Technology
eBay Inc. Reports Second Quarter 2024 Results
Published
2 years agoon
By
Revenue of $2.6 billion, up 1% on an as-reported basis and up 2% on an FX-Neutral basis Gross Merchandise Volume of $18.4 billion, up 1% on an as-reported and FX-Neutral basisGAAP and Non-GAAP earnings per diluted share of $0.45 and $1.18, respectivelyGAAP and Non-GAAP operating margin of 21.3% and 27.9%, respectivelyReturned $1.1 billion to stockholders in Q2, including $1.0 billion of share repurchases and $135 million paid in cash dividends
SAN JOSE, Calif., July 31, 2024 /PRNewswire/ — eBay Inc. (Nasdaq: EBAY), a global commerce leader that connects millions of buyers and sellers around the world, today reported financial results for its second quarter ended June 30, 2024.
“eBay’s strong Q2 results mark another step toward achieving sustainable, long-term growth,” said Jamie Iannone, Chief Executive Officer at eBay. “The continued momentum in Focus Categories contributed to our increase in GMV, while new AI capabilities are driving innovation across the platform and transforming the experience for eBay customers around the world.”
“Q2 was another strong quarter for eBay as we exceeded expectations across our key financial metrics,” said Steve Priest, Chief Financial Officer at eBay. “We achieved positive year-over-year GMV growth, driven by our execution against strategic initiatives, despite an uneven discretionary demand environment in our major markets.”
Second Quarter Financial Highlights
Revenue was $2.6 billion, up 1% on an as-reported basis and up 2% on a foreign exchange (FX) neutral basis.Gross Merchandise Volume (GMV) was $18.4 billion, up 1% on an as-reported and FX-Neutral basis.GAAP net income from continuing operations was $226 million, or $0.45 per diluted share.Non-GAAP net income from continuing operations was $602 million, or $1.18 per diluted share.GAAP and Non-GAAP operating margin was 21.3% and 27.9%, respectively.Generated $367 million of operating cash flow and $278 million of free cash flow.We completed the previously announced sale of Adevinta shares in exchange for $2.4 billion in cash and shares of a newly privatized entity, Aurelia, which are valued at $1.9 billion at the closing of the transactions.Returned $1.1 billion to stockholders, including $1.0 billion of share repurchases and $135 million paid in cash dividends.
Business Highlights
eBay closed a series of transactions with Collectors, including the acquisition of Goldin from Collectors, the sale of the eBay vault, and a commercial agreement for more streamlined grading, storage and selling experiences.eBay enabled Venmo as an additional payment method during the quarter. Known for its popularity among Gen Z and Millennials, Venmo gives eBay buyers in the U.S. even more choice and flexibility during the checkout experience.The company expanded its eBay Refurbished program to include refurbished golf clubs, bringing warranties and hassle-free returns to thousands of previously owned clubs from the world’s top brands.In June, the company announced a sustainability collaboration with Seagate, a global leader in data storage solutions. Seagate’s official storefront on eBay now offers direct sales of factory recertified hard drives, which can eliminate a significant amount of e-waste by extending the lifecycles of these products.The company launched a number of innovative product features to simplify and enhance the buying and selling experience for customers. In the U.S. and U.K., eBay introduced Shop the look, a generative-AI powered discovery feature for fashion buyers. The company also launched its AI-powered background enhancement tool to 100% of iOS and Android users in the U.S., U.K. and Germany, enabling even more sellers to apply a variety of backgrounds to their listing images.The company introduced improved selling and buying experiences for pre-owned apparel in the U.K. For sellers, these changes included a new selling flow that makes it considerably easier to list on eBay, with image guidance, simpler item aspect collection, and a streamlined shipping module. For buyers, we introduced new Generative AI-powered features, like Shop the look and Explore, which offer more inspirational shopping experiences for fashion enthusiasts.eBay and Certilogo launched a new ‘click-to-resell’ feature, making it easier for sellers to list pre-owned clothing on eBay and verify authenticity through Certilogo’s AI-based system. Italian outerwear brand Save The Duck is the first to pilot the new feature.eBay’s consignment service expanded in the U.S. to include luxury watches, footwear and fine jewelry. In partnership with Linda’s Stuff, this service gives casual sellers the opportunity to leverage experts to list and sell luxury items on their behalf.The company partnered with Condé Nast to spotlight pre-loved apparel at some of fashion’s biggest moments like the Met Gala and Vogue World in Paris.eBay became an Official Partner of the McLaren Formula 1 Team, enabling both brands to reach new audiences through unique storytelling opportunities with their respective fans and customers. As part of the multi-year collaboration, eBay branding is being featured on the race cars of drivers Lando Norris and Oscar Piastri for four races across the 2024 season: the Miami, British, United States and Las Vegas Grands Prix.
Impact
In May, eBay released its 2023 Impact Report showcasing how the company has leveraged its global marketplace to create economic opportunities, promote sustainable commerce, and foster a diverse and inclusive workforce.eBay also published its latest Recommerce Report highlighting the many benefits of shopping pre-loved items.eBay launched “Rocket Man Resale,” a partnership with Elton John, who released a personal collection of pre-loved fashion items exclusively on eBay through auctions and fixed-priced listings. The partnership included a pop-up shop in the West Village of New York City. All proceeds benefited the Elton John AIDS Foundation.During the quarter, eBay Foundation granted nearly $7 million to strategic nonprofit partners across the U.S., which are addressing and removing barriers to entrepreneurship for people who identify with historically excluded groups.eBay for Charity contributed more than $47 million globally in Q2, up 22% year-over-year.
Second Quarter 2024 Financial Highlights (presented in millions, except per share data and percentages)
Second Quarter
2024
2023
Change
eBay Inc.
Net revenues
$ 2,572
$ 2,540
$ 32
1 %
GAAP – Continuing Operations
Net income
$ 226
$ 172
$ 54
31 %
Earnings per diluted share
$ 0.45
$ 0.32
$ 0.13
39 %
Non-GAAP – Continuing Operations
Net income
$ 602
$ 555
$ 47
8 %
Earnings per diluted share
$ 1.18
$ 1.03
$ 0.15
15 %
Other Selected Financial and Operational Results
Operating margin – GAAP operating margin increased to 21.3% for the second quarter of 2024, compared to 20.4% for the same period last year. Non-GAAP operating margin increased to 27.9% for the second quarter of 2024, compared to 26.9% for the same period last year.Taxes – The GAAP effective tax rate for continuing operations for the second quarter of 2024 was 31.1%, compared to 39.7% for the second quarter of 2023. The non-GAAP effective tax rate for continuing operations for the second quarter of 2024 was 16.5%(1).Cash flow – The company generated $367 million of operating cash flow and $278 million of free cash flow during the second quarter of 2024.Capital returns – The company repurchased $1.0 billion of its common stock, or approximately 19 million shares, in the second quarter of 2024. The company’s total repurchase authorization remaining as of June 30, 2024 was approximately $1.9 billion. The company also paid cash dividends of $135 million during the second quarter of 2024.Cash and cash equivalents and non-equity investments – The company’s cash and cash equivalents and non-equity investments portfolio totaled $6.3 billion as of June 30, 2024.
