StubHub Lifts Sales Outlook as Adjusted EBITDA Jumps 84%

Adjusted EBITDA rose 84% to $124 million in the third quarter at StubHub Holdings (NYSE: STUB), the operator of the StubHub ticket marketplace, on gross merchandise sales of $2.6 billion, up 7% from a year earlier. The company raised its full-year sales outlook while keeping its profit forecast unchanged. Net income came in at $34 million.

Revenue reached $502 million, also up 7%, with the adjusted EBITDA margin expanding 10 percentage points to 25%. Founder, Chairman and Chief Executive Eric Baker said the results reflected demand for live events and greater operating efficiency. StubHub simultaneously announced that Chief Financial Officer Connie James will step down early next year; Mike Noonan, currently CFO of Tripadvisor, is set to join in January.

What did StubHub change in its guidance?

StubHub increased its 2026 gross merchandise sales guidance—the total value of tickets transacted on its marketplace—to $10.175 billion to $10.375 billion, representing growth of 11% to 13%. Its previous outlook called for growth of 10% to 12%. The company maintained its adjusted EBITDA forecast of $400 million to $420 million.

James said the outlook accounts for uncertainty over when tickets for 2027 concerts will go on sale. Baker said promoters may put major tours on sale late this year or wait until the first quarter, a decision outside StubHub's control. The calendar, one notes, rarely negotiates.

Baker also flagged difficult fourth-quarter comparisons against the initial release of World Cup tickets in December 2025 and last year's Major League Baseball postseason. This year's World Series involved smaller-market teams and lasted five games, he said, compared with a seven-game series last year. Excluding the World Cup on-sale and baseball factors, Baker said underlying fourth-quarter growth would be in the high single digits. The company plans to discuss its 2027 expectations when it reports fourth-quarter results.

Where did the operating gains come from?

Sales and marketing expense fell to 45% of revenue, an improvement of nine percentage points from a year earlier. Baker attributed the efficiency gains to scale, improved conversion and repeat usage. He said Google marketing channels remained healthy and that StubHub was not yet seeing material traffic from artificial-intelligence referrals.

Revenue as a percentage of GMS was 19% in the third quarter, up from about 18.5% in the second quarter. James said the rate was affected by the World Cup and that the company still expected it to approach 20% for the full year.

Free cash flow over the trailing 12 months reached $192 million, equivalent to 53% of adjusted EBITDA for that period. James said quarterly cash flow can fluctuate because StubHub collects money from buyers before paying sellers, typically after an event. The company recorded a $447 million net working capital outflow in the third quarter, after collecting $472 million of net inflows in the first half, largely because of the World Cup.

Net leverage declined to 2.5 times trailing 12-month adjusted EBITDA at quarter-end, from 4.5 times at the end of 2025. StubHub repaid $100 million of debt in July and later extended its term loan maturities to October 2033 while reducing borrowing costs. Baker said the stronger balance sheet allows the company to consider investment, debt reduction and potential stock buybacks, though he announced no buyback. Optionality, in finance-desk parlance, has been preserved.

What about distribution, advertising and regulation?

Baker said StubHub is developing its open distribution offering, which allows content owners to sell tickets through its marketplace on a nonexclusive basis. The company is working on integrations with primary ticketing providers and expects to announce a partnership with the Big 12 Conference covering football and basketball events.

StubHub is also testing sponsored listings with individual sellers as well as professional sellers. James said advertising remains an immaterial business in financial terms, at a level in the tens of millions of dollars, while the company focuses on improving the product.

On regulation, Baker said proposed ticket price caps had not advanced in California or New York. He said the company believes restrictions can reduce access and shift activity to less transparent channels. The segment StubHub considers most relevant to regulators—large quantities of high-demand concert tickets listed well above their original price—represented approximately 10% of global GMS in 2025, he said.

StubHub Holdings operates online marketplaces connecting buyers and sellers of tickets to live events across sports, concerts, theater and other entertainment. Its platforms allow customers to browse listings, compare options and complete purchases, while sellers list tickets for sale. The company operates StubHub and viagogo, serving customers in the United States and international markets. The business grew from StubHub, founded in 2000, and viagogo, which acquired StubHub from eBay in 2020.

The verdict: a raised sales outlook, halved leverage and a modest advertising bet. The CFO change in January is the detail worth watching.