Vivid Seats Inc.

Good morning and welcome to the Vivid Seats first quarter 2023 earnings conference call. Following management's prepared remarks, we will open the call for Q&A. I would now like to turn the call over to Kate Copples.

Good morning and welcome to Vivid Seats first quarter 2023 earnings conference call. I'm Kate Copples, head of investor relations at Vivid Seats. Joining me today to discuss Vivid Seats results are Stan Chia, Chief Executive Officer, and Larry Fay, Chief Financial Officer. By now, everyone should have access to our first quarter earnings press release, which we released earlier this morning. We have also provided supplemental earnings slides. The press release and earnings slides are available on the investor relations page of Vivid Seats website at investors.vividseats.com. During the course of this call, management may make forward-looking statements within the meaning of federal securities laws. These forward-looking statements are subject to the risks and uncertainties as described in our earnings press release and other filings with the SEC. On today's call, we will refer to adjusted EBITDA and adjusted EBITDA margin, which are non-GAAP financial measures that provide useful information for our investors. you will find a historical reconciliation of adjusted EBITDA and adjusted EBITDA margin to the corresponding gap measure in the earnings press release, supplemental earnings slides, and SEC filings. And now, I would like to turn the call over to Stan.

Good morning, everyone, and thank you for joining us today. I'm thrilled to share our exceptional first quarter 2023 results with you. As always, we prioritize initiatives that generate long-term value and stickiness in our marketplace, and I'm excited to report on our progress. Our first quarter financial results speak to our ability to relentlessly drive incremental efficiency and simultaneously invest in competitive product differentiation. To begin with, I'll walk through our financial and strategic highlights from the quarter, before turning it to Larry to take you through our financial results in more detail and to discuss our updated outlook for 2023. We set out strong in 2023, and I'm proud to report we generated $856 million of Marketplace GOV, $161 million of revenues, and $42 million of adjusted EBITDA in the first quarter. We delivered double-digit growth for Marketplace GOV and revenues and doubled adjusted EBITDA despite a highly competitive ticketing environment. Thanks to a strong march, we quickly exceeded expectations set during our Q4 call, and we are accordingly raising our 2023 Marketplace GOV revenue and adjusted EBITDA guidance. The live event environment in the first quarter 2023 was robust, due to a combination of exciting event supply and exuberant fan demand. Consumers continued to crave live experiences in the first quarter, and we believe this trend will continue for many years. Consumers were eager to secure their seats for concert headliners like Drake and Beyonce, and for sporting events such as the World Baseball Classic and NCAA Women's Basketball Final Four. The Women's Final Four was the latest data point supporting an exciting trend of outsized growth across women's sports as a category that we believe will continue for decades to come. While consumers are seeking their favorite live events, our marketing campaigns are focused on ensuring fans are aware of our differentiated experience underpinned by our unique Vivid Seats Rewards program. Vivid Seats Rewards aligns us with fans by offering more rewards the more they buy. In addition to ticket savings, our loyalty program includes a host of other benefits ranging from surprise upgrades to exclusive game day experiences. Our buyer experience and engagement efforts, starting with our loyalty program, are designed to cultivate brand awareness and lasting affinity for our platform. Engagement during and between live events is crucial in our relatively low frequency category and we are seeing continued improvement as we invest in both marketing and product vehicles to drive engagement. With marketing efforts, whether at an on-site event or through our growing social presence, our buyers are engaging with us more than ever before. In social, we lead the competition with the highest positive sentiment, and we have been rapidly growing our social following. Our social engagement has grown 50 times since we began our initiatives in earnest and nearly doubled quarter over quarter in Q1. We continue to innovate and differentiate our product-focused engagement efforts to buyers and are excited to announce our first free-to-play product available directly within the Vivid Seeds app, fully powered by Vivid Picks. Launching in May, users will be able to play daily challenges with the chance to win free tickets. We're thrilled to get this product off the ground and offer another compelling engagement opportunity for our buyers within our app experience. On the seller side, Skybox Drive, our new automated pricing product that leverages our powerful marketplace data, continues to progress and has moved into its beta phase. We are incorporating feedback as we march towards an exciting launch in the latter half of the year. Our leading products are the result of consistent investments focused on driving long-term stickiness on both sides of our marketplace. Our install base of sellers on Skybox already includes more than 50% of professional sellers. On the buyer side, we continue to grow by adding new buyers and driving accretive repeat order activity. In tandem with our investments in loyalty and differentiated buyer experience, the portion of repeat orders placed on VividSeats increased to 56% in 2022 from 47% in 2018. We know our buyers better than ever before and offer personalized recommendations and campaigns. Even with our repeat rates trending higher across categories, there is still room to grow as we drive repeat behavior among passionate sports and music fans. At the same time, we will continue to attract cohorts of new buyers onto our platform, creating an ever-growing network to nurture for repeat purchases that provide a tailwind for our margins. Our strategic and operating principles are grounded in driving profitable growth. Our approach has always been to execute with disciplined rigor and maniacal testing, such that we continue to attract new buyers while increasing repeat rates through a consistent focus on things we can control. Raising and consuming capital to drive unsustainable volume is a strategy that does not endure. Sustained gains stem from differentiated product, service, and value, and that is where we invest and excel. To conclude, we made important strategic progress this quarter and delivered healthy growth, profitability, and cash flow. We continue to strengthen our product and market position while our strong balance sheet serves as a substantial asset that we are ready to deploy to continue our track record of outpacing industry growth. With that, I will turn it over to Larry.