Business Outlook
eBay is providing the following guidance for the third quarter 2024.
In billions, except per share data and percentages
Q3 2024 Guidance
Revenue
$2.50 – $2.56
FX-Neutral Y/Y Growth
1% – 3%
Diluted GAAP EPS
$0.82 – $0.87
Diluted Non-GAAP EPS
$1.15 – $1.20
Dividend Declaration
eBay’s Board of Directors has declared a cash dividend of $0.27 per share of the company’s common stock. The dividend is payable on September 13, 2024 to stockholders of record as of August 30, 2024.
(1) We use a non-GAAP effective tax rate for evaluating our operating results. Based on our current long-term projections, we are using a non-GAAP tax rate of 16.5%. This non-GAAP tax rate could change for various reasons including significant changes in our geographic earnings mix or fundamental tax law changes in major jurisdictions in which we operate.
Quarterly Conference Call and Webcast
eBay Inc. will host a conference call to discuss second quarter 2024 results at 2:30 p.m. Pacific Time today. Investors and participants can access the call by dialing (855) 761-5600 in the U.S. and (646) 307-1097 internationally. The passcode for the conference line is 7435074. A live webcast of the conference call, together with a slide presentation that includes supplemental financial information and reconciliations of certain non-GAAP measures to their nearest comparable GAAP measures, can be accessed through the company’s Investor Relations website at https://investors.ebayinc.com. In addition, an archive of the webcast will be accessible for at least three months through the same link.
eBay Inc. uses its Investor Relations website at https://investors.ebayinc.com as a means of disclosing material non-public information and for complying with its disclosure obligations under Regulation FD. Accordingly, investors should monitor this website, in addition to following our press releases, SEC filings, public conference calls and webcasts.
About eBay
eBay Inc. (Nasdaq: EBAY) is a global commerce leader that connects people and builds communities to create economic opportunity for all. Our technology empowers millions of buyers and sellers in more than 190 markets around the world, providing everyone the opportunity to grow and thrive. Founded in 1995 in San Jose, California, eBay is one of the world’s largest and most vibrant marketplaces for discovering great value and unique selection. In 2023, eBay enabled more than $73 billion of gross merchandise volume. For more information about the company and its global portfolio of online brands, visit www.ebayinc.com.
Presentation
All growth rates represent year-over-year comparisons, except as otherwise noted. All amounts in tables are presented in U.S. dollars, rounded to the nearest million, except as otherwise noted. As a result, certain amounts may not sum or recalculate using the rounded dollar amounts provided. References to “revenue” refer to “net revenues” as reported in the company’s consolidated statement of income.
Non-GAAP Financial Measures
This press release includes the following financial measures defined as “non-GAAP financial measures” by the Securities and Exchange Commission (SEC): non-GAAP net income, non-GAAP earnings per diluted share, non-GAAP operating income and margin, non-GAAP effective tax rate, free cash flow and FX-Neutral basis. These non-GAAP financial measures are presented on a continuing operations basis. These measures may be different from non-GAAP financial measures used by other companies. The presentation of this financial information, which is not prepared under any comprehensive set of accounting rules or principles, is not intended to be considered in isolation of, or as a substitute for, the financial information prepared and presented in accordance with generally accepted accounting principles (GAAP). For a reconciliation of these non-GAAP financial measures, except for figures in this press release presented on an “FX-Neutral basis,” to the nearest comparable GAAP measures, see “Business Outlook,” “Non-GAAP Measures of Financial Performance,” “Reconciliation of GAAP Operating Income to Non-GAAP Operating Income,” “Reconciliation of GAAP Net Income to Non-GAAP Net Income and Reconciliation of GAAP Effective Tax Rate to Non-GAAP Effective Tax Rate” and “Reconciliation of Operating Cash Flow to Free Cash Flow” included in this press release. For figures in this press release reported “on an FX-Neutral basis,” we calculate the year-over-year impact of foreign currency movements using prior period foreign currency rates, excluding hedging activity, applied to current year transactional currency amounts.
Forward-Looking Statements
This press release contains forward-looking statements relating to, among other things, the future performance of eBay Inc. and its consolidated subsidiaries that are based on the company’s current expectations, forecasts and assumptions and involve risks and uncertainties. These statements include, but are not limited to, statements regarding the future performance of eBay Inc. and its consolidated subsidiaries, including management’s vision for the future of eBay and our ability to accomplish our vision, expected financial results for the third quarter and full year 2024 and the future growth in our business, the effects and potential of current and contemplated strategic initiatives and offerings including with respect to artificial intelligence and partnership with other companies, the effects of new product features or programs, the effects of geopolitical events, foreign currency volatility, and inflationary pressure on our business and operations and our ability to respond to such effects, operating efficiency and margins, reinvestments, dividends and share repurchases. Actual results could differ materially from those expressed or implied and reported results should not be considered as an indication of future performance. Factors that could cause or contribute to such differences include, but are not limited to: fluctuations in, and our ability to predict, our results of operations and cash flows; our ability to convert visits into sales for our sellers, attract and retain sellers and buyers and execute on our business strategy; our ability to compete in the markets in which we participate; our ability to generate revenue from our foreign operations and expand in international markets; the impact of inflationary pressure, fluctuations in foreign currency exchange rates, changing interest rates and geopolitical events such as the ongoing wars in Ukraine and in Israel and Gaza, including the related disruptions to international shipping in the Red Sea; our ability to keep pace with rapid technological developments or continue to innovate and create new initiatives to provide new programs, products and services; our ability to operate and continuously develop our payments system and financial services offerings; the impact of evolving domestic and foreign government laws, regulations, rules and standards that affect us, our business and/or our industry; our reliance on third-party providers; our ability to protect or enforce our intellectual property rights; our ability to deal effectively with fraudulent activities on our platforms; the impact of any security breaches, cyberattacks or system failures and resulting interruptions; our ability to attract, retain and develop highly skilled employees; our ability to accomplish or accurately track and report results related to our environmental, social and governance goals; current and potential litigation and regulatory and government inquiries, investigations and disputes involving us or our industry; our ability to generate sufficient cash flow to service our indebtedness; the impact of evolving sales and other tax regimes in various jurisdictions and anticipated tax liabilities; and the success of our pending or potential acquisitions, dispositions, joint ventures, strategic partnerships and strategic investments.
The forward-looking statements in this release do not include the potential impact of any acquisitions or divestitures that may be announced and/or completed after the date hereof.
More information about factors that could affect the company’s operating results is included under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the company’s most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q, copies of which may be obtained by visiting the company’s Investor Relations website at https://investors.ebayinc.com or the SEC’s website at www.sec.gov. Undue reliance should not be placed on the forward-looking statements in this press release, which are based on information available to the company on the date hereof. The company assumes no obligation to update such statements.
eBay Inc.
