contractual terms and are not expected to differ significantly from actual results under our existing leases. We recognize rent expense under such agreements on a straight-line basis. Rent expense for the years ended December 31, 2020, 2019, and 2018 totaled $172 million, $130 million, and $94 million, respectively. In the first quarter of 2020, we entered into a sale-leaseback arrangement as the seller-lessee for a data center as the buyer-lessor obtained control of the facility. We sold the data center and simultaneously entered into an operating lease agreement with the purchaser for the right to use the facility for eight years. The Company received proceeds of approximately $119 million, net of selling costs, which resulted in a de minimis net gain on the sale transaction. During the year ended December 31, 2020, we incurred asset impairment charges of $30 million within restructuring and other charges on our consolidated statements of income. The impairments included a reduction to our ROU asset in the amount of $23 million, which were attributed to certain leased spaces we are no longer utilizing for our core business operations, a portion of which is being sub-leased. As of December 31, 2020, we also have additional operating leases that have not yet commenced, primarily for real estate and data centers, with minimum lease payments aggregating to $51 million. These operating leases will commence prior to the end of fiscal year 2021 with lease terms of three |
OTHER FINANCIAL STATEMENT DETAI
OTHER FINANCIAL STATEMENT DETAILS | 12 Months Ended |
Dec. 31, 2020 | |
Other Income and Expenses [Abstract] | |
OTHER FINANCIAL STATEMENT DETAILS | OTHER FINANCIAL STATEMENT DETAILS PROPERTY AND EQUIPMENT, NET As of December 31, 2020 2019 (In millions) Property and equipment, net: Computer equipment and software $ 3,179 $ 2,804 Internal use software and website development costs 2,831 2,471 Land and buildings 307 430 Leasehold improvements 410 460 Furniture and fixtures 199 171 Development in progress and other 83 80 Total property and equipment, gross 7,009 6,416 Accumulated depreciation and amortization (5,202) (4,723) Total property and equipment, net $ 1,807 $ 1,693 Depreciation and amortization expense was $738 million in 2020, $701 million in 2019, and $627 million in 2018. Non-cash investing activities involving property and equipment included in net changes to accounts payable as reflected in the consolidated statements of cash flows was an increase of $17 million in 2020, a decrease of $42 million in 2019, and a decrease of $10 million in 2018. Geographical Information The following table summarizes long-lived assets based on geography, which consist of property and equipment, net and operating lease right-of-use assets: As of December 31, 2020 2019 (In millions) Long-lived assets: U.S. $ 2,096 $ 1,862 Other countries 418 310 Total long-lived assets $ 2,514 $ 2,172 Long-lived assets attributed to the U.S. and other countries are based upon the country in which the asset is located or owned. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) The following table summarizes the changes in accumulated balances of other comprehensive income (loss) for the year ended December 31, 2020: Unrealized Unrealized Gains on Investments Foreign Currency Translation Adjustment ( “ CTA ”) Net Investment Estimated Total (In millions) Beginning balance $ 6 $ 2 $ (150) $ (31) $ — $ (173) Other comprehensive income (loss) before reclassifications (309) 9 (48) 55 2 (291) Less: Amount of gain reclassified from AOCI 20 — — — — 20 Net current period other comprehensive income (loss) (329) 9 (48) 55 2 (311) Ending balance $ (323) $ 11 $ (198) $ 24 $ 2 $ (484) The following table summarizes the changes in accumulated balances of other comprehensive income (loss) for the year ended December 31, 2019: Unrealized Gains (Losses) on Cash Flow Hedges Unrealized Gains (Losses) on Investments Foreign CTA Net Investment Estimated Total (In millions) Beginning balance $ 182 $ (13) $ (93) $ — $ 2 $ 78 Other comprehensive income (loss) before reclassifications 62 14 (57) (31) (2) (14) Less: Amount of gain (loss) reclassified from AOCI 238 (1) — — — 237 Net current period other comprehensive income (loss) (176) 15 (57) (31) (2) (251) Ending balance $ 6 $ 2 $ (150) $ (31) $ — $ (173) The following table summarizes the changes in accumulated balances of other comprehensive income (loss) for the year ended December 31, 2018: Unrealized Gains (Losses) on Cash Flow Hedges Unrealized Losses on Investments Foreign Estimated Tax Total (In millions) Beginning balance $ (111) $ (12) $ (25) $ 6 $ (142) Other comprehensive income (loss) before reclassifications 263 (1) (68) (4) 190 Less: Amount of loss reclassified from AOCI (30) — — — (30) Net current period other comprehensive income (loss) 293 (1) (68) (4) 220 Ending balance $ 182 $ (13) $ (93) $ 2 $ 78 The following table provides details about reclassifications out of AOCI for the periods presented below: Details about AOCI Components Amount of Gains (Losses) Reclassified from AOCI Affected Line Item in the Statements of Income Year Ended December 31, 2020 2019 2018 (In millions) Gains (losses) on cash flow hedges — foreign exchange contracts $ 20 $ 238 $ (30) Net revenues Unrealized losses on investments — (1) — Other income (expense), net $ 20 $ 237 $ (30) Income before income taxes — — — Income tax expense Total reclassifications for the period $ 20 $ 237 $ (30) Net income OTHER INCOME (EXPENSE), NET The following table reconciles the components of other income (expense), net for the periods presented below: Year Ended December 31, 2020 2019 2018 (In millions) Interest income $ 88 $ 197 $ 168 Interest expense (209) (115) (77) Net gains on strategic investments 1,914 208 87 Other (17) (11) 4 Other income (expense), net $ 1,776 $ 279 $ 182 Refer to “Note 1 — Overview and Summary of Significant Accounting Policies” for details on the composition of these balances. |
FUNDS RECEIVABLE AND CUSTOMER A
FUNDS RECEIVABLE AND CUSTOMER ACCOUNTS AND INVESTMENTS | 12 Months Ended |
Dec. 31, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
FUNDS RECEIVABLE AND CUSTOMER ACCOUNTS AND INVESTMENTS | FUNDS RECEIVABLE AND CUSTOMER ACCOUNTS AND INVESTMENTS The following table summarizes the assets underlying our funds receivable and customer accounts, short-term investments, and long-term investments as of December 31, 2020 and 2019: December 31, December 31, (In millions) Funds receivable and customer accounts: Cash and cash equivalents $ 13,222 $ 8,387 Time deposits 233 514 Available-for-sale debt securities 15,001 10,190 Funds receivable 4,962 3,436 Total funds receivable and customer accounts $ 33,418 $ 22,527 Short-term investments: Time deposits $ 1,519 $ 614 Available-for-sale debt securities 6,689 2,734 Restricted cash 81 64 Total short-term investments $ 8,289 $ 3,412 Long-term investments: Time deposits $ 31 $ — Available-for-sale debt securities 2,819 1,025 Restricted cash 7 — Strategic investments 3,232 1,838 Total long-term investments $ 6,089 $ 2,863 As of December 31, 2020 and 2019, the estimated fair value of our available-for-sale debt securities included within funds receivable and customer accounts, short-term investments, and long-term investments was as follows: December 31, 2020 (1) Gross Gross Gross (In millions) Funds receivable and customer accounts: U.S. government and agency securities $ 8,566 $ 4 $ — $ 8,570 Foreign government and agency securities 1,504 2 — 1,506 Corporate debt securities 2,011 — — 2,011 Short-term investments: U.S. government and agency securities 1,510 — — 1,510 Foreign government and agency securities 277 — — 277 Corporate debt securities 4,900 2 — 4,902 Long-term investments: U.S. government and agency securities 28 — — 28 Foreign government and agency securities 1,305 — (1) 1,304 Corporate debt securities 1,255 4 — 1,259 Asset-backed securities 228 — — 228 Total available-for-sale debt securities (2) $ 21,584 $ 12 $ (1) $ 21,595 (1) “—” Denotes gross unrealized gain or unrealized loss of less than $1 million in a given position. (2) Excludes foreign currency denominated available-for-sale debt securities accounted for under the fair value option. Refer to “Note 9 — Fair Value Measurement of Assets and Liabilities.” December 31, 2019 (1) Gross Gross Gross (In millions) Funds receivable and customer accounts: U.S. government and agency securities $ 4,996 $ — $ — $ 4,996 Foreign government and agency securities 1,392 — — 1,392 Corporate debt securities 2,112 — — 2,112 Short-term investments: Foreign government and agency securities 533 — — 533 Corporate debt securities 1,955 — — 1,955 Long-term investments: U.S. government and agency securities 140 — — 140 Foreign government and agency securities 207 — — 207 Corporate debt securities 636 2 — 638 Asset-backed securities 40 — — 40 Total available-for-sale debt securities (2) $ 12,011 $ 2 $ — $ 12,013 (1) “—” Denotes gross unrealized gain or unrealized loss of less than $1 million in a given position. (2) Excludes foreign currency denominated available-for-sale debt securities accounted for under the fair value option. Refer to “Note 9 — Fair Value Measurement of Assets and Liabilities.” Gross amortized cost and estimated fair value balances exclude accrued interest receivable on available-for-sale debt securities, which totaled $42 million and $54 million at December 31, 2020 and December 31, 2019, respectively, and were included in other current assets on our consolidated balance sheets. As of December 31, 2020 and 2019, the gross unrealized losses and estimated fair value of our available-for-sale debt securities included within funds receivable and customer accounts, short-term investments, and long-term investments for which an allowance for credit losses has not been deemed necessary in the current period, aggregated by length of time those individual securities have been in a continuous loss position was as follows: December 31, 2020 (1) Less than 12 months 12 months or longer Total Fair Value Gross Fair Value Gross Fair Value Gross (In millions) Funds receivable and customer accounts: U.S. government and agency securities $ 312 $ — $ — $ — $ 312 $ — Foreign government and agency securities 353 — — — 353 — Corporate debt securities 641 — — — 641 — Short-term investments: U.S. government and agency securities 270 — — — 270 — Foreign government and agency securities 72 — — — 72 — Corporate debt securities 392 — — — 392 — Long-term investments: U.S. government and agency securities 28 — — — 28 — Foreign government and agency securities 405 (1) — — 405 (1) Corporate debt securities 97 — — — 97 — Asset-backed securities 15 — — — 15 — Total available-for-sale debt securities $ 2,585 $ (1) $ — $ — $ 2,585 $ (1) (1) — Denotes gross unrealized loss or fair value of less than $1 million in a given position. December 31, 2019 (1) Less than 12 months 12 months or longer Total Fair Value Gross Fair Value Gross Fair Value Gross (In millions) Funds receivable and customer accounts: U.S. government and agency securities $ 2,452 $ — $ — $ — $ 2,452 $ — Foreign government and agency securities 563 — 30 — 593 — Corporate debt securities 825 — — — 825 — Short-term investments: Foreign government and agency securities 115 — — — 115 — Corporate debt securities 424 — — — 424 — Long-term investments: U.S. government and agency securities 100 — — — 100 — Foreign government and agency securities 75 — — — 75 — Corporate debt securities 1 — 40 — 41 — Asset-backed securities 26 — 4 — 30 — Total available-for-sale debt securities $ 4,581 $ — $ 74 $ — $ 4,655 $ — (1) — Denotes gross unrealized loss or fair value of less than $1 million in a given position. Unrealized losses have not been recognized into income as we neither intend to sell nor anticipate that it is more likely than not that we will be required to sell, the securities before recovery. The decline in fair value is due primarily to changes in market conditions, rather than credit losses. We will continue to monitor the performance of the investment portfolio and assess whether impairment due to expected credit losses has occurred. Amounts reclassified to earnings from unrealized gains and losses were not material for the year ended December 31, 2020 and 2019. Our available-for-sale debt securities included within funds receivable and customer accounts, short-term investments, and long-term investments classified by date of contractual maturity were as follows: December 31, 2020 Amortized Cost Fair Value (In millions) One year or less $ 17,416 $ 17,421 After one year through five years 4,168 4,174 Total $ 21,584 $ 21,595 STRATEGIC INVESTMENTS Our strategic investments include marketable equity securities, which are publicly traded, and non-marketable equity securities, which are investments in privately held companies. Our marketable equity securities have readily determinable fair values and are recorded as long-term investments on our consolidated balance sheets at fair value with changes in fair value recorded in other income (expense), net on our consolidated statements of income. Marketable equity securities totaled $2.4 billion and $1.3 billion as of December 31, 2020 and 2019, respectively, including the impact of the sale of securities during the year ended December 31, 2020. Our non-marketable equity securities are recorded in long-term investments on our consolidated balance sheets. As of December 31, 2020 and 2019, we had non-marketable equity securities of $10 million and $27 million, respectively, where we have the ability to exercise significant influence, but not control, over the investee and account for these equity securities using the equity method of accounting. The remaining non-marketable equity securities do not have a readily determinable fair value and we measure these equity investments at cost minus impairment, if any, and adjust for changes resulting from observable price changes in orderly transactions for an identical or similar investment in the same issuer. All gains and losses on these investments, realized and unrealized, and our share of earnings or losses from investments accounted for using the equity method are recognized in other income (expense), net on our consolidated statements of income. The carrying value of our non-marketable equity securities totaled $789 million and $524 million as of December 31, 2020 and 2019, respectively. Measurement Alternative Adjustments The adjustments to the carrying value of our non-marketable equity securities accounted for under the Measurement Alternative in the years ended December 31, 2020 and 2019 were as follows: Year Ended December 31, 2020 2019 (In millions) Carrying amount, beginning of period $ 497 $ 293 Adjustments related to non-marketable equity securities: Net additions (1) 143 60 Gross unrealized gains 161 144 Gross unrealized losses and impairments (22) — Carrying amount, end of period $ 779 $ 497 (1) Net additions include additions from purchases, reductions due to sales of securities, and reclassifications when Measurement Alternative is subsequently elected or no longer applies. The following table summarizes the cumulative gross unrealized gains and cumulative gross unrealized losses and impairment related to non-marketable equity securities accounted for under the Measurement Alternative for investments held at December 31, 2020 and 2019: December 31, December 31, (In millions) Cumulative gross unrealized gains $ 378 $ 230 Cumulative gross unrealized losses and impairment $ (27) $ (5) Unrealized gains (losses) on strategic investments, excluding those accounted for using the equity method The following table summarizes the net unrealized gain (losses) on marketable and non-marketable equity securities, excluding those accounted for using the equity method, held at December 31, 2020 and 2019: Year Ended December 31, 2020 2019 (In millions) Net unrealized gains $ 1,610 $ 203 |
FAIR VALUE MEASUREMENT OF ASSET
FAIR VALUE MEASUREMENT OF ASSETS AND LIABILITIES | 12 Months Ended |
Dec. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENT OF ASSETS AND LIABILITIES | FAIR VALUE MEASUREMENT OF ASSETS AND LIABILITIES FINANCIAL ASSETS AND LIABILITIES MEASURED AND RECORDED AT FAIR VALUE ON A RECURRING BASIS The following tables summarize our financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2020 and 2019: December 31, 2020 Quoted Prices in Significant Other Observable Inputs (Level 2) (In millions) Assets: Cash and cash equivalents (1) $ 867 $ — $ 867 Short-term investments (2) : U.S. government and agency securities 1,510 — 1,510 Foreign government and agency securities 277 — 277 Corporate debt securities 4,902 — 4,902 Total short-term investments 6,689 — 6,689 Funds receivable and customer accounts (3) : Cash and cash equivalents 1,770 — 1,770 U.S. government and agency securities 8,570 — 8,570 Foreign government and agency securities 4,296 — 4,296 Corporate debt securities 2,135 — 2,135 Total funds receivable and customer accounts 16,771 — 16,771 Derivatives 42 — 42 Long-term investments (2), (4) : U.S. government and agency securities 28 — 28 Foreign government and agency securities 1,304 — 1,304 Corporate debt securities 1,259 — 1,259 Asset-backed securities 228 — 228 Marketable equity securities 2,443 2,443 — Total long-term investments 5,262 2,443 2,819 Total financial assets $ 29,631 $ 2,443 $ 27,188 Liabilities: Derivatives $ 410 $ — $ 410 (1) Excludes cash of $3.9 billion not measured and recorded at fair value. (2) Excludes restricted cash of $88 million and time deposits of $1.6 billion not measured and recorded at fair value. (3) Excludes cash, time deposits, and funds receivable of $16.6 billion underlying funds receivable and customer accounts not measured and recorded at fair value. (4) Excludes non-marketable equity securities of $789 million measured using the Measurement Alternative or equity method accounting. December 31, 2019 Quoted Prices in Significant Other Observable Inputs (Level 2) (In millions) Assets: Cash and cash equivalents (1) $ 2,835 $ — $ 2,835 Short-term investments (2) : Foreign government and agency securities 757 — 757 Corporate debt securities 1,977 — 1,977 Total short-term investments 2,734 — 2,734 Funds receivable and customer accounts (3) : — Cash and cash equivalents 683 — 683 U.S. government and agency securities 4,996 — 4,996 Foreign government and agency securities 2,653 — 2,653 Corporate debt securities 2,541 — 2,541 Total funds receivable and customer accounts 10,873 — 10,873 Derivatives 135 — 135 Long-term investments (4) : U.S. government and agency securities 140 — 140 Foreign government and agency securities 207 — 207 Corporate debt securities 638 — 638 Asset-backed securities 40 — 40 Marketable equity securities 1,314 1,314 — Total long-term investments 2,339 1,314 1,025 Total financial assets $ 18,916 $ 1,314 $ 17,602 Liabilities: Derivatives $ 122 $ — $ 122 (1) Excludes cash of $4.5 billion not measured and recorded at fair value. (2) Excludes restricted cash of $64 million and time deposits of $614 million not measured and recorded at fair value. (3) Excludes cash, time deposits, and funds receivable of $11.7 billion underlying funds receivable and customer accounts not measured and recorded at fair value. (4) Excludes non-marketable equity securities of $524 million measured using the Measurement Alternative or equity method accounting. Our marketable equity securities are valued using quoted prices for identical assets in active markets (Level 1). All other financial assets and liabilities are valued using quoted prices for identical instruments in less active markets, readily available pricing sources for comparable instruments, or models using market observable inputs (Level 2). A 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. As of December 31, 2020 and 2019, 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). We elect to account for foreign currency denominated available-for-sale debt securities 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 statements of income to significantly reduce the accounting asymmetry that would otherwise arise when recognizing the corresponding foreign exchange gains and losses relating to customer liabilities. The following table summarizes the estimated fair value of our available-for-sale debt securities under the fair value option as of December 31, 2020 and 2019: December 31, 2020 December 31, 2019 (In millions) Funds receivable and customer accounts $ 2,914 $ 1,690 Short-term investments $ — $ 246 The following table summarizes the gains (losses) from fair value changes recognized in other income (expense), net related to the available-for-sale debt securities under the fair value option for the years ended December 31, 2020 and 2019 : Year Ended December 31, 2020 2019 (In millions) Funds receivable and customer accounts $ 190 $ (43) Short-term investments $ (24) $ (8) FINANCIAL ASSETS AND LIABILITIES MEASURED AND RECORDED AT FAIR VALUE ON A NON-RECURRING BASIS The following tables summarize our financial assets and liabilities held as of December 31, 2020 and 2019 for which a non-recurring fair value measurement was recorded during the year ended December 31, 2020 and 2019, respectively: December 31, 2020 Significant Other Observable Inputs (Level 2) (In millions) Non-marketable equity investments measured using the Measurement Alternative (1) $ 335 $ 335 Other assets (2) 44 44 Total $ 379 $ 379 (1) Excludes non-marketable equity investments of $444 million accounted for under the Measurement Alternative for which no observable price changes occurred during the year ended December 31, 2020. (2) Consists of ROU lease assets recorded at fair value pursuant to impairment charges recorded in 2020. See “Note 6—Leases” for additional information. December 31, 2019 Significant Other Observable Inputs (Level 2) (In millions) Non-marketable equity investments measured using the Measurement Alternative (1) $ 303 303 (1) Excludes non-marketable equity investments of $194 million accounted for under the Measurement Alternative for which no observable price changes occurred during the year ended December 31, 2019. We measure the non-marketable equity investments accounted for under the Measurement Alternative at cost minus impairment, if any, adjusted for observable price changes in orderly transactions for an identical or similar investment in the same issuer. Impairment losses on ROU lease assets related to office operating leases are calculated initially using estimated rental income per square foot derived from observable market data. FINANCIAL ASSETS AND LIABILITIES NOT MEASURED AND RECORDED AT FAIR VALUE Our financial instruments, including cash, restricted cash, time deposits, loans and interest receivable, net, certain customer accounts, and notes receivable are carried at amortized cost, which approximates their fair value. Our fixed rate debt had a carrying value of approximately $8.9 billion and fair value of approximately $9.7 billion as of December 31, 2020. Our fixed rate debt had a carrying value and fair value of approximately $5.0 billion as of December 31, 2019. If these financial instruments were measured at fair value in the financial statements, cash would be classified as Level 1; restricted cash, time deposits, certain customer accounts, and long-term debt would be classified as Level 2; and the remaining financial instruments would be classified as Level 3 in the fair value hierarchy. |
DERIVATIVE INSTRUMENTS
DERIVATIVE INSTRUMENTS | 12 Months Ended |
Dec. 31, 2020 | |
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 and by entering into collateral security arrangements. In addition, the potential risk of loss with any one counterparty resulting from this type of credit risk is monitored on an ongoing basis. We do not use any derivative instruments for trading or speculative purposes. Cash Flow Hedges We have significant international revenues and costs denominated in foreign currencies, which subjects us to foreign currency risk. We have a foreign currency exposure management program in which 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 denominated in foreign currencies. The objective of the foreign currency 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 derivative’s gain or loss is initially reported as a component of AOCI and subsequently reclassified into revenue in the same period the forecasted transaction affects earnings. We evaluate the effectiveness of our foreign currency exchange contracts on a quarterly basis by comparing the critical terms of the derivative instruments with the critical terms of the forecasted cash flows of the hedged item; if the critical terms are the same, we conclude the hedge will be perfectly effective. We did not exclude any component of the changes in fair value of the derivative instruments from the assessment of hedge effectiveness. We report cash flows arising from derivative instruments consistent with the classification of cash flows from the underlying hedged items that these derivatives are hedging. Accordingly, the cash flows associated with derivatives designated as cash flow hedges are classified in cash flows from operating activities on our consolidated statements of cash flows. As of December 31, 2020, we estimate that $287 million of net derivative losses related to our cash flow hedges included in AOCI are expected to be reclassified into earnings within the next 12 months. During the years ended December 31, 2020, 2019, and 2018, 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 prior to the occurrence of the hedged transaction. If we elect to discontinue our cash flow hedges and it is probable that the original forecasted transaction will occur, we continue to report the derivative’s gain or loss in AOCI until the forecasted transaction affects earnings, at which point we also reclassify it into earnings. Gains and losses on derivatives held after we discontinue our cash flow hedges and gains and losses on derivative instruments that are not designated as cash flow hedges are recorded in the same financial statement line item to which the derivative relates. Net Investment Hedge We used a forward foreign currency exchange contract to reduce the foreign currency exchange risk related to our investment in a foreign subsidiary. This derivative was designated as a net investment hedge and accordingly, the derivative’s gain and loss was recorded in AOCI as part of foreign currency translation. During the second quarter of 2020, this derivative matured. The accumulated gains and losses associated with this instrument will remain in AOCI until the foreign subsidiary is sold or substantially liquidated, at which point they will be reclassified into earnings. The cash flow associated with the derivative designated as a net investment hedge is classified in cash flows from investing activities on our consolidated statements of cash flows. During the year ended December 31, 2020 and 2019, we recognized $55 million in unrealized gain and $31 million in unrealized loss, respectively, on the foreign currency exchange contract designated as a net investment hedge within the foreign currency translation section of other comprehensive income. We have not reclassified any gains or losses from AOCI into earnings during any of the periods presented. Foreign Currency Exchange Contracts Not Designated As Hedging Instruments We have a foreign currency exposure management program in which we use foreign currency exchange contracts to offset the foreign currency 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 foreign currency exchange rate movements on our assets and liabilities. The gains and losses due to remeasurement of certain foreign currency denominated monetary assets and liabilities are recorded in other income (expense), net, which are offset by the gains and losses on these foreign currency exchange contracts. The cash flows associated with our non-designated derivatives that hedge foreign currency denominated monetary assets and liabilities are classified in cash flows from operating activities on our consolidated statements of cash flows. FAIR VALUE OF DERIVATIVE CONTRACTS The fair value of our outstanding derivative instruments as of December 31, 2020 and 2019 was as follows: Balance Sheet Location As of December 31, 2020 2019 Derivative Assets: (In millions) Foreign currency exchange contracts designated as hedging instruments Other current assets $ — $ 45 Foreign currency exchange contracts designated as hedging instruments Other assets (non-current) — 1 Foreign currency exchange contracts not designated as hedging instruments Other current assets 42 89 Total derivative assets $ 42 $ 135 Derivative Liabilities: Foreign currency exchange contracts designated as hedging instruments Other current liabilities $ 287 $ 58 Foreign currency exchange contracts designated as hedging instruments Other long-term liabilities 35 13 Foreign currency exchange contracts not designated as hedging instruments Other current liabilities 88 51 Total derivative liabilities $ 410 $ 122 MASTER NETTING AGREEMENTS - RIGHTS OF SETOFF Under master netting agreements with respective counterparties to our foreign currency 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 on our consolidated balance sheets. Rights of setoff associated with our foreign currency exchange contracts represented a potential offset to both assets and liabilities by $34 million as of December 31, 2020 and $92 million as of December 31, 2019. We have entered into collateral security arrangements that provide for collateral to be received or posted when the net fair value of certain financial instruments fluctuates from contractually established thresholds. The following table provides the collateral exchanged: December 31, December 31, (In millions) Cash collateral posted (1) $ 340 $ 12 Cash collateral received (2) $ 1 $ 39 (1) Right to reclaim cash collateral related to our derivative liabilities recognized in other current assets on our consolidated balance sheets. (2) Obligation to return counterparty cash collateral related to our derivative assets recognized in other current liabilities on our consolidated balance sheets. EFFECT OF DERIVATIVE CONTRACTS ON CONSOLIDATED STATEMENTS OF INCOME The following table provides the location in the consolidated statements of income and amount of recognized gains or losses related to our derivative instruments designated as hedging instruments: Year Ended December 31, 2020 2019 2018 (In millions) Net revenues Total amounts presented in the consolidated statements of income in which the effects of cash flow hedges are recorded $ 21,454 $ 17,772 $ 15,451 Gains (losses) on foreign exchange contracts designated as cash flow hedges reclassified from AOCI $ 20 $ 238 $ (30) The following table provides the location in the consolidated statements of income and amount of recognized gains or losses related to our derivative instruments not designated as hedging instruments: Year Ended December 31, 2020 2019 2018 (In millions) (Losses) gains on foreign exchange contracts recognized in other income (expense), net $ (110) $ 24 $ 38 Gains on foreign exchange contracts recognized in net revenues — — 7 Losses on equity derivative contracts recognized in other income (expense), net (1) (64) — — Total (losses) gains recognized from contracts not designated as hedging instruments $ (174) $ 24 $ 45 (1) During the year ended December 31, 2020, equity derivative contracts were entered into and matured which related to the sale of a portion of a strategic investment. The cash flows associated with the equity derivative contracts are classified in cash flows from investing activities on our consolidated statements of cash flows. NOTIONAL AMOUNTS OF DERIVATIVE CONTRACTS Derivative transactions are measured in terms of the notional amount; however, 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 currency exchange payments under these contracts is determined. The following table provides the notional amounts of our outstanding derivatives: Year Ended December 31, 2020 2019 (In millions) Foreign exchange contracts designated as hedging instruments $ 5,335 $ 4,550 Foreign exchange contracts not designated as hedging instruments 16,098 17,131 Total $ 21,433 $ 21,681 |
