EB - Earnings call transcript Q3 2019

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Operator

Good afternoon. My name is Daphne, and I will be your conference operator today. At this time, I would like to welcome everyone to the Eventbrite, Inc.

Third Quarter 2019 Earnings Conference Call. [Operator Instructions]. you. Thank

like Counsel. call now Johnston, to turn Corporate Senior to would over the Kristin I

begin conference. may You your

Kristin Johnston

Thank you, this Operator. results. at Third our Quarter investor.eventbrite.com. Good letter It afternoon, and Eventbrite shareholder on Call. welcome can Earnings be Prior our our to announcing call, found released XXXX we financial to website the

revenue We Before today's future could on best judgment be factors differ several net factors, will statements regarding materially that future non-GAAP call, events providing which I financial and us making and as like based including of currently statements XXXX. are actual remind X, to outlook to due beyond known fourth would to begin, November caution reflect of EBITDA our we we you control. during performance, that and and many such results for that adjusted quarter year forward-looking of our the are or our that today, events full

detailed and risks the section of more SEC. to statements our in For the forward-looking filings you affecting letter with shareholder and our results, We the refer titled a discussion our future we undertake uncertainties forward-looking to to events to the law. by circumstances during no update reflect of or or statements reflect except after call today the information required as obligation or new occurrence any events, made unanticipated

most financial letter. are reported GAAP and operations under a measures and available of flow, During present or in you analysis financial about EBITDA you prepared which GAAP. not information consider of both results. them cash as it directly read We important Reconciliations non-GAAP shareholder accordance this to analytical encourage of for are shareholder have will in measures. with our substitute free should limitations tools, we letter non-GAAP contains the are call, and measures non-GAAP to GAAP in our financial results These GAAP comparable adjusted isolation as as not and our

Co-Founder to Julia? and Chief turn Julia Executive call now Hartz, the will I over Officer.

Julia Hartz

joined call third call. and by forward to advantage this the CFO. growth opportunity position Baker, team on us. closely and we of Lanny XXXX you, Kristin, with Lanny look to earnings our appointed welcome Eventbrite conference of to executive today as take the I Thank working before to recently quarter the be I'm large pleased rest our

In a completed September, company. we year our first as public

made first-time While creators we've XXX,XXX in evolving more for have X had events million and our platform we million than over also creator learning creators. to IPO, our great some base. Eventbrite Since X powered we experiences, total expanding our serve strides welcomed over

added engagement. roster Over XX our the we've increased last months, platform, grown key our and creators consumer global functionality to of our

quarter The marked was third several highlights. by

better-than-expected growth to another platform. make sustainable progress by channel. Self results, support generated of better more And Sign-On we key transactional and of quarter products increasing our financial initiatives continue against We driven executing growth. our and plan operate advancing long-term to and efficiently We a growth realignment were which XX%-plus volume strategic our are in

public, of core learn they the technology that events Eventbrite a tickets. businesses we at strategy. space their releasing developed to XX,XXX our invite minutes letter, over Our culture JPL within In enables commitment public about NASA to year, latest the shareholder run event the XX tickets to efficiently our Explore where Propulsion of building This their flagship their experience their and platform creators is uses program. which Jet company Lab, the issued to support and featured NASA's to

attendee devices easier. ticket thus, also to heavy demand, this experience on-site making event, at tickets handle tools, much gave to they Eventbrite leveraged on which the check-in scanning our access mobile their employees relying Beyond easy for the

company revenue growth the than financial of to we our grew which XX% Sign-On million volume. Self for better the $XX performance in had strong Turning continued period. of channel, Total for expected our was with the pleased XX% paid results. quarter We're and ticket

our strong international by and of experience revenue quarter and U.S. XX% the growth U.K., respectively, total the to the year. XX%, continue for markets, paid We of the Brazil. Canada, led tickets accounted net XX% in prior Events versus in Australia outside XX% in and

