PARTII Item7. ManagementsDiscussionandAnalysisofFinancialConditionandResultsofOperations consideration payable on behalf of a customer, requires judgment. Incentives determined to be made to a customer, or payable on behalf of a customer, are recorded as a reduction to gross revenue. Changes in judgments with respect to theseassumptionsandestimatescouldimpacttheamountofrevenuerecognized. ValuationofGoodwillandIntangibles The valuation of assets acquired in a business combination requires the use of significant estimates and assumptions. The acquisition method of accounting for business combinations requires us to estimate the fair value of assets acquired, liabilities assumed, and any noncontrolling interest in an acquired business to properly allocate purchase price consideration between assets that are depreciated or amortized and goodwill. Our estimates are based upon assumptions that we believe to be reasonable, but which are inherently uncertain and unpredictable. These valuations require the use of managementsassumptions,whichdonotreflectunanticipatedeventsandcircumstancesthatmayoccur. EvaluationofStrategicInvestmentsforImpairment ANNU Wehave strategic investments in non-marketable equity securities, which include investments that do not have a readily AL determinable fair value and are measured at cost minus impairment, if any, and are adjusted for changes resulting from REPOR observablepricechangesinorderlytransactionsfor an identicalor similar investmentin the same issuer (the Measurement Alternative). We review these investments regularly to determine if impairment has occurred. We assess whether an T impairment loss on these non-marketable equity securities, which are primarily investments in privately held companies, has occurred based on qualitative factors such as the companies financial condition and business outlook, industry performance, regulatory, economic or technological environment, and other relevant events and factors affecting the company. When indicators of impairment exist, we estimate the fair value of these non-marketable equity securities using the market approach and/or the income approach. If any impairment is identified, we write down the investment to its fair value and record the correspondingchargethroughotherincome(expense),netin our consolidatedstatementsof income (loss). Estimating fair value requires judgment and use of estimates such as discount rates, forecasted cash flows, and marketdataofcomparablecompanies,amongothers. Item7A.QuantitativeandQualitativeDisclosuresAboutMarketRisk Market risk is the potential for economic losses to be incurred on market risk sensitive instruments arising from adverse changesinmarketfactorssuchasinterestrates,foreigncurrencyexchangerates,andequityinvestmentrisk. Management establishes and oversees the implementation of policies governing our investing, funding, and foreign currency derivative activities intended to mitigate market risks. We monitor risk exposures on an ongoing basis. InterestRateRisk Weare exposed to interest rate risk relating to our investment portfolio and from interest-rate sensitive assets underlying thecustomerbalancesweholdonourconsolidatedbalancesheetsascustomeraccounts. As of December 31, 2022 and 2021, approximately 57% and 40%, respectively, of our total cash, cash equivalents, and investment portfolio (excluding restricted cash and strategic investments) was held in cash and cash equivalents. The remaining portfolio and assets underlying the customer balances that we hold on our consolidated balance sheets as customeraccountsaremaintainedin interestand non-interestbearing bank deposits,time deposits,and available-for-sale debt securities. We seek to preserve principal while holding eligible liquid assets, as defined by applicable regulatory requirements and commercial law in certain jurisdictions where we operate, equal to at least 100% of the aggregate amountofallcustomerbalances.Wedonotpayinterestonamountsduetocustomers. Interest rate movements affect the interest income we earn on cash and cash equivalents, time deposits, and available-for-sale debt securities and the fair value of those securities. A hypothetical 100 basis points increase in interest rates would have resulted in a decrease in the fair value of our cash equivalents and available-for-sale debt securities investmentbyapproximately$161 million and $272 million at December31, 2022and 2021, respectively.Changesin the fair value of our available-for-sale debt securities resulting from such interest rate changes are reported as a component of accumulated other comprehensive income (“AOCI”) and are realized only if we sell the securities prior to their scheduled maturities or the declines in fair values are due to expected credit losses. As of December 31, 2022 and 2021, we had $10.4 billion and $9.0 billion, respectively, in fixed rate debt with varying maturity dates. Since these notes bear interest at fixed rates, they do not result in any financial statement risk associated with changes in interest rates. However, the fair value of these notes fluctuates when interest rates change, increasing in periodsofdeclininginterestratesanddeclininginperiodsofincreasinginterestrates. •2022AnnualReport 49