Vivid Seats - Earnings Call - Q1 2025

Executive Summary

• Mixed Q1: Revenue of $164.0M declined 14% YoY and 18% QoQ; Adjusted EBITDA of $21.7M fell 44% YoY and 36% QoQ as volume and marketing inefficiency pressured profitability.
• Top-line missed S&P Global consensus by ~2.7% ($164.0M vs $168.6M), while S&P’s Primary EPS “actual” was $0.30 versus -$0.29 consensus; however, GAAP net loss was -$9.8M (net loss attributable to Class A -$5.9M), highlighting a divergence between GAAP EPS attribution and S&P’s Primary EPS construct [GetEstimates; S&P Global]*.
• Competitive intensity and an unannounced change in Google’s performance marketing reporting reduced marketing efficiency industry-wide; management suspended FY25 guidance and expects continued near-term pressure despite easier comps in 2H25.
• Offsets/catalysts: take rate remained healthy at 16.3% (near-term outlook 15.5–16.0%), loyalty/Game Center engagement uplifted cohort behavior, and the United Airlines partnership should contribute in 2H25, but share losses in performance marketing channels are a key overhang.

What Went Well and What Went Wrong

• What Went Well

  • Take rate resilience: Marketplace take rate rose to 16.3% (+70 bps YoY), with near-term expectation at 15.5–16.0%.
  • Engagement ROI: New customers who interacted with Game Center showed a 55% higher repeat rate and 35% higher GOV in Q1, driven by fan-focused in-app enhancements and campaigns (e.g., Beyoncé, Bad Bunny, March Madness).
  • Strategic pipeline intact: United Airlines MileagePlus partnership expected to drive accretive volume starting in 2H25; ongoing SkyBox adoption underpins seller-side stickiness.

• What Went Wrong

  • Volume deterioration and share pressure: Marketplace GOV down 20% YoY to $820M; total marketplace orders down 20% YoY; management attributed declines to performance marketing inefficiency and competitive pressure.
  • Guidance withdrawn: FY25 guidance suspended amid macro variability, soft industry trends, and atypical performance marketing changes; management expects continued near-term pressure.
  • Cash generation and working capital: Negative operating cash flow in Q1 driven by seasonal items (inventory build, bonuses) and volume-led float pressure; management now expects “fairly limited” full-year cash generation.

Transcript

Operator (participant)

Good morning and welcome to the Vivid Seats First Quarter 2025 earnings conference call. Following the management's prepared remarks, we will open the call for Q&A. I would now like to turn the call over to Emily Epstein.

Emily Epstein (General Counsel)

Good morning and welcome to Vivid Seats First Quarter 2025 earnings conference call. I'm Emily Epstein, General Counsel at Vivid Seats. Joining me today to discuss Vivid Seats results are Stan Chia, Chief Executive Officer, and Larry Fey, Chief Financial Officer. By now, everyone should have access to our First Quarter earnings press release, which was issued earlier this morning. The press release, as well as supplemental earnings slides, are available on the Investor Relations page of our website at investors.vividseats.com. During the course of today's call, we may make forward-looking statements within the meaning of federal securities laws. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially, including the risks and uncertainties described in our earnings press release, our most recent annual report on Form 10-K, and our other filings with the SEC.

On today's call, we will refer to Adjusted EBITDA, Adjusted EBITDA margin, and cash generation, which are Non-GAAP financial measures that provide useful information for investors. To the extent reasonably available, a reconciliation of these Non-GAAP financial measures to their corresponding GAAP financial measures can be found in our earnings press release and supplemental earnings slides. I would like to turn the call over to Stan.

Stan Chia (CEO)

Good morning, everyone, and thank you for joining us today. Today, I'll share a recap of our first quarter results, updates on key priorities, and then discuss how we are strategically investing to drive our long-term success. I will turn it over to Larry to share our financial results in more detail. In the first quarter, we delivered $820 million of marketplace GOV, $164 million of revenues, and $22 million of Adjusted EBITDA. Overall, it was a challenging year-over-year comparison, and we fell short of our expectations. We have continued to see robust competitive intensity while also seeing softening industry trends amidst consumer uncertainty. As we've all witnessed, economic and political volatility has impacted consumer sentiment, and this uncertainty can also impact how and when artists and rights holders go to market.