Our line loss expenses quarter realignment. in $X.X to was resource and related million for expectation with adjusted included EBITDA our the in

in events. operate who Additionally, high-value and strengthening frequent we've creators made for host promote shows headway our venues, platform

many clients. enhanced platform's offers and a of reserve Our for music robust important seating functionality solution our

their tickets launched maximize learning real-time also tool pricing which ticket to sales. intelligently new data-driven a and more their that machine We leverages creators price ticket and insights, enable

the Eventbrite We've customers migration up nearly Ticketfly to planned. of wrapped Music as

focused be trust earning loyalty to these continue the customers. of and We on new

to generation the cash enabled us with position. and reducing strong putting debt in Ticketfly repay a further in the interest debt-free associated quarter us the expense acquisition, Our

have the our on months appreciate employees In leadership events mid-market. nine the the the our optimistic first of and shareholders we company. the first and summary, hard our good we of our of made our a about to on opportunity during progress as prospects and terrific position year We during the work build believe in dedication public executing plan growth support We our year. ticketing globe and around a remain

I'll that, now the over With turn call Lanny. to

Charles Baker

excited and global potential participate as market. of And presence events in today's has in Eventbrite years a to part company's privilege see team. ahead. expand a leader its It's to call, believe live value be the this I'm the the in to Julia. I I itself established Thanks, and tremendous

demand to Sign-On as do solution. business-enablement Eventbrite's thousands event platform both large business the The ever-evolving each simplicity our the our creators new strength as appeal of of we well healthy month. what And of brings and speaks for in and Self

just discuss results detail fourth so some shareholder then year. in in our letter, and turn the quarter provide covered housekeeping quarter We and I'll the quick the items for third financial outlook full to

year-to-year. year-to-year As as to and reported, to XX% quarter. the year-to-year $XX year-to-year in rose points grew $XX the quarter gross the Operating to channel. million. Julia noted, expenses, Gross led in It XX% by grew grew million million, margins XX% profit revenue $XX third by X Sign-On Self was

comparison However, describe operating there year-to-year in X% these roughly quarter were were last of in quarter equaled of adjusted an a in the Adjusting in expenses versus and down ongoing XXXX I'll to the year. unusual XX% of quarter moment; for a third and of the in third that a number items items revenue the ago. year XX% revenue

that include: related creator. by first, referenced XXXX out within consumer adjustments This canceled Music in marketing. its expense was refunds sales July was The we the $X million paid to Festival Roxodus recorded in and

our strategy and costs to We our are recently preliminary favor. received aggressive pursuing have a recoup legal injunction an in

locations our $X third quarter million $X.X during in include expenses was the consulting, into incur and the that XXXX. severance expect plan to recorded another efficiencies This growth. quarter costs related general cost our our to best and realignment reorganization propel Second, to of These resources initiatives $X directly the costs these in Europe, more centralizing changes fourth reducing in operations we to million related administrative. incurred most We administrative shifting in associated functions. spending million and with long-term and to of we of within reinvest to

on not We trends G&A accruals year related profitability to business. also and $X.X reported in the quarter, benefits recorded the in the better the million of reversal tax only nonrecurring our line in results items expense were our third Finally, sales the insurance within underlying of order XXXX. recorded these in recoveries. to expenses These in we and details quarter share but understand help investors ago

$XXX $XX the sales million outlook Turning for to The year and quarter term. million. anticipates music near today quarter business of of in to $XX the to business full our the revenue growth full for measured The year expectations the year. revenue full fourth revenue and million includes fourth fourth XXXX provided for million outlook outlook $XXX of quarter and

have we're all Ticketfly an of and substantially improvement growth newly quarter completed cautious about migrated for in of outlook certain the we Although revenue the we the customers creators. XXXX, saw in third music migration

product, Our service earning creators' sales aligned the organizations marketing, of loyalty. are these priority on all and

million outlook are year million negative expenses the EBITDA. EBITDA quarter the full to severance negative for adjusted EBITDA outlook. XXXX. included to breakeven million these and in $X and to $X expenses realignment, adjusted related anticipates The in to negative $X adjusted of million anticipate in in $X for the $X million fourth and to the We quarter Turning fourth business

third up, and we had well quarter, we are a strong positioned Summing XXXX. going into

the in beyond. Our on SSO based We've to our major milestone organic grow in of U.S. projecting and appeal a our the channel music the are focusing migration strongly and the mid-market passed platform. continues in on strength

in remains sheet $XXX strong no debt. balance million available liquidity with Our and

now about are opportunity We ahead. to your ready the And enthusiastic we're questions. take

