Eventbrite's Q3 2025 Earnings Call: Clashing Priorities on Growth Initiatives, GenAI-Driven Innovation, and Ads Strategy Reveal Strategic Uncertainties

Date of Call: November 06, 2025

Financials Results

• Revenue: $71.7M, down 8% YOY (Q4 guidance $71.5M–$74.5M; FY25 guidance $290M–$293M)
• Gross Margin: 67.9%, down 60 bps YOY; +40 bps sequential improvement vs Q2 driven by growth in higher‑margin Eventbrite ads

Guidance:

• Q4 net revenue expected to be $71.5M–$74.5M and adjusted EBITDA margin 8%–9%.
• FY2025 net revenue expected to be $290M–$293M with adjusted EBITDA margin 8%–9%.
• Return to monthly YOY paid ticket volume growth expected within the first few months of 2026; expect quarterly YOY growth in paid tickets, ticketing revenue and total net revenue by Q2 2026.
• Plan to retire remaining converts: $30M (Dec 2025) and $88M (by Sep 2026), leaving only a $60M term loan.

Business Commentary:

* Stabilization and Growth in Paid Tickets: - Eventbrite reported a 3% year-over-year decrease in paid ticket volume, improving from a 7% decline in the previous quarter. - This stabilization was attributed to the company's efforts in strengthening reliability, reporting, and foundational systems, as well as improving user experience, support, and success tools for creators.

• Cost Management and Structural Improvements:
• The company's adjusted EBITDA margin was 11.7%, exceeding the guided 7%, due to structural cost actions flowing through.

• Cost management included a reduction in operating expenses by 20% year-over-year, with significant reductions across product development, sales, marketing, and general and administrative expenses.

• Eventbrite Ads Revenue Growth:

• Eventbrite's ads revenue grew by 38% year-over-year, contributing to a 40 basis points sequential improvement in gross margin.

• This growth was driven by the increasing effectiveness of the ads product, with creators experiencing over a 200% ROAS.

• New Paid Creator Acquisition and Retention:

• There was a nearly 4% increase in new paid creator acquisition in Q3, with meaningful improvements in creator retention.

• This was the result of initiatives to enhance user experience, support, and success tools, along with improved trust and safety measures and a refreshed consumer app.

• Strategic Investments for Future Growth:

• Eventbrite plans to invest in premium tools for larger creators, AI-driven creator success, consumer engagement, and global expansion.
• These investments are made possible by structural improvements in the cost structure, aiming to drive growth and innovation while operating with discipline.

Sentiment Analysis:

Overall Tone: Positive

• Management highlighted adjusted EBITDA margin of 11.7% 'well above our 7% guidance', noted sequential and multi-quarter recovery in paid tickets/creators, and stated 'we expect to return to monthly year‑over‑year paid ticket volume growth within the first few months of 2026' and to resume quarterly revenue growth by Q2 2026.

Q&A:

• Question from Justin Patterson (KeyBanc Capital Markets Inc.): How are you thinking about the right level of investment to build upon creator stabilization and drive the return to growth in 2026?
  Response: Reallocate structural OpEx savings into high‑ROI growth areas (performance marketing, product experiments) while maintaining disciplined cost control; balance continued OpEx reduction with targeted investment.

• Question from Justin Patterson (KeyBanc Capital Markets Inc.): How does GenAI influence the pace of product innovation for creators and consumers?
  Response: Use AI across four priorities—premium tools for large creators, AI‑driven creator marketing/listing improvements, consumer personalization/discovery, and global/monetization expansion—to accelerate product innovation and upmarket offerings.

• Question from Cameron Mansson-Perrone (Morgan Stanley): Thoughts on the recent ticketing industry discussion (FTC lawsuit) and any knock‑on effects for Eventbrite; how do you balance monetization with transparency?
  Response: Eventbrite emphasizes transparency and fair pricing as a core principle; the company sees competitive openings as opportunities and will continue investing in premium creator tools and transparent, high‑conversion checkout—strategy unchanged by litigation.