LOANS AND INTEREST RECEIVABLE
LOANS AND INTEREST RECEIVABLE | 12 Months Ended |
Dec. 31, 2020 | |
Receivables [Abstract] | |
LOANS AND INTEREST RECEIVABLE | LOANS AND INTEREST RECEIVABLE We offer credit products to consumers and certain small and medium-sized merchants. We purchase receivables related to credit extended to U.S. merchants by an independent chartered financial institution and are responsible for servicing functions related to that portfolio. During the year ended December 31, 2020 and 2019, we purchased approximately $1.8 billion and $4.7 billion in credit receivables, respectively. CONSUMER RECEIVABLES We offer revolving and installment credit products to consumers at checkout. The majority of these installment loans allow consumers to pay for a product over periods of 12 months or less. As of December 31, 2020 and 2019, the outstanding balance of consumer receivables, which consisted of revolving and installment loans and interest receivable, was $2.2 billion and $1.3 billion, respectively. We closely monitor the credit quality of our consumer receivables to evaluate and manage our related exposure to credit risk. Credit risk management begins with initial underwriting and continues through to full repayment of a loan. To assess a consumer who requests a loan, we use, among other indicators, internally developed risk models using detailed information from external sources, such as credit bureaus where available, and internal historical experience, including the consumer’s prior repayment history with our credit products where available. We use delinquency status and trends to assist in making new and ongoing credit decisions, to adjust our models, to plan our collection practices and strategies, and in determining our allowance for consumer loans and interest receivable. Consumer Receivables Delinquency and Allowance The following table presents the delinquency status of consumer loans and interest receivable at December 31, 2020 and 2019. Since our consumer loans are primarily revolving in nature, they are disclosed in the aggregate and not by year of origination. The amounts are based on the number of days past the billing date. The “current” category represents balances that are within 29 days of the billing date. December 31, 2020 December 31, 2019 Amortized Cost Basis Revolving Percent Amortized Cost Basis Percent (In millions, except percentages) Current $ 2,124 97.9 % $ 1,279 96.7 % 30-59 days 15 0.7 % 15 1.1 % 60-89 days 11 0.5 % 9 0.7 % 90-179 days 19 0.9 % 19 1.5 % Total consumer loans and interest receivable (1), (2), (3) $ 2,169 100.0 % $ 1,322 100.0 % (1) Excludes receivables from other consumer credit products of $56 million and $92 million at December 31, 2020 and December 31, 2019, respectively. (2) Includes installment loans of $556 million and $80 million at December 31, 2020 and December 31, 2019, respectively, substantially all of which were current and originated within the past 12 months. (3) Balances at December 31, 2020 include the impact of payment holidays provided primarily in the second quarter of 2020 by the Company to some consumers as a part of our COVID-19 payment relief initiatives. The following table summarizes the activity in the allowance for consumer loans and interest receivable for the years ended December 31, 2020 and 2019: December 31, 2020 December 31, 2019 Consumer Loans Receivable Interest Receivable Total Allowance (1) Consumer Loans Receivable Interest Receivable Total Allowance (1) (In millions) Beginning balance $ 49 $ 8 $ 57 $ 27 $ 3 $ 30 Adjustment for adoption of credit losses accounting standard 24 4 28 — — — Provisions 245 50 295 34 11 45 Charge-offs (69) (12) (81) (44) (6) (50) Recoveries (2) 27 — 27 31 — 31 Other (3) 23 3 26 1 — 1 Ending Balance $ 299 $ 53 $ 352 $ 49 $ 8 $ 57 (1) Excludes allowances from other consumer credit products of $3 million and $10 million at December 31, 2020 and December 31, 2019, respectively. (2) The recoveries were primarily related to fully charged-off U.S. consumer credit receivables not subject to the sale to Synchrony. (3) Includes amounts related to foreign currency remeasurement. Provisions for the year ended December 31, 2020 were primarily attributable to changes in current and projected macroeconomic conditions, including the impact of qualitative adjustments primarily related to the impact of payment holidays provided as part of our COVID-19 payment relief initiatives, and the overall growth in our portfolio. The increase in charge-offs for the year ended December 31, 2020 was primarily attributable to the overall growth in our portfolio. The provision for current expected credit losses relating to our consumer loans receivable portfolio is recognized in transaction and credit losses on our consolidated statements of income. The provision for interest receivable due to interest earned on our consumer loans receivable portfolio is recognized in revenues from other value added services as a reduction to revenue. Loans receivable past the payment due date continue to accrue interest until they are charged off. We charge off consumer receivable balances in the month in which a customer’s balance becomes 180 days past the billing date. Bankrupt accounts are charged off within 60 days after receipt of notification of bankruptcy. Charge-offs that are recovered are recorded as a reduction to our allowance for loans and interest receivable. MERCHANT RECEIVABLES We offer access to credit products for certain small and medium-sized merchants through our PPWC and PPBL products, which we collectively refer to as our merchant lending offerings. As of December 31, 2020 and 2019, the total outstanding balance in our pool of merchant loans, advances, and interest and fees receivable was $1.4 billion and $2.8 billion, respectively, net of the participation interest sold to an independent chartered financial institution of $59 million and $124 million, respectively. See “Note 1—Overview and Summary of Significant Accounting Policies” for additional information on this participation arrangement. Through our PPWC product, merchants can borrow a certain percentage of their annual payment volume processed by PayPal and are charged a fixed fee for the loan or advance based on the overall credit assessment of the merchant. Loans and advances are repaid through a fixed percentage of the merchant’s future payment volume that PayPal processes. Through our PPBL product, we provide merchants with access to short-term business financing for a fixed fee based on an evaluation of the applying business as well as the business owner. PPBL repayments are collected through periodic payments until the balance has been satisfied. The interest or fee is fixed at the time the loan or advance is extended and is recognized as deferred revenues included in accrued expenses and other current liabilities on our consolidated balance sheets. The fixed interest or fee is amortized to revenues from other value added services based on the amount repaid over the repayment period. We estimate the repayment period for PPWC based on the merchant’s payment processing history with PayPal, where available. For PPWC, there is a general requirement that at least 10% of the original amount of the loan or advance plus the fixed fee must be repaid every 90 days. We calculate the repayment rate of the merchant’s future payment volume so that repayment of the loan or advance and fixed fee is expected to generally occur within 9 to 12 months from the date of the loan or advance. On a monthly basis, we recalculate the repayment period based on the repayment activity on the receivable. As such, actual repayment periods are dependent on actual merchant payment processing volumes. For PPBL, we receive fixed periodic payments over the contractual term of the loan which generally ranges from 3 to 12 months. We actively monitor receivables with repayment periods greater than the original expected or contractual repayment period, as well as the credit quality of our merchant loans and advances that we extend or purchase so that we can evaluate, quantify, and manage our credit risk exposure. To assess a merchant seeking a business financing loan or advance, we use, among other indicators, risk models developed internally which utilize information obtained from multiple internal and external data sources to predict the likelihood of timely and satisfactory repayment by the merchant of the loan or advance amount and the related interest or fee. Primary drivers of the models include the merchant’s annual payment volume, payment processing history with PayPal, and prior repayment history with PayPal’s credit products where available, information sourced from consumer and business credit bureau reports, and other information obtained during the application process. We use delinquency status and trends to assist in making (or, in the U.S., to assist the independent chartered financial institution in making) ongoing credit decisions, to adjust our internal models, to plan our collection strategies, and in determining our allowance for these loans and advances. Merchant Receivables Delinquency and Allowance The following table presents the delinquency status of the principal amount of merchant loans, advances, and interest and fees receivable by year of origination. The amounts are based on the number of days past the expected or contractual repayment date for amounts outstanding. The “current” category represents balances that are within 29 days of the contractual repayment dates, or within 29 days of the expected repayment date. December 31, 2020 (In millions, except percentages) 2020 2019 2018 2017 2016 Total Percent Current $ 884 $ 154 $ 4 $ — $ — $ 1,042 75.4% 30 - 59 Days 56 46 3 — — 105 7.6% 60 - 89 Days 29 30 3 — — 62 4.5% 90 - 179 Days 58 77 7 — — 142 10.3% 180+ Days 6 20 5 — — 31 2.2% Total (1) $ 1,033 $ 327 $ 22 $ — $ — $ 1,382 100% (1) Balances include the impact of payment holidays provided primarily during the second quarter of 2020 and modification programs offered by the Company as a part of our COVID-19 payment relief initiatives (as discussed further below). The following table presents our estimate of the principal amount of merchant loans, advances, and interest and fees receivable past their original expected or contractual repayment period as of December 31, 2019, prior to the adoption of the new credit losses accounting guidance as described in “Note 1—Overview and Summary of Significant Accounting Policies.” December 31, 2019 (In millions, except percentages) Within Original Expected or Contractual Repayment Period 30 - 59 Days Greater 60 - 89 Days Greater 90 - 179 Days Greater 180+ Days Total Past Original Expected or Contractual Repayment Period Total $ 2,523 $ 115 $ 61 $ 100 $ 17 $ 293 $ 2,816 89.6% 4.1 % 2.1 % 3.6 % 0.6 % 10.4 % 100 % The following table summarizes the activity in the allowance for merchant loans, advances, and interest and fees receivable, for the years ended December 31, 2020 and 2019: December 31, 2020 December 31, 2019 Merchant Loans and Advances Interest and Fees Receivable Total Allowance Merchant Loans and Advances Interest and Fees Receivable Total Allowance (In millions) Beginning balance $ 171 $ 20 $ 191 $ 115 $ 15 $ 130 Adjustment for adoption of credit losses accounting standard 165 17 182 — — — Provisions 358 33 391 240 26 266 Charge-offs (274) (27) (301) (201) (21) (222) Recoveries 20 — 20 17 — 17 Ending Balance $ 440 $ 43 $ 483 $ 171 $ 20 $ 191 Provisions for the year ended December 31, 2020 were primarily attributable to changes in current and projected macroeconomic conditions as well as originations occurring primarily in the first quarter of 2020. The provisions associated with changes in current and projected macroeconomic conditions included the impact of qualitative adjustments to account for limitations in our current expected credit loss models that have arisen due to the extreme fluctuations in both the actual and projected macroeconomic conditions during the period and to incorporate varying degrees of merchant performance in the current environment and expected performance in future periods. The increase in charge-offs for the year ended December 31, 2020 was primarily attributable to a significant expansion of the portfolio in 2019. For merchant loans and advances, the determination of delinquency is based on the current expected or contractual repayment period of the loan or advance and fixed interest or fee payment as compared to the original expected or contractual repayment period. We charge off the receivables outstanding under our PPBL product when the repayments are 180 days past the contractual repayment date. We charge off the receivables outstanding under our PPWC product when the repayments are 180 days past our expectation of repayments and the merchant has not made a payment in the last 60 days, or when the repayments are 360 days past due regardless of whether the merchant has made a payment within the last 60 days. Bankrupt accounts are charged off within 60 days of receiving notification of bankruptcy. The provision for credit losses on merchant loans and advances is recognized in transaction and credit losses, and the provision for interest and fees receivable is recognized as a reduction of deferred revenues included in accrued expenses and other current liabilities on our consolidated balance sheets. Charge-offs that are recovered are recorded as a reduction to our allowance for loans and interest receivable. Troubled Debt Restructurings In instances where a merchant is able to demonstrate that they are experiencing financial difficulty, there may be a modification of the loans or advances and the related interest receivable for which it is probable that without modification we will be unable to collect all amounts due. These modifications are intended to provide merchants with financial relief, and to help enable us to mitigate losses. These modifications include an increase in term by 1 to 5.5 years while moving the delinquency status to current. The fee on some of these loans or advances remains unchanged over the extended term. Alternatively, certain loans and advances have been modified to replace the initial fixed fee structure at the time the loan or advance was extended with a fixed annual percentage rate applied over the amended remaining term, which will continue to accrue interest at the fixed rate until the earlier of maturity or charge-off. These modifications had a de minimis impact on our consolidated statements of income in the year ended December 31, 2020. Allowances for TDRs are assessed separately from other loans within our portfolio and are determined by estimating current expected credit losses utilizing the modified term and interest rate assumptions. Historical loss estimates are utilized in addition to macroeconomic assumptions to determine expected credit loss rates. Further, we include qualitative adjustments that incorporate incremental information not captured in the quantitative estimates of our current expected credit losses. The following table shows the merchant loans and interest receivables which have been modified as TDRs in the year ended December 31, 2020: Number of Accounts Outstanding Balances (1) (in millions) Weighted Average Payment Term Extensions Loans and interest receivable 13 $ 354 37 (1) Balances are as of modification date. A merchant is considered in payment default after a modification when the merchant’s payment becomes 60 days past their expected or contractual repayment date. For loans that have defaulted after being modified, the increased estimate of current expected credit loss is factored into overall expected credit losses. As of December 31, 2020, the amount of merchant loans and interest receivables classified as TDRs that have subsequently defaulted on payments were de minimis. |
DEBT
DEBT | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT FIXED RATE NOTES On May 18, 2020, we issued fixed rate notes with varying maturity dates for an aggregate principal amount of $4.0 billion. Interest on these notes is payable on June 1 and December 1 of each year, beginning on December 1, 2020. On September 26, 2019, we issued fixed rate notes with varying maturity dates for an aggregate principal amount of $5.0 billion. Interest on these notes is payable in arrears semiannually (payable March 26 and September 26 for the notes due in 2022 and payable April 1 and October 1 for the remaining notes). The notes issued from the May 2020 and September 2019 debt issuances are senior unsecured obligations and are collectively referred to as the “Notes.” We may redeem these Notes in whole, at any time, or in part, from time to time, prior to maturity, at their redemption prices. Upon the occurrence of both a change of control of the Company and a downgrade of the Notes below an investment grade rating, we will be required to offer to repurchase each series of Notes at a price equal to 101% of the then outstanding principal amounts, plus accrued and unpaid interest. The Notes are subject to covenants including limitations on our ability to create liens on our assets, enter into sale and leaseback transactions, and merge or consolidate with another entity, in each case subject to certain exceptions, limitations, and qualifications. Proceeds from the issuance of these Notes may be used for general corporate purposes, which may include funding the repayment or redemption of outstanding debt, share repurchases, ongoing operations, capital expenditures, and possible acquisitions of businesses, assets, or strategic investments. As of December 31, 2020 and 2019, we had an outstanding aggregate principal amount of $9.0 billion and $5.0 billion, respectively, related to the Notes. The following table summarizes the Notes: As of December 31, Maturities Effective Interest Rate 2020 2019 (in millions) September 2019 debt issuance of $5.0 billion: Fixed-rate 2.200% notes 9/26/2022 2.39% $ 1,000 $ 1,000 Fixed-rate 2.400% notes 10/1/2024 2.52% 1,250 1,250 Fixed-rate 2.650% notes 10/1/2026 2.78% 1,250 1,250 Fixed-rate 2.850% notes 10/1/2029 2.96% 1,500 1,500 May 2020 debt issuance of $4 billion: Fixed-rate 1.350% notes 6/1/2023 1.55% $ 1,000 $ — Fixed-rate 1.650% notes 6/1/2025 1.78% 1,000 — Fixed-rate 2.300% notes 6/1/2030 2.39% 1,000 — Fixed-rate 3.250% notes 6/1/2050 3.33% 1,000 — Total term debt 9,000 5,000 Unamortized premium (discount) and issuance costs, net (61) (35) Total carrying amount of term debt $ 8,939 $ 4,965 The effective interest rates for the Notes include interest on the Notes, amortization of debt issuance costs, and amortization of the debt discount. The interest expense recorded for the Notes, including amortization of the debt discount and debt issuance costs, was $190 million and $35 million for the year ended December 31, 2020 and 2019, respectively. CREDIT FACILITIES Five-Year Revolving Credit Facility In September 2019, we entered into a credit agreement (the “Credit Agreement”) that provides for an unsecured $5.0 billion, five-year revolving credit facility that includes a $150 million letter of credit sub-facility and a $500 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 from time to time. Loans borrowed under the Credit Agreement are available in U.S. dollar, Euro, British Pound, Canadian dollar, and Australian dollar, and in each case subject to the sub-limits and other limitations provided in the Credit Agreement. We may also, subject to the agreement of the applicable lenders and satisfaction of specified conditions, increase the commitments under the revolving credit facility by up to $2.0 billion. Subject to specific conditions, we may designate one or more of our subsidiaries as additional borrowers under the Credit Agreement, provided PayPal Holdings, Inc. guarantees the portion of borrowings made available and other obligations of any such subsidiaries under the Credit Agreement. As of December 31, 2020, certain subsidiaries were designated as additional borrowers. Funds borrowed under the Credit Agreement may be used for working capital, capital expenditures, acquisitions, and other purposes not in contravention with the Credit Agreement. We are obligated to pay interest on loans under the Credit Agreement and other customary fees for a credit facility of this size and type, including an upfront fee and an unused commitment fee based on our debt rating. Loans under the Credit Agreement bear interest at either (i) the applicable eurocurrency rate plus a margin (based on our public debt ratings) ranging from 0.875 percent to 1.375 percent, (ii) the applicable overnight rate plus a margin (based on our public debt ratings) ranging from 0.875 percent to 1.375 percent, or (iii) a formula based on the prime rate, the federal funds effective rate, or LIBOR plus a margin (based on our public debt ratings) ranging from zero to 0.375 percent. The Credit Agreement will terminate and all amounts owed thereunder will be due and payable in September 2024, unless the commitments are terminated earlier. The Credit Agreement contains customary representations, warranties, affirmative and negative covenants, including a financial covenant, events of default, and indemnification provisions in favor of the lenders. The negative covenants include restrictions regarding the incurrence of liens and the incurrence of subsidiary indebtedness, in each case subject to certain exceptions. The financial covenant requires us to meet a quarterly financial test with respect to a maximum consolidated leverage ratio. In March 2020, we drew down $3.0 billion under the Credit Agreement. In May 2020, we repaid the $3.0 billion using proceeds from the May 2020 debt issuance. As of December 31, 2020, no borrowings or letters of credit were outstanding under the Credit Agreement. Accordingly, at December 31, 2020, $5.0 billion of borrowing capacity was available for the purposes permitted by the Credit Agreement, subject to customary conditions to borrowing. The total interest expense and fees we recorded related to the Credit Agreement was approximately $16 million for the year ended December 31, 2020. 364-Day Revolving Credit Facility In September 2019, we entered into a 364-Day credit agreement that provided for an unsecured $1.0 billion 364-Day revolving credit facility, which terminated in September 2020. Amended Credit Agreement In the fourth quarter of 2018, we entered into an amended credit agreement (“Amended Credit Agreement”), which amended and restated in its entirety the previous agreement entered into in 2017. The Amended Credit Agreement provided for an unsecured $5.0 billion, 364-day delayed-draw term loan credit facility, which was available in up to four separate borrowings until April 6, 2019. As of December 31, 2018, $2.0 billion was outstanding under the Amended Credit Agreement. On April 5, 2019, the Company drew down an additional $500 million under the Amended Credit Agreement. On September 26, 2019, the Amended Credit Agreement was terminated and we repaid $2.5 billion of borrowings outstanding under that agreement. The total interest expense and fees we recorded related to the Amended Credit Agreement were $69 million and $72 million for the year ended December 31, 2019 and 2018, respectively. Other Available Facilities We also maintain an uncommitted credit facility with a borrowing capacity of approximately $30 million, where we can withdraw and utilize the funds at our discretion for general corporate purposes. The interest rate term for this facility reflects prevailing market rates for companies with strong credit ratings. As of December 31, 2020, the majority of the borrowing capacity under this credit facility was available, subject to customary conditions to borrowing. FUTURE PRINCIPAL PAYMENTS As of December 31, 2020, the future principal payments associated with our long term debt were as follows (in millions): 2021 $ — 2022 1,000 2023 1,000 2024 1,250 2025 1,000 Thereafter 4,750 Total $ 9,000 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES COMMITMENTS As of December 31, 2020 and 2019, approximately $3.0 billion and $3.1 billion, respectively, of unused credit was available to PayPal Credit account holders. Substantially all of the PayPal Credit account holders with unused credit are in the U.K. While this amount represents the total unused credit available, we have not experienced, and do not anticipate, that all 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 based on, among other things, account usage and customer creditworthiness. 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 at that time. 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 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 13, 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 and reasonably estimable were not material for the year ended December 31, 2020. Except as otherwise noted for the proceedings described in this Note 13, we have concluded, based on currently available information, that reasonably possible losses arising directly from the proceedings (i.e., monetary damages or amounts paid in judgment or settlement) in excess of our recorded accruals are also not material. Determining legal reserves or possible losses from such matters involves judgment and may not reflect the full range of uncertainties and unpredictable outcomes. We may be exposed to losses in excess of the amount recorded, and such amounts could be material. If any of our estimates and assumptions change or prove to have been incorrect, it could have a material adverse effect on our business, financial position, results of operations, or cash flows. Regulatory Proceedings We are required to comply with U.S. economic and trade sanctions administered by the U.S. Department of the Treasury’s Office of Foreign Assets Control (“OFAC”). 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 that were inadvertently processed but subsequently identified 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. PayPal Australia Pty Limited (“PPAU”) self-reported a potential violation to the Australian Transaction Reports and Analysis Centre (“AUSTRAC”) on May 22, 2019. This self-reported matter relates to PPAU incorrectly filing required international funds transfer instructions over a period of time under the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (“AML/CTF Act”). On September 23, 2019, PPAU received a notice from AUSTRAC requiring that PPAU appoint an external auditor (a partner of a firm which is not our independent auditor) to review certain aspects of PPAU’s compliance with its obligations under the AML/CTF Act. The external auditor was appointed on November 1, 2019. As required under the terms of AUSTRAC’s notice, as amended, PPAU issued to AUSTRAC the external auditor’s interim reports on December 31, 2019, March 13, 2020, May 6, 2020 and July 7, 2020 and a final report on August 31, 2020. AUSTRAC has notified PPAU that its enforcement team is investigating the matters reported upon by the external auditor in its August 31, 2020 final report. PPAU is continuing to cooperate with AUSTRAC in all respects, including remediation activities, ongoing regular engagement with AUSTRAC, responding to requests for information and documents, and reporting to AUSTRAC of international funds transfer instructions based on the operation of the AML/CTF Act. We cannot estimate the potential impact, if any, on our business or financial statements at this time. In the event an adverse outcome arises from any associated enforcement, proceeding, or other further matter initiated by AUSTRAC, this could result in enforceable undertakings, 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 January 21, 2021, we received a Civil Investigative Demand (“CID”) from the Consumer Financial Protection Bureau (“CFPB”) related to Venmo’s unauthorized funds transfers and collections processes, and related matters. The CID requests the production of documents and answers to written questions. We are cooperating with the CFPB in connection with this CID. Legal Proceedings In November 2017, we announced that we had suspended the operations of TIO Networks (“TIO”) as part of an ongoing investigation of security vulnerabilities of the TIO platform. On December 1, 2017, we announced that we had identified evidence of unauthorized access to TIO’s network and the potential compromise of personally identifiable information for approximately 1.6 million TIO customers. We have received a number of governmental inquiries, and we may be subject to additional inquiries in the future. In addition, on December 6, 2017, a putative class action lawsuit was filed in the U.S. District Court for the Northern District of California (the “Court”) against the Company, its Chief Executive Officer, its Chief Financial Officer and Hamed Shahbazi, the former chief executive officer of TIO alleging violations of federal securities laws. The plaintiffs filed their operative, second amended complaint (the “SAC”) on July 13, 2018. The SAC names TIO Networks ULC, TIO Networks USA, Inc., and John Kunze (at that time, the Company’s Vice President, Global Consumer Products and Xoom) as additional defendants, but no longer names Hamed Shabazi as a defendant. The SAC is purportedly brought on behalf of all persons other than the defendants who acquired the Company’s securities between November 10, 2017 and December 1, 2017, and alleges that the Company’s November 2017 announcement was false and misleading because it only disclosed security vulnerabilities on TIO’s platform, rather than an actual security breach affecting millions of TIO users that defendants were allegedly aware of at the time of the announcement. Defendants filed their motion to dismiss the SAC on March 15, 2019, and the Court granted the defendants’ motion with prejudice on September 18, 2019. Plaintiffs appealed the dismissal to the U.S. Court of Appeals for the Ninth Circuit, and on December 17, 2020, the Ninth Circuit issued a memorandum decision affirming the dismissal. We may be subject to additional litigation relating to TIO’s data security platform or the suspension of TIO’s operations in the future. 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 introducing new products or services 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 may 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 business has grown and expanded in scale and scope, including the number of active accounts and payments transactions on our platforms, the range and increasing complexity of the products and services that we offer, and our geographical operations. 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 Our agreements with eBay governing our separation from eBay provide for specific indemnity and liability obligations for both eBay and us. Disputes between eBay and us have arisen and others may arise in the future, and an adverse outcome in such matters could materially and adversely impact our business, results of operations, and financial condition. 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. 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. We have provided an indemnity for other types of third-party claims, which are indemnities related primarily to intellectual property rights, confidentiality, willful misconduct, data privacy obligations, and certain breach of contract claims. We have also provided an indemnity to our payments processors in the event of 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. PayPal has participated in the U.S. Government’s Paycheck Protection Program administered by the U.S. Small Business Administration. Loans made under this program are funded by an independent chartered financial institution that we partner with. We receive a fee for providing origination services and loan servicing for these loans and retain operational risk related to those activities. We have agreed, under certain circumstances, to indemnify the chartered financial institution in connection with the services provided for loans made under this program. 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, 2020 and 2019, 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 for certain transactions completed on our Payments Platform. These programs are intended to 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. These protection programs are considered assurance-type warranties for which we estimate and record associated costs in transaction and credit losses during the period the payment transaction is completed. At December 31, 2020 and 2019, the allowance for transaction losses totaled $144 million and $136 million, respectively. The allowance for negative customer balances was $270 million and $263 million at December 31, 2020 and 2019, respectively. The following table shows changes in the allowance for transaction losses and negative customer balances related to our protection programs for the year end December 31, 2020 and 2019: As of December 31, 2020 2019 (In millions) Beginning balance $ 399 $ 344 Provision 1,135 1,092 Realized losses (1,208) (1,098) Recoveries 88 61 Ending balance $ 414 $ 399 |