Operator

[Operator Instructions].

comes Sundby Blair. first line Our from William question Ryan of from the

Ryan Sundby

in up than less like guess, QX. QX, but to that was last it was just to I sounded likely show in start, you expected, quarter, churn

Just QX, And could was think look the as how in would into play how QX? should that, about biggest wondering idea be then, if the we that you how then XXXX? churn? that out impact into about out. talk that we forward does And I think played

Charles Baker

primary third Sure, assuming about music our during customer that's retention focus. which throughout roughly the with year in retention category, quarter that has has you're Ryan. this in about, been and of of been asking we I that our area assume expectations. talking what kind the the And as migrated you're line

been about large themselves months, from earning done one big the transitions with as fourth platform. number that have the creators' retention to There's Ticketfly but of couple establish creators loyalty as a as term. work cautious many As prior for those that and at quarter. cautious quarter, hard very the fourth a to last have and another. outlook the we It's just on these platform migrated something platform we're of we're be out calling over new look Eventbrite switch in very they to well to this migrations, in we described, into a change in We've about customers of we near the in

Ryan Sundby

But then does point? through you see Ticketfly coming Or potential the drag that get of do losses that more as fourth of at quarter, kind kind the end XXXX? in you

Julia Hartz

in mid-market, look landscape opportunity have. Ryan, that the total focusing global here. music we and includes that the forward, we we're When the on I jump can in

market already Eventbrite's into and create deeply where customers. our only we're the on helping growth and also use really how toward done committed of And other looking functionality, music platform, to and markets migration footing the we customers front in we transitioned of not that the the are scale work platform success find reap to these we're exist. that can So we benefit have already to expand we've their this

Ryan Sundby

maybe functionality, added there. be I that this tempted guess follow of see all Julia, you've the of in to feedback of on I event platform functionality - hear up clearly, some process from earlier add you would other especially have lot expect? you year. that customers functionality? maybe mean, a as now that here And come show starting then Any this second, the there, left just love are the you to to terms to in didn't transition that your side, the color end this categories Eventbrite Just in high you creation maybe up back

Julia Hartz

Great.

created customers creators. informative loop feedback added So capability with strengthened event as we've the us when of a we features these we've meet been for that has frequent incredibly our - that needs these and

grow markets. So at winning music that Ticketfly focused that customers steps we'll be your and astute music came what with platform. engendering we've customers right these so will these to to to to the customers venue from folks expand. And When of look and absolutely now we're And of businesses, trust in over international we and there, time, who frequent categories from it the are or so doing they category, absolutely been other take I for that time. developing is we their we'll to and loyalty transfers on correct. Ticketfly but continue is believe the highly customers see benefit them the important work creators take think and We comparison helping the that back Eventbrite quite

Operator

[Operator Instructions].

Your next question comes Squali SunTrust. with of from Youssef the line

Nathan Mitchell

for on Youssef. Mitchell Nate is This

that you've able is anything back you for like referenced And your since driving specific revenues larger there turning to end to the at us customers, the the the are approximate letter? much in seem the you to ones outlook of the that's date? Ticketfly's related maybe seen churn caution Just migration, it quantify annual doesn't

Charles Baker

No, there's nothing specific.

caution customers in brought that operating customers - transition through for system - think retention as is described, of the our near trying I about having a And we've we're to really business. very a their these it I important the be express term. in prudent those

of In XXXX. before vast terms the of migration quarter the majority customers the quantifying of percentage, of third happened the Ticketfly well

about talking that of So small migrated relatively customers were it's in year. part number last this a of we're the

Nathan Mitchell

now? they Small though, number of customers, but more, revenue-wise, weigh

Charles Baker

later. There Yes, customers larger migrated who that's were accurate.