Unaudited Condensed Consolidated Balance Sheet
June 30,
2024
December 31,
2023
(In millions)
ASSETS
Current assets:
Cash and cash equivalents
$ 1,963
$ 1,985
Short-term investments
3,203
2,533
Equity investment in Adevinta
—
4,474
Customer accounts and funds receivable
1,071
1,013
Other current assets
1,032
1,011
Total current assets
7,269
11,016
Long-term investments
1,722
1,129
Equity investment in Aurelia
1,910
—
Property and equipment, net
1,285
1,243
Goodwill
4,285
4,267
Operating lease right-of-use assets
439
493
Deferred tax assets
3,011
3,089
Other assets
457
383
Total assets
$ 20,378
$ 21,620
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Short-term debt
$ 1,551
$ 750
Accounts payable
319
267
Customer accounts and funds payable
1,113
1,054
Accrued expenses and other current liabilities
2,004
2,196
Income taxes payable
812
253
Total current liabilities
5,799
4,520
Operating lease liabilities
332
387
Deferred tax liabilities
1,814
2,408
Long-term debt
6,174
6,973
Other liabilities
734
936
Total liabilities
14,853
15,224
Total stockholders’ equity
5,525
6,396
Total liabilities and stockholders’ equity
$ 20,378
$ 21,620
eBay Inc.
Unaudited Condensed Consolidated Statement of Income
Three Months Ended
June 30,
Six Months Ended
June 30,
2024
2023
2024
2023
(In millions, except per share amounts)
Net revenues
$ 2,572
$ 2,540
$ 5,128
$ 5,050
Cost of net revenues (1)
735
718
1,435
1,418
Gross profit
1,837
1,822
3,693
3,632
Operating expenses:
Sales and marketing (1)
577
566
1,118
1,077
Product development (1)
379
392
730
744
General and administrative (1)
241
251
479
548
Provision for transaction losses
86
90
177
174
Amortization of acquired intangible assets
5
5
9
13
Total operating expenses
1,288
1,304
2,513
2,556
Income from operations
549
518
1,180
1,076
Interest and other:
Loss on equity investments and warrant, net
(222)
(214)
(319)
(16)
Interest expense
(65)
(65)
(131)
(133)
Interest income and other, net
66
46
134
88
Income from continuing operations before income taxes
328
285
864
1,015
Income tax provision
(102)
(113)
(199)
(274)
Income from continuing operations
226
172
665
741
Loss from discontinued operations, net of income taxes
(2)
(1)
(3)
(3)
Net income
$ 224
$ 171
$ 662
$ 738
Income per share – basic:
Continuing operations
$ 0.45
$ 0.32
$ 1.31
$ 1.38
Discontinued operations
—
—
(0.01)
(0.01)
Net income per share – basic
$ 0.45
$ 0.32
$ 1.30
$ 1.37
Income per share – diluted:
Continuing operations
$ 0.45
$ 0.32
$ 1.30
$ 1.37
Discontinued operations
—
—
(0.01)
(0.01)
Net income per share – diluted
$ 0.45
$ 0.32
$ 1.29
$ 1.36
Weighted average shares:
Basic
503
534
509
536
Diluted
507
537
513
539
(1) Includes stock-based compensation as follows:
Cost of net revenues
$ 14
$ 14
$ 27
$ 27
Sales and marketing
25
25
48
45
Product development
77
74
141
133
General and administrative
38
41
84
77
$ 154
$ 154
$ 300
$ 282
eBay Inc.
Unaudited Condensed Consolidated Statement of Cash Flows
Three Months Ended
June 30,
Six Months Ended
June 30,
2024
2023
2024
2023
(In millions)
Cash flows from operating activities:
Net income
$ 224
$ 171
$ 662
$ 738
Loss from discontinued operations, net of income taxes
2
1
3
3
Adjustments:
Provision for transaction losses
86
90
177
174
Depreciation and amortization
77
101
153
208
Stock-based compensation
154
154
300
282
Loss on investments and other, net
132
34
138
44
Deferred income taxes
(563)
(111)
(523)
(78)
Change in fair value of warrant
174
(31)
25
(69)
Change in fair value of equity investment in Adevinta
(84)
210
156
36
Changes in assets and liabilities, net of acquisition effects
165
(14)
(109)
108
Net cash provided by continuing operating activities
367
605
982
1,446
Net cash used in discontinued operating activities
—
(4)
—
(4)
Net cash provided by operating activities
367
601
982
1,442
Cash flows from investing activities:
Purchases of property and equipment
(89)
(113)
(232)
(245)
Purchases of investments
(4,601)
(4,144)
(7,913)
(7,687)
Maturities of investments
2,996
3,978
6,699
8,382
Proceeds from sale of shares in Adevinta
2,417
—
2,417
—
Other
(71)
2
(69)
(26)
Net cash provided (used in) by investing activities
652
(277)
902
424
Cash flows from financing activities:
Proceeds from issuance of common stock
55
48
55
48
Repurchases of common stock
(1,030)
(250)
(1,483)
(492)
Payments for taxes related to net share settlements of restricted stock units and awards
(45)
(68)
(96)
(160)
Payments for dividends
(135)
(133)
(274)
(267)
Repayment of debt
—
—
—
(1,150)
Net funds receivable and payable activity
35
333
7
563
Other
1
—
(14)
—
Net cash used in financing activities
(1,119)
(70)
(1,805)
(1,458)
Effect of exchange rate changes on cash, cash equivalents and restricted cash
(6)
(11)
(17)
(6)
Net increase (decrease) in cash, cash equivalents and restricted cash
(106)
243
62
402
Cash, cash equivalents and restricted cash at beginning of period
2,661
2,431
2,493
2,272
Cash, cash equivalents and restricted cash at end of period
$ 2,555
$ 2,674
$ 2,555
$ 2,674
eBay Inc.
Unaudited Summary of Consolidated Net Revenues
Three Months Ended
June 30,
2024
March 31,
2024
December 31,
2023
September 30,
2023
June 30,
2023
(In millions, except percentages)
Total net revenues (1)(2)
$ 2,572
$ 2,556
$ 2,562
$ 2,500
$ 2,540
Current quarter vs prior year quarter
1 %
2 %
2 %
5 %
5 %
Percent from international
50 %
49 %
50 %
50 %
50 %
(1) Hedge gain/(loss)
$ (10)
$ (10)
$ 11
$ 2
$ 14
(2) Foreign currency impact
$ (11)
$ 14
$ 63
$ 43
$ (9)
eBay Inc.
Unaudited Supplemental Operating Data
Three Months Ended
June 30,
2024
March 31,
2024
December 31,
2023
September 30,
2023
June 30,
2023
(In millions, except percentages)
Active Buyers (1)
132
132
132
132
132
Current quarter vs prior year quarter
0 %
(1) %
(2) %
(3) %
(4) %
Active Buyers excluding GittiGidiyor, TCGplayer and Goldin (2)
131
131
131
131
131
Current quarter vs prior year quarter
0 %
0 %
(1) %
(1) %
(3) %
Gross Merchandise Volume (3)
U.S.