STOCK REPURCHASE PROGRAMS
STOCK REPURCHASE PROGRAMS | 12 Months Ended |
Dec. 31, 2020 | |
Equity [Abstract] | |
STOCK REPURCHASE PROGRAMS | STOCK REPURCHASE PROGRAMS In April 2017, our Board of Directors authorized a stock repurchase program that provided for the repurchase of up to $5 billion of our common stock, with no expiration from the date of authorization. In July 2018, our Board of Directors authorized an additional stock repurchase program that provides for the repurchase of up to $10 billion of our common stock, with no expiration from the date of authorization. This program became effective in the first quarter of 2020 upon completion of the April 2017 stock repurchase program. Our stock repurchase programs are 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 programs may be made through open market transactions, block trades, privately negotiated transactions, including accelerated share repurchase agreements, 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. Moreover, any stock repurchases are subject to market conditions and other uncertainties, and we cannot predict if or when any stock repurchases will be made. We may terminate our stock repurchase programs at any time without prior notice. During the year ended December 31, 2020, we repurchased approximately 12 million shares of our common stock for approximately $1.6 billion at an average cost of $136.19. These shares were purchased in the open market under our stock repurchase programs authorized in April 2017 and July 2018. As of December 31, 2020, a total of approximately $8.4 billion remained available for future repurchases of our common stock under our July 2018 stock repurchase program. During the year ended December 31, 2019, we repurchased approximately 14 million shares of our common stock for approximately $1.4 billion, including approximately $656 million in the open market and approximately $750 million pursuant to an Accelerated Share Repurchase (“ASR”) agreement under our April 2017 stock repurchase program. During the year ended December 31, 2018, we repurchased approximately 44 million shares of our common stock for approximately $3.5 billion, including approximately $2.5 billion in the open market and approximately $1.0 billion pursuant to an ASR agreement under our April 2017 stock repurchase program. |
STOCK-BASED AND EMPLOYEE SAVING
STOCK-BASED AND EMPLOYEE SAVINGS PLANS | 12 Months Ended |
Dec. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
STOCK-BASED AND EMPLOYEE SAVINGS PLANS | STOCK-BASED AND EMPLOYEE SAVINGS PLANS EQUITY INCENTIVE PLAN Under the terms of the Amended and Restated PayPal Holdings, Inc. 2015 Equity Incentive Award Plan (the “Plan”), equity awards, including stock options, restricted stock units (“RSUs”), restricted stock awards (“RSAs”), performance based restricted stock units (“PBRSUs”), deferred stock units (“DSUs”), and stock payments, may be granted to our directors, officers, and employees. At December 31, 2020, 70 million shares were authorized under the Plan and 49 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 the Plan generally vest 12.5% six months from the date of grant or 25% one year from the date of grant with the remainder vesting at a rate of 2.08% per month thereafter, and generally expire seven 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. We discontinued granting stock options in January 2016. RSUs are granted to eligible employees under the Plan. RSUs generally vest in equal annual installments over a period of three years, are subject to an employee’s continuing service to us, and do not have an expiration date. The cost of RSUs granted is determined using the fair market value of PayPal’s common stock on the date of grant. Certain of our executives and non-executives are eligible to receive PBRSUs, which are equity awards that may be earned based on an initial target number. The final number of PBRSUs may vest and settle depending on the Company’s performance against pre-established performance metrics over a predefined performance period. PBRSUs granted under the Plan generally have one EMPLOYEE STOCK PURCHASE PLAN Under the terms of the Employee Stock Purchase Plan (“ESPP”), 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 contribute between 2% and 10% of their gross compensation during an offering period to purchase shares, but not more than the statutory limitation of $25,000 per year. All 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 years ended December 31, 2020, 2019, and 2018, our employees purchased 1.7 million, 1.8 million, and 2.4 million shares under the ESPP at an average per share price of $80.36, $66.36, and $43.09, respectively. As of December 31, 2020, approximately 50 million shares were reserved for future issuance under the ESPP. STOCK OPTION ACTIVITY The following table summarizes stock option activity of our employees under the Plan for the year ended December 31, 2020: Shares Weighted Weighted Aggregate (In thousands, except per share amounts and years) Outstanding at January 1, 2020 476 $ 25.18 Assumed 574 $ 1.88 Exercised (441) $ 10.23 Forfeited/expired/canceled (18) $ 3.51 Outstanding at December 31, 2020 591 $ 14.37 4.89 $ 128,143 Expected to vest 244 $ 4.48 6.92 $ 55,345 Options exercisable 329 $ 22.25 3.26 $ 68,780 The weighted average grant date fair value of options assumed from acquisitions during the year ended December 31, 2020 and 2018 was $108.61 and $72.02, respectively. No options were granted or assumed in 2019. The aggregate intrinsic value was calculated as the difference between the exercise price of the underlying options and the quoted price of our common stock at December 31, 2020. During the years ended December 31, 2020, 2019, and 2018, the aggregate intrinsic value of options exercised under the Plan was $66 million, $51 million, and $71 million, respectively, determined as of the date of option exercise. At December 31, 2020, all outstanding options were in-the-money. RSU, PBRSU, AND RESTRICTED STOCK ACTIVITY The following table summarizes the RSUs, PBRSUs, and restricted stock activity under the Plan as of December 31, 2020 and changes during the year ended December 31, 2020: Units Weighted Average Grant-Date (In thousands, except per share amounts) Outstanding at January 1, 2020 23,009 $ 83.61 Awarded and assumed (1), (2) 16,592 $ 113.63 Vested (1) (14,170) $ 77.50 Forfeited (2,267) $ 101.44 Outstanding at December 31, 2020 23,164 $ 107.13 Expected to vest 20,767 (1) Includes approximately 1.4 million of additional PBRSUs issued during 2020 due to the achievement of company performance metrics on awards granted in previous years. (2) Includes approximately 0.6 million in RSUs assumed from our Honey acquisition in 2020. During the years ended December 31, 2020, 2019, and 2018, the aggregate intrinsic value of RSUs and PBRSUs vested under the Plan was $1.7 billion, $1.6 billion, and $1.4 billion, respectively. In the year ended December 31, 2020, the Company granted 1.4 million PBRSUs with a one-year performance period (fiscal 2020), which will become fully vested following the completion of the performance period in February 2021 (one year from the annual incentive award cycle grant date), and 0.7 million PBRSUs with a three-year performance period. In the year ended December 31, 2019, the Company granted 1.5 million PBRSUs with a one-year performance period (fiscal 2019), which became fully vested following the completion of the performance period in February 2020 (one year from the annual incentive award cycle grant date), and 0.9 million PBRSUs with a three-year performance period. STOCK-BASED COMPENSATION EXPENSE We record stock-based compensation expense for the Plan in accordance with U.S. GAAP, which requires the measurement and recognition of compensation expense based on estimated fair values. T he impact on our results of operations of recording stock-based compensation expense under the Plan for the years ended December 31, 2020, 2019, and 2018 was as follows: Year Ended December 31, 2020 2019 2018 (In millions) Customer support and operations $ 250 $ 198 $ 174 Sales and marketing 172 127 125 Technology and development 529 420 303 General and administrative 460 305 269 Total stock-based compensation expense $ 1,411 $ 1,050 $ 871 Capitalized as part of internal use software and website development costs $ 48 $ 38 $ 38 Income tax benefit recognized for stock-based compensation arrangements $ 239 $ 176 $ 154 As of December 31, 2020, there was approximately $1.4 billion of unearned stock-based compensation estimated to be expensed primarily from 2021 through 2022. 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 equity awards we grant, or assume unvested equity awards in connection with acquisitions. EMPLOYEE SAVINGS PLANS Under the terms of the PayPal Holdings, Inc. Deferred Compensation Plan, which also qualifies under Section 401(k) of the Code, participating U.S. employees may contribute up to 50% of their eligible compensation, but not more than statutory limits. Under the PayPal plan, eligible employees received one dollar for each dollar contributed, up to 4% of each employee’s eligible salary, subject to a maximum employer contribution per employee of $11,600 in 2020 and $11,200 in both 2019 and 2018. Our non-U.S. employees are covered by other savings plans. For the years ended December 31, 2020, 2019, and 2018, the matching contribution expense for our U.S. and international savings plans was approximately $72 million, $59 million, and $51 million, respectively. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The components of income (loss) before income taxes are as follows: Year Ended December 31, 2020 2019 2018 (In millions) United States $ 1,504 $ 8 $ (474) International 3,561 2,990 2,850 Income before income taxes $ 5,065 $ 2,998 $ 2,376 The income tax expense is composed of the following: Year Ended December 31, 2020 2019 2018 (In millions) Current: Federal $ 310 $ 132 $ 180 State and local 143 47 32 Foreign 245 629 278 Total current portion of income tax expense $ 698 $ 808 $ 490 Deferred: Federal $ 259 $ (107) $ (115) State and local (32) (39) (35) Foreign (62) (123) (21) Total deferred portion of income tax expense 165 (269) (171) Income tax expense $ 863 $ 539 $ 319 The following is a reconciliation of the difference between the effective income tax rate and the federal statutory rate: Year Ended December 31, 2020 2019 2018 Federal statutory rate 21.0 % 21.0 % 21.0 % State taxes, net of federal benefit 2.2 % 0.3 % (0.1) % Foreign income taxed at different rates (7.4) % (5.0) % (3.9) % Stock-based compensation expense (1.2) % (3.9) % (4.1) % Tax credits (2.0) % (2.4) % (2.1) % Change in valuation allowances 0.1 % 0.1 % — % Intra-group transfer of intellectual property 4.1 % 7.6 % 0.7 % Other 0.2 % 0.3 % 1.9 % Effective income tax rate 17.0 % 18.0 % 13.4 % For the year ended December 31, 2020, the difference between the effective income tax rate and the U.S. federal statutory rate of 21% to income before income taxes is primarily the result of foreign income taxed at different rates, partially offset by tax expense related to the intra-group transfer of intellectual property. For the year ended December 31, 2019, the difference between the effective income tax rate and the federal statutory rate of 21% to income before income taxes is primarily the result of foreign income taxed at different rates and stock-based compensation deductions, partially offset by tax expense related to the intra-group transfer of intellectual property. For the year ended December 31, 2018, the difference between the effective income tax rate and the federal statutory rate of 21% to income before income taxes is primarily the result of foreign income taxed at different rates and stock-based compensation deductions. 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, 2020 2019 (In millions) Deferred tax assets: Net operating loss and credit carryforwards $ 201 $ 182 Accruals and allowances 413 235 Lease liability 188 120 Partnership investment 6 8 Stock-based compensation 196 160 Net unrealized losses 4 5 Fixed assets and other intangibles 11 88 Total deferred tax assets 1,019 798 Valuation allowance (166) (184) Net deferred tax assets $ 853 $ 614 Deferred tax liabilities: Unremitted foreign earnings $ (21) $ (17) Acquired intangibles (153) (103) Lease asset (172) (116) Net unrealized gains (440) (71) Total deferred tax liabilities (786) (307) Net deferred tax assets $ 67 $ 307 The following table shows the deferred tax assets and liabilities within our consolidated balance sheets: As of December 31, 2020 2019 Balance Sheet Location (In millions) Total deferred tax assets (non-current) Other assets $ 142 $ 396 Total deferred tax liabilities (non-current) Deferred tax liability and other long-term liabilities (75) (89) Total net deferred tax assets $ 67 $ 307 As of December 31, 2020, our federal, state, and foreign net operating loss carryforwards for income tax purposes were approximately $14 million, $336 million, and $316 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 2022, and the state net operating loss carryforwards will begin to expire in 2021. Approximately $4 million of the foreign net operating loss carryforwards will begin to expire in 2021, $46 million will begin to expire in 2024, $70 million will begin to expire in 2034, and $196 million has no expiration date and may be carried forward indefinitely. As of December 31, 2020, our federal and state tax credit carryforwards for income tax purposes were approximately $16 million and $244 million, respectively. If not utilized, the federal tax credits will begin to expire in 2029. Approximately $13 million of the state tax credits will begin to expire in 2021, $22 million will begin to expire in 2028, $8 million will begin to expire in 2035, and $201 million may be carried 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. We have elected the tax law ordering approach to assess the realizability of our net operating losses. During the year ended December 31, 2020, we decreased our valuation allowance by $18 million and during the years ended December 31, 2019 and 2018, we increased our valuation allowance by $52 million and $39 million, respectively. At December 31, 2020, 2019, and 2018, 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, 2020, none of our unremitted foreign earnings of approximately $7.2 billion are considered to be indefinitely reinvested. We have accrued $21 million of deferred U.S. state and foreign withholding taxes on the $7.2 billion of undistributed foreign earnings. We benefit from agreements concluded in certain jurisdictions, most significantly Singapore and, through 2019, Luxembourg. In December 2019, a new agreement was concluded in Singapore. The new agreement took effect January 1, 2021 and will be in effect from 2021 through 2030. In December 2019, the Luxembourg government passed legislation confirming that tax agreements granted before January 1, 2015 will no longer be binding after December 31, 2019. These agreements 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 agreements. These agreements resulted in tax savings of approximately $596 million, $472 million, and $465 million in 2020, 2019, and 2018, respectively. The benefit of these agreements on our net income per share (diluted) was approximately $0.50, $0.40, and $0.39 in 2020, 2019, and 2018, respectively. The following table reflects changes in unrecognized tax benefits for the periods presented below: Year Ended December 31, 2020 2019 2018 (In millions) Gross amounts of unrecognized tax benefits as of the beginning of the period $ 1,141 $ 800 $ 424 Increases related to prior period tax positions 92 97 120 Decreases related to prior period tax positions (78) (28) (6) Increases related to current period tax positions 360 336 287 Settlements (34) (63) (20) Statute of limitation expirations (2) (1) (5) Gross amounts of unrecognized tax benefits as of the end of the period $ 1,479 $ 1,141 $ 800 If the remaining balance of unrecognized tax benefits were realized in a future period, it would result in a tax benefit of $1.1 billion. In December 31, 2020, 2019, and 2018, we recognized net interest and penalties of $40 million, $63 million, and $57 million, respectively, related to uncertain tax positions in income tax expense. The amount of interest and penalties accrued as of December 31, 2020 and 2019 was approximately $211 million and $171 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 2008 to 2019 tax years. The material jurisdictions in which we are subject to examination by tax authorities for tax years after 2007 primarily include the U.S. (Federal and California), Germany, India, Israel, and Singapore. During 2020, we settled income tax audits in various jurisdictions including France, Germany, and California. We believe that adequate amounts have been reserved for any adjustments that may ultimately result from our open 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, 2020 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 AND OTHER CHARGES
RESTRUCTURING AND OTHER CHARGES | 12 Months Ended |
Dec. 31, 2020 | |
Restructuring and Related Activities [Abstract] | |
RESTRUCTURING AND OTHER CHARGES | RESTRUCTURING AND OTHER CHARGES In the first quarter of the years ended December 31, 2020, 2019, and 2018, management approved strategic reductions of the existing global workforce, which resulted in restructuring charges of $109 million, $78 million, and $25 million, respectively. The approved strategic reduction in 2020 is part of a multiphase process to reorganize our workforce concurrently with the redesign of our operating structure, which spanned multiple quarters. We primarily incurred employee severance and benefits costs, as well as other associated consulting costs under the 2020 strategic reduction. We experienced delays, primarily as a result of COVID-19, in the execution of these restructuring actions, which are now expected to be completed by the end of the first quarter of 2021. The following table summarizes the restructuring reserve activity during the year ended December 31, 2020: Employee Severance and Benefits and Other Associated Costs (In millions) Accrued liability as of January 1, 2020 $ 9 Charges 109 Payments (63) Accrued liability as of December 31, 2020 $ 55 Additionally, in 2020, we incurred asset impairment charges of $30 million due to the write-off of certain ROU lease assets and related leasehold improvements in conjunction with exiting certain leased properties. See “Note 6—Leases” for additional information. The approved strategic reductions for 2019 were intended to better align our teams to support key business priorities and included the transfer of certain operational functions between geographies, as well as the impact of the transition servicing activities provided to Synchrony, which ended in the second quarter of 2019. We primarily incurred employee severance and benefits expenses under the 2019 strategic reductions, which were substantially completed by the end of the first quarter of 2020. The strategic reduction approved in the first quarter of 2018 included restructuring charges related to the decision to wind down TIO’s operations. We incurred employee and severance benefits expenses under the 2018 strategic reductions, which were substantially completed by the end of 2018. |
QUARTERLY UNAUDITED FINANCIAL D
QUARTERLY UNAUDITED FINANCIAL DATA | 12 Months Ended |
Dec. 31, 2020 | |
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, 2020 and 2019. 2020 Quarter Ended March 31 June 30 September 30 December 31 (Unaudited, in millions, except per share amounts) Net revenues $ 4,618 $ 5,261 $ 5,459 $ 6,116 Net income $ 84 $ 1,530 $ 1,021 $ 1,567 Net income per share - basic $ 0.07 $ 1.30 $ 0.87 $ 1.34 Net income per share - diluted $ 0.07 $ 1.29 $ 0.86 $ 1.32 Weighted average shares: Basic 1,173 1,173 1,172 1,172 Diluted 1,185 1,184 1,190 1,191 2019 Quarter Ended March 31 June 30 September 30 December 31 (Unaudited, in millions, except per share amounts) Net revenues $ 4,128 $ 4,305 $ 4,378 $ 4,961 Net income $ 667 $ 823 $ 462 $ 507 Net income per share - basic $ 0.57 $ 0.70 $ 0.39 $ 0.43 Net income per share - diluted $ 0.56 $ 0.69 $ 0.39 $ 0.43 Weighted average shares: Basic 1,171 1,175 1,175 1,174 Diluted 1,188 1,187 1,188 1,187 |
Schedule II_VALUATION AND QUALI
Schedule II—VALUATION AND QUALIFYING ACCOUNTS | 12 Months Ended |
Dec. 31, 2020 | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract] | |
Schedule II—VALUATION AND QUALIFYING ACCOUNTS | 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 Charged/ Charged to Other Accounts (1) Charges Balance at (In millions) Allowance for Transaction Losses and Negative Customer Balances Year Ended December 31, 2018 $ 266 $ 1,059 $ — $ (981) $ 344 Year Ended December 31, 2019 $ 344 $ 1,092 $ — $ (1,037) $ 399 Year Ended December 31, 2020 $ 399 $ 1,135 $ — $ (1,120) $ 414 Allowance for Loans and Interest Receivable Year Ended December 31, 2018 $ 129 $ 243 $ — $ (200) $ 172 Year Ended December 31, 2019 $ 172 $ 325 $ — $ (239) $ 258 Year Ended December 31, 2020 $ 258 $ 689 $ 210 $ (319) $ 838 (1) The amount is related to the impact of the adjustment recorded for adoption of the credit losses accounting standard. |
OVERVIEW AND SUMMARY OF SIGNI_2
OVERVIEW AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of presentation | Basis of presentation and principles of consolidation The accompanying consolidated financial statements include the financial statements of PayPal and our wholly- and majority-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Noncontrolling interest reported as a component of equity on our consolidated balance sheets represents the equity interests not owned by PayPal and is recorded for consolidated entities we control and of which we own less than 100%. Noncontrolling interest is not presented separately on our consolidated statements of income as the amount is de minimis. Investments in entities where we have the ability to exercise significant influence, but not control, over the investee are accounted for using the equity method of accounting. For such investments, our share of the investee’s results of operations is included in other income (expense), net on our consolidated statements of income and our investment balance is included in long-term investments on our consolidated balance sheets. Investments in entities where we do not have the ability to exercise significant influence over the investee are accounted for at fair value or cost minus impairment, if any, adjusted for changes resulting from observable price changes, which are included in other income (expense), net on our consolidated statements of income. Our investment balance is included in long-term investments on our consolidated balance sheets. We determine at the inception of each investment, and re-evaluate if certain events occur, whether an entity in which we have made an investment is considered a variable interest entity (“VIE”). If we determine an investment is a VIE, we then assess if we are the primary beneficiary, which would require consolidation. As of December 31, 2020, none of these VIEs qualified for consolidation as the structures of these entities do not provide us with the ability to direct the activities that would significantly impact their economic performance. The carrying value of our investments that are VIEs was de minimis and included as non-marketable equity securities accounted for using the equity method of accounting in long-term investments on our consolidated balance sheets. Our maximum exposure to loss, including the carrying value of the investments and any future funding commitments, was $105 million as of December 31, 2020. In the opinion of management, these consolidated financial statements reflect all adjustments, consisting only of normal recurring adjustments, which are necessary for a fair statement of the consolidated financial statements for all periods presented. |
Principles of consolidation | Basis of presentation and principles of consolidation The accompanying consolidated financial statements include the financial statements of PayPal and our wholly- and majority-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. Noncontrolling interest reported as a component of equity on our consolidated balance sheets represents the equity interests not owned by PayPal and is recorded for consolidated entities we control and of which we own less than 100%. Noncontrolling interest is not presented separately on our consolidated statements of income as the amount is de minimis. Investments in entities where we have the ability to exercise significant influence, but not control, over the investee are accounted for using the equity method of accounting. For such investments, our share of the investee’s results of operations is included in other income (expense), net on our consolidated statements of income and our investment balance is included in long-term investments on our consolidated balance sheets. Investments in entities where we do not have the ability to exercise significant influence over the investee are accounted for at fair value or cost minus impairment, if any, adjusted for changes resulting from observable price changes, which are included in other income (expense), net on our consolidated statements of income. Our investment balance is included in long-term investments on our consolidated balance sheets. We determine at the inception of each investment, and re-evaluate if certain events occur, whether an entity in which we have made an investment is considered a variable interest entity (“VIE”). If we determine an investment is a VIE, we then assess if we are the primary beneficiary, which would require consolidation. As of December 31, 2020, none of these VIEs qualified for consolidation as the structures of these entities do not provide us with the ability to direct the activities that would significantly impact their economic performance. The carrying value of our investments that are VIEs was de minimis and included as non-marketable equity securities accounted for using the equity method of accounting in long-term investments on our consolidated balance sheets. Our maximum exposure to loss, including the carrying value of the investments and any future funding commitments, was $105 million as of December 31, 2020. In the opinion of management, these consolidated financial statements reflect all adjustments, consisting only of normal recurring adjustments, which are necessary for a fair statement of the consolidated financial statements for all periods presented. |
Reclassifications | Reclassifications Beginning with the fourth quarter of 2020, we reclassified certain cash flows related to customer balances from cash flows from operating activities to cash flows from investing activities and cash flows from financing activities within the consolidated statements of cash flows. Prior period amounts have been reclassified to conform to the current period presentation. These changes have no impact on our previously reported consolidated net income, financial position, net change in cash, cash equivalents, and restricted cash, or total cash, cash equivalents, and restricted cash as reported on our consolidated statements of cash flows. The current period presentation classifies all changes in funds receivable and customer accounts and funds payable and amounts due to customers consistently on our consolidated statement of cash flows as cash flows from investing activities and cash flows from financing activities, respectively, regardless of which product the cash flows relate to on our Payments Platform. The current period presentation provides a more meaningful representation of the cash flows related to the movement of customer funds due to the restrictions on and use of those funds. |