I want to emphasize that we remain confident in the resiliency of our industry and are excited for the long-term tailwinds driving North American live events. Although there is pressure on the consumer, we continue to see consumers prioritizing spending on live experiences over goods, reinforcing our belief that while this is a period of volatility, the long-term opportunity and trends remain attractive. We will continue to align our near-term priorities with this current environment while not losing sight of the long-term opportunity. As we go forward, we will continue our cost-disciplined approach while making strategic and focused investments in both marketing and technology. Turning to those investments, we are focused on our product development capabilities and building on the strengths of our differentiated platform. In the coming months, we will be releasing several fan-focused experiential enhancements within our app to optimize discoverability and inspire the live event consumer.

These upcoming app enhancements will focus on elevating the customer experience with key improvements to the navigation and personalization of our platform. We are also pleased with our ongoing investment in Game Center, which continues to foster significant engagement in our app. In the first quarter, we capitalized on popular culture moments with contests around tours like Beyoncé and Bad Bunny, as well as our March Madness Bracket to Stack It game. These consumer engagement and experience efforts are designed to cultivate brand awareness and affinity for our platform. With limited marketing expense, we saw this in-app feature have a positive effect on our repeat rate for new customers who were acquired in the first quarter, which was 55% higher for fans that had interacted with Game Center. Similarly, GOV was 35% higher for new customers that had interacted with Game Center.

Turning to the seller side of our marketplace, we continue to invest in and demonstrate the power of Vivid Seats' marketplace data through SkyBox. As we've shared, our industry-leading ERP is utilized by over half of professional sellers to run their businesses. Additionally, we are pleased with our ongoing onboarding of SkyBox Drive users. While the progress is encouraging, we look forward to seeing further meaningful increases in adoption over time. As we look at our path ahead, we remain committed to expanding our TAM and taking a coordinated and deliberate approach to building out our global business for sustainable growth. After initiating our official European launch in the fourth quarter, in the first quarter, we continued to build on and further develop the internationalization of our platform and capabilities.

We will continue investing in favorable markets where we can scale our platform and look forward to international expansion supporting our growth. On our last call, we discussed our strong 2025 partnership pipeline. We look forward to launching our new partnership with United Airlines, the world's largest airline, soon. With over 130 million members, United's MileagePlus loyalty program is one of the largest loyalty programs in the world, and those many members will be able to earn miles for purchasing tickets through Vivid Seats. Partnerships like this provide an important strategic advantage and allow us to drive accretive volume through our ecosystem, and we expect this partnership to start contributing in the second half of 2025. Lastly, I'd like to provide an update on the progress we have made towards several initiatives outlined in our corporate responsibility and governance strategy since its launch in 2023.

We recently published our 2024 results and are proud of the significant step forward we made in our sustainability goals this past year. These strategic practices underscore our ongoing commitment and dedication to our employees, customers, environment, and global communities. To conclude, while we are navigating a challenging environment, we will continue to focus on efficiency, sustainable unit economics, and the ability to strategically invest in our future growth. Regardless of macroeconomic conditions, we are confident that our operational discipline, differentiated offering, and lean cost structure will position us to perform over the long term. With that, I will turn it over to Larry for a more detailed review of the quarter and year.

Larry Fey (CFO)

Thank you, Stan. We generated $820 million of marketplace GOV in Q1, which was down 20% year-over-year. Total marketplace orders were also down 20% versus Q1 2024, while average order size was flat year-over-year. We generated $164 million of revenues in Q1, which was down 14% year-over-year. Owned property revenues were down 14%, while private label revenues declined 27%. Our Q1 marketplace take rate was 16.3%, up 70 basis points from 15.6% in Q1 2024. While take rate will continue to see variability, we anticipate near-term take rates will be in the 15.5%-16% range. Q1 2025 Adjusted EBITDA was $22 million, down from $39 million in the prior year. This decline resulted from a combination of lower volume, higher marketing as a percentage of revenue, and negative operating leverage.

