Eventbrite, Inc.

Good day, everyone, and welcome to the Eventbrite, Inc. First Quarter 2025 Earnings Conference Call. At this time, all participants have been placed on a listen-only mode. If you have any questions or comments during the presentation, you may press star 1 on your phone to enter the question queue at any time, and we will open the floor for your questions and comments after the presentation. It is now my pleasure to turn the floor over to your host, Megan Manister. Megan, the floor is yours.

Good afternoon and welcome to Eventbrite's first quarter 2025 earnings call. My name is Megan Manister, Investor Relations. With us today are Julia Hartz, our co-founder and chief executive officer, and Anand Gandhi, our chief financial officer. As a reminder, this conference call is being recorded and will be available for replay at Eventbrite's investor relations website at investor.eventbrite.com. Please also refer to our investor relations website to find our press release announcing our financial results, which was released prior to the call. Before we get started, I would like to remind you that during today's call, we'll be making forward-looking statements regarding future events and financial performance. We caution that such statements reflect our best judgment as of today, May 8th, based on the 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 press release 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'll present adjusted EBITDA and adjusted EBITDA margin, 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 for our results of operation as reported under GAAP. A reconciliation to the most directly comparable GAAP financial measure is available in our investor presentation, which is available on our investor relations website. We encourage you to read our investor presentation, which contains important information about GAAP and non-GAAP results. And with that, I'll now turn the call over to Julia.

Thanks, Megan, and thank you to everyone joining our call today. We're off to a solid start this year. In Q1, we delivered $73.8 million in revenue, landing at the high end of our guidance. Adjusted EBITDA came in at $4.6 million, representing a 6% margin right in line with what we told you to expect. But more importantly, we're seeing continued progress in our recovery. paid ticket trends improved for a third quarter in a row. While ticket volume was still down 7.7% year over year, it showed clear improvement over Q4, which was down 10%, and Q3, which was down 14%. This was the plan. We knew this year would still carry the impact of last year's organizer fee reversal. We're managing through it and working to get back to growth in the second half of the year. We're driving consistent momentum across our strategic levers, the consumer flywheel is turning, our most impactful creators are sticking with us, and we're investing with discipline. Let's jump into the quarter's highlights, starting with the consumer side. This is the year where we're reintroducing Eventbrite, not just as a ticketing tool, but as the place to find something great to do. To deliver on this promise, we launched a new Eventbrite app and brand campaign in Q1, and consumer response has been strong. The app's focus on user preferences, discoverability, and real-world connection is making Eventbrite a go-to destination for live experiences. March app installs accelerated post-launch and paid tickets generated from the app were up 11% compared to last year's Q1. Total average monthly app users were up 13% in Q1 year-over-year. Total discovery users, who are people looking for something to do across our platform on any surface, rose 16% year over year. That matters to our creators because they succeed when more people come to Eventbrite to find events. To build on this growth, we're focused on improving how we match the right event to the right person at the right time, both within our marketplace and across our distribution channels. Now let's talk creators. We saw solid momentum on both of our sales and self sign-on channels, thanks in large part to powerful creator solutions we're delivering. Our new timed entry solution launched in late 2024 continues to gain traction. The experience improvements we made are resonating with creators who used to rely on manual workarounds to manage session-based events. Let's bring that to life with a few examples. iBoat NYC is based in New York and has sold more than 110,000 tickets on Eventbrite, over half of those driven directly by our efforts. They use the full suite of tools, timed entry to manage big crowds on multi-level yachts, Eventbrite ads to fill seats, and our TikTok integration to reach younger audiences. By automating event creation, they save up to 8 to 10 hours per series, That's a full workday back, time they can now spend focusing on the experience and growing their business. In Q1, Eventbrite ads revenue was up 30% year over year. Creators are seeing the impact. One of the clearest examples is Orlove. They're known for throwing some of the most exciting parties in the U.S., producing over 250 events each year across 40 cities. For their national St. Patrick's Day rollout, they leaned into Eventbrite ads and it delivered. The campaigns drove high sales with very little manual work. It was so effective, they've now built Eventbrite ads into their broader marketing strategy for both current and future events. These creators are proof. Eventbrite doesn't just help you sell tickets, it helps you operate smarter, reach more people, and scale what you're best at. and we're making it easier to do that every day. Our sales team is focused on the right segments, helping our largest and most frequent creators drive even greater retention and revenue. Now let's talk about how we're running the business. We're operating with financial discipline. Q1 operating expenses were down 14% year to year, reflecting cost actions from last year. We held G&A dollars flat by staying tight on costs and we directed investment toward go-to-market functions and scaling consumer engagement and ads, where we see the greatest leverage. Our liquidity position remains strong, with $550 million in cash and $240 million in available liquidity, up from $230 million at year-end. To sum it up, Q1 played out as expected. The year is off to a steady, focused start. We're on track for what we laid out, returning to paid ticket volume growth in the second half of the year, and driving long-term profitability. Before I hand it over to Anand, I want to share a quick update on our executive team. As we recently announced, Julia Taylor, our Chief Legal and People Officer, and Vivek Sagi, our Chief Technology Officer, have decided to move on to pursue new opportunities outside of Eventbrite. JT, as we all know her, has been an incredible leader, partner, and champion of our culture. Vivek has played a key role in modernizing our platform, strengthening reliability, and building a solid engineering foundation. I'm deeply grateful for their impact. Just as important, both JT and Vivek have built strong teams that will carry their work forward. That includes Lisa Gorman, who was recently promoted to general counsel. As we kick off searches for our next executive teammates, I want to personally thank JT and Vivek for the legacy they're leaving behind and for helping develop leaders who are ready to step up. Now I'll turn it over to Anand to walk through our Q1 financials and outlook.

