Eventbrite, Inc. Q2 FY2025 earnings call

• Delivered strong second quarter, outperforming on bottom line and improving core ticketing trends. - Started year focusing on stabilizing core ticketing business, with Q2 showing measurable progress in year-over-year declines of paid creators, paid events, and paid ticket volume. - Launched LINE UP tool for music organizers and venues. - Eventbrite ads as key growth lever, with adoption growing. - Relaunched app improving consumer discovery, app conversion rates up. - Focused on financial discipline, reducing costs and improving adjusted EBITDA margin.

Net revenue was $72.8 million. Eventbrite ads grew 50%. Ticketing revenue declined 10%. Marketplace revenue was significantly reduced due to elimination of organizer fees. Adjusted EBITDA was $6.4 million with a margin of 8.8%.

For Q3, expects net revenue between $70 million and $73 million and adjusted EBITDA margin of approximately 7% (excluding nonroutine items). For full year, updates revenue outlook to $290 million to $296 million and raises adjusted EBITDA margin outlook to approximately 7% (excluding nonroutine items), with expectation of monthly year-over-year growth in paid ticket volume by end of year.

Q: I have 2. The first one, you mentioned strong acceleration in paid creators and paid ticket growth in July. Just curious to hear what drove that? And any reason why that momentum cannot continue into the back half? And then secondly, on the mix impact that you're talking about from creators, are there any changes in the competitive or overall event landscape that might be affecting this as well outside of your focus on higher-margin self-sign-on creators?

A: Great. Thanks, Dave, and thanks so much. I appreciate you joining the call and for your question here. So what we're seeing in the business is in line with what we want to see in terms of recovery. We're watching the July -- as we wanted to give confidence in inflecting in the monthly year-over-year growth later in the year is in that it's being supported by the behavior of creators and consumers on the platform, not just the volume. So we are seeing the trends moving in the right direction. As you noted and as we shared on our call, paid creators are about flat in July and paid ticket volume was down just 1% year-over-year, which is a sharp improvement from the Q2 run rate. And that's just not a projection that's actual performance. So it tells us the recovery is progressing and the inflection point is approaching. Second is that we're controlling what we can to drive that growth. So we've put focused effort behind acquiring larger, higher volume creators through paid marketing, through brand development and an expanded sales team that's now more targeted and more productive. They're focused on vertical format and metro. So we're seeing that increase the near-term performance of paid creators, and we expect to see that the lagging indicator pick up towards the back half of the year in paid ticket volume. We're also seeing success with more consistent upselling motion that's driving greater adoption of Eventbrite ads. And that matters because it's helping creators sell more tickets while also increasing our monetization. And the final thing I'll say is that our product investments are designed to drive exactly this kind of growth, starting with the creator and helping them expand their business. So we're improving consumer demand through better discovery and personalization. We're expanding marketing tools that help creators grow their audience. and we're delivering insights that help them optimize the performance of their marketing and promotion as well as giving them insights into how their events are selling, especially for our repeat customers who are able to compare year-over-year. So these improvements that I just mentioned are already live and the adoption is building. I think while there's still work ahead, the combination of this real-time improvement that we're signaling for July and the proactive execution gives us the confidence that we'll reach that inflection and we're on a solid path to sustain it. Where we, in the course of Q2, saw some divergence in these main metrics is the recovery of creators is -- sorry, the recovery of tickets per creator is lagging slightly behind the recovery of creators. And that's what I think is driving a bit of that delayed improvement than what we had originally anticipated. And you also asked if there was a change in the overall landscape. We don't see a massive shift in the landscape. We think that Eventbrite is well positioned within the mid-market, and we are the #2 largest traffic live experience and ticketing destination out there. We think that we're able to compete against many smaller players as well as larger platforms with our product, focusing on helping creators build their businesses on Eventbrite and sell more tickets. Our marketplace, helping to drive nearly 40% of the ticket volume through our targeted consumer efforts and third, through our brand affinity and the ubiquity that Eventbrite has with live experiences. We see some really interesting secular tailwinds in live events as people are wanting to get out more and be in real life together, and we see the clear connection and opportunity, and we have a proven track record of using new technology and the adoption of technology to actually drive those trends of getting together in real life and connecting through experiences.