Vivid Seats Inc.: Form 10-Q for the period ended Sep 30, 2025

This discussion should be read together with our condensed consolidated financial statements and accompanying notes included elsewhere in this Report, as well as our audited consolidated financial statements and accompanying notes contained in our 2024 Form 10-K. This discussion contains forward-looking statements, which are subject to a number of risks and uncertainties, including those discussed in the “Risk Factors” and “Forward-Looking Statements” sections of this Report and our 2024 Form 10-K.

Overview

We are an online ticket marketplace that utilizes our technology platform to connect fans of live events seamlessly with ticket sellers. Our mission is to empower and enable fans to Experience It Live. We believe in the power of shared experiences to connect people with live events that deliver some of life’s most exciting moments. We operate a technology platform and marketplace that enables consumers to easily discover and purchase tickets to live events and book hotel rooms and packages while enabling ticket sellers and partners to seamlessly manage their operations. We differentiate from competitors by offering an extensive breadth and depth of ticket listings at a competitive value.

The following table summarizes our Marketplace Gross Order Value (“Marketplace GOV”), revenues, net income (loss), and adjusted EBITDA for the three and nine months ended September 30, 2025 and 2024 (in thousands):

* See the “Key Business Metrics and Non-U.S. GAAP Financial Measure” section below for more information on Marketplace GOV and adjusted EBITDA, which is a financial measure not defined under accounting principles generally accepted in the United States of America (“U.S. GAAP”).

Our Business Model

We operate our business in two segments: Marketplace and Resale.

Marketplace Segment

In our Marketplace segment, we primarily act as an intermediary between ticket buyers, sellers, and partners, for which we earn revenue from processing ticket sales for live events and facilitating the booking of hotel rooms and packages through (a) our Owned Properties, which consists of (i) Vivid Seats; (ii) Wavedash Co., Ltd. (“Wavedash”), an online ticket marketplace headquartered in Tokyo, Japan that we acquired in 2023; (iii) Vegas.com, LLC, an online ticket marketplace for live event enthusiasts exploring shows, attractions, tours, flights, and hotels in Las Vegas that we acquired in 2023; and (iv) until it ceased operations on July 18, 2025, Vivid Picks, a real-money daily fantasy sports mobile application, and (b) our Private Label Offering, which consists of numerous distribution partners. To a lesser extent, we also earn revenue from offering event insurance to ticket buyers. Using our online platform, we facilitate customer payments, deposits and withdrawals, coordinate ticket deliveries, and provide customer service. We do not hold ticket inventory in our Marketplace segment.

The amount of Marketplace revenue earned in a given period is primarily represented by service and delivery fees charged to ticket buyers. For historical periods in which Vivid Picks operated, the amount of Marketplace revenue earned in a given period is represented by the difference between cash entry fees collected and cash amounts paid out to users for winning picks, less customer promotions and incentives. For event insurance, the amount of Marketplace revenue earned in a given period is represented by referral fees charged to third-party insurance providers.

The main costs we incur in our Marketplace segment relate to developing and maintaining our online platform, providing back-office support and customer service, facilitating payments and deposits, and shipping non-electronic tickets. We also incur substantial marketing costs, primarily related to online advertising.

A key component of our online platform is Skybox, a proprietary enterprise resource planning (“ERP”) tool that is used by the majority of ticket sellers. Skybox is a free-to-use system that helps ticket sellers manage ticket inventories, adjust pricing, and fulfill orders across multiple ticket resale marketplaces. Professional ticket sellers use ERPs to manage their operations, and Skybox is their most widely adopted ERP.

Resale Segment

In our Resale segment, we primarily acquire tickets to resell on secondary ticketing marketplaces, including our own. Our Resale segment also provides internal research and development support for Skybox and supplements our ongoing efforts to deliver industry-leading seller software and tools.