$ 8,798
$ 8,974
$ 8,891
$ 8,638
$ 8,702
Current quarter vs prior year quarter
1 %
0 %
0 %
(1) %
(3) %
International
$ 9,620
$ 9,649
$ 9,700
$ 9,353
$ 9,512
Current quarter vs prior year quarter
1 %
3 %
4 %
4 %
(1) %
Total Gross Merchandise Volume
$ 18,418
$ 18,623
$ 18,591
$ 17,991
$ 18,214
Current quarter vs prior year quarter
1 %
1 %
2 %
2 %
(2) %
(1)
Active Buyers consist of all buyers who paid for a transaction on our platforms within the previous 12-month period. Buyers may register more than once, and as a result, may have more than one account.
(2)
On June 20, 2022 we announced the closure of our marketplace business in Turkey, GittiGidiyor. On October 31, 2022, we completed the acquisition of TCGplayer. On May 16, 2024, we completed the acquisition of Goldin.
(3)
Gross Merchandise Volume consists of the total value of all paid transactions between users on our platforms during the applicable period inclusive of shipping fees and taxes.
eBay Inc.
Business Outlook
The guidance figures provided below and elsewhere in this press release are forward-looking statements, reflect a number of estimates, assumptions and other uncertainties, and are approximate in nature because the company’s future performance is difficult to predict. Such guidance is based on information available on the date of this press release, and the company assumes no obligation to update it.
The company’s future performance involves risks and uncertainties, and the company’s actual results could differ materially from the information below and elsewhere in this press release. Some of the factors that could affect the company’s operating results are set forth under the caption “Forward-Looking Statements” above in this press release. More information about factors that could affect the company’s operating results is included under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the company’s most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q, copies of which may be obtained by visiting eBay’s investor relations website at https://investors.ebayinc.com or the SEC’s website at www.sec.gov.
eBay Inc.
Three Months Ending
September 30, 2024
(In billions, except per share amounts)
GAAP
Non-GAAP (a)
Net revenues
$2.50 – $2.56
$2.50 – $2.56
Diluted EPS
$0.82 – $0.87
$1.15 – $1.20
(a) Estimated non-GAAP amounts above for the three months ending September 30, 2024 reflect adjustments that exclude the estimated amortization of
acquired intangible assets of approximately $9 – $11 million, estimated stock-based compensation expense and associated employer payroll tax expense
of approximately $140 – $150 million, and estimated adjustment between our GAAP and non-GAAP tax rate of approximately $25 – $35 million. The estimated
GAAP diluted EPS above does not assume any gains or losses on our equity investments.
eBay Inc.
Non-GAAP Measures of Financial Performance
To supplement the company’s condensed consolidated financial statements presented in accordance with generally accepted accounting principles, or GAAP, the company uses non-GAAP measures of certain components of financial performance. These non-GAAP measures include non-GAAP net income, non-GAAP earnings per diluted share, non-GAAP operating income and margin, non-GAAP effective tax rate, free cash flow and figures in this press release presented on an “FX-Neutral basis.” These non-GAAP financial measures are presented on a continuing operations basis.
These non-GAAP measures are not in accordance with, or an alternative to, measures prepared in accordance with GAAP and may be different from non-GAAP measures used by other companies. In addition, these non-GAAP measures are not based on any comprehensive set of accounting rules or principles. Non-GAAP measures have limitations in that they do not reflect all of the amounts associated with the company’s results of operations as determined in accordance with GAAP. These measures should only be used to evaluate the company’s results of operations in conjunction with the corresponding GAAP measures.
Reconciliation to the nearest GAAP measure of all non-GAAP measures included in this press release, except for figures in this press release presented on an “FX-Neutral basis,” can be found in the tables included in this press release. For figures in this press release reported on an “FX-Neutral basis,” the company calculates the year-over-year impact of foreign currency movements using prior period foreign currency rates, excluding hedging activity, applied to current year transactional currency amounts.
These non-GAAP measures are provided to enhance investors’ overall understanding of the company’s current financial performance and its prospects for the future. Specifically, the company believes the non-GAAP measures provide useful information to both management and investors by excluding certain expenses, gains and losses, or net purchases of property and equipment, as the case may be, that may not be indicative of its core operating results and business outlook. In addition, because the company has historically reported certain non-GAAP results to investors, the company believes that the inclusion of non-GAAP measures provides consistency in the company’s financial reporting.
For its internal budgeting process, and as discussed further below, the company’s management uses financial measures that do not include stock-based compensation expense, employer payroll taxes on stock-based compensation, amortization or impairment of acquired intangible assets, impairment of goodwill, amortization of deferred tax assets associated with the realignment of its legal structure and related foreign exchange effects, significant gains or losses from the disposal/acquisition of a business, certain gains and losses on investments including changes in fair value, changes in foreign currency exchange rates and the impact of any related foreign exchange derivative instruments, gains or losses associated with a warrant agreement that the company entered into with Adyen, restructuring-related charges and the income taxes associated with the foregoing. In addition to the corresponding GAAP measures, the company’s management also uses the foregoing non-GAAP measures in reviewing the financial results of the company.
The company excludes the following items from non-GAAP net income, non-GAAP earnings per diluted share, non-GAAP operating income and margin and non-GAAP effective tax rate:
Stock-based compensation expense and related employer payroll taxes. This expense consists of expenses for stock options, restricted stock and employee stock purchases. The company excludes stock-based compensation expense from its non-GAAP measures primarily because they are non-cash expenses that management does not believe are reflective of ongoing operating results. The related employer payroll taxes are dependent on the company’s stock price and the vesting of restricted stock by employees and the timing and size of stock option exercises, over which management has limited to no control, and as such management does not believe it correlates to the company’s operation of the business.
Amortization or impairment of acquired intangible assets, impairment of goodwill, certain amortization of deferred tax assets and related foreign exchange effects, significant gains or losses and transaction expenses from the acquisition or disposal of a business and certain gains or losses on investments. The company incurs amortization or impairment of acquired intangible assets and goodwill in connection with acquisitions and may incur significant gains or losses from the acquisition or disposal of a business and therefore excludes these amounts from its non-GAAP measures. The company also excludes certain gains and losses on investments. The company excludes the non-cash amortization of deferred tax assets associated with the realignment of its legal structure, which is not reduced by the effects of the Tax Cuts and Jobs Act, and related foreign exchange effects. The company excludes these items because management does not believe they correlate to the ongoing operating results of the company’s business.
Restructuring. These charges consist of expenses for employee severance and other exit and disposal costs. The company excludes significant restructuring charges primarily because management does not believe they are reflective of ongoing operating results.
Other certain significant gains, losses, or charges that are not indicative of the company’s core operating results. These are significant gains, losses, or charges during a period that are the result of isolated events or transactions which have not occurred frequently in the past and are not expected to occur regularly or be repeated in the future. The company excludes these amounts from its results primarily because management does not believe they are indicative of its current or ongoing operating results. These amounts include changes in fair value and the related change in foreign currency exchange rates of equity securities with readily determinable fair values, globally.
Change in fair market value of warrant. These are gains or losses associated with a warrant agreement that the company entered into with Adyen, which are attributable to changes in fair value during the period.
Income tax effects and adjustments. We use a non-GAAP tax rate for evaluating our operating results. Based on our current long-term projections, we are using a non-GAAP tax rate of 16.5%. This non-GAAP tax rate could change for various reasons including significant changes in our geographic earnings mix or fundamental tax law changes in major jurisdictions in which we operate.