Thanks, Julia. We delivered on our outlook for Q1 with net revenue and adjusted EBITDA each at the top end of our guidance range. Our ongoing efforts to strengthen the business continued to yield results. with the trend in paid ticket volume improving again for the third consecutive quarter. The progress we're achieving gives us confidence in our plan for the year, and as a result, we are reaffirming our full-year financial outlook. I will walk you through our first quarter results and then share more about our expectations for the year. All of the financial comparisons I will reference are on a year-over-year basis unless indicated otherwise. Starting with net revenue, net revenue of $73.8 million was at the high end of our outlook range of $71 to $74 million. This was down 14% year over year, in large part due to the elimination of organizer fees, which, as expected, significantly reduced marketplace revenue. This was partially offset by the continued rapid growth in Eventbrite ads, which was up 30%. Paid ticket volume of 19.6 million reflected continued sequential improvement in year-over-year trends, declining at a slower rate of 7.7%, a meaningful improvement compared to the year-over-year declines of 10.2% and 13.6% in Q4 and Q3 of 2024, respectively. Also, we're seeing continued sequential improvement in year-over-year trends in paid creators paid events, and paid buyers. Now looking at gross profit. Gross profit was $49 million, representing a gross margin of 67% compared to 71% a year ago. The margin contraction was expected due to the elimination of the higher margin organizer fees. Now turning to operating expenses. OPEX was $59 million in Q1. down 14 percent, which was our lowest OpEx quarter since 2022. Also, this represents our fifth consecutive quarter of OpEx reductions due to our continued focus on expense discipline. Stock-based compensation declined 27 percent to 10 million in Q1, reflecting our intentional equity management. We reduced product development expenses from $27 million a year ago to $21 million, and reduced general and administrative expenses from $21 million to $17 million. Sales, marketing, and support expenses were $22 million, up modestly from $21 million, in part due to strategic investment in our revenue-generating sales team. Now looking at profitability. Net loss was 6.6 million compared to 4.5 million a year ago. Adjusted EBITDA was 4.6 million, representing an adjusted EBITDA margin of 6.2%. This was at the upper end of our outlook and marks our 15th consecutive quarter of positive adjusted EBITDA. Now turning to our balance sheet. Cash, cash equivalents, and restricted cash totaled 551 million, up 86 million from the end of 2024. When deducting for creator payables, our available liquidity was 241 million at the end of Q1, which is an 11 million increase from the end of 2024. We're mindful of our outstanding convertible notes. We're confident in our ability to manage these maturities given our available liquidity and our consistent track record of generating positive adjusted EBITDA. We're also proactively evaluating options to secure incremental liquidity, and we're prioritizing non-dilutive alternatives. Now, turning to our outlook for 2025. Based on current performance, we continue to expect full-year 2025 net revenue in the range of 295 to 310 million, with an adjusted EBITDA margin in the mid-single digits. As we look to Q2, we expect net revenue in the range of 70 to 73 million and an adjusted EBITDA margin in the range of 3 to 4%. We attribute the sequential declines in revenue and margin to a few factors, including Easter week landing in April, creating a headwind for Q2 ticket sales, some larger planned Q2 events shifting to later in the year, and lower ticket prices consistent with historical quarter-over-quarter trends. We believe these Q2 factors will normalize, and we're confident that our progress across the business, combined with our continued financial discipline, will enable us to deliver improved revenue and margin trends in the second half of 2025. Now to recap. As Julia highlighted, our decisive actions and effective execution have delivered meaningful improvements in ticketing trends and product enhancements that are accelerating our marketplace transformation. Our strong operational execution and our continued financial discipline are setting the stage for long-term profitable growth. We have a promising year ahead, and we look forward to sharing more with you at our next earnings. And with that, now I'll turn it back to the operator for Q&A.

