Eventbrite, Inc.

Good afternoon, and thank you for standing by. Welcome to Eventbrite's second quarter fiscal year 2023 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question, please press star 1. To remove yourself from the queue, press star 2. Please be advised that today's conference is being recorded. I would now like to hand the conference over to Catherine Chen, Head of Investor Relations. Please go ahead.

Good afternoon and welcome to Eventbrite's second quarter 2023 earnings call. Prior to this call, we released our shareholder letter announcing our financial results, which can be found on our website at investor.eventbrite.com. Before we get started, I would like to remind you that during today's call, we will be making forward-looking statements regarding future events and financial performance. We caution that such statements reflect our best judgment as of today, August 3rd, based on factors that are currently known to us and that actual future events or results could differ materially due to several factors, many of which are beyond our control. For a more detailed discussion of the risks and uncertainties affecting our future results, we refer you to the section titled forward-looking statements in our shareholder letter and our filings with the SEC. We undertake no obligation to update any forward-looking statements made during the call to reflect events or circumstances after today, or to reflect new information or the occurrence of unanticipated events, except as required by law. During this call, we will present adjusted EBITDA, adjusted EBITDA margin, and available liquidity, which are non-GAAP financial measures. These non-GAAP financial measures are not prepared in accordance with generally accepted accounting principles and have limitations as an analytical tool. You should not consider them in isolation or as a substitute for analysis of our results of operations as reported under GAAP. A reconciliation to the most directly comparable GAAP financial measure is available in our shareholder letter. We encourage you to read our shareholder letter, which contains important information about GAAP and non-GAAP results. And with that, I'll now turn the call over to Julia Hartz, co-founder and chief executive officer.

Thank you, Catherine, and thank you all for joining us today. I'm excited to share the details of another strong quarter amid an important year for Eventbrite. In the second quarter, we transacted gross ticket sales of nearly $900 million. Record take rate helped net revenue grow to $79 million, up 20% year over year on a constant currency basis. I'm proud of how we've grown our core ticketing business efficiently while investing in our capacity to drive more demand toward events in our marketplace. This discipline produced adjusted EBITDA margin in the mid-teens for Q2, which was nearly three times the profitability of a year ago. From the top line to the bottom line, we've substantially grown our business in the first half of 2023. The most urgent priority of our creators is selling more tickets. And Eventbrite's scale, products, and consumer brand are uniquely positioned to help them succeed faster. Our results provide strong momentum as we head into the second half of 2023 and as we focus on improving both the creator and ticket buyer experience in our marketplace. We know that audiences are seeking the vast and diverse categories found on Eventbrite, from great live music to summertime food and drink festivals to air shows and even reptile expos. Nearly 33 million users bought or registered for tickets on Eventbrite during the second quarter, which is a new all-time record, surpassing pre-COVID levels. Total ticket volume grew year over year in each of our top five geographies, with the US setting a new Q2 record for tickets transacted. And monthly average users on the Eventbrite mobile app continued to accelerate, growing 39% year over year in Q2. The team focused on three core areas in the quarter to boost demand in the marketplace. First, increasing consumer traffic to event listings. Second, boosting SEO and discovery relevance. And third, launching content partnerships to gain broader awareness for seasonal events. To drive more traffic to event listings, we recently launched a video feature to give creators the ability to showcase their event more dynamically to consumers. Creators who use this feature saw a 74% increase in consumer traffic to those event listings. To increase relevance in SEO and on discovery pages, we're using machine learning to deliver better personalization and event recommendations to our things to do and for you pages, improving listings views by 64%. To reach a wider audience, we've launched a new partnership with Eater, the digital media brand focused on dining and restaurant discovery, which reaches 30 million people each month. A jointly curated collection of the best springtime food events in New York City became one of our most highly viewed city collections ever. We plan to do many more brand partnerships with Eater and others to boost consumer traffic and bring new audiences to Eventbrite events. These initiatives and more increased our ability to drive ticket sales through notification, browse, and discovery channels. Eventbrite drove over 6 million paid tickets, which equates to $202 million in gross ticket sales and another 13 million free tickets in the quarter. We drove 4 million tickets in the music category alone. Listing on Eventbrite sparks a powerful growth flywheel for creators, and we're investing to build even more value into demand generation features. This is a key unlock for event success because each incremental ticket sale represents revenue opportunity through food and beverage, merchandise, and other event-related transactions. Some of our targeted investments in Q2 were focused on the ads product to drive demand. First, Eventbrite ads launched internationally in Canada and Australia, expanding to our third and fourth largest markets. Second, ads are now available for recurring events, meaning creators can easily manage multiple promoted listings with a single campaign. Third, we're deploying generative AI to support end-to-end marketing motions. It now helps creators excel quickly at something that may have taken them hours in the past, giving them more time to focus on creating content. And in the coming quarter, we aim to expand AI to event listings creation, reducing the time it takes to publish an event to less than one minute. And fourth, we continue to make progress on our cost-per-click model for ads, which we expect will drive more dynamic pricing and better transparency for return on ad spending. Non-ticketing revenue from Eventbrite boost in ads grew 27% quarter-over-quarter with ads revenue exceeding $1 million for the first time on the one-year anniversary of its launch. We believe that the growing appeal of our marketing and advertising capabilities is a strong signal that creators value Eventbrite as a marketplace and demand engine. As we spend more time and effort on the demand side of our marketplace, we remain wholly committed to the success of independent entrepreneurial creators. Our creator base has grown year over year for nine straight quarters. That includes a record number of frequent creators in the second quarter, representing about 24% of total creators. Finally, I wanted to give you an update on one more move we're making to better position the value and accessibility of Eventbrite's marketing tools. Today, creators come to Eventbrite for ticketing, and then as a second order, they appreciate the strength of Boost to drive more ticket sales through paid social advertising and premium email marketing tools. As we've gotten better at delivering value to our customers through a great product experience, we realize that it's important for all creators to have access to these features. Therefore, we're changing the onboarding of Eventbrite to include these marketing tools as part of the core product. Beginning in Q3, we're introducing a new packaging framework that offers this comprehensive feature set to event creators of free and paid events for a fee. We're excited to be opening up access to Boost to a much wider set of creators, and we'll bring you updates as this rollout continues. Before Lani discusses financial results, I want to welcome Dr. Pilar Monchon, who is joining our board of directors today. Pilar is the Senior Director of Engineering, leading AI research at Google and a groundbreaking leader in this field. We're excited and delighted to have her join the Eventbrite team and look forward to her guidance and strategic vision as we build innovative product experiences for our customers. Now, Lani will discuss our Q2 results and Q3 outlook.