Use of estimates | Use of estimates The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles (“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 during the reporting period. On an ongoing basis, we evaluate our estimates, including those related to provisions for transaction and credit losses, loss contingencies, income taxes, revenue recognition, and the valuation of goodwill and intangible assets. We base our estimates on historical experience and various other assumptions which we believe to be reasonable under the circumstances. These estimates may change as new events occur, and as additional information surrounding the continued impact of the novel coronavirus (“COVID-19”) pandemic becomes available. Actual results could differ from these estimates and any such differences may be material to our financial statements. |
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 bank deposits, government and agency securities, and commercial paper. |
Investments | Investments Short-term investments 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 or maturities of less than one year on the reporting date. Long-term investments include time deposits, government and agency securities, corporate debt securities, and asset-backed securities with maturities exceeding one year, and our strategic investments. Government and agency securities, corporate debt securities, and asset-backed securities are classified as available-for-sale and are reported at fair value using the specific identification method. Unrealized gains and losses are 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 9—Fair Value Measurement of Assets and Liabilities.” 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 strategic investments consist of marketable equity securities, which are publicly traded, and non-marketable equity securities, which are investments in privately held companies. Marketable equity securities have readily determinable fair values with changes in fair value recorded in other income (expense), net. Non-marketable equity securities include investments that do not have a readily determinable fair value, as well as equity method investments. The investments that do not have readily determinable fair value are measured at cost minus impairment, if any, adjusted for changes resulting from observable price changes in orderly transactions for an identical or similar investment in the same issuer (the “Measurement Alternative”). All gains and losses on these investments, realized and unrealized, are recorded in other income (expense), net on our consolidated statements of income. Our investments where we have the ability to exercise significant influence, but not control, over the investee are accounted for as equity method investments and our share of the investee’s results of operations is included in other income (expense), net. |
Loans and interest receivable, net | Loans and interest receivable, net Loans and interest receivable, net represents merchant receivables originated under our PayPal Working Capital (“PPWC”) product and PayPal Business Loan (“PPBL”) product and consumer loans originated under our PayPal Credit and installment credit products. In the U.S., we partner with an independent chartered financial institution that extends credit to merchants using our PPWC product or PPBL product and purchase the related receivables extended by the independent chartered financial institution. For our merchant credit products outside the U.S., we extend working capital advances in the U.K. and loans in Germany through our Luxembourg banking subsidiary, and working capital loans in Australia through an Australian subsidiary. In the U.S., we extend installment loans to consumers through a U.S. subsidiary. For our international consumer credit products, we extend credit through our Luxembourg banking subsidiary. As part of our arrangement with the independent chartered financial institution in the U.S., we sell back a participation interest in the pool of merchant receivables. The independent chartered financial institution has 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 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 merchant receivables. All risks of loss are shared pro rata based on participation interests held among all participating stakeholders. We account for the asset transfer as a sale and derecognize the portion of the participation interests for which control has been surrendered. For this arrangement, gains or losses on the sale of the participation interests are not material as the carrying amount of the participation interest sold approximates the fair value at time of transfer. In instances where a merchant is able to demonstrate that they are experiencing financial difficulty, there may be a modification of the loans or advances and the related interest receivable for which it is probable that, without modification, we will be unable to collect all amounts due, therefore resulting in a troubled debt restructuring (“TDR”). Refer to “Note 11—Loans and Interest Receivable” for further information related to TDRs. Loans, advances, and interest and fees receivable are reported at their outstanding balances, net of any participation interests sold and pro rata current expected credit losses, including unamortized deferred origination costs. We maintain the servicing rights for the entire pool of consumer and merchant receivables outstanding and receive a fee approximating the fair value for servicing the assets underlying the participation interest sold. We offer both revolving and installment credit products to our consumers. 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. U.S. Consumer Credit Portfolio In November 2017, we reached an agreement to sell our U.S. consumer credit receivables portfolio to Synchrony Bank (“Synchrony”). Following the closing of this transaction in July 2018, Synchrony became the exclusive issuer of the PayPal Credit online consumer financing program in the U.S. We no longer hold an ownership interest in the receivables generated through the program and thus, no longer record these receivables on our consolidated financial statements. PayPal earns a revenue share on the portfolio of consumer receivables owned by Synchrony, which includes both the sold and newly generated receivables, and it is recorded in revenues from other value added services on our consolidated statements of income. |
Allowance for loans and interest receivable | Allowance for loans and interest receivable The allowance for loans and interest receivable represents our estimate of current expected credit losses inherent in our portfolio of loans and interest receivables. Increases to the allowance for loans receivable are reflected as a component of transaction and credit losses on our consolidated statements of income. Increases to the allowance for interest and fees receivable are reflected as a reduction of net revenues on our consolidated statements of income, or as a reduction of deferred revenue when interest and fees are billed at the inception of a loan or advance. The evaluation process to assess the adequacy of allowances is subject to numerous estimates and judgments. Beginning in 2020, the allowance for loans and interest receivable is primarily based on expectations of credit losses based on historical lifetime loss data as well as macroeconomic forecasts applied to the portfolio, which is segmented by factors such as geographic region, delinquency, and vintage. Loss curves are generated using historical loss data for each loan portfolio and are applied to segments of each portfolio, categorized by factors such as geographic region, first borrowing versus reuse, delinquency, credit rating, and vintage, which vary by portfolio. We then apply macroeconomic factors such as forecasted trends in unemployment and benchmark credit card charge-off rates, which are sourced externally, using a single scenario that we believe is most appropriate to the economic conditions applicable to a particular period. Projected loss rates, inclusive of historical loss data and macroeconomic factors, are applied to the principal amount of our consumer and merchant receivables. We also include qualitative adjustments that incorporate incremental information not captured in the quantitative estimates of our current expected credit losses. Our consumer receivables are primarily revolving in nature and do not have a contractual term; however, the reasonable and supportable forecast period we have included in our projected loss rates based on externally sourced data is approximately seven years. Our merchant receivables vary in contractual term; however, the reasonable and supportable forecast period considered for projected loss rates is approximately 2.5 to 3.5 years, depending upon the product. The allowance for credit losses on interest and fees receivable is determined primarily by applying loss curves to each portfolio by geography, delinquency, and period of origination, among other factors. Prior to 2020, the allowance for our consumer loans receivable was primarily based on forecasted principal balance delinquency rates (“roll rates”). Roll rates are the percentage of balances which we estimate would 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 were applied to the principal amount of our consumer receivables for each stage of delinquency, from current to 179 days past the payment due date, in order to estimate the principal loans which had incurred losses and were probable to be charged off. For merchant loans and advances receivable, the allowance was 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 179 days past due, for principal balances related to merchant receivables outstanding was based on the current expected or contractual repayment period of the loan or advance and interest or fixed fee as compared to the original expected or contractual repayment period. The allowance for loss against interest receivable was 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 had incurred losses and were probable to be charged off. The allowance for fees receivable was primarily based on fee balances, forecasted delinquency rates, and recoveries through the use of a vintage-based loss forecasting model. |
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 sheets as a liability classified as amounts due to customers. Certain jurisdictions where PayPal operates require us to hold eligible liquid assets, as defined by applicable regulatory requirements and commercial law in these jurisdictions, equal to at least 100% of the aggregate amount of all customer balances. Therefore, we restrict the use of the assets underlying the customer balances to meet these regulatory requirements and separately classify the assets as customer accounts in our consolidated balance sheets. 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. Customer funds for which PayPal is an agent and custodian on behalf of our customers are not reflected on our consolidated balance sheets. These funds include U.S. dollar funds which are deposited at one or more third-party financial institutions insured by the Federal Deposit Insurance Corporation (“FDIC”) and are eligible for FDIC pass-through insurance (subject to applicable limits). We act as an agent in facilitating cryptocurrency transactions on behalf of our customers. Cryptocurrencies held on behalf of our customers are not PayPal’s assets and therefore are not reflected on our consolidated balance sheets. In June 2018, the Luxembourg Commission de Surveillance du Secteur Financier (the “CSSF”) agreed that PayPal’s management may designate up to 35% of European customer balances held in our Luxembourg banking subsidiary to be used for European and U.S. credit activities. As of December 31, 2020, the cumulative amount approved by management to be designated for credit activities aggregated to $2.0 billion and represented approximately 21% of European customer balances potentially available for our corporate use at that date, as determined by applying financial regulations maintained by the CSSF. At the time PayPal’s management designates the European customer balances held in our Luxembourg banking subsidiary to be used to extend credit, the balances are classified as cash and cash equivalents and no longer classified as customer accounts on our consolidated balance sheets. The remaining assets underlying the customer balances remain separately classified as customer accounts on our consolidated balance sheets. 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, government and agency securities, and asset-backed securities. See “Note 8—Funds Receivable and Customer Accounts and Investments” for additional information related to customer accounts. |
Funds receivable and funds payable | Funds receivable and funds payableFunds 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 PayPal account using their bank account, credit card, 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 three five |
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 and amortization. Depreciation and amortization are computed using the straight-line method over the estimated useful lives of the assets; generally, one |
Leases | Leases We determine whether an arrangement is a lease for accounting purposes at contract inception. Operating leases are recorded as right-of-use (“ROU”) assets, which are included in other assets, and lease liabilities, which are included in accrued expenses and other current liabilities and deferred tax liability and other long-term liabilities on our consolidated balance sheets. For sale-leaseback transactions, we evaluate the sale and the lease arrangement based on our conclusion as to whether control of the underlying asset has been transferred and recognize the sale-leaseback as either a sale transaction or under the financing method. The financing method requires the asset to remain on our consolidated balance sheets throughout the term of the lease and the proceeds to be recognized as a financing obligation. As of December 31, 2020, we had no finance leases. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. Our leases do not provide an implicit rate and therefore we use an incremental borrowing rate for specific terms on a collateralized basis based on the information available on the commencement date in determining the present value of lease payments. The ROU asset calculation includes lease payments to be made and excludes lease incentives. The ROU asset and lease liability may include amounts attributed to options to extend or terminate the lease when it is reasonably certain we will exercise that option. When we reach a decision to exercise a lease renewal or termination option, we recognize the associated impact to the ROU asset and lease liability. Lease expense for operating leases is recognized on a straight-line basis over the lease term. We evaluate ROU assets related to leases for indicators of impairment whenever events or changes in circumstances indicate that the carrying amount of an ROU asset may not be recoverable. When a decision has been made to exit a lease prior to the contractual term or to sublease that space, we evaluate the asset for impairment and recognize the associated impact to the ROU asset and related expense, if applicable. The evaluation is performed at the asset group level initially and when appropriate, at the lowest level of identifiable cash flows, which is at the individual lease level. Undiscounted cash flows expected to be generated by the related ROU assets are estimated over the ROU assets’ useful lives. If the evaluation indicates that the carrying amount of the ROU assets may not be recoverable, any potential impairment is measured based upon the fair value of the related ROU asset or asset group as determined by appropriate valuation techniques. We have lease agreements with lease and non-lease components. We have elected to apply the practical expedient and account for the lease and non-lease components as a single lease component for all leases, where applicable. In addition, we have elected the practical expedients related to lease classification, hindsight, and land easement. We apply a single portfolio approach to account for the ROU assets and lease liabilities. The Company adopted Accounting Standards Update (“ASU”) 2016-02, Leases |
Goodwill and intangible assets and impairment of long-lived assets | Goodwill and intangible assets Goodwill is tested for impairment, at a minimum, on an annual basis 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 may be 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 mergers 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, 2020 and 2019. We determined that no adjustment to the carrying value of goodwill of our reporting unit was required. As of December 31, 2020, we determined that no events occurred, or circumstances changed from August 31, 2020 through December 31, 2020 that would more likely than not reduce the fair value of the reporting unit below its carrying amount. Intangible assets consist of acquired customer list and user base intangible assets, marketing related intangibles, developed technology, and other intangible assets. Intangible assets are amortized over the period of estimated benefit using the straight-line method and estimated useful lives ranging from one 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 discounted cash flow the asset is expected to generate. |
Allowance for transaction losses and negative customer balances | Allowance for transaction losses We are exposed to transaction losses due to credit card and other payment misuse as well as nonperformance from sellers who accept payments through PayPal. We establish an allowance for estimated losses arising from completing customer transactions, such as chargebacks for unauthorized credit card use and merchant-related chargebacks due to non-delivery or unsatisfactory delivery of purchased items, buyer protection program claims, and account takeovers. This allowance represents an accumulation of the estimated amounts of probable transaction losses as of the reporting date, including those which we have not yet identified. The allowance is monitored regularly and is updated based on actual data received, including actual claims data reported by our claims processors. The allowance is based on known facts and circumstances, internal factors including experience with similar cases, historical trends involving loss payment patterns, the mix of transaction and loss types, as applicable. Additions to the allowance are reflected as a component of transaction and credit losses on our consolidated statements of income. The allowance for transaction losses was included in accrued expenses and other current liabilities on our consolidated balance sheets. Allowance for negative customer balances |
Fair value of financial instruments | Fair value of financial instrumentsOur 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 quoted prices for identical instruments in less active markets, readily available pricing sources for comparable instruments, or models using market observable inputs. |
Concentrations of risk | Concentrations of riskOur cash, cash equivalents, accounts receivable, loans and interest receivable, funds receivable and customer accounts, and long-term notes receivable 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 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 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 merchant and consumer financing activities for customers located in the U.S. and internationally. |
Advertising expense | Advertising expenseWe 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 are 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, including those costs incurred in expanding and enhancing our Payments Platform, are capitalized and amortized generally over an estimated useful life of three years and are recorded as depreciation and amortization within the financial statement captions aligned with the internal organizations that are the primary beneficiaries of such assets. PayPal capitalized $347 million and $314 million of internally developed software and website development costs for the years ended December 31, 2020 and 2019, respectively. Amortization expense for these capitalized costs was $322 million, $298 million, and $262 million for the years ended December 31, 2020, 2019, and 2018, 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. 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 We determine compensation expense associated with restricted stock units, performance based restricted stock units, and restricted stock awards 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, 2020, 2019, and 2018 has been reduced for estimated forfeitures. When estimating forfeitures, we consider voluntary termination behavior of our employees as well as trends of actual forfeitures. |
Foreign currency | Foreign currency Many of our foreign subsidiaries use the local currency of their respective countries as their functional currency. Assets and liabilities of our non-U.S. dollar functional currency subsidiaries are translated into U.S. dollars at exchange rates prevailing at the balance sheet dates. Revenues, costs, and expenses of our non-U.S. dollar functional currency subsidiaries are translated into U.S. dollars using daily exchange rates. Gains and losses resulting from these translations are recorded as a component of accumulated other comprehensive income (loss) (“AOCI”). Gains and losses from the remeasurement of foreign currency transactions into the functional currency are recognized as other income (expense), net in our consolidated statements of income. |
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. We account for Global Intangible Low-Taxed Income (“GILTI”) as a current-period expense when incurred. |
Other income (expense), net | Other income (expense), netOther income (expense), net includes: (i) interest income, which consists of interest earned on corporate cash and cash equivalents and short-term and long-term investments, (ii) interest expense, which consists of interest expenses, fees, and amortization of debt discount on our long-term debt and credit facilities, (iii) realized and unrealized gains (losses) on strategic investments, which includes changes in fair value related to our marketable equity securities and observable price changes on our non-marketable equity securities, and (iv) other, which primarily includes foreign currency exchange gains and losses due to remeasurement of certain foreign currency denominated monetary assets and liabilities, and fair value changes on the derivative contracts not designated as hedging instruments. |
Recent accounting guidance and recently adopted accounting guidance | Recent Accounting Guidance In 2020, the Financial Accounting Standards Board (“FASB”) issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting . This amended guidance provides transition relief for the accounting impact of reference rate reform. For a limited period, this guidance provides optional expedients and exceptions for applying GAAP to certain contract modifications, hedging relationships, and other transactions affected by a reference rate expected to be discontinued due to reference rate reform. The amended guidance is effective through December 31, 2022. Our exposure to London Interbank Offered Rate (“LIBOR”) is primarily limited to an insignificant portion of our available-for-sale debt securities and, accordingly, we do not expect reference rate reform to have a material impact on our consolidated financial statements. Recently Adopted Accounting Guidance In 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes . This amended guidance simplifies certain aspects of accounting for income taxes. It is intended to remove certain exceptions to the general principles in GAAP, reduce the cost and complexity in accounting for income taxes, and improve financial statement preparers’ application of income tax-related guidance. It is effective for fiscal years, and interim periods within those years, beginning after December 15, 2020, with early adoption permitted. We early adopted this guidance in the first quarter of 2020. Adoption of this guidance did not have a material impact on our consolidated financial statements. In 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments . This update provided new guidance on the measurement of credit losses on financial instruments. Under the new guidance, credit losses on loans, trade and other receivables, held-to-maturity debt securities, and other instruments reflect our current expected credit losses and generally result in the earlier recognition of allowances for credit losses. Credit losses on available-for-sale debt securities with unrealized losses are recognized as allowances for credit losses limited to the amount by which fair value is below amortized cost. Additional disclosures are required, including information used to track credit quality by year of origination for most financing receivables. We were required to apply the provisions of this guidance 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 adopted the new guidance effective January 1, 2020. For additional information, see “Note 11—Loans and Interest Receivable.” There are other new accounting pronouncements issued by the FASB that we have adopted or will adopt, as applicable. We do not believe any of these accounting pronouncements have had, or will have, a material impact on our consolidated financial statements or disclosures. |
OVERVIEW AND SUMMARY OF SIGNI_3
OVERVIEW AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of reclassifications | The following tables present the effects of the changes on the presentation of these cash flows to the previously reported consolidated statements of cash flows: Year Ended December 31, 2019 (In millions) As Previously Reported (1) Adjustments Reclassified Net cash provided by (used in): Operating activities (2) $ 4,561 $ (490) $ 4,071 Investing activities (3) (5,733) (9) (5,742) Financing activities (4) 3,688 499 4,187 Effect of exchange rates on cash, cash equivalents, and restricted cash (6) — (6) Net increase in cash, cash equivalents, and restricted cash $ 2,510 $ — $ 2,510 (1) As reported in our 2019 Form 10-K filed with the SEC on February 6, 2020. (2) Financial statement lines impacted in operating activities were “Funds receivable” and “Funds payable and amounts due to customers,” which increased by $9 million and decreased by $499 million, respectively, to arrive at the reclassified amounts. (3) Financial statement line impacted in investing activities was “Funds receivable.” (4) Financial statement line impacted in financing activities was “Funds payable and amounts due to customers.” Year Ended December 31, 2018 (In millions) As Previously Reported (1) Adjustments Reclassified Net cash provided by (used in): Operating activities (2) $ 5,483 $ (3) $ 5,480 Investing activities (3) 840 (19) 821 Financing activities (4) (1,262) 22 (1,240) Effect of exchange rates on cash, cash equivalents, and restricted cash (113) — (113) Net increase in cash, cash equivalents, and restricted cash $ 4,948 $ — $ 4,948 (1) As reported in our 2019 Form 10-K filed with the SEC on February 6, 2020. (2) Financial statement lines impacted in operating activities were “Funds receivable” and “Funds payable and amounts due to customers,” which increased by $19 million and decreased by $22 million, respectively, to arrive at the reclassified amounts. (3) Financial statement line impacted in investing activities was “Funds receivable.” (4) Financial statement line impacted in financing activities was “Funds payable and amounts due to customers.” |
REVENUE (Tables)
REVENUE (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of disaggregation of revenue | The following table presents our revenue disaggregated by primary geographical market and category: Year Ended December 31, 2020 2019 2018 (In millions) Primary geographical markets United States (“U.S.”) $ 11,013 $ 9,417 $ 8,324 United Kingdom (“U.K.”) 2,340 1,872 1,658 Other countries (1) 8,101 6,483 5,469 Total revenues (2) $ 21,454 $ 17,772 $ 15,451 Revenue category Transaction revenues $ 19,918 $ 16,099 $ 13,709 Revenues from other value added services 1,536 1,673 1,742 Total revenues (2) $ 21,454 $ 17,772 $ 15,451 (1) No single country included in the other countries category generated more than 10% of total revenue. (2) Total revenues include $597 million, $1.1 billion and $1.2 billion for the years ended December 31, 2020, 2019, and 2018, respectively, which do not represent revenues recognized in the scope of Accounting Standards Codification Topic 606, Revenue from contracts with customers. Such revenues relate to interest, fees, and gains earned on loans and interest receivables, as well as hedging gains or losses and interest earned on certain assets underlying customer balances. |
NET INCOME PER SHARE (Tables)
NET INCOME PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
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, 2020 2019 2018 (In millions, except per share amounts) Numerator: Net income $ 4,202 $ 2,459 $ 2,057 Denominator: Weighted average shares of common stock — basic 1,173 1,174 1,184 Dilutive effect of equity incentive awards 14 14 19 Weighted average shares of common stock — diluted 1,187 1,188 1,203 Net income per share: Basic $ 3.58 $ 2.09 $ 1.74 Diluted $ 3.54 $ 2.07 $ 1.71 Common stock equivalents excluded from income per diluted share because their effect would have been anti-dilutive 1 2 1 |
BUSINESS COMBINATIONS (Tables)
BUSINESS COMBINATIONS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Business Combinations [Abstract] | |
Schedule of allocation of purchase consideration to fair value of assets acquired and liabilities assumed | 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 $ 2,962 Customer lists and user base 115 Marketing related 30 Developed technology 572 Total intangibles $ 717 Accounts receivable, net 50 Deferred tax liabilities, net (58) Other net liabilities (36) Total purchase price $ 3,635 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 $ 1,600 Customer lists and user base 426 Marketing related 102 Developed technology 121 All other 1 Total intangibles $ 650 Cash 103 Funds receivable and customer accounts 47 Funds payable and amounts due to customers (47) Deferred tax liabilities, net (116) Other net liabilities (55) Total purchase price $ 2,182 |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of goodwill balances and adjustments | The following table presents goodwill balances and adjustments to those balances for the years ended December 31, 2020 and 2019: December 31, 2018 Goodwill Adjustments December 31, 2019 Goodwill Adjustments December 31, 2020 (In millions) Total goodwill $ 6,284 $ — $ (72) $ 6,212 $ 2,962 $ (39) $ 9,135 |
Schedule of components of identifiable intangible assets | The components of identifiable intangible assets are as follows: December 31, 2020 December 31, 2019 Gross Accumulated Net Weighted Gross Accumulated Net Weighted (In millions, except years) Intangible assets: Customer lists and user base $ 1,206 $ (797) $ 409 6 $ 1,114 $ (700) $ 414 7 Marketing related 321 (278) 43 3 294 (239) 55 3 Developed technology 999 (577) 422 3 445 (343) 102 3 All other 449 (275) 174 7 436 (229) 207 7 Intangible assets, net $ 2,975 $ (1,927) $ 1,048 $ 2,289 $ (1,511) $ 778 |