Thank you. The floor is now open for questions. If you wish to join the queue to ask a question at this time, please press star 1 on your telephone keypad. We do ask if listening on speakerphone today that you pick up your handset to provide optimal sound quality. Once again, please press star 1 on your telephone keypad at this time if you wish to join the queue to ask a question. Please hold a moment while we poll for questions and organize the queue. And our first question today is coming from Cameron Monsoon Perrone from Morgan Stanley. Cameron, your line is live. Please go ahead.

Hi, thanks. Yeah, first on The app MAU growth, that's still a modest portion of the total MAUs, but it is nicely outpacing. Is a shift to more app-based MAUs an intentional strategy that you guys are pursuing? And then maybe just some help on kind of how user behavior differs between creators and attendees using the app relative to those on the web. If that is a strategy, we can help better understand how that influences the business or impacts the business. Thanks.

Yeah, thanks, Cameron. So our intention around the consumer side investments in the marketplace is to really focus on the app. Our app users are up healthily year over year, and they're more retentive and engaging than our total buyer behavior. And so when we think about the redesigned app and the pillars that we used when we relaunched the app, really focusing on simplification, discoverability, personalization, and also making event discovery more social, We were thinking about how we could be disciplined in investing in consumer side growth, but also go toward the highest intent, most valuable users. And that's really where we're leaning in. Those users are three times more likely to buy a ticket than web users. And while they are a smaller subset, we think that we can learn a lot from these signals in app discovery. Overall, discovery users are up 16% year over year. So we know that writ large, we're doing a better job of putting that right event in front of the right person at the right time, wherever they are. And I want to really commend the team that they've done a really nice job of balancing both focused, intense, work on our consumer app and that end-to-end journey and that work continues even post the rebrand, but also extending Eventbrite's inventory out into the world where people are searching for things to do. So especially social media with our partnership with TikTok and other platforms, we're really focused on connecting the dots for people so that wherever you're looking for something to do, Eventbrite's there and our omnipresence is there. is really driving the liquidity in our marketplace. In terms of creator behavior, we're starting to educate our creators on how their events are showing up in the app and how they can optimize their listings in the app to make it even more high converting. And we don't see any any major, you know, derivations in terms of how creators are going to be thinking about when they put their events on sale. But we do hope to continue to educate them through our reporting and analytics dashboard around how effective mobile app consumers are and why they should really lean into making that experience better for their users.

That's helpful. One other just quick housekeeping thing. item, but Anand, curious, the 1Q SBC, is that a good run rate for the remainder of the year or just anything in terms of from a stock-based comp perspective, what we should expect as we move through 25?

Thanks, Cameron. Yeah, that is a good run rate for the year. If anything, we might see some improvements. I would say in general, given the fact that there's vesting it's over multiple years. It's not exactly a straight line pattern and there's a little jaggedness in the progression, but, but we don't, we see this at the high end, most likely of the quarterly SPC for the year.

Got it.

And then one, one more, if I can, but on the, on the ads growth, I'd be curious or would love to hear just a little bit more detail on, you know, what's helping sustain that. I think 30% was, similar to the growth we saw last quarter. So any additional color on kind of what's supporting that? And then as we think about, you know, the continued growth in marketplace revs, any additional color around, you know, you called out higher incrementals, but any additional color on kind of how the incrementals for marketplace compare to, you know, the core ticketing business? That'd be helpful.