There were unexpected changes in certain performance marketing channels during Q1, and we believe marketing efficiency will improve sequentially, while year-over-year volume declines will continue in the near term. We ended Q1 with $393 million of debt and $199 million of cash, with net debt of $194 million. Cash generation was negative during the quarter due to a combination of seasonal items such as inventory build and annual bonus payments, compounded by continued pressure on working capital due to organic volume declines. During the first quarter, we repurchased $7 million worth of shares at an average price of $2.89. In terms of outlook for the remainder of 2025, we are suspending guidance. While we previously anticipated continued competitive intensity, the additional variability across the global economy, potential consumer softness, and atypical changes across the performance marketing landscape have combined to create a particularly broad range of potential outcomes.

We will start to lap easier year-over-year volume comps in the second half of the year, but expect persistent competitive intensity to drive near-term pressure. I'll now hand it back to Stan for concluding remarks.

Stan Chia (CEO)

Thanks, Larry. Our historical approach has been to execute with disciplined rigor and focus on the things we can control. In this shifting environment, we are focused on operational discipline to manage the business for the long term. As we've said before, we realize benefit from investing in our differentiated product, service, and value, and that is where we will continue to focus in this current environment. With that, Operator, I'd like to open it up for questions.

Operator (participant)

Thank you. At this time, we will conduct a question-and-answer session. As a reminder, to ask a question, you will need to press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Please stand by while we compile the Q&A roster. The first question comes from Ryan Sigdahl with Craig-Hallum Capital Group. Please go ahead.

Ryan Sigdahl (Analyst)

Hey, good morning, guys. I want to start with, and maybe it's kind of a two-part question, the competitive environment, but the performance marketing and atypical nature that happened in Q1. Can you elaborate exactly what's happening there? In the context of that and the continued competitive intensity, namely from one of your skilled peers, does that change your strategy? I know you talked about defending unit economics last year, but focus more on defending market share this year if that's still the strategy.

Larry Fey (CFO)

Yeah. I can go first and get a roll-in. On the performance marketing side, we saw some changes actually in the Google channel and the way they do some of their data reporting. Unannounced change, inconsistent data across their multiple portals, and as best we can tell, that inconsistent data compelled folks to bid more aggressively than they normally would. It related to splitting the auctions from one per page to two per page. It took, I think, us and the industry a while to realize that the change had happened and recalibrate some of the metrics accordingly. You had a dip in efficiency industry-wide, I think, around that. On top of it, I think the same song plays on repeat with the continued competitive intensity.

I think to your latter point, it seems like the culprit is intent on continuing to put pressure on that channel. We have to assume indefinitely, and that pressure is certainly not alleviating. As we look at that channel for volume, I think we are presuming it will remain under pressure for the foreseeable future and preparing to adjust accordingly.

Stan Chia (CEO)

Yeah. I think, Ryan, as you asked the question, I think for us, we continue to try to invest really for the long term and building out capabilities that I think ideally allow us to do both, right, which is continue to drive profitable growth and disciplined unit economics while continuing to focus on, I think, recapturing share at the appropriate time.

Ryan Sigdahl (Analyst)

Great. For my follow-up, just curious if you've seen any change. Your industry expectations from mid-single digits to flat to down, I guess, is that entirely the consumer, and how much of that have you seen year-to-date versus just taking a more conservative approach given all the volatility that's happening in the economy for what could happen later this year? I guess, secondly, have you seen any changes to either the mix or amount of concert supply that you were expecting for this year?

Larry Fey (CFO)

Yeah. I'd say we think we alluded in the last quarter to the year starting out strongly and then softening into February and March. We've actually seen a little bit of a bounce back in April. I think just given the broader economic environment, we felt like it made sense to deflate expectations, even though we are continuing to see some level of choppiness month to month.