Schedule of expected future intangible asset amortization | Expected future intangible asset amortization as of December 31, 2020 is as follows: Fiscal years: (In millions) 2021 $ 400 2022 338 2023 100 2024 99 2025 83 Thereafter 28 $ 1,048 |
LEASES (Tables)
LEASES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
Schedule of components of lease expense, supplemental cash and noncash and balance sheet information | The components of lease expense were as follows: Year Ended December 31, 2020 2019 (In millions) Lease expense Operating lease expense $ 166 $ 136 Sublease income (6) (6) Total lease expense $ 160 $ 130 Supplemental cash flow information related to leases were as follows: Year Ended December 31, 2020 2019 (In millions) Cash paid for amounts included in the measurement of lease liabilities Operating cash flows from operating leases $ 159 $ 131 Right-of-use assets obtained in exchange for operating lease liabilities (1) $ 345 $ 598 (1) Includes opening balance additions of $498 million for operating leases as a result of the adoption of the new lease accounting guidance effective January 1, 2019. Supplemental balance sheet information related to leases was as follows: As of December 31, 2020 2019 (In millions, except weighted-average figures) Operating lease right-of-use assets $ 707 $ 479 Other current lease liabilities 144 104 Operating lease liabilities 642 403 Total operating lease liabilities $ 786 $ 507 Weighted-average remaining lease term — operating leases 6.9 years 5.8 years Weighted-average discount rate — operating leases 3 % 5 % |
Schedule of future minimum lease payments for operating leases | Future minimum lease payments for our operating leases as of December 31, 2020 were as follows: Operating Leases Fiscal years: (In millions) 2021 $ 165 2022 132 2023 116 2024 106 2025 94 Thereafter 266 Total $ 879 Less: present value discount (93) Lease liability $ 786 |
OTHER FINANCIAL STATEMENT DET_2
OTHER FINANCIAL STATEMENT DETAILS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Other Income and Expenses [Abstract] | |
Schedule of property and equipment, net | PROPERTY AND EQUIPMENT, NET As of December 31, 2020 2019 (In millions) Property and equipment, net: Computer equipment and software $ 3,179 $ 2,804 Internal use software and website development costs 2,831 2,471 Land and buildings 307 430 Leasehold improvements 410 460 Furniture and fixtures 199 171 Development in progress and other 83 80 Total property and equipment, gross 7,009 6,416 Accumulated depreciation and amortization (5,202) (4,723) Total property and equipment, net $ 1,807 $ 1,693 |
Schedule of long-lived assets, by geographical areas | The following table summarizes long-lived assets based on geography, which consist of property and equipment, net and operating lease right-of-use assets: As of December 31, 2020 2019 (In millions) Long-lived assets: U.S. $ 2,096 $ 1,862 Other countries 418 310 Total long-lived assets $ 2,514 $ 2,172 |
Schedule of changes in accumulated other comprehensive income (loss) | The following table summarizes the changes in accumulated balances of other comprehensive income (loss) for the year ended December 31, 2020: Unrealized Unrealized Gains on Investments Foreign Currency Translation Adjustment ( “ CTA ”) Net Investment Estimated Total (In millions) Beginning balance $ 6 $ 2 $ (150) $ (31) $ — $ (173) Other comprehensive income (loss) before reclassifications (309) 9 (48) 55 2 (291) Less: Amount of gain reclassified from AOCI 20 — — — — 20 Net current period other comprehensive income (loss) (329) 9 (48) 55 2 (311) Ending balance $ (323) $ 11 $ (198) $ 24 $ 2 $ (484) The following table summarizes the changes in accumulated balances of other comprehensive income (loss) for the year ended December 31, 2019: Unrealized Gains (Losses) on Cash Flow Hedges Unrealized Gains (Losses) on Investments Foreign CTA Net Investment Estimated Total (In millions) Beginning balance $ 182 $ (13) $ (93) $ — $ 2 $ 78 Other comprehensive income (loss) before reclassifications 62 14 (57) (31) (2) (14) Less: Amount of gain (loss) reclassified from AOCI 238 (1) — — — 237 Net current period other comprehensive income (loss) (176) 15 (57) (31) (2) (251) Ending balance $ 6 $ 2 $ (150) $ (31) $ — $ (173) The following table summarizes the changes in accumulated balances of other comprehensive income (loss) for the year ended December 31, 2018: Unrealized Gains (Losses) on Cash Flow Hedges Unrealized Losses on Investments Foreign Estimated Tax Total (In millions) Beginning balance $ (111) $ (12) $ (25) $ 6 $ (142) Other comprehensive income (loss) before reclassifications 263 (1) (68) (4) 190 Less: Amount of loss reclassified from AOCI (30) — — — (30) Net current period other comprehensive income (loss) 293 (1) (68) (4) 220 Ending balance $ 182 $ (13) $ (93) $ 2 $ 78 |
Reclassifications out of accumulated other comprehensive income | The following table provides details about reclassifications out of AOCI for the periods presented below: Details about AOCI Components Amount of Gains (Losses) Reclassified from AOCI Affected Line Item in the Statements of Income Year Ended December 31, 2020 2019 2018 (In millions) Gains (losses) on cash flow hedges — foreign exchange contracts $ 20 $ 238 $ (30) Net revenues Unrealized losses on investments — (1) — Other income (expense), net $ 20 $ 237 $ (30) Income before income taxes — — — Income tax expense Total reclassifications for the period $ 20 $ 237 $ (30) Net income |
Schedule of other income (expense), net | The following table reconciles the components of other income (expense), net for the periods presented below: Year Ended December 31, 2020 2019 2018 (In millions) Interest income $ 88 $ 197 $ 168 Interest expense (209) (115) (77) Net gains on strategic investments 1,914 208 87 Other (17) (11) 4 Other income (expense), net $ 1,776 $ 279 $ 182 |
FUNDS RECEIVABLE AND CUSTOMER_2
FUNDS RECEIVABLE AND CUSTOMER ACCOUNTS AND INVESTMENTS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of assets underlying funds receivable and customer accounts, short-term investments and long-term investments | The following table summarizes the assets underlying our funds receivable and customer accounts, short-term investments, and long-term investments as of December 31, 2020 and 2019: December 31, December 31, (In millions) Funds receivable and customer accounts: Cash and cash equivalents $ 13,222 $ 8,387 Time deposits 233 514 Available-for-sale debt securities 15,001 10,190 Funds receivable 4,962 3,436 Total funds receivable and customer accounts $ 33,418 $ 22,527 Short-term investments: Time deposits $ 1,519 $ 614 Available-for-sale debt securities 6,689 2,734 Restricted cash 81 64 Total short-term investments $ 8,289 $ 3,412 Long-term investments: Time deposits $ 31 $ — Available-for-sale debt securities 2,819 1,025 Restricted cash 7 — Strategic investments 3,232 1,838 Total long-term investments $ 6,089 $ 2,863 |
Schedule of estimated fair value of available-for-sale debt securities | As of December 31, 2020 and 2019, the estimated fair value of our available-for-sale debt securities included within funds receivable and customer accounts, short-term investments, and long-term investments was as follows: December 31, 2020 (1) Gross Gross Gross (In millions) Funds receivable and customer accounts: U.S. government and agency securities $ 8,566 $ 4 $ — $ 8,570 Foreign government and agency securities 1,504 2 — 1,506 Corporate debt securities 2,011 — — 2,011 Short-term investments: U.S. government and agency securities 1,510 — — 1,510 Foreign government and agency securities 277 — — 277 Corporate debt securities 4,900 2 — 4,902 Long-term investments: U.S. government and agency securities 28 — — 28 Foreign government and agency securities 1,305 — (1) 1,304 Corporate debt securities 1,255 4 — 1,259 Asset-backed securities 228 — — 228 Total available-for-sale debt securities (2) $ 21,584 $ 12 $ (1) $ 21,595 (1) “—” Denotes gross unrealized gain or unrealized loss of less than $1 million in a given position. (2) Excludes foreign currency denominated available-for-sale debt securities accounted for under the fair value option. Refer to “Note 9 — Fair Value Measurement of Assets and Liabilities.” December 31, 2019 (1) Gross Gross Gross (In millions) Funds receivable and customer accounts: U.S. government and agency securities $ 4,996 $ — $ — $ 4,996 Foreign government and agency securities 1,392 — — 1,392 Corporate debt securities 2,112 — — 2,112 Short-term investments: Foreign government and agency securities 533 — — 533 Corporate debt securities 1,955 — — 1,955 Long-term investments: U.S. government and agency securities 140 — — 140 Foreign government and agency securities 207 — — 207 Corporate debt securities 636 2 — 638 Asset-backed securities 40 — — 40 Total available-for-sale debt securities (2) $ 12,011 $ 2 $ — $ 12,013 (1) “—” Denotes gross unrealized gain or unrealized loss of less than $1 million in a given position. (2) Excludes foreign currency denominated available-for-sale debt securities accounted for under the fair value option. Refer to “Note 9 — Fair Value Measurement of Assets and Liabilities.” |
Schedule of gross unrealized losses and estimated fair value of available-for-sale debt securities in a continuous loss position | As of December 31, 2020 and 2019, the gross unrealized losses and estimated fair value of our available-for-sale debt securities included within funds receivable and customer accounts, short-term investments, and long-term investments for which an allowance for credit losses has not been deemed necessary in the current period, aggregated by length of time those individual securities have been in a continuous loss position was as follows: December 31, 2020 (1) Less than 12 months 12 months or longer Total Fair Value Gross Fair Value Gross Fair Value Gross (In millions) Funds receivable and customer accounts: U.S. government and agency securities $ 312 $ — $ — $ — $ 312 $ — Foreign government and agency securities 353 — — — 353 — Corporate debt securities 641 — — — 641 — Short-term investments: U.S. government and agency securities 270 — — — 270 — Foreign government and agency securities 72 — — — 72 — Corporate debt securities 392 — — — 392 — Long-term investments: U.S. government and agency securities 28 — — — 28 — Foreign government and agency securities 405 (1) — — 405 (1) Corporate debt securities 97 — — — 97 — Asset-backed securities 15 — — — 15 — Total available-for-sale debt securities $ 2,585 $ (1) $ — $ — $ 2,585 $ (1) (1) — Denotes gross unrealized loss or fair value of less than $1 million in a given position. December 31, 2019 (1) Less than 12 months 12 months or longer Total Fair Value Gross Fair Value Gross Fair Value Gross (In millions) Funds receivable and customer accounts: U.S. government and agency securities $ 2,452 $ — $ — $ — $ 2,452 $ — Foreign government and agency securities 563 — 30 — 593 — Corporate debt securities 825 — — — 825 — Short-term investments: Foreign government and agency securities 115 — — — 115 — Corporate debt securities 424 — — — 424 — Long-term investments: U.S. government and agency securities 100 — — — 100 — Foreign government and agency securities 75 — — — 75 — Corporate debt securities 1 — 40 — 41 — Asset-backed securities 26 — 4 — 30 — Total available-for-sale debt securities $ 4,581 $ — $ 74 $ — $ 4,655 $ — (1) — Denotes gross unrealized loss or fair value of less than $1 million in a given position. |
The estimated fair values of investments classified as available for sale included within funds receivable and customer accounts by date of contractual maturity | Our available-for-sale debt securities included within funds receivable and customer accounts, short-term investments, and long-term investments classified by date of contractual maturity were as follows: December 31, 2020 Amortized Cost Fair Value (In millions) One year or less $ 17,416 $ 17,421 After one year through five years 4,168 4,174 Total $ 21,584 $ 21,595 |
Schedule of adjustments to the carrying value of equity investments and summary of cumulative gross unrealized gains and cumulative gross unrealized losses and impairment related to non-marketable equity securities accounted for under the Measurement Alternative | The adjustments to the carrying value of our non-marketable equity securities accounted for under the Measurement Alternative in the years ended December 31, 2020 and 2019 were as follows: Year Ended December 31, 2020 2019 (In millions) Carrying amount, beginning of period $ 497 $ 293 Adjustments related to non-marketable equity securities: Net additions (1) 143 60 Gross unrealized gains 161 144 Gross unrealized losses and impairments (22) — Carrying amount, end of period $ 779 $ 497 (1) Net additions include additions from purchases, reductions due to sales of securities, and reclassifications when Measurement Alternative is subsequently elected or no longer applies. The following table summarizes the cumulative gross unrealized gains and cumulative gross unrealized losses and impairment related to non-marketable equity securities accounted for under the Measurement Alternative for investments held at December 31, 2020 and 2019: December 31, December 31, (In millions) Cumulative gross unrealized gains $ 378 $ 230 Cumulative gross unrealized losses and impairment $ (27) $ (5) |
Schedule of unrealized gains (losses) on strategic investments, excluding those accounted for using the equity method | The following table summarizes the net unrealized gain (losses) on marketable and non-marketable equity securities, excluding those accounted for using the equity method, held at December 31, 2020 and 2019: Year Ended December 31, 2020 2019 (In millions) Net unrealized gains $ 1,610 $ 203 |
FAIR VALUE MEASUREMENT OF ASS_2
FAIR VALUE MEASUREMENT OF ASSETS AND LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Summary of financial assets and liabilities measured at fair value on a recurring basis | The following tables summarize our financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2020 and 2019: December 31, 2020 Quoted Prices in Significant Other Observable Inputs (Level 2) (In millions) Assets: Cash and cash equivalents (1) $ 867 $ — $ 867 Short-term investments (2) : U.S. government and agency securities 1,510 — 1,510 Foreign government and agency securities 277 — 277 Corporate debt securities 4,902 — 4,902 Total short-term investments 6,689 — 6,689 Funds receivable and customer accounts (3) : Cash and cash equivalents 1,770 — 1,770 U.S. government and agency securities 8,570 — 8,570 Foreign government and agency securities 4,296 — 4,296 Corporate debt securities 2,135 — 2,135 Total funds receivable and customer accounts 16,771 — 16,771 Derivatives 42 — 42 Long-term investments (2), (4) : U.S. government and agency securities 28 — 28 Foreign government and agency securities 1,304 — 1,304 Corporate debt securities 1,259 — 1,259 Asset-backed securities 228 — 228 Marketable equity securities 2,443 2,443 — Total long-term investments 5,262 2,443 2,819 Total financial assets $ 29,631 $ 2,443 $ 27,188 Liabilities: Derivatives $ 410 $ — $ 410 (1) Excludes cash of $3.9 billion not measured and recorded at fair value. (2) Excludes restricted cash of $88 million and time deposits of $1.6 billion not measured and recorded at fair value. (3) Excludes cash, time deposits, and funds receivable of $16.6 billion underlying funds receivable and customer accounts not measured and recorded at fair value. (4) Excludes non-marketable equity securities of $789 million measured using the Measurement Alternative or equity method accounting. December 31, 2019 Quoted Prices in Significant Other Observable Inputs (Level 2) (In millions) Assets: Cash and cash equivalents (1) $ 2,835 $ — $ 2,835 Short-term investments (2) : Foreign government and agency securities 757 — 757 Corporate debt securities 1,977 — 1,977 Total short-term investments 2,734 — 2,734 Funds receivable and customer accounts (3) : — Cash and cash equivalents 683 — 683 U.S. government and agency securities 4,996 — 4,996 Foreign government and agency securities 2,653 — 2,653 Corporate debt securities 2,541 — 2,541 Total funds receivable and customer accounts 10,873 — 10,873 Derivatives 135 — 135 Long-term investments (4) : U.S. government and agency securities 140 — 140 Foreign government and agency securities 207 — 207 Corporate debt securities 638 — 638 Asset-backed securities 40 — 40 Marketable equity securities 1,314 1,314 — Total long-term investments 2,339 1,314 1,025 Total financial assets $ 18,916 $ 1,314 $ 17,602 Liabilities: Derivatives $ 122 $ — $ 122 (1) Excludes cash of $4.5 billion not measured and recorded at fair value. (2) Excludes restricted cash of $64 million and time deposits of $614 million not measured and recorded at fair value. (3) Excludes cash, time deposits, and funds receivable of $11.7 billion underlying funds receivable and customer accounts not measured and recorded at fair value. (4) Excludes non-marketable equity securities of $524 million measured using the Measurement Alternative or equity method accounting. |
Summary of investments under the fair value option | The following table summarizes the estimated fair value of our available-for-sale debt securities under the fair value option as of December 31, 2020 and 2019: December 31, 2020 December 31, 2019 (In millions) Funds receivable and customer accounts $ 2,914 $ 1,690 Short-term investments $ — $ 246 The following table summarizes the gains (losses) from fair value changes recognized in other income (expense), net related to the available-for-sale debt securities under the fair value option for the years ended December 31, 2020 and 2019 : Year Ended December 31, 2020 2019 (In millions) Funds receivable and customer accounts $ 190 $ (43) Short-term investments $ (24) $ (8) |
Summary of financial assets and liabilities measured at fair value on a non-recurring basis | The following tables summarize our financial assets and liabilities held as of December 31, 2020 and 2019 for which a non-recurring fair value measurement was recorded during the year ended December 31, 2020 and 2019, respectively: December 31, 2020 Significant Other Observable Inputs (Level 2) (In millions) Non-marketable equity investments measured using the Measurement Alternative (1) $ 335 $ 335 Other assets (2) 44 44 Total $ 379 $ 379 (1) Excludes non-marketable equity investments of $444 million accounted for under the Measurement Alternative for which no observable price changes occurred during the year ended December 31, 2020. (2) Consists of ROU lease assets recorded at fair value pursuant to impairment charges recorded in 2020. See “Note 6—Leases” for additional information. December 31, 2019 Significant Other Observable Inputs (Level 2) (In millions) Non-marketable equity investments measured using the Measurement Alternative (1) $ 303 303 (1) Excludes non-marketable equity investments of $194 million accounted for under the Measurement Alternative for which no observable price changes occurred during the year ended December 31, 2019. |
DERIVATIVE INSTRUMENTS (Tables)
DERIVATIVE INSTRUMENTS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of fair value of outstanding derivative instruments | The fair value of our outstanding derivative instruments as of December 31, 2020 and 2019 was as follows: Balance Sheet Location As of December 31, 2020 2019 Derivative Assets: (In millions) Foreign currency exchange contracts designated as hedging instruments Other current assets $ — $ 45 Foreign currency exchange contracts designated as hedging instruments Other assets (non-current) — 1 Foreign currency exchange contracts not designated as hedging instruments Other current assets 42 89 Total derivative assets $ 42 $ 135 Derivative Liabilities: Foreign currency exchange contracts designated as hedging instruments Other current liabilities $ 287 $ 58 Foreign currency exchange contracts designated as hedging instruments Other long-term liabilities 35 13 Foreign currency exchange contracts not designated as hedging instruments Other current liabilities 88 51 Total derivative liabilities $ 410 $ 122 |
Schedule of offsetting assets | The following table provides the collateral exchanged: December 31, December 31, (In millions) Cash collateral posted (1) $ 340 $ 12 Cash collateral received (2) $ 1 $ 39 (1) Right to reclaim cash collateral related to our derivative liabilities recognized in other current assets on our consolidated balance sheets. (2) Obligation to return counterparty cash collateral related to our derivative assets recognized in other current liabilities on our consolidated balance sheets. |
Schedule of offsetting liabilities | The following table provides the collateral exchanged: December 31, December 31, (In millions) Cash collateral posted (1) $ 340 $ 12 Cash collateral received (2) $ 1 $ 39 (1) Right to reclaim cash collateral related to our derivative liabilities recognized in other current assets on our consolidated balance sheets. (2) Obligation to return counterparty cash collateral related to our derivative assets recognized in other current liabilities on our consolidated balance sheets. |
Schedule of recognized gains or losses related to derivative instruments designated as hedging instruments | The following table provides the location in the consolidated statements of income and amount of recognized gains or losses related to our derivative instruments designated as hedging instruments: Year Ended December 31, 2020 2019 2018 (In millions) Net revenues Total amounts presented in the consolidated statements of income in which the effects of cash flow hedges are recorded $ 21,454 $ 17,772 $ 15,451 Gains (losses) on foreign exchange contracts designated as cash flow hedges reclassified from AOCI $ 20 $ 238 $ (30) |
Schedule of recognized gains or losses related to derivative instruments not designated as hedging instruments | The following table provides the location in the consolidated statements of income and amount of recognized gains or losses related to our derivative instruments not designated as hedging instruments: Year Ended December 31, 2020 2019 2018 (In millions) (Losses) gains on foreign exchange contracts recognized in other income (expense), net $ (110) $ 24 $ 38 Gains on foreign exchange contracts recognized in net revenues — — 7 Losses on equity derivative contracts recognized in other income (expense), net (1) (64) — — Total (losses) gains recognized from contracts not designated as hedging instruments $ (174) $ 24 $ 45 |
Schedule of notional amounts of outstanding derivatives | The following table provides the notional amounts of our outstanding derivatives: Year Ended December 31, 2020 2019 (In millions) Foreign exchange contracts designated as hedging instruments $ 5,335 $ 4,550 Foreign exchange contracts not designated as hedging instruments 16,098 17,131 Total $ 21,433 $ 21,681 |
LOANS AND INTEREST RECEIVABLE (
LOANS AND INTEREST RECEIVABLE (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Receivables [Abstract] | |
Schedule of delinquency status of the principal amount of consumer loans and interest receivable | The following table presents the delinquency status of consumer loans and interest receivable at December 31, 2020 and 2019. Since our consumer loans are primarily revolving in nature, they are disclosed in the aggregate and not by year of origination. The amounts are based on the number of days past the billing date. The “current” category represents balances that are within 29 days of the billing date. December 31, 2020 December 31, 2019 Amortized Cost Basis Revolving Percent Amortized Cost Basis Percent (In millions, except percentages) Current $ 2,124 97.9 % $ 1,279 96.7 % 30-59 days 15 0.7 % 15 1.1 % 60-89 days 11 0.5 % 9 0.7 % 90-179 days 19 0.9 % 19 1.5 % Total consumer loans and interest receivable (1), (2), (3) $ 2,169 100.0 % $ 1,322 100.0 % (1) Excludes receivables from other consumer credit products of $56 million and $92 million at December 31, 2020 and December 31, 2019, respectively. (2) Includes installment loans of $556 million and $80 million at December 31, 2020 and December 31, 2019, respectively, substantially all of which were current and originated within the past 12 months. (3) Balances at December 31, 2020 include the impact of payment holidays provided primarily in the second quarter of 2020 by the Company to some consumers as a part of our COVID-19 payment relief initiatives. The following table presents the delinquency status of the principal amount of merchant loans, advances, and interest and fees receivable by year of origination. The amounts are based on the number of days past the expected or contractual repayment date for amounts outstanding. The “current” category represents balances that are within 29 days of the contractual repayment dates, or within 29 days of the expected repayment date. December 31, 2020 (In millions, except percentages) 2020 2019 2018 2017 2016 Total Percent Current $ 884 $ 154 $ 4 $ — $ — $ 1,042 75.4% 30 - 59 Days 56 46 3 — — 105 7.6% 60 - 89 Days 29 30 3 — — 62 4.5% 90 - 179 Days 58 77 7 — — 142 10.3% 180+ Days 6 20 5 — — 31 2.2% Total (1) $ 1,033 $ 327 $ 22 $ — $ — $ 1,382 100% (1) Balances include the impact of payment holidays provided primarily during the second quarter of 2020 and modification programs offered by the Company as a part of our COVID-19 payment relief initiatives (as discussed further below). The following table presents our estimate of the principal amount of merchant loans, advances, and interest and fees receivable past their original expected or contractual repayment period as of December 31, 2019, prior to the adoption of the new credit losses accounting guidance as described in “Note 1—Overview and Summary of Significant Accounting Policies.” December 31, 2019 (In millions, except percentages) Within Original Expected or Contractual Repayment Period 30 - 59 Days Greater 60 - 89 Days Greater 90 - 179 Days Greater 180+ Days Total Past Original Expected or Contractual Repayment Period Total $ 2,523 $ 115 $ 61 $ 100 $ 17 $ 293 $ 2,816 89.6% 4.1 % 2.1 % 3.6 % 0.6 % 10.4 % 100 % |
Schedule of allowance for loans and interest receivable | The following table summarizes the activity in the allowance for consumer loans and interest receivable for the years ended December 31, 2020 and 2019: December 31, 2020 December 31, 2019 Consumer Loans Receivable Interest Receivable Total Allowance (1) Consumer Loans Receivable Interest Receivable Total Allowance (1) (In millions) Beginning balance $ 49 $ 8 $ 57 $ 27 $ 3 $ 30 Adjustment for adoption of credit losses accounting standard 24 4 28 — — — Provisions 245 50 295 34 11 45 Charge-offs (69) (12) (81) (44) (6) (50) Recoveries (2) 27 — 27 31 — 31 Other (3) 23 3 26 1 — 1 Ending Balance $ 299 $ 53 $ 352 $ 49 $ 8 $ 57 (1) Excludes allowances from other consumer credit products of $3 million and $10 million at December 31, 2020 and December 31, 2019, respectively. (2) The recoveries were primarily related to fully charged-off U.S. consumer credit receivables not subject to the sale to Synchrony. (3) Includes amounts related to foreign currency remeasurement. The following table summarizes the activity in the allowance for merchant loans, advances, and interest and fees receivable, for the years ended December 31, 2020 and 2019: December 31, 2020 December 31, 2019 Merchant Loans and Advances Interest and Fees Receivable Total Allowance Merchant Loans and Advances Interest and Fees Receivable Total Allowance (In millions) Beginning balance $ 171 $ 20 $ 191 $ 115 $ 15 $ 130 Adjustment for adoption of credit losses accounting standard 165 17 182 — — — Provisions 358 33 391 240 26 266 Charge-offs (274) (27) (301) (201) (21) (222) Recoveries 20 — 20 17 — 17 Ending Balance $ 440 $ 43 $ 483 $ 171 $ 20 $ 191 |
Loans modified as TDRs | The following table shows the merchant loans and interest receivables which have been modified as TDRs in the year ended December 31, 2020: Number of Accounts Outstanding Balances (1) (in millions) Weighted Average Payment Term Extensions Loans and interest receivable 13 $ 354 37 (1) Balances are as of modification date. |
DEBT (Tables)
DEBT (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of outstanding aggregate principal amount related to the notes | The following table summarizes the Notes: As of December 31, Maturities Effective Interest Rate 2020 2019 (in millions) September 2019 debt issuance of $5.0 billion: Fixed-rate 2.200% notes 9/26/2022 2.39% $ 1,000 $ 1,000 Fixed-rate 2.400% notes 10/1/2024 2.52% 1,250 1,250 Fixed-rate 2.650% notes 10/1/2026 2.78% 1,250 1,250 Fixed-rate 2.850% notes 10/1/2029 2.96% 1,500 1,500 May 2020 debt issuance of $4 billion: Fixed-rate 1.350% notes 6/1/2023 1.55% $ 1,000 $ — Fixed-rate 1.650% notes 6/1/2025 1.78% 1,000 — Fixed-rate 2.300% notes 6/1/2030 2.39% 1,000 — Fixed-rate 3.250% notes 6/1/2050 3.33% 1,000 — Total term debt 9,000 5,000 Unamortized premium (discount) and issuance costs, net (61) (35) Total carrying amount of term debt $ 8,939 $ 4,965 |
Schedule of future principal payments associated with long term debt | As of December 31, 2020, the future principal payments associated with our long term debt were as follows (in millions): 2021 $ — 2022 1,000 2023 1,000 2024 1,250 2025 1,000 Thereafter 4,750 Total $ 9,000 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of allowance for transaction losses and negative customer balances related to protection products | The following table shows changes in the allowance for transaction losses and negative customer balances related to our protection programs for the year end December 31, 2020 and 2019: As of December 31, 2020 2019 (In millions) Beginning balance $ 399 $ 344 Provision 1,135 1,092 Realized losses (1,208) (1,098) Recoveries 88 61 Ending balance $ 414 $ 399 |
STOCK-BASED AND EMPLOYEE SAVI_2
STOCK-BASED AND EMPLOYEE SAVINGS PLANS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of stock option activity | The following table summarizes stock option activity of our employees under the Plan for the year ended December 31, 2020: Shares Weighted Weighted Aggregate (In thousands, except per share amounts and years) Outstanding at January 1, 2020 476 $ 25.18 Assumed 574 $ 1.88 Exercised (441) $ 10.23 Forfeited/expired/canceled (18) $ 3.51 Outstanding at December 31, 2020 591 $ 14.37 4.89 $ 128,143 Expected to vest 244 $ 4.48 6.92 $ 55,345 Options exercisable 329 $ 22.25 3.26 $ 68,780 |
Schedule of RSUs, PBRSUs, and restricted stock activity | The following table summarizes the RSUs, PBRSUs, and restricted stock activity under the Plan as of December 31, 2020 and changes during the year ended December 31, 2020: Units Weighted Average Grant-Date (In thousands, except per share amounts) Outstanding at January 1, 2020 23,009 $ 83.61 Awarded and assumed (1), (2) 16,592 $ 113.63 Vested (1) (14,170) $ 77.50 Forfeited (2,267) $ 101.44 Outstanding at December 31, 2020 23,164 $ 107.13 Expected to vest 20,767 (1) Includes approximately 1.4 million of additional PBRSUs issued during 2020 due to the achievement of company performance metrics on awards granted in previous years. (2) Includes approximately 0.6 million in RSUs assumed from our Honey acquisition in 2020. |