Absolutely. So Eventbrite Ads is working, you know, really for our creators because it's native to the marketplace. It's performance driven. And it's creator-led. It's not just an add-on. It's a part of the core monetization engine. And so as we get better at educating our creators and putting the ads tool in the right place within their event creation and lifecycle process, we think that we'll continue to grow adoption. We're happy with the 30% year-over-year growth because it is a clear signal that there's product market fit. And when we think about how can we beyond education and, you know, really helping our creators onboard to the tool, how can we grow ads better? Well, first is experience. expand the high intent placement. So there are surfaces on Eventbrite where ads are not yet embedded and where we know they will convert and we're continuing to roll a roadmap against that work stream. We also want to give creators better tools to see better ROI. So things like ticket sales, ad objectives, Finally, the third thing that we're focused on improving consistently is the relevance of the ads that we're showing to consumers when they're searching whatever surface they're searching on, whether it's desktop, mobile web, or app. We want consumers to see the most relevant ads, which will, of course, drive the best outcome for our creators. I think the bottom line really is that ads are growing because they help creators sell more tickets. and more creators are seeing the effectiveness, and that really aligns perfectly with how we think about scaling the marketplace monetization. We'll really focus on marketing and promotion and driving demand within our monetization picture. This year, we also are focusing on opening up core ticketing volume growth through new segments like timed entry, which is a relatively new capability on Eventbrite that brings a lot of opportunity, growing nearly 40%. We think that we have a lot of room to grow there, and we're just getting started. Visibility into the sales pipeline is very positive, and combined... Timed entry creators who are hyper frequent and regular customers and Eventbrite ads makes a lot of sense. So I'm excited about the combination of that.

That's all helpful. Thank you both.

Thank you. Your next question is coming from Nived Khan from B Reilly Securities. Nived, your line is live. Please go ahead.

Hi, this is Ryan Powell on for Neved. Thank you for taking our questions. So first question I wanted to ask is on the Eventbrite app redesign, if there's anything to call out in terms of event category performance since launch. And then second, for traction on time to entry, wondering what percent of overall events those are now and what the long-term expectations for that could be. Thank you.

Sure. Thanks so much, Ryan. So on the Eventbrite app, in terms of category performance, we're not breaking that out right now, but what I can tell you is that we've seen some strong growth within the categories where we have executed our ITLA strategy. It's sort of a self-fulfilling prophecy, but we're focusing on the most highly liquid categories in the key metros where we see the most focused buyer intent. And so the categories like music, food and drink, community and culture, and performing arts are the ones that I think you should keep an eye on. We're continuing to lean in there. And again, we are running a strategy that's scaling right now where we partner with local influencers to have them help curate the best events in those categories. And we're seeing a really nice conversion rate from that curation. And then on the timed entry side, you know, a little too early to start sharing numbers there. But how I would think about it is that timed entry expands our addressable market. So I'd look beyond the traditional categories to a more like attractions category. and installed experiences that are happening hyperfrequently. So what I mean by that is there's sessions, there's several time sessions throughout the day. They're happening seven days a week, 365 days a year. That's really the market we're focused on. And this is the first time that Eventbrite has really stepped into this segment of live experiences. So It's early. We will continue to update you as we have, you know, more metrics that we want you to start baking into your models. We do have dedicated sales members focused on time to entry, which is also relatively new. And so that's what drives my confidence in, you know, both time to entry and then also, you know, in what we're seeing in curation and discovery.

Thank you. That's all very helpful. And then on the TikTok partnership, is there anything to call out there on trends for impressions and conversion rates?

I don't have any new news for you other than the adoption of social sharing tools for creators is continuing to be a cornerstone to our strategy for driving demand and why creators are staying at a higher rate. We're really focused on helping higher value creators in the, you know, 100 to 1,000 attendee range find ways to drive demand and build audience. And we're seeing a higher retention rate because of that in that segment. So I think that, you know, As we continue to build these blocks around how we can help creators be the best marketers and promoters of their events, we are really focused on the most important platforms that we need to integrate with, and TikTok's a great example, but there's certainly others out there, and we continue to work on those partnerships.