• Question from Cameron Mansson-Perrone (Morgan Stanley): You cited a 40 bps sequential gross margin improvement from ads—should we expect that momentum to continue into year‑end and how does that align with adjusted EBITDA guidance?
  Response: Expect modest continued sequential gross margin improvement as higher‑margin ad revenue grows as a share of revenue, but management declined to quantify incremental basis points.

Contradiction Point 1

Investment in Growth Initiatives

It involves changes in strategic priorities and financial allocations for growth initiatives, which are crucial for future business performance.

What level of investment is needed to build on this year's progress in stabilizing creators and improving cost structure to drive 2026 growth? - Justin Patterson (KeyBanc Capital Markets Inc., Research Division)

2025Q3: We're focused on bringing down OpEx in a disciplined way, allocating funds to areas that can drive growth, like performance marketing. We aim to balance reducing operating expenses with funding growth initiatives, feeling confident about our current position. - Anand Gandhi(CFO & Principal Accounting Officer)

With improved cost management and business repositioning, can you shift focus to growth, and how do you prioritize stabilizing the business versus driving growth? - Eric Joseph (Ignite Investor Relations)

2025Q2: We are focused on improving operating efficiency while maintaining investment in growth initiatives. The investments are targeted areas where we can drive growth and continue to differentiate the business. - Anand Gandhi(CFO & Principal Accounting Officer)

Contradiction Point 2

Product Innovation Driven by GenAI

It involves changes in the company's strategic focus and direction regarding the integration of artificial intelligence, which is crucial for staying competitive in the market.

How is GenAI-driven product innovation impacting creators and consumers? - Justin Patterson (KeyBanc Capital Markets Inc., Research Division)

2025Q3: Investments in 2026 focus on premium tools for larger creators, AI to drive creator success, consumer engagement and personalization, and global and monetization expansion. Structural improvements in cost efficiency allow for these innovations. - Julia Hartz(Co-Founder, Executive Chairman & CEO)

What drove the acceleration in paid creators and paid ticket growth in July? What factors are affecting the impact of smaller creators on this mix? - Dae Lee (JPMorgan)

2025Q2: We plan to continue to execute against our core product strategy, which is to make our platform more valuable for creators to create and host events and for consumers to discover and attend events. - Julia Hartz(Co-Founder and CEO)

Contradiction Point 3

Eventbrite Ads Growth Strategy and Impact

It involves differing explanations of the factors driving Eventbrite Ads growth, which is a critical revenue stream and strategic focus for the company.

What is the appropriate investment level to build on this year's progress in stabilizing creators and improving costs for 2026 growth? - Justin Patterson(KeyBanc Capital Markets Inc., Research Division)

2025Q3: We're focused on bringing down OpEx in a disciplined way, allocating funds to areas that can drive growth, like performance marketing. - Anand Gandhi(CFO & Principal Accounting Officer)

What is driving sustained ad growth? - Justin Patterson(KeyBanc Capital Markets Inc., Research Division)

2025Q1: Eventbrite Ads is native to the marketplace, performance-driven, and creator-led. Growth is supported by expanding high-intent ad placements, improving creator ROI tools, and enhancing ad relevance. - Julia Hartz(Co-Founder & CEO)

Contradiction Point 4

Impact of GenAI on Product Innovation

It showcases differing views on the impact of GenAI on product innovation, which could affect the company's strategic direction and future product offerings.

How is GenAI-driven product innovation impacting creators and consumers? - Justin Patterson (KeyBanc Capital Markets Inc., Research Division)

2025Q3: Investments in 2026 focus on premium tools for larger creators, AI to drive creator success, consumer engagement and personalization, and global and monetization expansion. Structural improvements in cost efficiency allow for these innovations. - Julia Hartz(CEO)

Has there been any improvement in conversion rates for the TikTok partnership? - Naved Khan (B. Riley)

2024Q4: Our partnership with TikTok continues to be an important channel for driving event discovery and ticket sales. We are working with them to put the native ticket integration into places like search, aiming to drive viewers and impressions to conversion. We’re still working on making the ticketing more seamless to improve conversion. - Julia Hartz(CEO)