After a prolonged wait for its IPO, StubHub has experienced a rocky debut on the New York Stock Exchange, with shares plummeting over 7% on Friday. This marks the third consecutive day of decline since the company went public on Wednesday, bringing the stock’s value down to $19—an 18% drop from its initial public offering price of $23.50. Trading under the ticker symbol “STUB,” the online ticket vendor has notably underperformed compared to other recent market entrants such as online lender Klarna, design software company Figma, and stablecoin issuer Circle, all of which saw favorable responses from investors shortly after their IPOs.
The struggles facing StubHub come in stark contrast to shares of cybersecurity firm Netskope, which demonstrated a more promising trajectory with a 12% increase on Friday following an initial surge on Thursday. StubHub’s journey to the public market has not been straightforward; the company reportedly postponed its debut twice in recent years, with the latest delay attributable to market fluctuations triggered by former President Donald Trump’s sweeping tariff announcements in April. An updated prospectus was filed in August, helping to reignite its public offering efforts, though the company’s market capitalization has since dipped to approximately $7 billion from $8.6 billion at the time of its IPO.
Founded in 2000, StubHub primarily earns its revenue by facilitating connections between buyers and ticket resellers, reporting a 10% revenue increase to $397.6 million for the first quarter compared to the previous year. However, the company also reported a widening net loss, which expanded to $35.9 million from $29.7 million in the same period last year.
CEO Eric Baker addressed concerns in an interview with CNBC, revealing that new federal regulations related to transparent ticket pricing are expected to impact StubHub’s finances significantly. These regulations have intensified scrutiny on online ticket sellers, particularly regarding their pricing tactics and efforts to combat automated purchasing bots. The Federal Trade Commission (FTC) has also taken action against StubHub’s competitor, Live Nation Entertainment—the parent company of Ticketmaster—by filing a lawsuit that accuses it of engaging in illegal resale practices.
Despite the rocky entrance for StubHub, the wider tech IPO market has shown signs of vitality, with companies like Amazon reseller Pattern Group witnessing a stock increase of 10% on Friday, even after an initial decline. This indicates a potentially positive trend for other tech firms considering similar public offerings in the near future.