In addition to the non-GAAP measures discussed above, the company also uses free cash flow. Free cash flow represents operating cash flows less purchases of property and equipment. The company considers free cash flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by the business after the purchases of property, buildings, and equipment, which can then be used to, among other things, invest in the company’s business, make strategic acquisitions, repurchase stock and pay dividends. A limitation of the utility of free cash flow as a measure of financial performance is that it does not represent the total increase or decrease in the company’s cash balance for the period and does not exclude certain non-discretionary expenditures, such as mandatory debt service requirements.
eBay Inc.
Reconciliation of GAAP Operating Income to Non-GAAP Operating Income*
Three Months Ended
June 30,
Six Months Ended
June 30,
2024
2023
2024
2023
(In millions, except percentages)
GAAP operating income
$ 549
$ 518
$ 1,180
$ 1,076
Stock-based compensation expense and related employer payroll taxes
158
158
308
290
Amortization of acquired intangible assets within cost of net revenues and operating expenses
9
8
17
18
Restructuring
3
—
(6)
42
Non-recurring legal matters
—
—
(6)
—
Other general and administrative expenses
1
—
1
2
Total non-GAAP operating income adjustments
171
166
314
352
Non-GAAP operating income
$ 720
$ 684
$ 1,494
$ 1,428
GAAP operating margin
21.3 %
20.4 %
23.0 %
21.3 %
Non-GAAP operating margin
27.9 %
26.9 %
29.1 %
28.3 %
*Presented on a continuing operations basis
Reconciliation of GAAP Net Income to Non-GAAP Net Income and
GAAP Effective Tax Rate to Non-GAAP Effective Tax Rate
Three Months Ended
June 30,
Six Months Ended
June 30,
2024
2023
2024
2023
(In millions, except per share amounts and percentages)
GAAP income from continuing operations before income taxes
$ 328
$ 285
$ 864
$ 1,015
GAAP provision for income taxes
(102)
(113)
(199)
(274)
GAAP net income from continuing operations
$ 226
$ 172
$ 665
$ 741
Non-GAAP adjustments to net income from continuing operations:
Non-GAAP operating income from continuing operations adjustments (see table above)
$ 171
$ 166
$ 314
$ 352
Change in fair value of equity investment in Adevinta
—
210
234
36
Realized change in fair value of shares sold in Adevinta
(84)
—
(78)
—
Change in fair market value of warrant
174
(31)
25
(69)
Change in fair market value of other equity investments
23
35
29
49
Fair value of Aurelia option
109
—
109
—
Income tax effects and adjustments
(17)
3
(48)
46
Non-GAAP net income from continuing operations
$ 602
$ 555
$ 1,250
$ 1,155
Diluted net income from continuing operations per share:
GAAP
$ 0.45
$ 0.32
$ 1.30
$ 1.37
Non-GAAP
$ 1.18
$ 1.03
$ 2.43
$ 2.14
Shares used in GAAP diluted net income per share calculation
507
537
513
539
Shares used in non-GAAP diluted net income per share calculation
507
537
513
539
GAAP effective tax rate – Continuing operations
31.1 %
39.7 %
23.0 %
27.0 %
Income tax effects and adjustments to net income from continuing operations
(14.6) %
(23.2) %
(6.5) %
(10.5) %
Non-GAAP effective tax rate – Continuing operations
16.5 %
16.5 %
16.5 %
16.5 %
Reconciliation of Operating Cash Flow to Free Cash Flow
Three Months Ended
June 30,
Six Months Ended
June 30,
2024
2023
2024
2023
(In millions)
Net cash provided by operating activities
$ 367
$ 605
$ 982
$ 1,446
Less: Purchases of property and equipment
(89)
(113)
(232)
(245)
Free cash flow
$ 278
$ 492
$ 750
$ 1,201
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SOURCE eBay Inc.
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Huawei Cloud Strengthens Thailand’s Insurance Industry with Next-Generation Digital Technologies
Published
16 minutes agoon
April 19, 2026By
BANGKOK, April 19, 2026 /PRNewswire/ — Huawei Cloud Thailand in collaboration with The Thai Life Assurance Association, hosted an executive forum bringing together more than 30 senior executives and technology leaders from leading insurance companies. The initiative reflects Huawei Cloud’s commitment to strengthening its role as a strategic partner in advancing Thailand’s digital and AI-driven economy, supporting insurance companies in accelerating secure, flexible, and scalable digital transformation through cloud-native infrastructure, advanced database technologies, and industry-specific solutions.
The event served as a platform for industry leaders to exchange insights on the future of the insurance industry in the era of cloud and AI-driven innovation, while exploring how cloud and AI technologies can modernize core insurance systems and enhance operational stability and resilience.
Driving the Future of Digital Insurance
As the insurance industry continues to accelerate its digital transformation, insurers are under increasing pressure to modernize legacy systems in order to support real-time services, rapidly growing data volumes, and evolving customer expectations.
Huawei Insurance Day event aims to position Huawei Cloud as a Strategic Digital Transformation Partner for the insurance industry, helping insurance companies build secure, scalable, and resilient digital infrastructures that can support long-term business growth.
During the event, Huawei Cloud showcased its end-to-end capabilities for the insurance sector, including cloud infrastructure, cloud-native databases, and specialized industry solutions designed to support mission-critical insurance systems.
Key Solutions for Insurance Digital Transformation
Digital Core Insurance Solution
A modernization solution that transform insurance companies migrate from legacy system such as AS/400 systems to cloud-native architectures with A next-generation core insurance architecture that enables insurers to rapidly launch new products, enhance system flexibility, simplifying maintenance and improve overall customer experience.
GaussDB for Mission-Critical Insurance Systems
Huawei’s enterprise-grade database that has been trusted by large financial organization globally, including Thailand. GaussDB designed to support critical workloads with high reliability, security and performance across multiple data centers on Huawei Cloud.
Piyatida Itiravivongs, President of Huawei Cloud Thailand said:
“Digital transformation has become a strategic priority for the insurance industry. Huawei Cloud is committed to supporting insurers in building a strong digital service by combining cloud infrastructure, advanced database technologies, and industry-specific solutions to improve operational efficiency and deliver better customer experiences.”
Meanwhile, Huang Hu, Solution Architect of Sinosoft, said:
“Sinosoft has extensive experience in developing technology platforms for the insurance industry. Through our collaboration with Huawei Cloud, we have successfully modernized insurance systems by adopting cloud-based architectures, helping organizations enhance the performance and stability of their core insurance platforms while supporting long-term business growth.
The success of these projects demonstrates the strong synergy between Sinosoft’s insurance technology expertise and Huawei Cloud’s advanced cloud infrastructure. We hope the experience and case studies shared at this event will provide valuable insights for insurance companies in Thailand as they accelerate their journey toward digital insurance.”
Thailand’s insurance industry is entering a new era in which digital technologies play an increasingly important role in enhancing operational efficiency and improving customer services. Forums such as this provide a valuable platform for industry stakeholders to exchange knowledge and perspectives on emerging technologies and innovations in cloud and digital infrastructure. Such knowledge sharing supports insurance companies in Thailand as they prepare for the ongoing evolution of the digital insurance landscape.