All very helpful. Thank you.

Thank you. And as a reminder, if you wish to join the queue at this time to ask a question, you may press star one on your telephone keypad to join the queue. Once again, that will be star one on your telephone keypad at this time if you wish to join the queue to ask a question. And your next question today is coming from Hamed Khorasan from BWS Financial. Hamed, your line is live. Please go ahead.

Hi. So my first question was, I was just trying to understand what you're trying to do as far as taking up the paid creator count. There was a lot of talk last quarter that you were optimistic about that number. It went down this quarter.

So if you just provide a little bit more insight into that strategy. Yeah, you know, I think that...

As we look at the year and how it plays out, we are encouraged by the trajectory that we're seeing. The overall number of paid creators is, yes, still recovering. But as I touched on this in the previous answer a little bit, importantly, we're seeing growth in the right segments. So in Q1, we saw improvement in large and frequent creators who publish events that are between 100 and 1,000 attendees. And that's really the heart of our strategy and our most monetizable cohort. So while the headline creator count may look slower to rebound, what matters is that activity is shifting toward higher quality supply. And we found that these creators, not only are they selling more tickets more regularly, but they're also adapting to features like timed entry and adopting and paying for ads and retaining at higher rates. And that's exactly what we want to see. So creator and event growth is obviously very important to us in our leading indicators, but it's not the only path to inflecting paid tickets. We're also seeing improvements in repeat creator retention and ticket volume per event. and in buyer conversion, particularly on the mobile app, as we discussed. So I think these are all key drivers, and together they're powering this recovery. And I think that Eventbrite continues to be top of mind for creators who are, you know, hosting local relevant events and we're doing a much better job at helping them drive demand to their events and we can see that in the sentiment analysis and in the feedback that we're getting from them.

Okay, thank you. Thank you.

And once again, if you wish to join the queue at this time to ask a question, you may press star one. on your telephone keypad. Our next question is coming from Day Lee from JPMorgan. Day, your line is live. Please go ahead.

Great. Thanks for taking my questions. I have two. So first one, a follow-up on the app redesign. So I was curious on the philosophy behind it, like what you were trying to accomplish relative to the app design that you had previously Is it more user engagement, time spent, or trying to achieve a different action from the consumer using your app? And then secondly, on your four-year guide, I appreciate you guys reiterating that, but just curious if that's more of you not seeing an impact from macro conditions or you are seeing some signs, but you just feel more confident in your strategy to deliver against that four-year target.

Thank you.

Thanks, Dave. So the goal of the app redesign is really simple. It's to make Eventbrite the easiest and most relevant place to find live experiences. And what we want to do is turn that engagement of easily finding something to do into real business for our creators. So we think about the consumer investment through the lens of what's actually going to make the creator more successful. And as we think about how we... then convert that into business results, we think that it ties directly to not only our ability to attract more sales-led acquisition, which is accelerating, but also to reactivate our self-sign-on channel, which is a very attractive channel for us and is a near-term focus. And then if Finally, as we attract more new creator types through features like time gentry, that only reinforces the flywheel and also improves the category and inventory on the app. And so as we think about pushing the app more and more into our buyers' hands through things like ticket access, this gives us the great opportunity to then connect them to the personalization that we know will help them think of Eventbrite as a place to go to find things to do. And so I would say engagement and conversion to ticket sales are the two core metrics that we're looking at on behalf of our creators.

And to your second question there about macro environment and what does that mean for a full year outlook? So, you know, right now, we're not seeing clear impact from macro pressure. We're very aware of the overall sentiment of the markets. Understandably, we're cautious and we're going to continue to monitor that closely. But we do think, you know, we're in a place that has some resilience here given our price points and the fact that we're not a category that requires a lot of additional investment in terms of purchasing a hotel or a flight. So we think we have elements that, you know, suggest that we can be more resilient in times of macro uncertainty. At the same time, you know, we are monitoring and we realize that, you know, If the macro situation worsens materially, you know, it is possible to have an impact on customer sentiments, and we're going to pay close attention to that.

Okay. Thank you. Thank you.

This does conclude our question and answer session for today and also concludes today's conference call. Thank you for your participation. You may disconnect at this time. Have a wonderful day.