Ryan Sigdahl (Analyst)

Any change on the supply side? That's it for me. Thanks, guys.

Operator (participant)

Thank you. Our next question comes from Curtis Nagle with Bank of America. Please go ahead.

Curtis Nagle (Analyst)

Sure. Maybe I'll just follow up on that a little bit. Maybe, Stan, could you extrapolate on that comment that it sounds like macro uncertainty is impacting when rights holders go to market? Are you actually seeing artists pull back or maybe delay planned tours, or did I maybe misinterpret that comment?

Stan Chia (CEO)

No. Hey, Curtis. Yeah. Look, I think no surprise, I mean, not our industry alone, but certainly across multiple consumer-facing segments, I think there just is a lot of volatility. I think in our industry, and when you look through, I think, even others who participate, there's probably been what we see as a seasonal low in terms of what we've seen come to market. That being said, I think April is, I think, Live Nation called out certainly an early period of stronger on sales. Outside of that, I would say I think we've seen, I think, a dearth of what we would normally expect during this period. While still early in the quarter, certainly enough volatility that it could be a multitude of factors that are impacting it.

Curtis Nagle (Analyst)

Okay. Got it. And then just maybe one for you, Larry, just in terms of take rate expectations, did those change? Right? I think, what, we are 15.5%-16% now. That maybe was supposed to be a little bit higher for the rest of the year, but again, maybe I misinterpreted. Just any clarification there would be great.

Larry Fey (CFO)

Yeah. I think if we zoom out a little bit, going way back to early 2024, we had said expect 15.5% or higher. 2024, as we were optimizing unit economics, we came above that level. I think in prior calls alluded to perhaps we overshot the mark a little bit. So kind of drip back down to that original 15.5% or higher level as a reasonable guidance level. Yeah, we'll continue to be opportunistically looking to move levers where we see opportunities up or down. I think the net was when we were getting into that 17% range, I think we were probably over-prioritizing take rate relative to volume.

Curtis Nagle (Analyst)

Okay. Understood. Thank you.

Operator (participant)

Thank you. Our next question comes from Thomas Forte with Maxim Group. Please go ahead.

Thomas Forte (Analyst)

Great. Thanks. Can you compare what you're seeing in concerts versus sporting events versus theater and comedy?

Larry Fey (CFO)

Yeah. Maybe start with industry-level volume, and then we can move to our performance within that. I think the concert landscape has been particularly volatile in terms of year-over-year volume trends. I think we alluded to January being up double digits, March ended up down double digits, April back up double digits. I think you have in concerts that continued issue where when you look on a monthly basis, the timing or event mix of which on sales happen to fall in which month can lead you to a dangerous conclusion if you take the last month and assume that trend continues indefinitely. When you blend it all together, I think concerts has been flat to up slightly year-to-date. Sports has been down a bit at the industry level.

Yeah, I think there were some tough comps where we started out as an easy comp with the new college football playoff, but tough Super Bowl. We had Copa América last year. We had the Peyton Clark effect last year. We'll have a tough World Series comp coming up later in the year. I would expect that the sports growth will lag the rest of the industry. Theater has been quite strong at the industry level, both bolstered by a couple pretty meaningful comedian tours. I've seen really nice growth in that category, folks like Shane Gillis and the like. Our performance relative to the industry, I'd say, has been broadly similar. Maybe we slightly under-indexed on the theater outperformance, but across sports and concert, pretty consistent relative performance to the underlying industry trend.

Thomas Forte (Analyst)

Great. Thanks, Larry. For my follow-up, I know you're suspending guidance for full year, but can you give your current high-level thoughts on cash conversion at EBITDA and then what your current thoughts are on capital allocation, buying back shares, strategic M&A, investing in the business?