Huawei Cloud will continue to invest in cloud innovation to support the financial services and insurance sectors with secure, reliable, and scalable technologies, enabling sustainable business growth in the digital economy.
About Huawei Cloud Thailand
Huawei Cloud Thailand is a leading cloud service provider committed to accelerating Thailand’s digital transformation under the mission of “In Thailand, For Thailand.” According to the latest report from Gartner, Huawei Cloud is ranked No.2 by revenue in Thailand’s Infrastructure as a Service (IaaS) market, solidifying its position as one of the most trusted and fastest-growing international cloud providers in the country.
As the first international public cloud vendor to establish local data centers in Thailand, Huawei Cloud now operates three Availability Zones, ensuring high reliability and low-latency connectivity for local users. Leveraging Huawei’s 30-plus years of expertise in ICT infrastructure, it integrates cutting-edge Artificial Intelligence (AI), Cloud-Native 2.0, and Big Data technologies to empower over 40 government agencies and thousands of enterprises across the Kingdom. By building a robust digital ecosystem and fostering local talent, Huawei Cloud aims to drive Thailand’s “Digital Economy” forward, bringing cloud and intelligence to every corner of the country for a fully connected, intelligent future.
For more information, please visit Huawei Cloud Thailand online at
https://www.huaweicloud.com/intl/th-th/ or follow us on:
https://www.facebook.com/HuaweiCloudTH
https://www.youtube.com/@HuaweiCloudAPAC
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SOURCE Huawei Cloud Thailand
Technology
Breakthrough Prize Foundation Announces Winner of the 11th Annual Breakthrough Junior Challenge
Published
2 hours agoon
April 19, 2026By
Matea Cañizarez, Age 18, of Quito, Ecuador, Receives Top Honors and $400,000 in Education Prizes for her Original Video Explaining Quark-Gluon Plasma
SAN FRANCISCO, April 18, 2026 /PRNewswire/ — The Breakthrough Prize Foundation today announced Ecuador-based student Matea Cañizarez as the winner of the 11th annual Breakthrough Junior Challenge, a global competition that empowers young people to creatively communicate complex ideas in the life sciences, physics, and mathematics.
The Breakthrough Junior Challenge will provide $400,000 in educational awards to Matea and her teacher, Roberto Procel. As the student winner, Matea will be granted a $250,000 college scholarship. In recognition of his work as a science teacher, Mr. Procel will receive a $50,000 award. The prize package also includes a cutting-edge science laboratory, designed by Cold Spring Harbor Laboratory and valued at $100,000, to be installed at Colegio Johannes Kepler, Matea’s current school, located in Quito, Ecuador.
Matea was honored alongside the 2026 Breakthrough Prize laureates at The Breakthrough Prize Ceremony in Los Angeles on April 18, 2026.
“It’s exhilarating to meet bright, curious young people like Matea,” said Julia Milner, co-founder of the Breakthrough Junior Challenge, “And to see them pursuing their passion for ideas and communicating it to others makes me truly hopeful for the future,” said Julia Milner, co-founder of the Breakthrough Prize.
Matea’s winning entry explains quark-gluon plasma, an extreme state of matter that existed just after the Big Bang, in which quarks and gluons move freely instead of being bound inside protons and neutrons. Her short video can be seen here. This was Matea’s first entry to the Breakthrough Junior Prize, and she is currently applying for college next fall.
“Coming from a rural town in Ecuador, my passion for science was not a given. I am humbled by the honor of winning the Breakthrough Junior Challenge and hope to work in the service of society and nature by making the most of this opportunity,” said Matea.
“Congratulations on your beautiful video explaining the quark-gluon plasma,” said David Gross, winner of the 2026 Special Breakthrough Prize in Fundamental Physics, whose theories led directly to the discovery of the phenomenon in Matea’s video. Gross continued, “Very exciting, very well done, and I hope you stay in physics and help us understand even better the properties of the quark-gluon plasma in the laboratory, in the early Universe, and perhaps in the core of neutron stars.”
The Breakthrough Junior Challenge is a global program designed to showcase and advance young people’s understanding of science and core scientific principles, spark enthusiasm for STEM fields, encourage pursuit of STEM careers, and engage the broader public in fundamental scientific concepts. Each year, students ages 13 to 18 are invited to produce original videos of up to two minutes that explain a concept or theory in life sciences, physics, or mathematics.
Entries are judged on how effectively participants communicate complex scientific ideas in clear, compelling, and creative ways.
“Seeing students take on complex topics and explain them with enthusiasm and creativity is inspiring,” said Sal Khan, founder and CEO of Khan Academy and Vision Steward of TED. “Their work is a reminder that when young people are given access and opportunity to explore their interests, they can achieve great things.”
This year, the Breakthrough Junior Challenge attracted more than 2,500 applicants from around the world. Submissions were narrowed down to 30 semifinalists, which represented the top submissions after two rounds of judging: first, a mandatory peer review, followed by an evaluation panel of judges. Sixteen finalists were selected in December 2025.
Celebrating its 11th year, the Breakthrough Junior Challenge has reached a global community of more than 100,000 students, parents, and educators, drawing upwards of 30,000 applications from students in over 200 countries, including Canada, Nigeria, Kazakhstan, the Philippines, Singapore, and the United States. Since its launch, the program has distributed more than $2.5 million in college scholarships, invested $1 million in state-of-the-art science laboratories, and awarded $500,000 to exceptional science and mathematics teachers. Winning submissions have explored subjects ranging from Mechanogenetic Cellular Engineering, Einstein’s Theory of Relativity, Circadian Rhythms, Neutrino Astronomy, and more. Challenge alumni have continued their academic journeys at top-tier universities such as MIT, Harvard, Princeton, and Stanford.
This year’s Selection Committee was comprised of: Thea Booysen, MsC, social media director for neurologist Dr. Richard Isaacson and founder of MadeByHuman; Rachel Crane, space and science correspondent, CNN; Pascale Ehrenfreund, PhD, president, Committee on Space Research COSPAR; Dennis Gaitsgory, professor, Max Planck Institute for Mathematics, and Breakthrough Prize in Mathematics Laureate; John Grunsfelt, PhD astronaut, associate administrator for science, chief scientist at NASA Headquarters; Mae Jemison, physician, former astronaut, entrepreneur; Jeffery W. Kelly, professor of chemistry, Scripps Research Institute and Breakthrough Prize in Life Sciences laureate; Scott Kelly, retired NASA astronaut; Salman Khan, founder and CEO, Khan Academy; Ijad Madisch, CEO, co-founder, ResearchGate; Samaya Nissanke, University of Amsterdam, Breakthrough Prize in Fundamental Physics laureate; Nicole Stott, NASA astronaut, and co-founder of the Space for Art Foundation; Andrew Strominger, professor of physics, Harvard University, and Breakthrough Prize in Fundamental Physics laureate; Terence Tao, UCLA professor and Breakthrough Prize in Mathematics laureate; Esther Wojcicki, founder, Palo Alto High Media Arts Center; Richard Youle, National Institutes of Health, and Breakthrough Prize in Life Sciences laureate; and S. Pete Worden, chairman, Breakthrough Prize Foundation.
