As expected, online ticket resale marketplace StubHub has filed for an initial public offering in New York, as it seeks to capitalize on the post-pandemic rebound in live entertainment spending.
The company has yet to determine the size of its IPO. Earlier this month, The New York Times reported, citing an attendee at an investor meeting, that StubHub aims to raise more than $1 billion from its public listing.
Last year, The Information reported, citing people close to the company, that StubHub is planning an IPO and targeting a valuation of $16.5 billion.
In its SEC filing, submitted on Friday (March 21), the company disclosed a 29.5% YoY jump in revenue in 2024, which it attributed to the growth in its gross merchandise sales, representing the total value paid by buyers for ticket transactions and fulfillment.
StubHub’s revenue for 2024 jumped to $1.77 billion from $1.37 billion in 2023. Compared with 2022 levels, StubHub’s revenue was up 70.8% from $1.04 billion.
Despite the revenue surge, StubHub swung to a net loss of $2.8 million in 2024 from a net profit of $405.2 million in 2023. The reversal came as the company’s costs and expenses ballooned to $1.63 billion from $1.11 billion a year prior. In 2022, the company incurred a net loss of $261 million.
Founded in 2000 by CEO Eric Baker, StubHub claims to operate “the largest global secondary ticketing marketplace for live events.” Its platform connects buyers and sellers of tickets to sports events, concerts and theater shows, among other events.
“We see a future where content rights holders will offer tickets directly over our marketplace just like any other seller, leveraging our distribution and data to fill more seats.”
Eric Baker, StubHub
“Our business model has achieved scale with high growth and generated significant revenue, profit and cash flow. We connect fans around the world with sellers who use our marketplace to reach passionate fans and price tickets efficiently. We operate our global ticketing marketplace through two brands: StubHub in North America and viagogo internationally,” the company said in its IPO filing.
StubHub says it plans to use the proceeds from the IPO to repay existing debts and for general corporate purposes. As of December 31, 2024, StubHub had $2.85 billion of outstanding debt under its term loan credit facilities with an interest rate of 9.11% for its 2024 US dollar term loan and 7.86% interest for its 2024 Euro term loan.
The filing also revealed that StubHub booked $93.9 million in estimated potential expenses from legal and regulatory proceedings for 2024, and $48.2 million for 2023. The company said these proceedings are “part of its normal operations.”
In May 2024, a jury in a US state court awarded $16.4 million against StubHub for breach of contract and “tortious interference.” Sports ticketing company TicketManager alleged that StubHub had failed to make payments for purchases sent to StubHub, and schemed to damage the relationship between TicketManager and American Express. StubHub has recognized this amount as a liability on its balance sheet.
StubHub has also faced scrutiny over its pricing practices. In Wang v. StubHub, a case filed in California in 2018, the company was accused of misleading customers with initial headline prices before adding unavoidable taxes and fees at checkout, a practice termed “drip pricing.” StubHub said this matter was settled in Q4 2022, resulting in $3.1 million in attorney fees, $1.5 million in cash settlements, and $20 million in sales credits for future purchases.
More recently, in February 2024, the company received a subpoena from the Attorney General of the District of Columbia regarding allegations that certain website features, including its all-in pricing feature, violated consumer protection laws.
Despite these challenges, StubHub says its market position remains strong. The company reported that buyers from over 200 countries and territories bought 40 million tickets from over 1 million sellers on its platform in 2024.
StubHub also plans to use a portion of the IPO proceeds to acquire or make investments in businesses, products, offerings and technologies.
“We see a massive opportunity to leverage our data and technology to create a comprehensive platform for all event-related content. We see a future where content rights holders will offer tickets directly over our marketplace just like any other seller, leveraging our distribution and data to fill more seats,” said Baker.
StubHub’s IPO comes as its rival, Vivid Seats, is reportedly considering a sale. The company went public via a merger with Horizon Acquisition Corp., a special purpose acquisition company (SPAC), in 2021.
As of Friday, Vivid Seats’ stock price fell 6.6% from the previous session to $2.81. The price tumbled 35.7% from a month prior and fell 37.8% year-to-date. A number of equities analysts recently lowered their price targets on Vivid Seats. Morgan Stanley cut its price target on Vivid Seats to $3.75 from $4.60, while Bank of America reissued an “underperform” rating.
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