Schedule of stock-based compensation expense | T he impact on our results of operations of recording stock-based compensation expense under the Plan for the years ended December 31, 2020, 2019, and 2018 was as follows: Year Ended December 31, 2020 2019 2018 (In millions) Customer support and operations $ 250 $ 198 $ 174 Sales and marketing 172 127 125 Technology and development 529 420 303 General and administrative 460 305 269 Total stock-based compensation expense $ 1,411 $ 1,050 $ 871 Capitalized as part of internal use software and website development costs $ 48 $ 38 $ 38 Income tax benefit recognized for stock-based compensation arrangements $ 239 $ 176 $ 154 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Schedule of components of income (loss) before income taxes | The components of income (loss) before income taxes are as follows: Year Ended December 31, 2020 2019 2018 (In millions) United States $ 1,504 $ 8 $ (474) International 3,561 2,990 2,850 Income before income taxes $ 5,065 $ 2,998 $ 2,376 |
Schedule of income tax expense | The income tax expense is composed of the following: Year Ended December 31, 2020 2019 2018 (In millions) Current: Federal $ 310 $ 132 $ 180 State and local 143 47 32 Foreign 245 629 278 Total current portion of income tax expense $ 698 $ 808 $ 490 Deferred: Federal $ 259 $ (107) $ (115) State and local (32) (39) (35) Foreign (62) (123) (21) Total deferred portion of income tax expense 165 (269) (171) Income tax expense $ 863 $ 539 $ 319 |
Schedule of reconciliation of the difference between the effective income tax rate and the federal statutory rate | The following is a reconciliation of the difference between the effective income tax rate and the federal statutory rate: Year Ended December 31, 2020 2019 2018 Federal statutory rate 21.0 % 21.0 % 21.0 % State taxes, net of federal benefit 2.2 % 0.3 % (0.1) % Foreign income taxed at different rates (7.4) % (5.0) % (3.9) % Stock-based compensation expense (1.2) % (3.9) % (4.1) % Tax credits (2.0) % (2.4) % (2.1) % Change in valuation allowances 0.1 % 0.1 % — % Intra-group transfer of intellectual property 4.1 % 7.6 % 0.7 % Other 0.2 % 0.3 % 1.9 % Effective income tax rate 17.0 % 18.0 % 13.4 % |
Schedule of deferred tax assets and liabilities | Significant deferred tax assets and liabilities consist of the following: As of December 31, 2020 2019 (In millions) Deferred tax assets: Net operating loss and credit carryforwards $ 201 $ 182 Accruals and allowances 413 235 Lease liability 188 120 Partnership investment 6 8 Stock-based compensation 196 160 Net unrealized losses 4 5 Fixed assets and other intangibles 11 88 Total deferred tax assets 1,019 798 Valuation allowance (166) (184) Net deferred tax assets $ 853 $ 614 Deferred tax liabilities: Unremitted foreign earnings $ (21) $ (17) Acquired intangibles (153) (103) Lease asset (172) (116) Net unrealized gains (440) (71) Total deferred tax liabilities (786) (307) Net deferred tax assets $ 67 $ 307 The following table shows the deferred tax assets and liabilities within our consolidated balance sheets: As of December 31, 2020 2019 Balance Sheet Location (In millions) Total deferred tax assets (non-current) Other assets $ 142 $ 396 Total deferred tax liabilities (non-current) Deferred tax liability and other long-term liabilities (75) (89) Total net deferred tax assets $ 67 $ 307 |
Schedule of unrecognized tax benefits | The following table reflects changes in unrecognized tax benefits for the periods presented below: Year Ended December 31, 2020 2019 2018 (In millions) Gross amounts of unrecognized tax benefits as of the beginning of the period $ 1,141 $ 800 $ 424 Increases related to prior period tax positions 92 97 120 Decreases related to prior period tax positions (78) (28) (6) Increases related to current period tax positions 360 336 287 Settlements (34) (63) (20) Statute of limitation expirations (2) (1) (5) Gross amounts of unrecognized tax benefits as of the end of the period $ 1,479 $ 1,141 $ 800 |
RESTRUCTURING AND OTHER CHARG_2
RESTRUCTURING AND OTHER CHARGES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Restructuring and Related Activities [Abstract] | |
Summary of restructuring reserve activity | The following table summarizes the restructuring reserve activity during the year ended December 31, 2020: Employee Severance and Benefits and Other Associated Costs (In millions) Accrued liability as of January 1, 2020 $ 9 Charges 109 Payments (63) Accrued liability as of December 31, 2020 $ 55 |
QUARTERLY UNAUDITED FINANCIAL_2
QUARTERLY UNAUDITED FINANCIAL DATA (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
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, 2020 and 2019. 2020 Quarter Ended March 31 June 30 September 30 December 31 (Unaudited, in millions, except per share amounts) Net revenues $ 4,618 $ 5,261 $ 5,459 $ 6,116 Net income $ 84 $ 1,530 $ 1,021 $ 1,567 Net income per share - basic $ 0.07 $ 1.30 $ 0.87 $ 1.34 Net income per share - diluted $ 0.07 $ 1.29 $ 0.86 $ 1.32 Weighted average shares: Basic 1,173 1,173 1,172 1,172 Diluted 1,185 1,184 1,190 1,191 2019 Quarter Ended March 31 June 30 September 30 December 31 (Unaudited, in millions, except per share amounts) Net revenues $ 4,128 $ 4,305 $ 4,378 $ 4,961 Net income $ 667 $ 823 $ 462 $ 507 Net income per share - basic $ 0.57 $ 0.70 $ 0.39 $ 0.43 Net income per share - diluted $ 0.56 $ 0.69 $ 0.39 $ 0.43 Weighted average shares: Basic 1,171 1,175 1,175 1,174 Diluted 1,188 1,187 1,188 1,187 |
OVERVIEW AND SUMMARY OF SIGNI_4
OVERVIEW AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Basis of Presentation and Principles of Consolidation (Details) $ in Millions | Dec. 31, 2020USD ($) |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Variable interest entity, primary beneficiary, maximum exposure to loss | $ 105 |
OVERVIEW AND SUMMARY OF SIGNI_5
OVERVIEW AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Schedule of Reclassifications (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Net cash provided by (used in) operating activities | $ 5,854 | $ 4,071 | $ 5,480 |
Net cash provided by (used in) investing activities | (16,218) | (5,742) | 821 |
Net cash provided by (used in) financing activities | 12,492 | 4,187 | (1,240) |
Effect of exchange rate changes on cash, cash equivalents, and restricted cash | 169 | (6) | (113) |
Net change in cash, cash equivalents, and restricted cash | 2,297 | 2,510 | 4,948 |
As Previously Reported | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Net cash provided by (used in) operating activities | 4,561 | 5,483 | |
Net cash provided by (used in) investing activities | (5,733) | 840 | |
Net cash provided by (used in) financing activities | 3,688 | (1,262) | |
Effect of exchange rate changes on cash, cash equivalents, and restricted cash | (6) | (113) | |
Net change in cash, cash equivalents, and restricted cash | 2,510 | 4,948 | |
Adjustments | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Net cash provided by (used in) operating activities | (490) | (3) | |
Net cash provided by (used in) investing activities | (9) | (19) | |
Net cash provided by (used in) financing activities | 499 | 22 | |
Effect of exchange rate changes on cash, cash equivalents, and restricted cash | 0 | 0 | |
Net change in cash, cash equivalents, and restricted cash | 0 | $ 0 | |
Increase in funds receivable | 19 | 9 | |
Decrease in funds payable and amounts due to customers | $ 22 | $ 499 |
OVERVIEW AND SUMMARY OF SIGNI_6
OVERVIEW AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Allowance for Loans and Interest Receivable (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Consumer Receivables | |
Financing Receivable, Allowance for Credit Loss [Line Items] | |
Projected loss rate period | 7 years |
Merchant Receivables | Minimum | |
Financing Receivable, Allowance for Credit Loss [Line Items] | |
Projected loss rate period | 2 years 6 months |
Merchant Receivables | Maximum | |
Financing Receivable, Allowance for Credit Loss [Line Items] | |
Projected loss rate period | 3 years 6 months |
OVERVIEW AND SUMMARY OF SIGNI_7
OVERVIEW AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Customer Accounts and Funds Receivable and Funds Payable (Details) - USD ($) $ in Billions | 12 Months Ended | |
Dec. 31, 2020 | Jun. 30, 2018 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Minimum aggregate customer balances required to be covered by eligible liquid assets held, percentage | 100.00% | |
Europe | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Funds receivable and customer accounts designated for credit funding, percentage | 35.00% | |
Funds receivable and customer accounts designated for credit funding, percentage utilized | 21.00% | |
U.S. | Minimum | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Funds receivable and funds payable, transaction clearing period | 1 day | |
U.S. | Maximum | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Funds receivable and funds payable, transaction clearing period | 3 days | |
Other countries | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Funds receivable and funds payable, transaction clearing period | 5 days | |
Cash and cash equivalents | Europe | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Funds receivable and customer accounts designated for credit funding | $ 2 |
OVERVIEW AND SUMMARY OF SIGNI_8
OVERVIEW AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Property and Equipment (Details) | 12 Months Ended |
Dec. 31, 2020 | |
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 | 4 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 SIGNI_9
OVERVIEW AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Goodwill and Intangible Assets (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Minimum | |
Finite-Lived Intangible Assets [Line Items] | |
Useful life | 1 year |
Maximum | |
Finite-Lived Intangible Assets [Line Items] | |
Useful life | 8 years |
OVERVIEW AND SUMMARY OF SIGN_10
OVERVIEW AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Allowance for Transaction Losses and Negative Customer Balances (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Allowance for negative customer balances, threshold period past due, writeoff | 120 days |
OVERVIEW AND SUMMARY OF SIGN_11
OVERVIEW AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Concentrations of Risk (Details) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Accounts receivable | Customer concentration risk | Customer 1 | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 26.00% | 23.00% | |
Other assets | Customer concentration risk | Partner 1 | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 28.00% | 28.00% | |
Revenue | Product concentration risk | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 13.00% | 14.00% | 17.00% |
OVERVIEW AND SUMMARY OF SIGN_12
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, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Property, Plant and Equipment [Line Items] | |||
Advertising expense | $ 654 | $ 399 | $ 484 |
Capitalized internally developed software and website development costs | 347 | 314 | |
Amortization expense of previously capitalized internally developed software and website development costs | $ 322 | $ 298 | $ 262 |
Maximum | Internal use software and website development costs | |||
Property, Plant and Equipment [Line Items] | |||
Estimated useful lives | 3 years |
REVENUE - Additional Informatio
REVENUE - Additional Information (Details) | 12 Months Ended |
Dec. 31, 2020obligationsegment | |
Disaggregation of Revenue [Line Items] | |
Number of operating segments | 1 |
Number of reportable segments | 1 |
Revenues from other value added services | |
Disaggregation of Revenue [Line Items] | |
Number of performance obligations | obligation | 1 |
REVENUE - Disaggregation of Rev
REVENUE - Disaggregation of Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Disaggregation of Revenue [Line Items] | |||||||||||
Total revenues | $ 6,116 | $ 5,459 | $ 5,261 | $ 4,618 | $ 4,961 | $ 4,378 | $ 4,305 | $ 4,128 | $ 21,454 | $ 17,772 | $ 15,451 |
Transaction revenues | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total revenues | 19,918 | 16,099 | 13,709 | ||||||||
Revenues from other value added services | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total revenues | 1,536 | 1,673 | 1,742 | ||||||||
Interest, fees and gains earned on loan and interest receivables, net and held for sale portfolio, hedging gains or losses and interest earned on customer balances | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenues which do not represent revenues recognized in the scope of ASC Topic 606 | 597 | 1,100 | 1,200 | ||||||||
United States (“U.S.”) | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total revenues | 11,013 | 9,417 | 8,324 | ||||||||
United Kingdom (“U.K.”) | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total revenues | 2,340 | 1,872 | 1,658 | ||||||||
Other countries | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Total revenues | $ 8,101 | $ 6,483 | $ 5,469 |
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, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Numerator: | |||||||||||
Net income | $ 1,567 | $ 1,021 | $ 1,530 | $ 84 | $ 507 | $ 462 | $ 823 | $ 667 | $ 4,202 | $ 2,459 | $ 2,057 |
Denominator: | |||||||||||
Weighted average shares of common stock - basic (in shares) | 1,172 | 1,172 | 1,173 | 1,173 | 1,174 | 1,175 | 1,175 | 1,171 | 1,173 | 1,174 | 1,184 |
Dilutive effect of equity incentive awards (in shares) | 14 | 14 | 19 | ||||||||
Weighted average shares of common stock - diluted (in shares) | 1,191 | 1,190 | 1,184 | 1,185 | 1,187 | 1,188 | 1,187 | 1,188 | 1,187 | 1,188 | 1,203 |
Net income per share: | |||||||||||
Basic (in usd per share) | $ 1.34 | $ 0.87 | $ 1.30 | $ 0.07 | $ 0.43 | $ 0.39 | $ 0.70 | $ 0.57 | $ 3.58 | $ 2.09 | $ 1.74 |
Diluted (in usd per share) | $ 1.32 | $ 0.86 | $ 1.29 | $ 0.07 | $ 0.43 | $ 0.39 | $ 0.69 | $ 0.56 | $ 3.54 | $ 2.07 | $ 1.71 |
Common stock equivalents excluded from income per diluted share because their effect would have been anti-dilutive (in shares) | 1 | 2 | 1 |
BUSINESS COMBINATIONS - Acquisi
BUSINESS COMBINATIONS - Acquisitions Completed in 2020 (Details) $ in Millions | 1 Months Ended | 12 Months Ended | ||
Jan. 31, 2020USD ($) | Dec. 31, 2020USD ($)business | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($)acquisition | |
Business Acquisition [Line Items] | ||||
Number of businesses acquired | 1 | 4 | ||
Percentage of interests acquired | 100.00% | 100.00% | ||
Payments to acquire businesses | $ 3,609 | $ 70 | $ 2,124 | |
Aggregate purchase price for acquisitions | $ 2,700 | |||
Honey Science Corporation | ||||
Business Acquisition [Line Items] | ||||
Payments to acquire businesses | $ 3,635 | $ 3,600 | ||
Aggregate purchase price for acquisitions | 4,000 | |||
Equity interest issued or issuable, value assigned | $ 400 | |||
Intangible assets acquired, useful life | 3 years | |||
Equity interest issued, vesting period | 4 years |
BUSINESS COMBINATIONS - Schedul
BUSINESS COMBINATIONS - Schedule of Allocation of Purchase Consideration to Fair Value of Assets Acquired and Liabilities Assumed (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | ||||
Jan. 31, 2020 | Sep. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | May 31, 2018 | |
Business Acquisition [Line Items] | ||||||
Goodwill | $ 6,284 | $ 9,135 | $ 6,212 | $ 4 | ||
Total purchase price | $ 2,700 | |||||
Developed technology | ||||||
Business Acquisition [Line Items] | ||||||
Total intangibles | $ 13 | |||||
Honey Science Corporation | ||||||
Business Acquisition [Line Items] | ||||||
Goodwill | $ 2,962 | |||||
Total intangibles | 717 | |||||
Funds receivable and customer accounts | 50 | |||||
Deferred tax liabilities, net | (58) | |||||
Other net liabilities | (36) | |||||
Total purchase price | 4,000 | |||||
Honey Science Corporation | Customer lists and user base | ||||||
Business Acquisition [Line Items] | ||||||
Total intangibles | 115 | |||||
Honey Science Corporation | Marketing related | ||||||
Business Acquisition [Line Items] | ||||||
Total intangibles | 30 | |||||
Honey Science Corporation | Developed technology | ||||||
Business Acquisition [Line Items] | ||||||
Total intangibles | $ 572 | |||||
iZettle | ||||||
Business Acquisition [Line Items] | ||||||
Goodwill | $ 1,600 | |||||
Total intangibles | 650 | |||||
Cash | 103 | |||||
Funds receivable and customer accounts | 47 | |||||
Funds payable and amounts due to customers | (47) | |||||
Deferred tax liabilities, net | (116) | |||||
Other net liabilities | (55) | |||||
Total purchase price | 2,182 | |||||
iZettle | Customer lists and user base | ||||||
Business Acquisition [Line Items] | ||||||
Total intangibles | 426 | |||||
iZettle | Marketing related | ||||||
Business Acquisition [Line Items] | ||||||
Total intangibles | 102 | |||||
iZettle | Developed technology | ||||||
Business Acquisition [Line Items] | ||||||
Total intangibles | 121 | |||||
iZettle | All other | ||||||
Business Acquisition [Line Items] | ||||||
Total intangibles | $ 1 |
BUSINESS COMBINATIONS - Acqui_2
BUSINESS COMBINATIONS - Acquisitions Completed in 2019 (Details) | 12 Months Ended |
Dec. 31, 2019business | |
Business Combinations [Abstract] | |
Number of businesses acquired or divested | 0 |
BUSINESS COMBINATIONS - Acqui_3
BUSINESS COMBINATIONS - Acquisitions Completed in 2018 (Details) $ in Millions | 1 Months Ended | 12 Months Ended | |||||
Nov. 30, 2018USD ($) | Sep. 30, 2018USD ($) | Jul. 31, 2018USD ($) | May 31, 2018USD ($) | Dec. 31, 2020USD ($)business | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($)acquisition | |
Business Acquisition [Line Items] | |||||||
Number of businesses acquired | 1 | 4 | |||||
Percentage of interests acquired | 100.00% | 100.00% | |||||
Total purchase price | $ 2,700 | ||||||
Cash consideration to acquire business | $ 16 | ||||||
Net liabilities | 1 | ||||||
Goodwill | 4 | $ 9,135 | $ 6,212 | 6,284 | |||
Total purchase price | $ 3,609 | $ 70 | $ 2,124 | ||||
Minimum | |||||||
Business Acquisition [Line Items] | |||||||
Intangible assets acquired, useful life | 1 year | ||||||
Maximum | |||||||
Business Acquisition [Line Items] | |||||||
Intangible assets acquired, useful life | 8 years | ||||||
Developed technology | |||||||
Business Acquisition [Line Items] | |||||||
Intangible assets acquired | $ 13 | ||||||
Intangible assets acquired, useful life | 2 years | ||||||
Hyperwallet Systems Inc. | |||||||
Business Acquisition [Line Items] | |||||||
Cash consideration to acquire business | $ 400 | ||||||
Funds receivable and customer accounts | 412 | ||||||
Funds payable and amounts due to customers | 412 | ||||||
Net liabilities | 32 | ||||||
Goodwill | $ 300 | ||||||
Hyperwallet Systems Inc. | Minimum | |||||||
Business Acquisition [Line Items] | |||||||
Intangible assets acquired, useful life | 3 years | ||||||
Hyperwallet Systems Inc. | Maximum | |||||||
Business Acquisition [Line Items] | |||||||
Intangible assets acquired, useful life | 7 years | ||||||
Hyperwallet Systems Inc. | Customer lists and user base | |||||||
Business Acquisition [Line Items] | |||||||
Intangible assets acquired | $ 100 | ||||||
Hyperwallet Systems Inc. | Developed technology | |||||||
Business Acquisition [Line Items] | |||||||
Intangible assets acquired | 30 | ||||||
Hyperwallet Systems Inc. | Marketing related | |||||||
Business Acquisition [Line Items] | |||||||
Intangible assets acquired | $ 2 | ||||||
iZettle | |||||||
Business Acquisition [Line Items] | |||||||
Total purchase price | $ 2,182 | ||||||
Intangible assets acquired | 650 | ||||||
Funds receivable and customer accounts | 47 | ||||||
Funds payable and amounts due to customers | 47 | ||||||
Goodwill | 1,600 | ||||||
Total purchase price | 2,100 | ||||||
Cash acquired | 103 | ||||||
Restricted shares issued and issuable | $ 22 | ||||||
iZettle | Minimum | |||||||
Business Acquisition [Line Items] | |||||||
Intangible assets acquired, useful life | 3 years | ||||||
iZettle | Maximum | |||||||
Business Acquisition [Line Items] | |||||||
Intangible assets acquired, useful life | 7 years | ||||||
iZettle | Customer lists and user base | |||||||
Business Acquisition [Line Items] | |||||||
Intangible assets acquired | $ 426 | ||||||
iZettle | Developed technology | |||||||
Business Acquisition [Line Items] | |||||||
Intangible assets acquired | 121 | ||||||
iZettle | Marketing related | |||||||
Business Acquisition [Line Items] | |||||||
Intangible assets acquired | $ 102 | ||||||
Simility, Inc. | |||||||
Business Acquisition [Line Items] | |||||||
Cash consideration to acquire business | $ 107 | ||||||
Net liabilities | 10 | ||||||
Goodwill | 79 | ||||||
Simility, Inc. | Developed technology | |||||||
Business Acquisition [Line Items] | |||||||
Intangible assets acquired | $ 18 | ||||||
Intangible assets acquired, useful life | 3 years |
GOODWILL AND INTANGIBLE ASSET_2
GOODWILL AND INTANGIBLE ASSETS - Schedule of Goodwill Balances and Adjustments (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Total Goodwill | ||
Beginning balance | $ 6,212 | $ 6,284 |
Goodwill Acquired | 2,962 | 0 |
Adjustments | (39) | (72) |
Ending balance | $ 9,135 | $ 6,212 |
GOODWILL AND INTANGIBLE ASSET_3
GOODWILL AND INTANGIBLE ASSETS - Schedule of Components of Identifiable Intangible Assets (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 2,975 | $ 2,289 |
Accumulated Amortization | (1,927) | (1,511) |
Net Carrying Amount | 1,048 | 778 |
Customer lists and user base | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 1,206 | 1,114 |
Accumulated Amortization | (797) | (700) |
Net Carrying Amount | $ 409 | $ 414 |
Weighted Average Useful Life (Years) | 6 years | 7 years |
Marketing related | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 321 | $ 294 |
Accumulated Amortization | (278) | (239) |
Net Carrying Amount | $ 43 | $ 55 |
Weighted Average Useful Life (Years) | 3 years | 3 years |
Developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 999 | $ 445 |
Accumulated Amortization | (577) | (343) |
Net Carrying Amount | $ 422 | $ 102 |
Weighted Average Useful Life (Years) | 3 years | 3 years |
All other | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 449 | $ 436 |
Accumulated Amortization | (275) | (229) |
Net Carrying Amount | $ 174 | $ 207 |
Weighted Average Useful Life (Years) | 7 years | 7 years |
GOODWILL AND INTANGIBLE ASSET_4
GOODWILL AND INTANGIBLE ASSETS - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Finite-Lived Intangible Assets [Line Items] | ||||
Amortization expense for intangible assets | $ 451 | $ 211 | $ 149 | |
GoPay Assets Acquisition | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Percentage of shares acquired | 70.00% | |||
Finite-lived intangible assets acquired | $ 190 | |||
Weighted average useful life | 7 years |
GOODWILL AND INTANGIBLE ASSET_5
GOODWILL AND INTANGIBLE ASSETS - Schedule of Expected Future Intangible Asset Amortization (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity | ||
2021 | $ 400 | |
2022 | 338 | |
2023 | 100 | |
2024 | 99 | |
2025 | 83 | |
Thereafter | 28 | |
Net Carrying Amount | $ 1,048 | $ 778 |
LEASES - Schedule of Components
LEASES - Schedule of Components of Lease Expense (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Jan. 01, 2019 | |
Lease expense | |||
Operating lease expense | $ 166 | $ 136 | |
Sublease income | (6) | (6) | |
Total lease expense | 160 | 130 | |
Cash paid for amounts included in the measurement of lease liabilities | |||
Operating cash flows from operating leases | 159 | 131 | |
Right-of-use assets obtained in exchange for operating lease liabilities | 345 | 598 | |
Operating lease right-of-use assets | $ 707 | $ 479 | |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | ug-gaap:OtherAssetsNoncurrent | ug-gaap:OtherAssetsNoncurrent | |
Other current lease liabilities | $ 144 | $ 104 | |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | us-gaap:AccruedLiabilitiesCurrent | us-gaap:AccruedLiabilitiesCurrent | |
Operating lease liabilities | $ 642 | $ 403 | |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | us-gaap:DeferredTaxAndOtherLiabilitiesNoncurrent | us-gaap:DeferredTaxAndOtherLiabilitiesNoncurrent | |
Total operating lease liabilities | $ 786 | $ 507 | |
Weighted-average remaining lease term—operating leases | 6 years 10 months 24 days | 5 years 9 months 18 days | |
Weighted-average discount rate—operating leases | 3.00% | 5.00% | |
Accounting Standards Update 2016-02 | |||
Cash paid for amounts included in the measurement of lease liabilities | |||
Operating lease right-of-use assets | $ 498 |
LEASES - Schedule of Future Min
LEASES - Schedule of Future Minimum Operating Lease Payments (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Fiscal years: | ||
2021 | $ 165 | |
2022 | 132 | |
2023 | 116 | |
2024 | 106 | |
2025 | 94 | |
Thereafter | 266 | |
Total | 879 | |
Less: present value discount | (93) | |
Lease liability | $ 786 | $ 507 |
LEASES - Additional Information
LEASES - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Lessee, Lease, Description [Line Items] | ||||
Operating lease, rent expense | $ 172 | $ 130 | ||
Operating lease, rent expense prior to adoption of ASU 2016-02 | $ 94 | |||
Sale leaseback transaction, lease term | 8 years | |||
Sale leaseback transaction, net proceeds | $ 119 | |||
Asset impairment charges | 30 | |||
Operating lease, impairment loss | 23 | |||
Operating lease, lease not yet commenced, amount | $ 51 | |||
Minimum | ||||
Lessee, Lease, Description [Line Items] | ||||
Operating lease, lease not yet commenced, term of contract | 3 years | |||
Maximum | ||||
Lessee, Lease, Description [Line Items] | ||||
Operating lease, lease not yet commenced, term of contract | 10 years |
OTHER FINANCIAL STATEMENT DET_3
OTHER FINANCIAL STATEMENT DETAILS - Property and Equipment, Net (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Property, plant and equipment, gross | $ 7,009 | $ 6,416 | |
Accumulated depreciation and amortization | (5,202) | (4,723) | |
Total property and equipment, net | 1,807 | 1,693 | |
Depreciation and amortization expense | 738 | 701 | $ 627 |
Net change in property and equipment included in accounts payable | 17 | 42 | $ 10 |
Total long-lived assets | 2,514 | 2,172 | |
U.S. | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total long-lived assets | 2,096 | 1,862 | |
Other countries | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Total long-lived assets | 418 | 310 | |
Computer equipment and software | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Property, plant and equipment, gross | 3,179 | 2,804 | |
Internal use software and website development costs | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Property, plant and equipment, gross | 2,831 | 2,471 | |
Land and buildings | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Property, plant and equipment, gross | 307 | 430 | |
Leasehold improvements | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Property, plant and equipment, gross | 410 | 460 | |
Furniture and fixtures | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Property, plant and equipment, gross | 199 | 171 | |
Development in progress and other | |||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||
Property, plant and equipment, gross | $ 83 | $ 80 |
OTHER FINANCIAL STATEMENT DET_4
OTHER FINANCIAL STATEMENT DETAILS - Schedule of Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Accumulated Balances of Other Comprehensive Income (Loss), Net of Tax | |||
Beginning balance | $ 16,929 | $ 15,386 | $ 15,994 |
Other comprehensive income (loss) before reclassifications | (291) | (14) | 190 |
Less: Amount of gain reclassified from AOCI | 20 | 237 | (30) |
Other comprehensive income (loss), net of tax | (311) | (251) | 220 |
Ending balance | 20,063 | 16,929 | 15,386 |
AOCI Attributable to Parent | |||
Accumulated Balances of Other Comprehensive Income (Loss), Tax | |||
Beginning balance | 0 | 2 | 6 |
Other comprehensive income (loss) before reclassifications | 2 | (2) | (4) |
Less: Amount of gain reclassified from AOCI | 0 | 0 | 0 |
Net current period other comprehensive income (loss) | 2 | (2) | (4) |
Ending balance | 2 | 0 | 2 |
Accumulated Balances of Other Comprehensive Income (Loss), Net of Tax | |||
Beginning balance | (173) | 78 | (142) |
Ending balance | (484) | (173) | 78 |
Unrealized Gains (Losses) on Cash Flow Hedges | |||
Accumulated Balances of Other Comprehensive Income (Loss), Before Tax | |||
Beginning balance | 6 | 182 | (111) |
Other comprehensive income (loss) before reclassifications | (309) | 62 | 263 |
Less: Amount of gain reclassified from AOCI | 20 | 238 | (30) |
Net current period other comprehensive income (loss) | (329) | (176) | 293 |
Ending balance | (323) | 6 | 182 |
Unrealized Gains on Investments | |||
Accumulated Balances of Other Comprehensive Income (Loss), Before Tax | |||
Beginning balance | 2 | (13) | (12) |
Other comprehensive income (loss) before reclassifications | 9 | 14 | (1) |
Less: Amount of gain reclassified from AOCI | 0 | (1) | 0 |
Net current period other comprehensive income (loss) | 9 | 15 | (1) |
Ending balance | 11 | 2 | (13) |
Foreign Currency Translation Adjustment (“CTA”) | |||
Accumulated Balances of Other Comprehensive Income (Loss), Before Tax | |||
Beginning balance | (150) | (93) | (25) |
Other comprehensive income (loss) before reclassifications | (48) | (57) | (68) |
Less: Amount of gain reclassified from AOCI | 0 | 0 | 0 |
Net current period other comprehensive income (loss) | (48) | (57) | (68) |
Ending balance | (198) | (150) | (93) |
Net Investment Hedge CTA Gain (Loss) | |||
Accumulated Balances of Other Comprehensive Income (Loss), Before Tax | |||
Beginning balance | (31) | 0 | |
Other comprehensive income (loss) before reclassifications | 55 | (31) | |
Less: Amount of gain reclassified from AOCI | 0 | 0 | |
Net current period other comprehensive income (loss) | 55 | (31) | |
Ending balance | $ 24 | $ (31) | $ 0 |
OTHER FINANCIAL STATEMENT DET_5
OTHER FINANCIAL STATEMENT DETAILS - Schedule of Reclassifications out of Accumulated Other Comprehensive Income (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | |||||||||||
Net revenues | $ 6,116 | $ 5,459 | $ 5,261 | $ 4,618 | $ 4,961 | $ 4,378 | $ 4,305 | $ 4,128 | $ 21,454 | $ 17,772 | $ 15,451 |
Other income (expense), net | 1,776 | 279 | 182 | ||||||||
Income before income taxes | 5,065 | 2,998 | 2,376 | ||||||||
Income tax expense | (863) | (539) | (319) | ||||||||
Net income | $ 1,567 | $ 1,021 | $ 1,530 | $ 84 | $ 507 | $ 462 | $ 823 | $ 667 | 4,202 | 2,459 | 2,057 |
Amount of Gains (Losses) Reclassified from AOCI | |||||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | |||||||||||
Income before income taxes | 20 | 237 | (30) | ||||||||
Income tax expense | 0 | 0 | 0 | ||||||||