Larry Fey (CFO)

Yeah. I think as EBITDA drifts lower relative to expectations this year, as GOV drifts lower relative to original expectations, you'll have, unfortunately, the dual effect of continued pressure on our float and thus working capital contribution, which, as we talked about in a growing environment, is a source. When you're suffering organic declines like we continue to see, it becomes the youth. We have our interest expense. We have our CapEx. Those are effectively fixed cash obligations. As EBITDA declines, the amount of cash that comes out of the bottom gets compressed as well. Sitting here today with the negative cash outflows that we saw in Q1, I think a prudent calculation for our cash generation would be fairly limited on a full-year basis. Certainly well below what we had expected coming into the quarter.

In terms of capital allocation, yeah, I think continue to be fully aware of our valuation and multiple and trajectory. High bar, to say the least, for M&A. I think we continue to have cash and flexibility to make the right investments operationally and subject to our view on valuation and the share price will continue to consider and pursue share purchases if it makes economic sense.

Thomas Forte (Analyst)

Great. Thanks, Larry. Appreciate it.

Operator (participant)

Thank you. Our next question comes from Maria Ripps with Canaccord. Please go ahead.

Maria Ripps (Analyst)

Good morning, and thanks for taking my questions. Can you maybe talk about expectations around your market share dynamics versus flat to down industry volumes for the year? Could we actually see GOV sort of returning to growth by the end of the year?

Larry Fey (CFO)

Yeah. I think if you sort of map a flattish industry in Q1 against our GOV being down 20%, you can get a fair proxy for share impact. I think that predominantly is coming out of the performance marketing channels. We see a similar trajectory, if not worse, across other players in the space that are heavily indexed towards the performance marketing channels. Yeah. I think we talked about last year starting to lap some easier—sorry. We will start to lap some easier comps as we suffered additional share pressure in the second half of last year. We have some nice private label wins. I think at this point, assuming a Q2 trajectory that's broadly in line with Q1 is prudent and why I'd certainly anticipate the second half looking better with what we've seen to date, I'd be hesitant to forecast a reversion to growth.

Maria Ripps (Analyst)

Got it. That's helpful. You talked about being sort of mindful in terms of near-term investments here. Is there a level of EBITDA margin that you maybe would like to maintain regardless of the macro kind of dynamics and sort of competitive environment?

Larry Fey (CFO)

Yes. I think we'll have to continue to be dynamic. I think, frankly, the pressures that we've seen play out year-to-date have come in well above what we had anticipated coming into the year. It continues to be a fluid exercise. Yes, continuing to actively manage the trade-off of marketing efficiency and how much marketing spend to balance profitability and volume. Obviously, we're already in a tough volume position. The Nth dollar of marketing that you pull back, while it may be EBITDA accretive, will further pressure volume and share. It's strung tight. We're continuing to look everywhere we can for efficiencies to retain as much EBITDA as possible. It's a night fight at the moment.

Maria Ripps (Analyst)

Got it. Thank you, Larry.

Operator (participant)

Thank you. Our next question comes from Cameron Mannson-Perrone with Morgan Stanley. Please go ahead.

Cameron Mansson-Perrone (Analyst)

Thank you. Morning. You mentioned still being excited about growing the TAM. I was wondering if you could elaborate just on—I realize it's early—but any additional update in terms of your international efforts and what's progressing there, any early learnings? Then on the performance marketing front, I was just wondering if you could elaborate on or give us some additional color on how your participation in performance marketing has evolved to where it stands today. How much are you—how would you characterize your level of activity or spend there today relative to a year ago, two years ago? It would be helpful. Thanks.

Stan Chia (CEO)

Yeah. Hey, Cameron. I'll take the first one. I think on international, I think we remain pretty pleased with the early signs. While, as you said, nascent, I think our efforts continue to be really focused on building up scale across the multiple dimensions of the marketplace, be that supply, demand, and spinning up our infrastructure and technology across those spaces. Early reads have been pretty positive, and we continue to be excited about expanding that global reach and that TAM as well. On the, I think, marketing side, as you think about that, I think that continues to be a large channel for us. I'd say proportionately, we probably haven't seen a large difference in mix.

However, I think we continue to invest in diversifying that, being aware of, I would say, various components of the changes in that channel, as we alluded to in the earnings component, and then building out, I think, the components of our platform that drive stickiness within. That is certainly where we're focused for the long term.