Partners
The Breakthrough Junior Challenge
The Breakthrough Junior Challenge, co-founded by Julia and Yuri Milner, is a global science video competition, aiming to develop and demonstrate young people’s knowledge of science and scientific principles and communications skills; generate excitement in these fields; support STEM career choices; and engage the imagination and interest of the public-at-large in key concepts of fundamental science.
The Breakthrough Prize
The Breakthrough Prize, renowned as the “Oscars of Science,” recognizes the world’s top scientists. Each prize is $3 million and presented in the fields of Life Sciences, Fundamental Physics (one per year) and Mathematics (one per year). In addition, up to three New Horizons in Physics Prizes, up to three New Horizons in Mathematics Prizes and up to three Maryam Mirzakhani New Frontiers Prizes are given out to early-career researchers each year. Laureates attend a gala award ceremony designed to celebrate their achievements and inspire the next generation of scientists.
The Breakthrough Prizes were founded by Sergey Brin, Priscilla Chan and Mark Zuckerberg, Julia and Yuri Milner, and Anne Wojcicki. The Prizes have been sponsored by the personal foundations established by Sergey Brin, Priscilla Chan and Mark Zuckerberg, Julia and Yuri Milner and Anne Wojcicki. Selection Committees composed of previous Breakthrough Prize laureates in each field choose the winners. Information on the Breakthrough Prize is available at breakthroughprize.org.
About Khan Academy
Khan Academy is a 501(c)(3) nonprofit organization with the mission of providing a free, world-class education for anyone, anywhere. Since 2008, Khan Academy has provided an education safety net, a free platform designed to provide global access to high-quality learning for students and free resources for teachers. Khan Academy partners with more than 600 school districts in the United States and works with school systems in countries around the world, providing tools that personalize education. Khan Academy is at the forefront of using AI in education to support students while ensuring educators remain at the heart of the classroom. Worldwide, more than 200 million registered learners have used Khan Academy in 190 countries and more than 50 languages. For more information, please see research findings about Khan Academy and our press center.
Cold Spring Harbor Laboratory (CSHL)
The Breakthrough Prize Lab for the winning student’s school is designed in partnership with Cold Spring Harbor Laboratory (CSHL). Founded in 1890, CSHL, an independent 501(c)(3) nonprofit, powers transformational discoveries in cancer, neuroscience, artificial intelligence, plant biology, and quantitative biology. Through world-renowned science and education divisions, CSHL nurtures a culture of curiosity, discovery, and innovation to make lives better. CSHL’s DNA Learning Center (DNALC) is the largest provider of hands-on instruction in genetics and biotechnology, reaching nearly 40,000 middle and high school students through field trips, day camps, summer camps, mentored research projects, and teacher training. For more than a century, CSHL has been a powerful and productive environment for developing, connecting, and sharing world-changing ideas. For more information, visit www.cshl.edu<http://www.cshl.edu/>>.
Contact
For more information, including competition rules, video submission guidelines and queries, go to: breakthroughjuniorchallenge.org.
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SOURCE Breakthrough Prize
Technology
Penn Medicine, Children’s Hospital of Philadelphia team awarded Breakthrough Prize for developing gene therapy for inherited blindness
Published
3 hours agoon
April 18, 2026By
LOS ANGELES, April 18, 2026 /PRNewswire/ — Their discovery started with a group of blind dogs living at a vet school. Now, the work has been awarded the prestigious Breakthrough Prize at the “Oscars of Science.”
Today, Jean Bennett, MD, PHD, and Albert Maguire, MD, both emeritus professors of Ophthalmology in the Perelman School of Medicine at the University of Pennsylvania, and Katherine High, MD, an emeritus professor of Pediatrics and the founding director of the Raymond G. Perelman Center for Cellular and Molecular Therapeutics at Children’s Hospital of Philadelphia (CHOP), received the Breakthrough Prize in Life Sciences for their work in developing the first FDA-approved gene therapy for an inherited condition, which dramatically improves sight in people with a form of blindness called Leber Congenital Amaurosis (LCA).
Their work blazed a trail for the more than 140 gene therapy trials for retinal conditions, including macular degeneration and diabetic retinopathy, diseases that collectively impact about 30 million people in the US. Eighty more trials are currently underway.
“Even 20 years ago, treating people with gene therapy was seen by some as an impossibility,” said Jonathan Epstein, MD, dean of the Perelman School of Medicine and executive vice president of the University of Pennsylvania for the Health System. “But this group of incredible physician-scientists persisted and created something that is providing sight to people who would have been completely blind as early as kindergarten. Their belief in the power of life-changing science has led to breathtaking results and richly deserved global recognition.”
The Breakthrough Prizes are called the “Oscars of Science” for their high-profile celebration of research and support from celebrities spanning numerous areas of pop culture. Created in 2012 by Sergey Brin, Priscilla Chan and Mark Zuckerberg, Yuri and Julia Milner, and Anne Wojcicki, the prizes are given out in five categories including Life Sciences, Fundamental Physics, and Math, each with an accompanying $3 million award.
This year’s accolade now means that nine Penn-affiliated researchers have received the Breakthrough Prize, tied for the most with Harvard University. The prior Penn Medicine award winners are Carl June, PhD (2024), Drew Weissman, MD, PhD, and Katalin Karikó, PhD (2022), and Virginia M.Y. Lee, PhD (2019). Additionally, Penn faculty members Charles Kane, PhD, and Eugene Mele, PhD, won the prize for Physics in 2019. Mathew Madhavacheril, PhD, an assistant professor of Physics and Astronomy in Penn’s School of Arts & Sciences, also received recognition at this year’s Breakthrough Prize ceremony when he was honored with the New Horizons in Physics award, given to researchers early in their careers.
“Science is rarely a straight path, and those who make the most profound discoveries are resilient and persistent, overcoming obstacles along the way,” said J. Larry Jameson, MD, PhD, president of the University of Pennsylvania. “That is exactly what I see in this year’s awardees, and it has been true of all our remarkable faculty who have been recognized for scientific breakthroughs. Whether they are discovering what lies beneath Alzheimer’s Disease, curing cancer by engineering a patients’ own immune cells, or reversing blindness—they have persisted with imagination and rigor. Their steadfastness has pushed the boundaries of what medicine can achieve.”
“Developing cell and gene therapies has long been a top priority for our organization,” said Madeline Bell, CHOP’s CEO. “This breakthrough is the result of decades of investment and collaboration, and reflects our commitment to translating scientific discoveries into therapies that will transform patients’ lives. It has paved the way for many more cell and gene therapy innovations and has given hope to families around the world.”
“They can see!”
Bennett and Maguire met and married during medical school in the 1980s. It was then that they both became intrigued by the concept of genetic therapy, the practice of replacing a mutated or faulty gene with a functional copy, and started dreaming of treating inherited forms of blindness with the technique, which at that time remained the stuff of science fiction.
It was “like thinking you wanted to go to the moon in 1950,” Maguire said many years later.