Net income | 20 | 237 | (30) | ||||||||
Amount of Gains (Losses) Reclassified from AOCI | Gains (losses) on cash flow hedges—foreign exchange contracts | |||||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | |||||||||||
Net revenues | 20 | 238 | (30) | ||||||||
Amount of Gains (Losses) Reclassified from AOCI | Unrealized losses on investments | |||||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income on Derivatives [Line Items] | |||||||||||
Other income (expense), net | $ 0 | $ (1) | $ 0 |
OTHER FINANCIAL STATEMENT DET_6
OTHER FINANCIAL STATEMENT DETAILS - Schedule of Other Income (Expense), Net (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Other Income and Expenses [Abstract] | |||
Interest income | $ 88 | $ 197 | $ 168 |
Interest expense | (209) | (115) | (77) |
Net gains on strategic investments | 1,914 | 208 | 87 |
Other | (17) | (11) | 4 |
Other income (expense), net | $ 1,776 | $ 279 | $ 182 |
FUNDS RECEIVABLE AND CUSTOMER_3
FUNDS RECEIVABLE AND CUSTOMER ACCOUNTS AND INVESTMENTS - Schedule of Assets Underlying Funds Receivable and Customer Accounts, Short-term Investments, and Long-term Investments (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Funds receivable and customer accounts: | ||
Total funds receivable and customer accounts | $ 33,418 | $ 22,527 |
Short-term investments: | ||
Time deposits | 1,519 | 614 |
Available-for-sale debt securities | 6,689 | 2,734 |
Restricted cash | 81 | 64 |
Total short-term investments | 8,289 | 3,412 |
Long-term investments: | ||
Time deposits | 31 | 0 |
Available-for-sale debt securities | 2,819 | 1,025 |
Restricted cash | 7 | 0 |
Strategic investments | 3,232 | 1,838 |
Total long-term investments | 6,089 | 2,863 |
Cash and cash equivalents | ||
Funds receivable and customer accounts: | ||
Total funds receivable and customer accounts | 13,222 | 8,387 |
Time deposits | ||
Funds receivable and customer accounts: | ||
Total funds receivable and customer accounts | 233 | 514 |
Available-for-sale debt securities | ||
Funds receivable and customer accounts: | ||
Total funds receivable and customer accounts | 15,001 | 10,190 |
Funds receivable | ||
Funds receivable and customer accounts: | ||
Total funds receivable and customer accounts | $ 4,962 | $ 3,436 |
FUNDS RECEIVABLE AND CUSTOMER_4
FUNDS RECEIVABLE AND CUSTOMER ACCOUNTS AND INVESTMENTS - Schedule of Estimated Fair Value of Available-for-Sale Debt Securities (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Debt Securities, Available-for-sale [Line Items] | ||
Gross Amortized Cost | $ 21,584 | $ 12,011 |
Gross Unrealized Gains | 12 | 2 |
Gross Unrealized Losses | (1) | 0 |
Estimated Fair Value | 21,595 | 12,013 |
Funds receivable and customer accounts | U.S. government and agency securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Gross Amortized Cost | 8,566 | 4,996 |
Gross Unrealized Gains | 4 | 0 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 8,570 | 4,996 |
Funds receivable and customer accounts | Foreign government and agency securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Gross Amortized Cost | 1,504 | 1,392 |
Gross Unrealized Gains | 2 | 0 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 1,506 | 1,392 |
Funds receivable and customer accounts | Corporate debt securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Gross Amortized Cost | 2,011 | 2,112 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 2,011 | 2,112 |
Short-term investments | U.S. government and agency securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Gross Amortized Cost | 1,510 | |
Gross Unrealized Gains | 0 | |
Gross Unrealized Losses | 0 | |
Estimated Fair Value | 1,510 | |
Short-term investments | Foreign government and agency securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Gross Amortized Cost | 277 | 533 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 277 | 533 |
Short-term investments | Corporate debt securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Gross Amortized Cost | 4,900 | 1,955 |
Gross Unrealized Gains | 2 | 0 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 4,902 | 1,955 |
Long-term investments | U.S. government and agency securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Gross Amortized Cost | 28 | 140 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 28 | 140 |
Long-term investments | Foreign government and agency securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Gross Amortized Cost | 1,305 | 207 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (1) | 0 |
Estimated Fair Value | 1,304 | 207 |
Long-term investments | Corporate debt securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Gross Amortized Cost | 1,255 | 636 |
Gross Unrealized Gains | 4 | 2 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 1,259 | 638 |
Long-term investments | Asset-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Gross Amortized Cost | 228 | 40 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 228 | 40 |
Other current assets | ||
Debt Securities, Available-for-sale [Line Items] | ||
Accrued interest receivable on available-for-sale debt securities | $ 42 | $ 54 |
FUNDS RECEIVABLE AND CUSTOMER_5
FUNDS RECEIVABLE AND CUSTOMER ACCOUNTS AND INVESTMENTS - Schedule of Gross Unrealized Losses and Estimated Fair Value of Available-for-Sale Debt Securities in a Continuous Loss Position (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Fair Value | ||
Less than 12 months | $ 2,585 | $ 4,581 |
12 months or longer | 0 | 74 |
Total | 2,585 | 4,655 |
Gross Unrealized Losses | ||
Less than 12 months | (1) | 0 |
12 months or longer | 0 | 0 |
Total | (1) | 0 |
Funds receivable and customer accounts | U.S. government and agency securities | ||
Fair Value | ||
Less than 12 months | 312 | 2,452 |
12 months or longer | 0 | 0 |
Total | 312 | 2,452 |
Gross Unrealized Losses | ||
Less than 12 months | 0 | 0 |
12 months or longer | 0 | 0 |
Total | 0 | 0 |
Funds receivable and customer accounts | Foreign government and agency securities | ||
Fair Value | ||
Less than 12 months | 353 | 563 |
12 months or longer | 0 | 30 |
Total | 353 | 593 |
Gross Unrealized Losses | ||
Less than 12 months | 0 | 0 |
12 months or longer | 0 | 0 |
Total | 0 | 0 |
Funds receivable and customer accounts | Corporate debt securities | ||
Fair Value | ||
Less than 12 months | 641 | 825 |
12 months or longer | 0 | 0 |
Total | 641 | 825 |
Gross Unrealized Losses | ||
Less than 12 months | 0 | 0 |
12 months or longer | 0 | 0 |
Total | 0 | 0 |
Short-term investments | U.S. government and agency securities | ||
Fair Value | ||
Less than 12 months | 270 | |
12 months or longer | 0 | |
Total | 270 | |
Gross Unrealized Losses | ||
Less than 12 months | 0 | |
12 months or longer | 0 | |
Total | 0 | |
Short-term investments | Foreign government and agency securities | ||
Fair Value | ||
Less than 12 months | 72 | 115 |
12 months or longer | 0 | 0 |
Total | 72 | 115 |
Gross Unrealized Losses | ||
Less than 12 months | 0 | 0 |
12 months or longer | 0 | 0 |
Total | 0 | 0 |
Short-term investments | Corporate debt securities | ||
Fair Value | ||
Less than 12 months | 392 | 424 |
12 months or longer | 0 | 0 |
Total | 392 | 424 |
Gross Unrealized Losses | ||
Less than 12 months | 0 | 0 |
12 months or longer | 0 | 0 |
Total | 0 | 0 |
Long-term investments | U.S. government and agency securities | ||
Fair Value | ||
Less than 12 months | 28 | 100 |
12 months or longer | 0 | 0 |
Total | 28 | 100 |
Gross Unrealized Losses | ||
Less than 12 months | 0 | 0 |
12 months or longer | 0 | 0 |
Total | 0 | 0 |
Long-term investments | Foreign government and agency securities | ||
Fair Value | ||
Less than 12 months | 405 | 75 |
12 months or longer | 0 | 0 |
Total | 405 | 75 |
Gross Unrealized Losses | ||
Less than 12 months | (1) | 0 |
12 months or longer | 0 | 0 |
Total | (1) | 0 |
Long-term investments | Corporate debt securities | ||
Fair Value | ||
Less than 12 months | 97 | 1 |
12 months or longer | 0 | 40 |
Total | 97 | 41 |
Gross Unrealized Losses | ||
Less than 12 months | 0 | 0 |
12 months or longer | 0 | 0 |
Total | 0 | 0 |
Long-term investments | Asset-backed securities | ||
Fair Value | ||
Less than 12 months | 15 | 26 |
12 months or longer | 0 | 4 |
Total | 15 | 30 |
Gross Unrealized Losses | ||
Less than 12 months | 0 | 0 |
12 months or longer | 0 | 0 |
Total | $ 0 | $ 0 |
FUNDS RECEIVABLE AND CUSTOMER_6
FUNDS RECEIVABLE AND CUSTOMER ACCOUNTS AND INVESTMENTS - Estimated Fair Values of Investments Classified as Available for Sale Included within Funds Receivable and Customer Accounts by Date of Contractual Maturity (Details) $ in Millions | Dec. 31, 2020USD ($) |
Amortized Cost | |
One year or less | $ 17,416 |
After one year through five years | 4,168 |
Total | 21,584 |
Fair Value | |
One year or less | 17,421 |
After one year through five years | 4,174 |
Total | $ 21,595 |
FUNDS RECEIVABLE AND CUSTOMER_7
FUNDS RECEIVABLE AND CUSTOMER ACCOUNTS AND INVESTMENTS - Strategic Investments (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Investments, Debt and Equity Securities [Abstract] | ||
Carrying value of marketable equity securities recorded in long-term investments | $ 2,400 | $ 1,300 |
Carrying value of non-marketable equity securities | 10 | 27 |
Carrying value of non-marketable equity securities which do not have readily determinable fair value | $ 789 | $ 524 |
FUNDS RECEIVABLE AND CUSTOMER_8
FUNDS RECEIVABLE AND CUSTOMER ACCOUNTS AND INVESTMENTS - Schedule of Adjustments to Carrying Value of Equity Investments (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Equity Securities without Readily Determinable Fair Value [Roll Forward] | ||
Carrying amount, beginning of period | $ 497 | $ 293 |
Adjustments related to non-marketable equity securities: | ||
Net additions | 143 | 60 |
Gross unrealized gains | 161 | 144 |
Gross unrealized losses and impairments | (22) | 0 |
Carrying amount, end of period | $ 779 | $ 497 |
FUNDS RECEIVABLE AND CUSTOMER_9
FUNDS RECEIVABLE AND CUSTOMER ACCOUNTS AND INVESTMENTS - Summary of Cumulative Gross Unrealized Gains and Cumulative Gross Unrealized Losses and Impairment Related to Non-marketable Equity Securities Accounted for Under the Measurement Alternative (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Investments, Debt and Equity Securities [Abstract] | ||
Cumulative gross unrealized gains | $ 378 | $ 230 |
Cumulative gross unrealized losses and impairment | $ (27) | $ (5) |
FUNDS RECEIVABLE AND CUSTOME_10
FUNDS RECEIVABLE AND CUSTOMER ACCOUNTS AND INVESTMENTS - Schedule of Unrealized Gains (Losses) on Strategic Investments, Excluding Those Accounted for Using the Equity Method (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Investments, Debt and Equity Securities [Abstract] | ||
Net unrealized gains | $ 1,610 | $ 203 |
FAIR VALUE MEASUREMENT OF ASS_3
FAIR VALUE MEASUREMENT OF ASSETS AND LIABILITIES - Summary of Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Assets: | ||
Funds receivable and customer accounts | $ 33,418 | $ 22,527 |
Liabilities: | ||
Cash | 3,900 | 4,500 |
Short-term restricted cash | 88 | 64 |
Time deposits | 1,600 | 614 |
Carrying value of non-marketable equity securities which do not have readily determinable fair value | 789 | 524 |
Fair value, measurements, recurring basis | ||
Assets: | ||
Cash and cash equivalents | 867 | 2,835 |
Funds receivable and customer accounts | 16,771 | 10,873 |
Derivatives | 42 | 135 |
Total financial assets | 29,631 | 18,916 |
Liabilities: | ||
Derivatives | 410 | 122 |
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 | 2,443 | 1,314 |
Liabilities: | ||
Derivatives | 0 | 0 |
Fair value, measurements, recurring basis | Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Cash and cash equivalents | 867 | 2,835 |
Funds receivable and customer accounts | 16,771 | 10,873 |
Derivatives | 42 | 135 |
Total financial assets | 27,188 | 17,602 |
Liabilities: | ||
Derivatives | 410 | 122 |
Cash and cash equivalents | ||
Assets: | ||
Funds receivable and customer accounts | 13,222 | 8,387 |
Cash and cash equivalents | Fair value, measurements, recurring basis | ||
Assets: | ||
Funds receivable and customer accounts | 1,770 | 683 |
Cash and cash equivalents | Fair value, measurements, recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets: | ||
Funds receivable and customer accounts | 0 | 0 |
Cash and cash equivalents | Fair value, measurements, recurring basis | Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Funds receivable and customer accounts | 1,770 | 683 |
U.S. government and agency securities | Fair value, measurements, recurring basis | ||
Assets: | ||
Funds receivable and customer accounts | 8,570 | 4,996 |
U.S. government and agency securities | Fair value, measurements, recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets: | ||
Funds receivable and customer accounts | 0 | 0 |
U.S. government and agency securities | Fair value, measurements, recurring basis | Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Funds receivable and customer accounts | 8,570 | 4,996 |
Foreign government and agency securities | Fair value, measurements, recurring basis | ||
Assets: | ||
Funds receivable and customer accounts | 4,296 | 2,653 |
Foreign government and agency securities | Fair value, measurements, recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets: | ||
Funds receivable and customer accounts | 0 | 0 |
Foreign government and agency securities | Fair value, measurements, recurring basis | Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Funds receivable and customer accounts | 4,296 | 2,653 |
Corporate debt securities | Fair value, measurements, recurring basis | ||
Assets: | ||
Funds receivable and customer accounts | 2,135 | 2,541 |
Corporate debt securities | Fair value, measurements, recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets: | ||
Funds receivable and customer accounts | 0 | 0 |
Corporate debt securities | Fair value, measurements, recurring basis | Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Funds receivable and customer accounts | 2,135 | 2,541 |
Cash, time deposits and funds receivable | ||
Assets: | ||
Funds receivable and customer accounts | 16,600 | 11,700 |
Short-term investments | Fair value, measurements, recurring basis | ||
Assets: | ||
Investments | 6,689 | 2,734 |
Short-term investments | Fair value, measurements, recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets: | ||
Investments | 0 | 0 |
Short-term investments | Fair value, measurements, recurring basis | Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Investments | 6,689 | 2,734 |
Short-term investments | U.S. government and agency securities | Fair value, measurements, recurring basis | ||
Assets: | ||
Investments | 1,510 | |
Short-term investments | U.S. 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 | U.S. government and agency securities | Fair value, measurements, recurring basis | Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Investments | 1,510 | |
Short-term investments | Foreign government and agency securities | Fair value, measurements, recurring basis | ||
Assets: | ||
Investments | 277 | 757 |
Short-term investments | Foreign government and agency securities | Fair value, measurements, recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets: | ||
Investments | 0 | 0 |
Short-term investments | Foreign government and agency securities | Fair value, measurements, recurring basis | Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Investments | 277 | 757 |
Short-term investments | Corporate debt securities | Fair value, measurements, recurring basis | ||
Assets: | ||
Investments | 4,902 | 1,977 |
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 | 4,902 | 1,977 |
Long-term investments | Fair value, measurements, recurring basis | ||
Assets: | ||
Investments | 5,262 | 2,339 |
Long-term investments | Fair value, measurements, recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets: | ||
Investments | 2,443 | 1,314 |
Long-term investments | Fair value, measurements, recurring basis | Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Investments | 2,819 | 1,025 |
Long-term investments | U.S. government and agency securities | Fair value, measurements, recurring basis | ||
Assets: | ||
Investments | 28 | 140 |
Long-term investments | U.S. government and agency securities | Fair value, measurements, recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets: | ||
Investments | 0 | 0 |
Long-term investments | U.S. government and agency securities | Fair value, measurements, recurring basis | Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Investments | 28 | 140 |
Long-term investments | Foreign government and agency securities | Fair value, measurements, recurring basis | ||
Assets: | ||
Investments | 1,304 | 207 |
Long-term investments | Foreign government and agency securities | Fair value, measurements, recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets: | ||
Investments | 0 | 0 |
Long-term investments | Foreign government and agency securities | Fair value, measurements, recurring basis | Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Investments | 1,304 | 207 |
Long-term investments | Corporate debt securities | Fair value, measurements, recurring basis | ||
Assets: | ||
Investments | 1,259 | 638 |
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 | 1,259 | 638 |
Long-term investments | Asset-backed securities | Fair value, measurements, recurring basis | ||
Assets: | ||
Investments | 228 | 40 |
Long-term investments | Asset-backed securities | Fair value, measurements, recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets: | ||
Investments | 0 | 0 |
Long-term investments | Asset-backed securities | Fair value, measurements, recurring basis | Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Investments | 228 | 40 |
Long-term investments | Marketable equity securities | Fair value, measurements, recurring basis | ||
Assets: | ||
Investments | 2,443 | 1,314 |
Long-term investments | Marketable equity securities | Fair value, measurements, recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Assets: | ||
Investments | 2,443 | 1,314 |
Long-term investments | Marketable equity securities | Fair value, measurements, recurring basis | Significant Other Observable Inputs (Level 2) | ||
Assets: | ||
Investments | $ 0 | $ 0 |
FAIR VALUE MEASUREMENT OF ASS_4
FAIR VALUE MEASUREMENT OF ASSETS AND LIABILITIES - Additional Information (Details) - USD ($) $ in Billions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Notes payable, carrying value | $ 8.9 | $ 5 |
Notes payable, fair value | $ 9.7 | $ 5 |
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 |
FAIR VALUE MEASUREMENT OF ASS_5
FAIR VALUE MEASUREMENT OF ASSETS AND LIABILITIES - Summary of Investments Under the Fair Value Option (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt securities, available-for-sale, fair value | $ 21,595 | $ 12,013 |
Funds receivable and customer accounts | Fair Value Option, Investments | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt securities, available-for-sale, fair value | 2,914 | 1,690 |
Net gains (losses) from fair value changes | 190 | (43) |
Short-term investments | Fair Value Option, Investments | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Debt securities, available-for-sale, fair value | 0 | 246 |
Net gains (losses) from fair value changes | $ (24) | $ (8) |
FAIR VALUE MEASUREMENT OF ASS_6
FAIR VALUE MEASUREMENT OF ASSETS AND LIABILITIES - Summary of Financial Assets and Liabilities Measured at Fair Value on a Non-Recurring Basis (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Equity securities accounted for under the Measurement Alternative | $ 779 | $ 497 | $ 293 |
Fair value, measurements, not on a recurring basis | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Non-marketable equity investments measured using the Measurement Alternative | 335 | 303 | |
Other assets | 44 | ||
Total financial assets | 379 | ||
Equity securities accounted for under the Measurement Alternative | 444 | 194 | |
Fair value, measurements, not on a recurring basis | Significant Other Observable Inputs (Level 2) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Non-marketable equity investments measured using the Measurement Alternative | 335 | $ 303 | |
Other assets | 44 | ||
Total financial assets | $ 379 |
DERIVATIVE INSTRUMENTS - Additi
DERIVATIVE INSTRUMENTS - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||
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 | $ (287,000,000) | ||
Net investment hedge CTA gain (loss) | 55,000,000 | $ (31,000,000) | $ 0 |
Net investment hedge CTA gains (losses), reclassifications | 0 | 0 | $ 0 |
Derivative asset, offset | 34,000,000 | 92,000,000 | |
Derivative liability, offset | $ 34,000,000 | $ 92,000,000 |
DERIVATIVE INSTRUMENTS - Schedu
DERIVATIVE INSTRUMENTS - Schedule of Fair Value of Outstanding Derivative Instruments (Details) - Foreign Exchange Contract - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Derivatives, Fair Value [Line Items] | ||
Derivative assets | $ 42 | $ 135 |
Derivative liabilities | 410 | 122 |
Foreign currency exchange contracts designated as hedging instruments | Other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets | 0 | 45 |
Foreign currency exchange contracts designated as hedging instruments | Other assets (non-current) | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets | 0 | 1 |
Foreign currency exchange contracts designated as hedging instruments | Other current liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liabilities | 287 | 58 |
Foreign currency exchange contracts designated as hedging instruments | Other long-term liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liabilities | 35 | 13 |
Foreign currency exchange contracts not designated as hedging instruments | Other current assets | ||
Derivatives, Fair Value [Line Items] | ||
Derivative assets | 42 | 89 |
Foreign currency exchange contracts not designated as hedging instruments | Other current liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Derivative liabilities | $ 88 | $ 51 |
DERIVATIVE INSTRUMENTS - Offset
DERIVATIVE INSTRUMENTS - Offsetting Liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Other current assets | ||
Offsetting Liabilities [Line Items] | ||
Cash collateral posted | $ 340 | $ 12 |
Other current liabilities | ||
Offsetting Liabilities [Line Items] | ||
Cash collateral received | $ 1 | $ 39 |
DERIVATIVE INSTRUMENTS - Sche_2
DERIVATIVE INSTRUMENTS - Schedule of Recognized Gains or Losses Related to Derivative Instruments Designated as Hedging Instruments and not Designated as Hedging Instruments (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Derivative Instruments, Gain (Loss) [Line Items] | |||||||||||
Total amounts presented in the consolidated statements of income in which the effects of cash flow hedges are recorded | $ 6,116 | $ 5,459 | $ 5,261 | $ 4,618 | $ 4,961 | $ 4,378 | $ 4,305 | $ 4,128 | $ 21,454 | $ 17,772 | $ 15,451 |
Not Designated as Hedging Instrument | |||||||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||||||
Total gains (losses) recognized from foreign exchange contracts | (174) | 24 | 45 | ||||||||
Foreign Exchange Contract | Net Revenues | Designated as Hedging Instrument | Cash Flow Hedging | |||||||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||||||
Total gains (losses) recognized from foreign exchange contracts | 20 | 238 | (30) | ||||||||
Foreign Exchange Contract | Net Revenues | Not Designated as Hedging Instrument | |||||||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||||||
Total gains (losses) recognized from foreign exchange contracts | 0 | 0 | 7 | ||||||||
Foreign Exchange Contract | Other Income (Expense) | Not Designated as Hedging Instrument | |||||||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||||||
Total gains (losses) recognized from foreign exchange contracts | (110) | 24 | 38 | ||||||||
Equity Contract | Other Income (Expense) | Not Designated as Hedging Instrument | |||||||||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||||||||
Total gains (losses) recognized from foreign exchange contracts | $ (64) | $ 0 | $ 0 |
DERIVATIVE INSTRUMENTS - Sche_3
DERIVATIVE INSTRUMENTS - Schedule of Notional Amounts of Outstanding Derivatives (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Derivatives, Fair Value [Line Items] | ||
Notional amounts | $ 21,433 | $ 21,681 |
Foreign Exchange Contract | Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Notional amounts | 5,335 | 4,550 |
Foreign Exchange Contract | Not Designated as Hedging Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Notional amounts | $ 16,098 | $ 17,131 |
LOANS AND INTEREST RECEIVABLE -
LOANS AND INTEREST RECEIVABLE - Additional Information (Details) - USD ($) $ in Billions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Receivables [Abstract] | ||
Purchased merchant receivables | $ 1.8 | $ 4.7 |
LOANS AND INTEREST RECEIVABLE_2
LOANS AND INTEREST RECEIVABLE - Consumer Receivables (Details) - Consumer Receivables - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Loans and interest receivable | $ 2,169 | $ 1,322 |
Threshold period, write-off of receivables | 180 days | |
Threshold period, write-off of bankrupt accounts | 60 days | |
Loans Receivable | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Expected period of repayment | 12 months |
LOANS AND INTEREST RECEIVABLE_3
LOANS AND INTEREST RECEIVABLE - Schedule of Delinquency Status of the Principal Amount of Loans and Interest Receivables (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Consumer Receivables | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, current | $ 2,124 | $ 1,279 |
Loans, advances, and interest receivable | $ 2,169 | $ 1,322 |
Loans, advances, and interest receivable, current, percentage | 97.90% | 96.70% |
Loans, advances, and interest receivable, percentage | 100.00% | 100.00% |
Consumer Receivables | Other Consumer Credit Products | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable | $ 56 | $ 92 |
Consumer Receivables | Installment Loans Receivable | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable | 556 | 80 |
Consumer Receivables | 30-59 Days Past Due | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, past due | $ 15 | $ 15 |
Loans, advances, and interest receivable, past due, percentage | 0.70% | 1.10% |
Consumer Receivables | 60-89 Days Past Due | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, past due | $ 11 | $ 9 |
Loans, advances, and interest receivable, past due, percentage | 0.50% | 0.70% |
Consumer Receivables | 90 To 179 Days Past Due | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, past due | $ 19 | $ 19 |
Loans, advances, and interest receivable, past due, percentage | 0.90% | 1.50% |
Merchant Receivables | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, current | $ 1,042 | $ 2,523 |
Loans, advances, and interest receivable, past due | 293 | |
Loans, advances, and interest receivable | $ 1,382 | $ 2,816 |
Loans, advances, and interest receivable, current, percentage | 75.40% | 89.60% |
Loans, advances, and interest receivable, past due, percentage | 10.40% | |
Loans, advances, and interest receivable, percentage | 100.00% | 100.00% |
Merchant Receivables | Financial Asset, 2020 Origination | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, current | $ 884 | |
Loans, advances, and interest receivable | 1,033 | |
Merchant Receivables | Financial Asset, 2019 Origination | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, current | 154 | |
Loans, advances, and interest receivable | 327 | |
Merchant Receivables | Financial Asset, 2018 Origination | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, current | 4 | |
Loans, advances, and interest receivable | 22 | |
Merchant Receivables | Financial Asset, 2017 Origination | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, current | 0 | |
Loans, advances, and interest receivable | 0 | |
Merchant Receivables | Financial Asset, 2016 Origination | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, current | 0 | |
Loans, advances, and interest receivable | 0 | |
Merchant Receivables | 30-59 Days Past Due | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, past due | $ 105 | $ 115 |
Loans, advances, and interest receivable, past due, percentage | 7.60% | 4.10% |
Merchant Receivables | 30-59 Days Past Due | Financial Asset, 2020 Origination | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, past due | $ 56 | |
Merchant Receivables | 30-59 Days Past Due | Financial Asset, 2019 Origination | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, past due | 46 | |
Merchant Receivables | 30-59 Days Past Due | Financial Asset, 2018 Origination | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, past due | 3 | |
Merchant Receivables | 30-59 Days Past Due | Financial Asset, 2017 Origination | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, past due | 0 | |
Merchant Receivables | 30-59 Days Past Due | Financial Asset, 2016 Origination | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, past due | 0 | |
Merchant Receivables | 60-89 Days Past Due | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, past due | $ 62 | $ 61 |
Loans, advances, and interest receivable, past due, percentage | 4.50% | 2.10% |
Merchant Receivables | 60-89 Days Past Due | Financial Asset, 2020 Origination | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, past due | $ 29 | |
Merchant Receivables | 60-89 Days Past Due | Financial Asset, 2019 Origination | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, past due | 30 | |
Merchant Receivables | 60-89 Days Past Due | Financial Asset, 2018 Origination | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, past due | 3 | |
Merchant Receivables | 60-89 Days Past Due | Financial Asset, 2017 Origination | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, past due | 0 | |
Merchant Receivables | 60-89 Days Past Due | Financial Asset, 2016 Origination | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, past due | 0 | |
Merchant Receivables | 90 To 179 Days Past Due | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, past due | $ 142 | $ 100 |
Loans, advances, and interest receivable, past due, percentage | 10.30% | 3.60% |
Merchant Receivables | 90 To 179 Days Past Due | Financial Asset, 2020 Origination | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, past due | $ 58 | |
Merchant Receivables | 90 To 179 Days Past Due | Financial Asset, 2019 Origination | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, past due | 77 | |
Merchant Receivables | 90 To 179 Days Past Due | Financial Asset, 2018 Origination | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, past due | 7 | |
Merchant Receivables | 90 To 179 Days Past Due | Financial Asset, 2017 Origination | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, past due | 0 | |
Merchant Receivables | 90 To 179 Days Past Due | Financial Asset, 2016 Origination | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, past due | 0 | |
Merchant Receivables | Equal to or Greater than 180 Days Past Due | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, past due | $ 31 | $ 17 |
