Eventbrite is still losing money as it grows, but now has strong revenue growth and plenty of cash to spend while getting back on track. The state of the booming global events business is a big help.
Eventbrite’s initial public offering in September was a success, and the company’s first earnings call as a public company sounded like business-as-usual. After a period of growth, Eventbrite’s fundamentals are strong as it continues to deal with the costs of product development and integrations, executives said Monday.
Eventbrite’s net revenue grew 45.1 percent year-over-year to $73.6 million in the third quarter, while the number of paid tickets sold on its various platforms increased 32.3 percent to $23.9 million. The company’s more expensive package options for venues and organizers were well received, boosting net revenue growth per ticket sold.
Growth comes with a cost, however. Eventbrite’s operating expenses surged to $55.2 million in the quarter, comprising 75 percent of net revenue. Increased investment in sales and marketing along with product development increased, along with various administrative costs related to going public. The results are also wonky because Eventbrite was only public ten days of the quarter.
Essentially, the company is still being weighed down by the costs of its acquisitions in recent years and spending to acquire customers again once they leave depreciated platforms. Eventbrite’s top competitor Live Nation also operates similarly, losing a bit of money to grow internationally and to entice event companies to join their platform, so they are in good company.
Eventbrite’s initial public offering was well received by investors, with shares soaring on its first day of trading and settling a few dollars higher than the $23 opening prices.
Eventbrite announced last week that it has rebranded Ticketfly, which it purchased last year, as Eventbrite Music to better capitalize on the visibility of its brands. It also probably had something to do with the recent hack of Ticketfly which exposed the information of 27 million users of the service. It also integrated with YouTube to sell tickets directly to viewers.
“We have gone to market as of last week with a product that is tailor-made for and music venues and promoters and music festivals,” said Julia Hartz, CEO of Eventbrite. “This applies to not just those using Eventbrite but the legacy Ticketfly product. Where we see the great value is that we’ve been able to… bring together a product offering specifically for venues. We’ve also coupled that with our launch with YouTube. We interact with these distribution partners to put the right event in front of the right consumer at the right time… this is very valuable for our music customers.”
It will be interesting to see how Eventbrite evolves as it finishes various integration projects that are still in process; will the ticketing service continue to operate by acquiring internationally with only incremental improvements to its digital platform, or invest in new tools and capabilities with an eye on the future?
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Photo credit: A promotional image of Eventbrite's offices. Eventbrite