Recent Developments

Corporate Simplification

On October 19, 2025, we entered into a Corporate Simplification Agreement (the “CSA”) with Hoya Intermediate and the TRA Parties named therein (including Hoya Topco, LLC (“Hoya Topco”)). Pursuant to the CSA and the ancillary agreements described therein, a series of transactions was consummated over the two business days ending on October 31, 2025 that, among other things, simplified our corporate structure (such transactions, collectively, the “Corporate Simplification”). In connection with the Corporate Simplification, among other things:

• Three Blocker Corporations (as defined in the CSA) merged with and into three of our wholly owned subsidiaries, respectively, such that the Blocker Corporations became our wholly owned subsidiaries;
• Hoya Topco exchanged all of its shares of Class B common stock (which comprised all of the outstanding shares thereof) and corresponding common units of Hoya Intermediate (“Intermediate Units”) for an equal number of shares of Class A common stock, following which we cancelled all outstanding shares of Class B common stock;
• The warrant agreements relating to the Intermediate Warrants (as defined herein) were amended to instead provide for the right to purchase equal numbers of shares of Class A common stock at equal exercise prices, and simultaneously, the warrant agreement between us and Hoya Topco, which provided Hoya Topco with the right to purchase 200,000 shares of Class B common stock at an exercise price of $0.02 per share, was terminated;
• All rights and obligations under the TRA and Hoya Intermediate’s Limited Liability Company Agreement were terminated (in each case other than certain terms thereof that expressly survived); and
• We issued an aggregate of 403,022 shares of Class A common stock (after rounding down any fractional shares) to the TRA Parties.

Reverse Stock Split

On August 5, 2025, following the approval of our stockholders and our Board of Directors (our “Board”), we amended our Amended and Restated Certificate of Incorporation to effect a 1-for-20 reverse stock split of our common stock pursuant to which every 20 shares of Class A and Class B common stock were combined into one share of Class A and Class B common stock, respectively (the “Reverse Stock Split”). The Reverse Stock Split became effective at 5:00 p.m. Eastern Time on August 5, 2025, and our Class A common stock began trading on a split-adjusted basis at the open of trading on August 6, 2025.

The Reverse Stock Split affected all holders of our common stock uniformly and did not affect any such holder’s percentage ownership interest in our company or proportionate voting power. However, if the Reverse Stock Split would have resulted in a stockholder holding fractional shares because the number of shares they held before the Reverse Stock Split was not evenly divisible by the 1-for-20 split ratio, we instead repurchased such fractional shares for cash and retired them from circulation, resulting in a less than $0.1 million cash outlay. The repurchase and retirement of such fractional shares is recorded as a separate component of both Class A common stock (for the number of shares that were repurchased and retired) and Additional paid-in capital (for the amount of the cash payment). The Reverse Stock Split did not affect the number of authorized shares or the par value of our common stock.

All share and per share amounts included in this Report have been adjusted to reflect the Reverse Stock Split.

Current Environment and Cost Reduction Program

While we continue to view live events as an attractive long-term opportunity supported by durable supply and demand tailwinds, recent industry trends have been challenging and our Marketplace order volumes have been under pressure thus far in 2025. We attribute this to a combination of economic uncertainty affecting discretionary consumer spending and competitive intensity in performance marketing channels. In response to this evolving industry landscape, during the nine months ended September 30, 2025 we began to implement a cost reduction program designed to right-size our business for the current environment and drive enhanced long-term efficiency.

Key Business Metrics and Non-U.S. GAAP Financial Measure

We use the following metrics to evaluate our performance, identify trends, formulate financial projections, and make strategic decisions. We believe these metrics provide useful information to investors and others in understanding and evaluating our results of operations in the same manner as management.

The following table summarizes our key business metrics and non-U.S. GAAP financial measure for the three and nine months ended September 30, 2025 and 2024 (in thousands):

(1) Marketplace GOV represents the total transactional amount of Marketplace orders processed on our online platform during a period, inclusive of fees, exclusive of taxes, and net of event cancellations. During the three and nine months ended September 30, 2025, event cancellations negatively impacted our Marketplace GOV by $11.4 million and $47.2 million, respectively, compared to $35.4 million and $74.9 million during the three and nine months ended September 30, 2024, respectively.

(2) Marketplace orders represent the total volume of Marketplace segment transactions processed on our online platform during a period, net of event cancellations. During the three and nine months ended September 30, 2025, our Marketplace segment experienced 39,414 and 129,612 event cancellations, respectively, compared to 77,012 and 179,453 event cancellations during the three and nine months ended September 30, 2024, respectively.

