• Revenue: $187 million in the third quarter.

• Adjusted EBITDA: $34 million with an 18% adjusted EBITDA margin.

• Marketplace GOV: $872 million, a 13% year-over-year decline.

• Take Rate: 17.5%, up 200 basis points year-over-year.

• Average Order Size: 11% year-over-year reduction.

• Total Marketplace Orders: 2% year-over-year decline.

• 2024 Guidance: Marketplace GOV of $3.8 billion to $4.0 billion; Revenues of $760 million to $780 million; Adjusted EBITDA of $145 million to $155 million.

• Warning! GuruFocus has detected 4 Warning Sign with SEAT.

Release Date: November 07, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Vivid Seats Inc (NASDAQ:SEAT) delivered $187 million in revenues and $34 million in adjusted EBITDA with an 18% adjusted EBITDA margin, showcasing strong unit economics despite market challenges.

• The company announced a strategic partnership with Brandon Marshall's IM Athlete, enhancing brand awareness and engagement through exclusive content and promotions.

• Vivid Seats Inc (NASDAQ:SEAT) successfully launched SkyBox Drive, an innovative pricing tool, with rapid adoption and a waitlist of prospective users, strengthening its position with professional sellers.

• The company was recognized by Newsweek for the fifth time for its excellence in customer service in the ticketing category.

• Vivid Seats Inc (NASDAQ:SEAT) is on track to launch operations in select international geographies by the end of the year, expanding its total addressable market (TAM).

Negative Points

• Marketplace Gross Order Value (GOV) declined by 13% year-over-year, driven by an 11% reduction in average order size and a 2% decline in total marketplace orders.

• The concert industry faced a 'digestion year' with a notable reduction in stadium tour activity, impacting Vivid Seats Inc (NASDAQ:SEAT)'s performance.

• High marketing intensity from competitors has created pressure on incremental orders and GOV, with some competitors pursuing uneconomic volume growth.

• The company's guidance for 2024 Marketplace GOV and revenues was revised downwards due to challenging concert supply dynamics and continued marketing intensity.

• Free cash flow conversion is expected to be lower in 2024 due to reduced top-line growth and working capital headwinds, impacting cash generation.

Q & A Highlights

Q: Can you explain the implied take rate guidance for Q4, considering the strong performance in Q2 and Q3? A: Lawrence Fey, CFO: The take rate in Q2 and Q3 was strong due to a balance between take rate and volume. We aim to maintain flexibility to adjust based on market conditions. The World Series, being a high AOS event, can deflate take rates when it constitutes a larger portion of our business. This year's World Series matchup was particularly favorable, which may impact take rates.