STUB — StubHub Holdings, Inc.

Summary of StubHub Q4 and Year-End 2025 Earnings Call

1. Key Financial Results and Metrics

• Gross Merchandise Sales (GMS): $9.2 billion for 2025, a 6% year-over-year increase. Excluding the Eras Tour, GMS grew 18%.
• Q4 GMS: $2.3 billion, down 8% year-over-year, primarily due to lapping a strong Q4 2024.
• Revenue: $1.7 billion for 2025, down from $1.8 billion in 2024; Q4 revenue was $449 million, a 16% decrease year-over-year.
• Adjusted Gross Margin: 83% for both the full year and Q4, up from 76% in the prior year.
• Adjusted EBITDA: $232 million for 2025 (13% margin); Q4 adjusted EBITDA was $63 million (14% margin).
• Free Cash Flow: Nearly 70% conversion of adjusted EBITDA.
• Debt Reduction: Total debt reduced by approximately 35%, down to $1.5 billion.

2. Strategic Updates and Business Highlights

• StubHub solidified its position as a leading global ticketing marketplace with a 50% share of the North American secondary market.
• The company is transitioning to a product-led strategy focusing on direct ticket issuance and enhancing its advertising business.
• StubHub is leveraging AI to improve operational efficiency and customer experience, particularly in direct issuance capabilities.
• The company is prioritizing long-term growth over immediate revenue from new initiatives.

3. Forward Guidance and Outlook

• For 2026, StubHub expects GMS to grow to between $9.9 billion and $10.1 billion (9% growth at midpoint) and adjusted EBITDA to reach between $400 million and $420 million.
• The guidance reflects expectations of continued market share gains in North America and accelerated growth in international markets.

4. Bad News, Challenges, or Points of Concern

• Q4 results showed a decline in GMS and revenue, attributed to difficult year-over-year comparisons and market share investments impacting short-term profitability.
• The company faces regulatory scrutiny, particularly regarding the secondary ticketing market, which could pose risks.
• The transition to direct issuance may create operational challenges and requires significant investment in technology and partnerships.

5. Notable Q&A Insights

• Management acknowledged that while the North American secondary market is strong, the all-in pricing transition will impact growth in the first half of 2026.
• Direct issuance is seen as a long-term growth opportunity, with a focus on reducing operational friction for partners.
• The advertising initiative is still in its early stages, generating modest revenue, with expectations for more significant contributions in the future.
• The regulatory environment remains generally favorable, but ongoing discussions about ticketing practices could affect the market landscape.

Overall, StubHub is positioned for growth with a focus on enhancing its marketplace and leveraging technology, despite facing some short-term challenges and regulatory uncertainties.