Cameron Mansson-Perrone (Analyst)

Got it. That's helpful. Thank you.

Operator (participant)

Thank you. Our next question comes from Andrew Marek with Raymond James. Please go ahead.

Andrew Marek (Analyst)

Hi. Thanks for taking my questions. You were pretty clear on a lot of the dynamics affecting order volume and the things going on there. I wanted to think about the AOS variable, given that there's presumably a macro headwind, but you're also entering a period of easier comps once you lap the Vegas.com and the Wavedash impacts. Thank you.

Larry Fey (CFO)

Yeah. In the first quarter, we saw our average order size hang in there and be flat. Interestingly, industry average order size was down a few points. We skewed slightly higher than industry on overall price point. Hard looking into the balance of the year to have a precise view, I do think we are likely facing a better concert environment in terms of lineup and supply than we were last year. At least as of today, a lesser consumer environment. To net those two together is going to be tough to say with precision. I think at the moment, I would say flat seems like as good a guess as anything.

Andrew Marek (Analyst)

Appreciate it. Really quickly, another marketing question, I guess. Has there been or could there really be any response to maybe some value-based messaging around the savings provided by the loyalty program? Could that help in any meaningful way, or is it just the case where sometimes people get economically pressured and they say, "No amount of loyalty discount will help me convince me to buy tickets"?

Larry Fey (CFO)

Yeah. I'd say we pretty consistently see pricing impact purchase behavior. We really haven't lived through a substantial or persistent period of consumer softness other than COVID, which I think was exceptional in a lot of ways, where I could say with any quantified confidence that elasticity increases when economic softness turns in. We have always seen that there is a consumer response to value prop. If you're seeing it elsewhere in consumer behavior, I think it's a reasonable hypothesis that the loyalty program could resonate a bit more. I think our task continues to be driving more awareness of that loyalty program. Folks that have it, we see good behavior shift. We need to continue to make folks aware and have them appreciate and understand how significant the value difference really is.

Andrew Marek (Analyst)

Understood. Thank you.

Operator (participant)

Thank you. Our next question comes from Dan Kurnos with The Benchmark Company. Please go ahead.

Dan Kurnos (Analyst)

Yeah. Thanks. Good morning. Maybe a few, I guess. Stan, I do not think we have addressed some of the regulatory stuff, whether it is the Trump executive order or the Ticket Act with the concierge component in it. Maybe start there and just give your thoughts on either impact to the industry or how you view that play to.

Stan Chia (CEO)

Yeah. Hey, Dan. Yeah. I think we are, and have always been, I think, really supportive of all the regulation that is targeted at providing transparency for consumers in the industry. I think, one, it's fundamentally a tenet that we believe in. Two, perhaps more on the competitive side, we believe that our leaner cost structure as well as pricing for consumers generally tends to always be lower than the competitive set. I think whether it is the recent executive order, the various acts that are looking at it, or the FTC's order that's coming into play, all are really focused on price transparency. We are quite supportive of all of that and are looking forward to a level playing field as it pertains to transparency and price to consumers.

Dan Kurnos (Analyst)

Got it. That makes sense. Not to sort of go on with this too much, but just in terms of maybe the delta between the primary and secondary markets, Live Nation's demand comments were a little bit more upbeat. I hear you, particularly Larry, on the supply challenges. We've seen that in the marketplace. Ticket pricing being higher in the secondary market, I guess I'm just trying to figure out how much you guys are concerned about the consumer relative to it being more of a competitive issue. If the higher secondary ticket pricing general relative to primary is playing a factor on your view on the demand equation.

Larry Fey (CFO)

Yeah. I mean, I'd certainly characterize our main challenge at the moment as share. I think we continue to believe the overall industry trajectory is robust. I think it continues to prove resilient relative to other consumer-facing categories. I think we continue to believe that there's healthy growth over a multi-year period. Specific to the U.S. versus Live Nation commentary, I think that probably just falls more under the slight stylistic difference, right? When we look at things we've seen fully come out, I think we're just probably a bit more tepid. I think, again, they might know a little more than we do on what's coming the balance of the year. From what we've seen, it's a fine lineup, right? I don't want to suggest otherwise.