Nathan Mitchell

not of customers we're are. run what the annual of annual the - quantifying rate But kind those

Charles Baker

correct. That's

Nathan Mitchell

international Okay. - continues Sign-On, And help ticket? Sign-On and Maybe can even Sign-On, on really you how of international paid any then you us give the Self whole? is as it's specifically Self to would if us XX% strong. maybe as directional can turning be what's be to a big to of with And going a really Self understand up sense there percentage color Or helpful.

Julia Hartz

Sure.

this creators and product meet Self really, where works So of is needs our Sign-On platform. to many to enablement is this as strong types Sign-On and you Eventbrite across of mission of paid Self is our through drive Sign-On channel. XX%, international saw, the tickets business, toward the We is growth core Self mentioned, that through in really the nod platform's horizontal a different

on the value tickets greenfield the Helping U.S., and a them the permeate revenue And seeing growth helping we expanding a have creators is there great growth and focus markets I these where Eventbrite their events. growth these have in then to markets we that really set with Our markets opportunity event our those is particularly product. stronger that And up delivering outside brand think focus is they in competition. methods mentioned we're of starting isn't delivering formidable for numbers sell what on the the that of really efficiently the as of lot penetrating sustainable events. more opportunity we

Charles Baker

quantifying of some where as some have can we letter, paid - half larger shareholder roughly ticket that In that, percentage. see in it's than Self our it's of about said, we it, where Sign-On terms I've that the as you in and is markets overseas some volume. And markets, markets exhibits our

the not little So it's different. international it's appreciably larger in bit but business, a

Operator

again. of Sundby William line next with the Your question comes Ryan from Blair

Ryan Sundby

kind I be thoughts don't this, there's that processing going on how too. know, that, go, Julia is or any to to that Lanny, after do with forward? great. it not I would relationship of kind the guess, But once if - and going on I'm move is or sure Square And who'd implications your of how

Julia Hartz

benefit been platform Thank a is long into different for us, and Square you. I for our has partner Sure. Square is payment and to processing news have for great on the, we look and the platforms solutions many time. partner to guess, opportunities our and integrate that we'll - front done for creators with so positive very our a

of creators to so and really And meet benefit variety And of us to scale customers. different options different we to have to we continue in offer globally our markets. the the as and many that's needs that important

Operator

from line question SunTrust. the comes of next Squali Youssef Your from

Nathan Mitchell

the how of the year, three Maybe years? next would add-ons. again. This speak on quarter is That over one past be Nate on this maybe helpful. more years, line Youssef for contribution and the Can to uptake just you to about be top investors product thinking the should two

Julia Hartz

Thanks.

for is event beyond any something on their the listing. event creator to ability So a sell add-ons ticket

So our merchandise, from it parking, creators And this an you imagine capture event. is really event more to up-selling revenue because opportunities. helps them can important

a clear the ticket. really seen indication merchandise revenue or product, add be is And able we're and efficiency experiences adoption solution around because reporting event ticketing sales. to so channels, solution this we in have it don't sell the not use to some more another see only they or the up these not to that And to creators what really helps greater from for a our but more open in integrate adjacent yet, while we numbers we've Sign-On Self specific functionalities when feature nice both

be it feedback. continue And closely, watching it so we'll to with good. so our refine event creators' so and But far,

Operator

to have time. turn over questions at like for call this to further closing We remarks. Julia no I Hartz the would

Julia Hartz

I in also a to their for our wanted I commitment. Eventbrite. hard great for Great. thank the participation again work And and on your everyone interest and today thank day. call want employees Have to their

Operator

Thank you.

Eventbrite (EB) 7 Nov 192019 Q3 Earnings call transcript