Loans, advances, and interest receivable, past due, percentage | 2.20% | 0.60% |
Merchant Receivables | Equal to or Greater than 180 Days Past Due | Financial Asset, 2020 Origination | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, past due | $ 6 | |
Merchant Receivables | Equal to or Greater than 180 Days Past Due | Financial Asset, 2019 Origination | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, past due | 20 | |
Merchant Receivables | Equal to or Greater than 180 Days Past Due | Financial Asset, 2018 Origination | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, past due | 5 | |
Merchant Receivables | Equal to or Greater than 180 Days Past Due | Financial Asset, 2017 Origination | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, past due | 0 | |
Merchant Receivables | Equal to or Greater than 180 Days Past Due | Financial Asset, 2016 Origination | ||
Financing Receivable, Past Due [Line Items] | ||
Loans, advances, and interest receivable, past due | $ 0 |
LOANS AND INTEREST RECEIVABLE_4
LOANS AND INTEREST RECEIVABLE - Schedule of Allowance for Loans and Interest Receivable (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Consumer Receivables | ||
Allowance for loans and interest receivable | ||
Beginning balance | $ 57 | $ 30 |
Provisions | 295 | 45 |
Charge-offs | (81) | (50) |
Recoveries | 27 | 31 |
Other | 26 | 1 |
Ending balance | 352 | 57 |
Consumer Receivables | Cumulative Effect, Period of Adoption, Adjustment | ||
Allowance for loans and interest receivable | ||
Beginning balance | 28 | 0 |
Ending balance | 28 | |
Merchant Receivables | ||
Allowance for loans and interest receivable | ||
Beginning balance | 191 | 130 |
Provisions | 391 | 266 |
Charge-offs | (301) | (222) |
Recoveries | 20 | 17 |
Ending balance | 483 | 191 |
Merchant Receivables | Cumulative Effect, Period of Adoption, Adjustment | ||
Allowance for loans and interest receivable | ||
Beginning balance | 0 | |
Ending balance | 182 | 0 |
Loans Receivable | Consumer Receivables | ||
Allowance for loans and interest receivable | ||
Beginning balance | 49 | 27 |
Provisions | 245 | 34 |
Charge-offs | (69) | (44) |
Recoveries | 27 | 31 |
Other | 23 | 1 |
Ending balance | 299 | 49 |
Loans Receivable | Consumer Receivables | Cumulative Effect, Period of Adoption, Adjustment | ||
Allowance for loans and interest receivable | ||
Beginning balance | 24 | 0 |
Ending balance | 24 | |
Loans Receivable | Merchant Receivables | ||
Allowance for loans and interest receivable | ||
Beginning balance | 171 | 115 |
Provisions | 358 | 240 |
Charge-offs | (274) | (201) |
Recoveries | 20 | 17 |
Ending balance | 440 | 171 |
Loans Receivable | Merchant Receivables | Cumulative Effect, Period of Adoption, Adjustment | ||
Allowance for loans and interest receivable | ||
Beginning balance | 0 | |
Ending balance | 165 | 0 |
Interest and Fees Receivable | Consumer Receivables | ||
Allowance for loans and interest receivable | ||
Beginning balance | 8 | 3 |
Provisions | 50 | 11 |
Charge-offs | (12) | (6) |
Recoveries | 0 | 0 |
Other | 3 | 0 |
Ending balance | 53 | 8 |
Interest and Fees Receivable | Consumer Receivables | Cumulative Effect, Period of Adoption, Adjustment | ||
Allowance for loans and interest receivable | ||
Beginning balance | 4 | 0 |
Ending balance | 4 | |
Interest and Fees Receivable | Merchant Receivables | ||
Allowance for loans and interest receivable | ||
Beginning balance | 20 | 15 |
Provisions | 33 | 26 |
Charge-offs | (27) | (21) |
Recoveries | 0 | 0 |
Ending balance | 43 | 20 |
Interest and Fees Receivable | Merchant Receivables | Cumulative Effect, Period of Adoption, Adjustment | ||
Allowance for loans and interest receivable | ||
Beginning balance | 0 | |
Ending balance | 17 | 0 |
Other Consumer Credit Products | Consumer Receivables | ||
Allowance for loans and interest receivable | ||
Beginning balance | 10 | |
Ending balance | $ 3 | $ 10 |
LOANS AND INTEREST RECEIVABLE_5
LOANS AND INTEREST RECEIVABLE - Merchant Receivables (Details) - Merchant Receivables - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Loans and interest receivable | $ 1,382 | $ 2,816 |
Participation interest sold, value | $ 59 | $ 124 |
Threshold period, write-off of bankrupt accounts | 60 days | |
PayPal Working Capital Products | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Required percentage of original loan payments every 90 days | 10.00% | |
Threshold period past due for write-off of financing receivable, number of days past exceeding expected repayment period | 180 days | |
Threshold period past due for write-off of financing receivable, non-payment | 60 days | |
Threshold period past due for write-off of financing receivable, threshold two | 360 days | |
PayPal Business Loans | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Threshold period, write-off of receivables | 180 days | |
Minimum | PayPal Working Capital Products | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Expected period of repayment | 9 months | |
Minimum | PayPal Business Loans | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Expected period of repayment | 3 months | |
Maximum | PayPal Working Capital Products | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Expected period of repayment | 12 months | |
Maximum | PayPal Business Loans | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Expected period of repayment | 12 months |
LOANS AND INTEREST RECEIVABLE_6
LOANS AND INTEREST RECEIVABLE - Troubled Debt Restructurings ("TDRs") (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Financing Receivable, Troubled Debt Restructuring [Line Items] | |
Financing receivable, modifications, payment default, threshold period past due | 60 days |
Minimum | |
Financing Receivable, Troubled Debt Restructuring [Line Items] | |
Financing receivable, modifications, term | 1 year |
Maximum | |
Financing Receivable, Troubled Debt Restructuring [Line Items] | |
Financing receivable, modifications, term | 5 years 6 months |
LOANS AND INTEREST RECEIVABLE_7
LOANS AND INTEREST RECEIVABLE - Loans Modified as TDRs (Details) - Merchant Receivables $ in Millions | 12 Months Ended |
Dec. 31, 2020USD ($)business | |
Financing Receivable, Troubled Debt Restructuring [Line Items] | |
Number of Accounts | business | 13,000 |
Outstanding Balances | $ | $ 354 |
Average Payment Term Extensions | 37 months |
DEBT - Fixed Rate Notes (Detail
DEBT - Fixed Rate Notes (Details) - USD ($) | May 18, 2020 | Dec. 31, 2020 | Dec. 31, 2019 |
Debt Instrument [Line Items] | |||
Outstanding aggregate principal amount | $ 9,000,000,000 | ||
Fixed-rate Notes Issued May 2020 | Senior Notes | |||
Debt Instrument [Line Items] | |||
Face amount | $ 4,000,000,000 | ||
Notes | Senior Notes | |||
Debt Instrument [Line Items] | |||
Redemption price, percentage | 101.00% | ||
Outstanding aggregate principal amount | 9,000,000,000 | $ 5,000,000,000 | |
Interest expense, debt | $ 190,000,000 | $ 35,000,000 |
DEBT - Schedule of Outstanding
DEBT - Schedule of Outstanding Aggregate Principal Amount Related to the Notes (Details) - USD ($) | Dec. 31, 2020 | May 18, 2020 | Dec. 31, 2019 | Sep. 26, 2019 |
Line of Credit Facility [Line Items] | ||||
Outstanding aggregate principal amount | $ 9,000,000,000 | |||
Senior Notes | ||||
Line of Credit Facility [Line Items] | ||||
Unamortized premium (discount) and issuance costs, net | (61,000,000) | $ (35,000,000) | ||
Total carrying amount of term debt | 8,939,000,000 | 4,965,000,000 | ||
Senior Notes | Notes | ||||
Line of Credit Facility [Line Items] | ||||
Outstanding aggregate principal amount | $ 9,000,000,000 | 5,000,000,000 | ||
Senior Notes | Fixed-rate Notes Issued September 2019 | ||||
Line of Credit Facility [Line Items] | ||||
Face amount | $ 5,000,000,000 | |||
Senior Notes | Fixed-rate 2.200% notes | ||||
Line of Credit Facility [Line Items] | ||||
Interest rate | 2.20% | |||
Effective Interest Rate | 2.39% | |||
Outstanding aggregate principal amount | $ 1,000,000,000 | 1,000,000,000 | ||
Senior Notes | Fixed-rate 2.400% notes | ||||
Line of Credit Facility [Line Items] | ||||
Interest rate | 2.40% | |||
Effective Interest Rate | 2.52% | |||
Outstanding aggregate principal amount | $ 1,250,000,000 | 1,250,000,000 | ||
Senior Notes | Fixed-rate 2.650% notes | ||||
Line of Credit Facility [Line Items] | ||||
Interest rate | 2.65% | |||
Effective Interest Rate | 2.78% | |||
Outstanding aggregate principal amount | $ 1,250,000,000 | 1,250,000,000 | ||
Senior Notes | Fixed-rate 2.850% notes | ||||
Line of Credit Facility [Line Items] | ||||
Interest rate | 2.85% | |||
Effective Interest Rate | 2.96% | |||
Outstanding aggregate principal amount | $ 1,500,000,000 | 1,500,000,000 | ||
Senior Notes | Fixed-rate Notes Issued May 2020 | ||||
Line of Credit Facility [Line Items] | ||||
Face amount | $ 4,000,000,000 | |||
Senior Notes | Fixed-rate 1.350% notes | ||||
Line of Credit Facility [Line Items] | ||||
Interest rate | 1.35% | |||
Effective Interest Rate | 1.55% | |||
Outstanding aggregate principal amount | $ 1,000,000,000 | 0 | ||
Senior Notes | Fixed-rate 1.650% notes | ||||
Line of Credit Facility [Line Items] | ||||
Interest rate | 1.65% | |||
Effective Interest Rate | 1.78% | |||
Outstanding aggregate principal amount | $ 1,000,000,000 | 0 | ||
Senior Notes | Fixed-rate 2.300% notes | ||||
Line of Credit Facility [Line Items] | ||||
Interest rate | 2.30% | |||
Effective Interest Rate | 2.39% | |||
Outstanding aggregate principal amount | $ 1,000,000,000 | 0 | ||
Senior Notes | Fixed-rate 3.250% notes | ||||
Line of Credit Facility [Line Items] | ||||
Interest rate | 3.25% | |||
Effective Interest Rate | 3.33% | |||
Outstanding aggregate principal amount | $ 1,000,000,000 | $ 0 |
DEBT - Five-Year Revolving Cred
DEBT - Five-Year Revolving Credit Facility (Details) - Credit Agreement - Unsecured Debt - USD ($) | Sep. 11, 2019 | May 31, 2020 | Mar. 31, 2020 | Dec. 31, 2020 |
Revolving Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Maximum borrowing capacity | $ 5,000,000,000 | |||
Credit facility, term | 5 years | |||
Increase limit | $ 2,000,000,000 | |||
Proceeds from additional drew down on credit facility | $ 3,000,000,000 | |||
Repayments on termination of credit facility | $ 3,000,000,000 | |||
Borrowings outstanding | $ 0 | |||
Remaining borrowing capacity | 5,000,000,000 | |||
Interest expense and fees | $ 16,000,000 | |||
Letter of Credit | ||||
Line of Credit Facility [Line Items] | ||||
Maximum borrowing capacity | 150,000,000 | |||
Bridge Loan | ||||
Line of Credit Facility [Line Items] | ||||
Maximum borrowing capacity | $ 500,000,000 | |||
Minimum | Eurodollar | Revolving Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Basis spread on variable rate | 0.875% | |||
Minimum | Overnight Rate | Revolving Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Basis spread on variable rate | 0.875% | |||
Minimum | Prime Rate, The Federal Funds Effective Rate Or London Interbank Offered Rate (LIBOR) | Revolving Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Basis spread on variable rate | 0.00% | |||
Maximum | Eurodollar | Revolving Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Basis spread on variable rate | 1.375% | |||
Maximum | Overnight Rate | Revolving Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Basis spread on variable rate | 1.375% | |||
Maximum | Prime Rate, The Federal Funds Effective Rate Or London Interbank Offered Rate (LIBOR) | Revolving Credit Facility | ||||
Line of Credit Facility [Line Items] | ||||
Basis spread on variable rate | 0.375% |
DEBT - 364-Day Revolving Credit
DEBT - 364-Day Revolving Credit Facility (Details) - 364-Day Credit Agreement - Unsecured Debt - Revolving Credit Facility | 1 Months Ended |
Sep. 30, 2019USD ($) | |
Line of Credit Facility [Line Items] | |
Credit facility, term | 364 days |
Maximum borrowing capacity | $ 1,000,000,000 |
DEBT - Amended Credit Agreement
DEBT - Amended Credit Agreement (Details) - Unsecured Debt - Delayed-Draw Term Loan Credit Facility | Sep. 26, 2019USD ($) | Apr. 05, 2019USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($)borrowing |
Line of Credit Facility [Line Items] | ||||
Maximum borrowing capacity | $ 5,000,000,000 | |||
Credit facility, term | 364 days | |||
Maximum number of borrowings | borrowing | 4 | |||
Borrowings outstanding | $ 2,000,000,000 | |||
Proceeds from additional drew down on credit facility | $ 500,000,000 | |||
Repayments on termination of credit facility | $ 2,500,000,000 | |||
Interest expense and fees | $ 69,000,000 | $ 72,000,000 |
DEBT - Other Available Faciliti
DEBT - Other Available Facilities (Details) $ in Millions | Dec. 31, 2020USD ($) |
Future Principal Payments | |
2021 | $ 0 |
2022 | 1,000 |
2023 | 1,000 |
2024 | 1,250 |
2025 | 1,000 |
Thereafter | 4,750 |
Total | 9,000 |
Uncommitted Credit Facilities | |
Line of Credit Facility [Line Items] | |
Maximum borrowing capacity | $ 30 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Additional Information (Details) customer in Millions, $ in Millions | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 01, 2017customer |
Commitments and Contingencies Disclosure [Abstract] | |||
Unused credit available to accountholders | $ 3,000 | $ 3,100 | |
Number of customers with potentially compromised information | customer | 1.6 | ||
Allowance for transaction losses | 144 | 136 | |
Allowance for negative customer balances | $ 270 | $ 263 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES - Schedule of Allowance for Transaction Losses and Negative Customer Balances Related to Protection Products (Details) - Protection Programs - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Loss Contingency Accrual [Roll Forward] | ||
Beginning balance | $ 399 | $ 344 |
Provision | 1,135 | 1,092 |
Realized losses | (1,208) | (1,098) |
Recoveries | 88 | 61 |
Ending balance | $ 414 | $ 399 |
STOCK REPURCHASE PROGRAMS (Deta
STOCK REPURCHASE PROGRAMS (Details) - USD ($) | 12 Months Ended | ||||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Jul. 31, 2018 | Apr. 30, 2017 | |
Equity, Class of Treasury Stock [Line Items] | |||||
Repurchases of shares of common stock, shares repurchased (in shares) | 12,000,000 | 14,000,000 | 44,000,000 | ||
Cash paid for shares repurchased | $ 1,635,000,000 | $ 1,411,000,000 | $ 3,520,000,000 | ||
Repurchases of shares of common stock, average price paid per share (in usd per share) | $ 136,190,000 | ||||
Repurchased shares retired during period (in shares) | 0 | 0 | 0 | ||
April 2017 Stock Repurchase Program | |||||
Equity, Class of Treasury Stock [Line Items] | |||||
Stock repurchase program, maximum authorized amount | $ 5,000,000,000 | ||||
July 2018 Stock Repurchase Program | |||||
Equity, Class of Treasury Stock [Line Items] | |||||
Remaining amount authorized for future repurchase of common stock | $ 8,400,000,000 | $ 10,000,000,000 | |||
Open Market Transactions | |||||
Equity, Class of Treasury Stock [Line Items] | |||||
Cash paid for shares repurchased | $ 656,000,000 | $ 2,500,000,000 | |||
Accelerated Share Repurchase Agreement | |||||
Equity, Class of Treasury Stock [Line Items] | |||||
Cash paid for shares repurchased | $ 750,000,000 | $ 1,000,000,000 |
STOCK-BASED AND EMPLOYEE SAVI_3
STOCK-BASED AND EMPLOYEE SAVINGS PLANS - Equity Incentive Plans (Details) - 2015 Paypal Equity Incentive Award Plan shares in Millions | 12 Months Ended |
Dec. 31, 2020shares | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |
Number of shares authorized (in shares) | 70 |
Number of shares available for grant (in shares) | 49 |
Employee Stock Option | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |
Expiration period from date of grant | 7 years |
Restricted Stock Units (RSUs) | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |
Award vesting period | 3 years |
Performance Shares | Minimum | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |
Award performance period | 1 year |
Awards to be issued, percentage of target amount | 0.00% |
Performance Shares | Maximum | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |
Award performance period | 3 years |
Awards to be issued, percentage of target amount | 200.00% |
Vesting period 2 | Employee Stock Option | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |
Award vesting rights, percentage | 2.08% |
Existing Employee | Vesting period 1 | Employee Stock Option | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |
Award vesting rights, percentage | 12.50% |
Award vesting period | 6 months |
New Employee | Vesting period 1 | Employee Stock Option | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |
Award vesting rights, percentage | 25.00% |
Award vesting period | 1 year |
STOCK-BASED AND EMPLOYEE SAVI_4
STOCK-BASED AND EMPLOYEE SAVINGS PLANS - Employee Stock Purchase Plan (Details) - PayPal Holdings, Inc. Employee Stock Purchase Plan - $ / shares shares in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [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 (in shares) | 1.7 | 1.8 | 2.4 |
Average price of shares purchased under the employee stock purchase plan (in usd per share) | $ 80.36 | $ 66.36 | $ 43.09 |
Number of shares available for grant (in shares) | 50 | ||
Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Employee subscription rate | 2.00% | ||
Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Employee subscription rate | 10.00% |
STOCK-BASED AND EMPLOYEE SAVI_5
STOCK-BASED AND EMPLOYEE SAVINGS PLANS - Schedule of Stock Option Activity (Details) - Employee Stock Option - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Shares | |||
Outstanding balance, beginning of period (in shares) | 476 | ||
Assumed (in shares) | 574 | ||
Exercised (in shares) | (441) | ||
Forfeited/expired/canceled (in shares) | (18) | ||
Outstanding balance, end of period (in shares) | 591 | 476 | |
Expected to vest (in shares) | 244 | ||
Options exercisable (in shares) | 329 | ||
Weighted Average Exercise Price | |||
Outstanding balance, beginning of period (in usd per share) | $ 25.18 | ||
Assumed (in usd per share) | 1.88 | ||
Exercised (in usd per share) | 10.23 | ||
Forfeited/expired/canceled (in usd per share) | 3.51 | ||
Outstanding balance, end of period (in usd per share) | 14.37 | $ 25.18 | |
Expected to vest, weighted average exercise price (in usd per share) | 4.48 | ||
Options exercisable, weighted average exercise price (in usd per share) | $ 22.25 | ||
Outstanding balance, end of period, weighted average remaining contractual term (years) | 4 years 10 months 20 days | ||
Expected to vest, weighted average remaining contractual term (years) | 6 years 11 months 1 day | ||
Options exercisable, weighted average remaining contractual term (years) | 3 years 3 months 3 days | ||
Outstanding balance, end of period, aggregate intrinsic value | $ 128,143 | ||
Expected to vest, aggregate intrinsic value | 55,345 | ||
Options exercisable, aggregate intrinsic value | $ 68,780 | ||
Weighted average grant date fair value of options granted to employees (in usd per share) | $ 108.61 | $ 0 | $ 72.02 |
Aggregate intrinsic value of options exercised | $ 66,000 | $ 51,000 | $ 71,000 |
STOCK-BASED AND EMPLOYEE SAVI_6
STOCK-BASED AND EMPLOYEE SAVINGS PLANS - Schedule of RSUs, PBRSUs, and Restricted Stock Activity (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Billions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Restricted Stock Units (RSUs), Performance Shares, And Restricted Stock | |||
Units | |||
Outstanding balance, beginning of period (in shares) | 23,009 | ||
Awarded (in shares) | 16,592 | ||
Vested (in shares) | (14,170) | ||
Forfeited (in shares) | (2,267) | ||
Outstanding balance, end of period (in shares) | 23,164 | 23,009 | |
Expected to vest at the end of period (in shares) | 20,767 | ||
Weighted Average Grant-Date Fair Value (per share) | |||
Outstanding balance, beginning of period (in usd per share) | $ 83.61 | ||
Awarded (in usd per share) | 113.63 | ||
Vested (in usd per share) | 77.50 | ||
Forfeited (in usd per share) | 101.44 | ||
Outstanding balance, end of period (in usd per share) | $ 107.13 | $ 83.61 | |
Restricted Stock Units (RSUs) and Performance Shares | |||
Weighted Average Grant-Date Fair Value (per share) | |||
Aggregate intrinsic value of vested restricted stock units | $ 1.7 | $ 1.6 | $ 1.4 |
Performance Shares | Vesting period 1 | |||
Units | |||
Awarded (in shares) | 1,400 | 1,500 | |
Weighted Average Grant-Date Fair Value (per share) | |||
Award requisite service period | 1 year | 1 year | |
Performance Shares | Vesting period 2 | |||
Units | |||
Awarded (in shares) | 700 | 900 | |
Weighted Average Grant-Date Fair Value (per share) | |||
Award requisite service period | 3 years | 3 years | |
Performance Shares | Achievement of Company Performance Metrics | |||
Units | |||
Awarded (in shares) | 1,400 | ||
Restricted Stock Units (RSUs) | Honey Science Corporation | |||
Units | |||
Awarded (in shares) | 600 |
STOCK-BASED AND EMPLOYEE SAVI_7
STOCK-BASED AND EMPLOYEE SAVINGS PLANS - Stock-Based Compensation Expense (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Stock-based compensation expense | $ 1,411 | $ 1,050 | $ 871 |
Capitalized as part of internal use software and website development costs | 48 | 38 | 38 |
Income tax benefit recognized for stock-based compensation arrangements | 239 | 176 | 154 |
Unearned stock-based compensation | 1,400 | ||
Customer support and operations | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Stock-based compensation expense | 250 | 198 | 174 |
Sales and marketing | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Stock-based compensation expense | 172 | 127 | 125 |
Technology and development | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Stock-based compensation expense | 529 | 420 | 303 |
General and administrative | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Stock-based compensation expense | $ 460 | $ 305 | $ 269 |
STOCK-BASED AND EMPLOYEE SAVI_8
STOCK-BASED AND EMPLOYEE SAVINGS PLANS - Employee Saving Plans (Details) - Other Postretirement Benefit Plan - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Maximum annual contributions per employee, percent of eligible compensation | 50.00% | ||
Employer matching contribution, maximum percentage of eligible employee salary | 4.00% | 4.00% | 4.00% |
Employer matching contribution, maximum annual contributions per employee | $ 11,600 | $ 11,200 | $ 11,200 |
Matching contribution expense | $ 72,000,000 | $ 59,000,000 | $ 51,000,000 |
INCOME TAXES - Schedule of Comp
INCOME TAXES - Schedule of Components of Income (Loss) Before Income Taxes (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |||
United States | $ 1,504 | $ 8 | $ (474) |
International | 3,561 | 2,990 | 2,850 |
Income before income taxes | $ 5,065 | $ 2,998 | $ 2,376 |
INCOME TAXES - Schedule of Inco
INCOME TAXES - Schedule of Income Tax Expense (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Current: | |||
Federal | $ 310 | $ 132 | $ 180 |
State and local | 143 | 47 | 32 |
Foreign | 245 | 629 | 278 |
Total current portion of income tax expense | 698 | 808 | 490 |
Deferred: | |||
Federal | 259 | (107) | (115) |
State and local | (32) | (39) | (35) |
Foreign | (62) | (123) | (21) |
Total deferred portion of income tax expense | 165 | (269) | (171) |
Income tax expense | $ 863 | $ 539 | $ 319 |
INCOME TAXES - Additional Infor
INCOME TAXES - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Operating Loss Carryforwards [Line Items] | |||
Valuation allowance, deferred tax asset, increase (decrease), amount | $ 18 | $ 52 | $ 39 |
Indefinitely reinvested foreign earnings | 7,200 | ||
Accrued income taxes | 21 | ||
Income tax savings | $ 596 | $ 472 | $ 465 |
Benefit of tax rulings on net income per share (in usd per share) | $ 0.50 | $ 0.40 | $ 0.39 |
Unrecognized tax benefits that would impact effective tax rate, if realized | $ 1,100 | ||
Interest and penalties related to uncertain tax positions recognized in income tax expense | 40 | $ 63 | $ 57 |
Interest and penalties accrued | 211 | $ 171 | |
Federal | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carryforwards | 14 | ||
Tax credit carryforward | 16 | ||
Federal | Expiring in 2021 | |||
Operating Loss Carryforwards [Line Items] | |||
Tax credit carryforward | 13 | ||
Federal | No Expiration Date | |||
Operating Loss Carryforwards [Line Items] | |||
Tax credit carryforward | 201 | ||
Federal | Expiring in 2028 | |||
Operating Loss Carryforwards [Line Items] | |||
Tax credit carryforward | 22 | ||
Federal | Expiring in 2035 | |||
Operating Loss Carryforwards [Line Items] | |||
Tax credit carryforward | 8 | ||
State | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carryforwards | 336 | ||
Tax credit carryforward | 244 | ||
Foreign | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carryforwards | 316 | ||
Foreign | Expiring in 2021 | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carryforwards | 4 | ||
Foreign | Expiring in 2024 | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carryforwards | 46 | ||
Foreign | Expiring in 2034 | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carryforwards | 70 | ||
Foreign | No Expiration Date | |||
Operating Loss Carryforwards [Line Items] | |||
Net operating loss carryforwards | $ 196 |
INCOME TAXES - Schedule of Reco
INCOME TAXES - Schedule of Reconciliation of the Difference Between the Effective Income Tax Rate and the Federal Statutory Rate (Details) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |||
Federal statutory rate | 21.00% | 21.00% | 21.00% |
State taxes, net of federal benefit | 2.20% | 0.30% | (0.10%) |
Foreign income taxed at different rates | (7.40%) | (5.00%) | (3.90%) |
Stock-based compensation expense | (1.20%) | (3.90%) | (4.10%) |
Tax credits | (2.00%) | (2.40%) | (2.10%) |
Change in valuation allowances | 0.10% | 0.10% | 0.00% |
Intra-group transfer of intellectual property | 4.10% | 7.60% | 0.70% |
Other | 0.20% | 0.30% | 1.90% |
Effective income tax rate | 17.00% | 18.00% | 13.40% |
INCOME TAXES - Schedule of Defe
INCOME TAXES - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred tax assets: | ||
Net operating loss and credit carryforwards | $ 201 | $ 182 |
Accruals and allowances | 413 | 235 |
Lease liability | 188 | 120 |
Partnership investment | 6 | 8 |
Stock-based compensation | 196 | 160 |
Net unrealized losses | 4 | 5 |
Fixed assets and other intangibles | 11 | 88 |
Total deferred tax assets | 1,019 | 798 |
Valuation allowance | (166) | (184) |
Net deferred tax assets | 853 | 614 |
Deferred tax liabilities: | ||
Unremitted foreign earnings | (21) | (17) |
Acquired intangibles | (153) | (103) |
Lease asset | (172) | (116) |
Net unrealized gains | (440) | (71) |
Total deferred tax liabilities | (786) | (307) |
Net deferred tax assets | $ 67 | $ 307 |
INCOME TAXES - Schedule of De_2
INCOME TAXES - Schedule of Deferred Tax Assets and Liabilities by Balance Sheet Location (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred Tax [Line Items] | ||
Total deferred tax assets (non-current) | $ 853 | $ 614 |
Total deferred tax liabilities (non-current) | (786) | (307) |
Net deferred tax assets | 67 | 307 |
Other assets | ||
Deferred Tax [Line Items] | ||
Total deferred tax assets (non-current) | 142 | 396 |
Deferred tax liability and other long-term liabilities | ||
Deferred Tax [Line Items] | ||
Total deferred tax liabilities (non-current) | $ (75) | $ (89) |
IINCOME TAXES - Schedule of Unr
IINCOME TAXES - Schedule of Unrecognized Tax Benefits (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Changes in unrecognized tax benefits | |||
Gross amounts of unrecognized tax benefits as of the beginning of the period | $ 1,141 | $ 800 | $ 424 |
Increases related to prior period tax positions | 92 | 97 | 120 |
Decreases related to prior period tax positions | (78) | (28) | (6) |
Increases related to current period tax positions | 360 | 336 | 287 |
Settlements | (34) | (63) | (20) |
Statute of limitation expirations | (2) | (1) | (5) |
Gross amounts of unrecognized tax benefits as of the end of the period | $ 1,479 | $ 1,141 | $ 800 |
RESTRUCTURING AND OTHER CHARG_3
RESTRUCTURING AND OTHER CHARGES - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Restructuring and Related Activities [Abstract] | |||
Restructuring expenses | $ 109 | $ 78 | $ 25 |
Asset impairment charges | $ 30 |
RESTRUCTURING AND OTHER CHARG_4
RESTRUCTURING AND OTHER CHARGES - Summary of Restructuring Reserve Activity (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Restructuring Reserve | |||
Accrued liability, beginning of period | $ 9 | ||
Charges | 109 | $ 78 | $ 25 |
Payments | (63) | ||
Accrued liability, end of period | $ 55 | $ 9 |
QUARTERLY UNAUDITED FINANCIAL_3
QUARTERLY UNAUDITED FINANCIAL DATA (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Net revenues | $ 6,116 | $ 5,459 | $ 5,261 | $ 4,618 | $ 4,961 | $ 4,378 | $ 4,305 | $ 4,128 | $ 21,454 | $ 17,772 | $ 15,451 |
Net income | $ 1,567 | $ 1,021 | $ 1,530 | $ 84 | $ 507 | $ 462 | $ 823 | $ 667 | $ 4,202 | $ 2,459 | $ 2,057 |
Net income per share - basic (in usd per share) | $ 1.34 | $ 0.87 | $ 1.30 | $ 0.07 | $ 0.43 | $ 0.39 | $ 0.70 | $ 0.57 | $ 3.58 | $ 2.09 | $ 1.74 |
Net income per share - diluted (in usd per share) | $ 1.32 | $ 0.86 | $ 1.29 | $ 0.07 | $ 0.43 | $ 0.39 | $ 0.69 | $ 0.56 | $ 3.54 | $ 2.07 | $ 1.71 |
Weighted average shares: | |||||||||||
Basic (in shares) | 1,172 | 1,172 | 1,173 | 1,173 | 1,174 | 1,175 | 1,175 | 1,171 | 1,173 | 1,174 | 1,184 |
Diluted (in shares) | 1,191 | 1,190 | 1,184 | 1,185 | 1,187 | 1,188 | 1,187 | 1,188 | 1,187 | 1,188 | 1,203 |
Schedule II_VALUATION AND QUA_2
Schedule II—VALUATION AND QUALIFYING ACCOUNTS (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Allowance for Transaction Losses and Negative Customer Balances | |||
Movement in Valuation Allowances and Reserves | |||
Balance at Beginning of Period | $ 399 | $ 344 | $ 266 |
Charged/ (Credited) to Net Income | 1,135 | 1,092 | 1,059 |
Charged to Other Accounts | 0 | 0 | 0 |
Charges Utilized/ (Write-offs) | (1,120) | (1,037) | (981) |
Balance at End of Period | 414 | 399 | 344 |
Allowance for Loans and Interest Receivable | |||
Movement in Valuation Allowances and Reserves | |||
Balance at Beginning of Period | 258 | 172 | 129 |
Charged/ (Credited) to Net Income | 689 | 325 | 243 |
Charged to Other Accounts | 210 | 0 | 0 |
Charges Utilized/ (Write-offs) | (319) | (239) | (200) |
Balance at End of Period | $ 838 | $ 258 | $ 172 |
Uncategorized Items - pypl-2020
Label | Element | Value |
Short-Term And Long-Term Investments [Member] | ||
Restricted Cash and Cash Equivalents | us-gaap_RestrictedCashAndCashEquivalents | $ 24,000,000 |
Restricted Cash and Cash Equivalents | us-gaap_RestrictedCashAndCashEquivalents | 7,000,000 |
Restricted Cash and Cash Equivalents | us-gaap_RestrictedCashAndCashEquivalents | 16,000,000 |
Funds Receivable And Customer Accounts [Member] | ||
Restricted Cash and Cash Equivalents | us-gaap_RestrictedCashAndCashEquivalents | 13,222,000,000 |
Restricted Cash and Cash Equivalents | us-gaap_RestrictedCashAndCashEquivalents | 8,387,000,000 |
Restricted Cash and Cash Equivalents | us-gaap_RestrictedCashAndCashEquivalents | $ 5,642,000,000 |