Given what we saw February and March, I think we see a couple consecutive months of softness, albeit buttressed by strength on either side of it. With the broader uncertainty, I think just we wanted to frame that on the margin, we're feeling more cautious, not less. Even when you look across what folks are saying in real time, I think there's a broader diversity of perspectives on how everything is looking at the moment than you saw it three, four, or five months ago.

Dan Kurnos (Analyst)

Got it. Super helpful. Just lastly on the marketing, which a lot of people have touched on, I guess, Stan or Larry, in terms of mix, social is having kind of a moment right now. United is a huge win for you guys. Obviously, you guys have been really good with the partnership side. I mean, how do you contemplate channel mix at this point? Are you developing some kind of maybe more clever ways to work more closely with some of the players to either define your own algos or however it is to get even further efficiencies in a channel that had maybe a momentary tailwind but is going to probably revert to the mean in the back half of the year?

Stan Chia (CEO)

Yeah. Thanks for that, Dan. I think it's actually a really astute point. I think as you see our focus on partnerships, a lot of our leverage of the distribution platform that we have has been on being able to diversify our volumetric mix away from, I would say, competitively pressured marketing channels. With deals like United, we remain very excited about the perspective of partnering with a brand that has 100 million-plus loyalty users in an accretive manner that is independent of the marketing pressure. We continue to focus on finding deals like that, where also we'll have cross-branded opportunities to drive a halo into the Vivid Seats platform. More broadly, on the social side, we continue to think that too is an area where we are making investments using, I think, AI-oriented tools to drive and scale creative in a way that wasn't possible before.

I think we look excited to the future as we lean heavier into that channel and look for more, I would say, accretive value out of that as we invest.

Dan Kurnos (Analyst)

Got it. Thanks for bearing with me, guys. Appreciate it.

Operator (participant)

Thank you.

Our next question comes from Ralph Schackart with William Blair. Please go ahead.

Ralph Schackart (Analyst)

Good morning. Thanks for taking the question. Just on the marketing change that you called out, and Google makes changes from time to time. I'm sure you've kind of worked through them historically. Maybe if you sort of frame the order of magnitude of this change versus what you've seen historically in just some sense from your perspective on the workarounds or how long you and/or the industry will be able to work through this change as well. Thank you.

Larry Fey (CFO)

Yeah. I think a little bit of a dangerous topic just because it is still a lot of black box and some magic that it's hard to know with precision what's happening. I would say this change, as best we can tell, was not universally rolled out, but it did hit our industry. We saw kind of one of the interesting parts of our private label business. We'll have multiple folks see multiple vantage points and quickly realize that it was impacting everyone universally. Everyone saw a kind of correlated almost to-the-day erosion in efficiency that persisted for a few weeks. Ultimately, I think, was confirmed. How does this compare to other changes they've made? Hard to speak precisely on that. It's a little bit like pile-on, right?

When you're already in a hyper-competitive performance environment, you have folks that are, I think, trying to effectively make it difficult for others to compete. When you layer on black box algorithmic changes on top of it, it felt incrementally painful relative to the normal course variability. I think everyone, precisely as we can tell, recalibrated and adjusted. There is still this lagging question. When you see, call it, performance marketing footprint continuing to move towards StubHub, is that because of efficiency that they are extracting and realizing? Is it because they continue to lean higher on spend and are accepting more volume for lower profit? Is there an incremental change in the Google algorithm where they're rewarding different bid types, bid behaviors relative to prior history?

It'll take, I think, a little more time for us to get clarity across those three incremental variables beyond the specific change that I would call more of like a glitch in February.

Ralph Schackart (Analyst)

That's helpful. Thanks, Larry.

Operator (participant)

Thank you. I'm showing no further questions at this time. This concludes the question and answer session. Thank you for your participation in today's conference. This concludes the program. You may now disconnect.