Both Bennett and Maguire joined Penn’s Scheie Eye Institute in the 1990s and began working on their ideas with lab mice. They learned that the University of Pennsylvania School of Veterinary Medicine housed a group of blind dogs who had a condition similar to the human disease: Leber congenital amaurosis (LCA). People born with a mutation on the RPE65 gene have poor vision starting at birth and often progress rapidly to complete blindness, usually by their 20s, but sometimes in early childhood.
The pair developed a therapy that used a virus as a transport, carrying a piece of DNA into cells that would then correct the faulty, blindness-causing proteins formed by the bad gene. The idea: Once the proteins were set right, some sight might return. First, they tested the therapy by injecting it into a single eye in each of three dogs.
It wasn’t long until they knew whether it worked. Bennett recalls receiving an excited phone call from a technician at the lab, who exclaimed, “They can see!”
Sure enough, the dogs were twirling around, using their treated eyes to see. Before treatment, the dogs had bumped and tripped through an obstacle course set up to test their sight. After the full treatment, the course was an easy task for the dogs.
A knock on the door
In parallel with Bennett and Maguire’s dreams of gene therapy, High was also working to bring the field forward. Like Bennett and Maguire, she had achieved long-term reversal of a serious genetic disease in a dog model: In her case, for hemophilia, a life-threatening bleeding disorder. High had advanced these studies from success in dogs to initial clinical trials in humans, delivering the donated gene into skeletal muscle and the liver.
The work was promising, but the human immune response to the gene delivery vessel—which was derived from a virus in the same way Bennett and Maguire’s therapy was—prevented sustained benefits from the therapeutic gene. At the same time, companies and investors, discouraged by high profile negative events, began to turn away from gene therapy. Progress stalled.
But with support from CHOP, High founded the Raymond G. Perelman Center for Cellular and Molecular Therapeutics (CCMT) in 2004. She recruited experts in all aspects of clinical gene therapy, including specialized knowledge in the manufacturing and release of gene therapy vectors, which are the particles that deliver a healthy copy of a defective gene to patients.
After vector production was set up at CHOP, High went to Bennett’s office and knocked on the door with a proposition to start a clinical trial in humans. In 2007, Maguire, who was then a surgeon in Pediatric Ophthalmology at CHOP, administered an injection of the experimental therapy at CHOP into a clinical trial participant – a 26-year-old woman—for the first time. Her twin, with the same condition, received the treatment shortly after.
When the team assessed the treatment of the 37 eligible participants from the original clinical trials, 72 percent reported the maximum possible improvement in a test of low-light conditions, which simulates night vision. Amid these, many reported improved peripheral and central vision, too. One patient, who could only detect changes in light, was suddenly able to navigate walking through Philadelphia at night, unaided, and could make out the clock on City Hall. Another patient was able to see a star for the first time in her life just six days after the procedure.
In 2017, the therapy—by then manufactured by Spark Therapeutics, a spinout from CHOP, and called Luxturna—received approval by the U.S. Food and Drug Administration. It became the first FDA approval of a genetic therapy for an inherited disease. Today, hundreds of people around the world have successfully received the treatment.
A celebration of decades of work
Today’s celebration in Los Angeles marks a celebratory milestone in roughly 40 years of work led by Bennett, Maguire, and High that has inspired others in the now vibrant field of gene therapy. In fact, a treatment stemming from High’s original work with hemophilia received FDA approval in 2024.
“We always just did what we thought you were supposed to do if you were a doctor: Find treatments for diseases,” said Maguire. “Both my father and Jean’s worked in science, and it seemed normal to try to push the envelope.”
“I think the only surprise for us was that things worked out so well,” Bennett said. “For every success, there are usually so many failures. That’s just the nature of science. But our team hit on something that has helped so many people and helped progress the field, and we’re really grateful for our part in that.”
High described the journey between the start of her collaboration with Bennett and Maguire in 2005 and the FDA approval in 2017 as “an arduous one.”
“At times, it seemed that the number of obstacles we needed to overcome to reach regulatory approval was never-ending,” High said. “Working without the benefit of the guidelines and precedents we now have today, we sought to solve each day’s problems so that the program would have a tomorrow. It was a bold and uncertain investment of time, effort, and resources. Few were willing to take on the risks, but it ultimately paid off, and it helped build the foundation of modern gene therapy.”
About Penn Medicine:
Penn Medicine is one of the world’s leading academic medical centers, dedicated to the related missions of medical education, biomedical research, excellence in patient care, and community service.
The organization consists of the University of Pennsylvania Health System and Penn’s Raymond and Ruth Perelman School of Medicine, founded in 1765 as the nation’s first medical school.
The Perelman School of Medicine is consistently among the nation’s top recipients of funding from the National Institutes of Health, with more than $588 million awarded in the 2024 fiscal year. Home to a proud history of “firsts,” Penn Medicine teams have pioneered discoveries that have shaped modern medicine, including CAR T cell therapy for cancer and the Nobel Prize-winning mRNA technology used in COVID-19 vaccines.
The University of Pennsylvania Health System cares for patients in facilities and their homes stretching from the Susquehanna River in Pennsylvania to the New Jersey shore. UPHS facilities include the Hospital of the University of Pennsylvania, Penn Presbyterian Medical Center, Chester County Hospital, Doylestown Health, Lancaster General Health, Princeton Health, and Pennsylvania Hospital—the nation’s first hospital, chartered in 1751. Additional facilities and enterprises include Penn Medicine at Home, GSPP Rehabilitation, Lancaster Behavioral Health Hospital, and Princeton House Behavioral Health, among others.
Penn Medicine is a $13.7 billion enterprise powered by more than 50,000 talented faculty and staff.
About Children’s Hospital of Philadelphia:
A non-profit, charitable organization, Children’s Hospital of Philadelphia was founded in 1855 as the nation’s first pediatric hospital. Through its long-standing commitment to providing exceptional patient care, training new generations of pediatric healthcare professionals, and pioneering major research initiatives, the hospital has fostered many discoveries that have benefited children worldwide. Its pediatric research program is among the largest in the country. The institution has a well-established history of providing advanced pediatric care close to home through its CHOP Care Network, which includes more than 50 primary care practices, specialty care and surgical centers, urgent care centers, and community hospital alliances throughout Pennsylvania and New Jersey. CHOP also operates the Middleman Family Pavilion and its dedicated pediatric emergency department in King of Prussia, the Behavioral Health and Crisis Center (including a 24/7 Crisis Response Center) and the Center for Advanced Behavioral Healthcare, a mental health outpatient facility. Its unique family-centered care and public service programs have brought Children’s Hospital of Philadelphia recognition as a leading advocate for children and adolescents. For more information, visit www.chop.edu.
Media Contacts:
CHOP PR Contact:
Ashley Moore
Moorea1@chop.edu
267-426-6071
Penn Medicine PR Contact:
Frank Otto
Frank.Otto@pennmedicine.upenn.edu
267-693-2999
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SOURCE Children’s Hospital of Philadelphia
Huawei Cloud Strengthens Thailand’s Insurance Industry with Next-Generation Digital Technologies
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