Vivid Seats Inc.

Good morning and welcome to the Vivid Seats fourth quarter 2024 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 Africk.

Good morning and welcome to Vivid Seats fourth quarter and full year 2024 earnings conference call. I'm Kate Africk, head of investor relations at Vivid Seats. Joining me today to discuss VividSeats results are Stan Chia, Chief Executive Officer, and Larry Fay, Chief Financial Officer. By now, everyone should have access to our fourth quarter earnings press release, which we released earlier this morning. The press release, as well as supplemental earnings slides, are available on the Investor Relations page of VividSeats' website at investors.vividseats.com. During the course of today's call, management may make forward-looking statements within the meaning of federal securities laws. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially, including the risks and uncertainties described in our earnings press release, our most recent annual report on Form 10-K, and our other filings with the SEC. On today's call, we will refer to adjusted EBITDA, cash generation, and last 12 months net leverage, which are non-GAAP financial measures that provide useful information for our investors. To the extent reasonably available, a reconciliation of these non-GAAP financial measures to their comparable GAAP measures can be found in our earnings press release and supplemental earnings slides. And now, I would like to turn the call over to Stan.

Good morning, everyone, and thank you for joining us today. As we reflect on 2024, We are encouraged by the performance of our investments that continue to drive differentiation and efficiency in our marketplace. While the market backdrop in 2024 was muted relative to the extraordinary years of 2022 and 2023, we remain confident in the long-term tailwinds driving North American live events and that we are making the right investments that will drive our long-term success. In the fourth quarter, we delivered $200 million of revenues, which is 1% higher year over year, and $33 million of adjusted EBITDA, which was 5% lower year over year. For full year 2024, we delivered $776 million of revenues, which was 9% higher year over year, and $151 million of adjusted EBITDA, which was 7% higher year over year. We delivered strong unit economics while continuing to invest in initiatives that position us well alongside the long-term secular growth trends in live events. Sources of industry data, such as third-party data from Polestar covering the last 25 years, highlight a long history of strong live event industry growth. Additionally, we are seeing that consumers increasingly prioritize spending on live experiences over goods, and artists are touring more and more. While 2024 saw muted growth relative to the record-setting growth seen in 2022 and 2023, 2025 looks to potentially return to industry expansion consistent with its long-term trajectory. Next, I'll turn to our investments that are yielding efficiencies and differentiating our platform. This includes our industry-leading loyalty program, Vivid Seats Rewards, where loyalty members earn a free 11th ticket and other perks. Over time, we have continued to refine our program and focus on targeting the right users with the right offers to maximize repeat behavior. We are seeing enrolled members making repeat orders two to three times as often as non-enrolled customers. Repeat orders are highly accretive thanks to lower marketing expense. Our mix of repeat versus new orders has trended higher each year since we launched our loyalty program, and we are excited to share that our mix of repeat orders trended higher again in 2024, reaching 61%. Our investment in Game Center is another source of differentiation. Game Center users often browse tickets while playing contests, And in the fourth quarter, we paired our Game Center contests with concert on sale announcements for 2025. With these exciting contests, such as for Kendrick Lamar and Stray Kids, we saw increased engagement and increased GOV and app downloads attributable to Game Center with limited marketing expense. Specifically, app downloads attributable to Game Center approximately doubled both year over year and quarter over quarter in the fourth quarter. we will continue to grow our Game Center user base and foster engagement in our app to further yield marketing efficiencies. In tandem with Game Center usership, our social media following continues to grow nicely. And notably, our net social sentiment is the highest among our scaled ticketing competitors, which reinforces our repeat flywheel. Moving on to an update on vegas.com, which we acquired in late 2023 and which is increasingly yielding synergies on two fronts. As we said last quarter, cross-listed complimentary Vivid Seats inventory on Vegas.com already makes a notable contribution to our broader GOV. And now, as we've had more time for our cross-sell campaigns to run, cross-sold Vegas.com customers are converting to Vivid Seats customers at an encouraging rate and generating substantial GOV while incurring minimal marketing expense. To conclude, cross-listing and cross-selling synergies are ramping nicely and ramping in line with our synergy estimates. Our TAM also continues to expand. First, this was through our acquisitions of Vegas.com and Wavedash, and now we are seeing TAM expansion through organic international expansion. We are excited to report that the first of our global technology platform capabilities that we built in 2024 are now in place and that we have kicked off our European launch. We expect to ramp activity throughout 2025, which we expect will contribute modestly to revenues. We will continue investing in the most favorable markets where we can also scale our platform and flywheel and look forward to international expansion bolstering our growth. Another element of TAM expansion is our position as the official ticketing provider and the exclusive home for tickets across all games in the new College Basketball Crown tournament beginning later this month. With this new postseason tournament, we will leverage our platform in new ways, facilitating the distribution of all primary and secondary tickets while elevating our brand awareness nationally. Looking to the seller side of our marketplace, Skybox remains the industry-leading ERP with over 55% of professional sellers exclusively using our ERP to run their businesses. Skybox is now even more powerful with the addition of our Skybox Drive automated pricing tool, which went live several months ago. We continue to onboard more Skybox Drive users and are excited to share that we have begun to monetize the product as initial adopters move beyond their trial periods. Users continue to be pleased with the product, which is turnkey, integrated, and exclusive to our Skybox ERP and leverages the power of VividSeat's marketplace data. We have an exciting partnership pipeline and expect volumes to ramp through new partnerships targeting captive audiences throughout 2025. These long-term partnerships have been a key focus as they allow us to drive accretive volume through our ecosystem that is insulated from competitive marketing intensity. This includes a new partnership with United Airlines, the world's largest airline. Our agreement will enable MileagePlus members to earn miles for purchasing tickets through VividSeats and even more miles when using the United MileagePlus credit cards powered by Chase. United's MileagePlus loyalty program is one of the largest loyalty programs in the world with over 130 million members. The partnership will go live later this year and will also connect millions of customers to personalized content through United's Connective Media, the first traveler media network operated by an airline. Again, strategic partnerships like these allow us to leverage our infrastructure and tap into new audiences and we are excited by our growing roster of new and upcoming partners. As we look ahead to 2025, I wanted to highlight a dynamic contemplated within our guidance, which Larry will cover shortly. While competitive intensity was high for the duration of 2024, performance marketing channels were particularly competitive in the second half, causing us to expect to return to top-line growth in the second half of 2025 after we lapped challenging comp periods in the first half. In 2024, amidst the ramp of competitive intensity, we made the strategic decision to prioritize strong profitability over incremental volume. With competitive intensity persisting into 2025, we are leaving flexibility within our guidance to increase investment as prudent to generate stronger volumes and long-term growth. We intend to increase investment in both marketing and technology consistent with our principled approach of building differentiated and sustainable value into our platform. We remain confident that efficient marketing combined with a differentiated value proposition will be a winning combination in the long term. With that, I will turn it over to Larry for a more detailed review of the quarter and year.