(3) Resale orders represent the total volume of Resale segment transactions processed on a given platform (including our own) during a period, net of event cancellations. During the three and nine months ended September 30, 2025, our Resale segment experienced 1,598 and 3,759 event cancellations, respectively, compared to 2,411 and 4,494 event cancellations during the three and nine months ended September 30, 2024, respectively.

(4) Adjusted EBITDA is a non-U.S. GAAP financial measure that we believe provides useful information to investors and others in understanding and evaluating our results of operations and serves as a useful measure for making period-to-period comparisons of our business performance. See the “Adjusted EBITDA” section below for more information, including a reconciliation of adjusted EBITDA to net income (loss), the most directly comparable U.S. GAAP financial measure.

Marketplace GOV

Marketplace GOV is a key driver of Marketplace revenue. Marketplace GOV represents the total transactional amount of Marketplace orders processed on our online platform in a period, inclusive of fees, exclusive of taxes, and net of event cancellations. Marketplace GOV reflects our ability to attract and retain customers and provides insight into the overall health of the industry.

Marketplace GOV can be impacted by seasonality. Typically, we experience slightly increased activity in the fourth quarter when all major sports leagues are in season, concert on-sales begin for the following year, and theater event orders increase during the holiday season. Quarterly fluctuations in Marketplace GOV can result from, among other things:

• Event supply;
• The popularity of and demand for certain artists, sports teams, tours, and events;
• The mix of concert venue types between stadiums, arenas, and amphitheaters;
• The length and team composition of sports playoff series and championship games; and
• Event cancellations.

Marketplace GOV decreased by $253.6 million, or 29%, during the three months ended September 30, 2025 compared to the three months ended September 30, 2024 and decreased by $774.3 million, or 27%, during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The decreases resulted primarily from a decrease in Marketplace orders.

Marketplace Orders

Marketplace orders represent the volume of Marketplace-related transactions processed on our online platform in a period, net of event cancellations. A Marketplace order can include one or more tickets, hotel rooms, or parking passes. Marketplace orders allow us to monitor transaction volume and better identify trends within our Marketplace segment.

Marketplace orders decreased by 0.9 million, or 29%, during the three months ended September 30, 2025 compared to the three months ended September 30, 2024 and decreased by 2.4 million, or 27%, during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The decreases resulted primarily from lower activity in our Marketplace segment.

Resale Orders

Resale orders represent the volume of Resale-related transactions processed on a given platform (including our own) in a period, net of event cancellations. A Resale order can include one or more tickets or parking passes. Resale orders allow us to monitor transaction volume and better identify trends within our Resale segment.

Resale orders decreased by less than 0.1 million, or 1%, during the three months ended September 30, 2025 compared to the three months ended September 30, 2024 and increased by less than 0.1 million, or less than 1%, during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024.

Adjusted EBITDA

We present adjusted EBITDA, which is a non-U.S. GAAP financial measure, because it is a key measure used by analysts, investors, and others to evaluate companies in our industry. Adjusted EBITDA is also used by management to make operating decisions, including those related to analyzing operating expenses, evaluating performance, and performing strategic planning and annual budgeting.

We believe adjusted EBITDA is a useful measure for understanding, evaluating, and highlighting trends in our operating results and for making period-to-period comparisons of our business performance because it excludes the impact of items that are outside of our control and/or not reflective of ongoing performance related directly to the operation of our business.

Adjusted EBITDA is not based on any comprehensive set of accounting rules or principles and should not be considered a substitute for, or superior to, financial measures calculated in accordance with U.S. GAAP. Adjusted EBITDA does not reflect all amounts associated with our operating results as determined in accordance with U.S. GAAP and specifically excludes certain recurring costs such as income tax expense (benefit), interest expense – net, depreciation and amortization, sales tax liabilities, transaction costs, equity-based compensation, litigation, settlements, and related costs, change in fair value of warrants, loss on asset disposals, change in fair value of derivative asset, foreign currency loss (gain) – net, loss on extinguishment of debt, adjustment of liabilities under our TRA (as defined herein), impairment charges, and severance compensation. In addition, other companies may calculate adjusted EBITDA differently than we do, thereby limiting its usefulness as a comparative tool. We compensate for these limitations by providing specific information regarding the U.S. GAAP amounts that are excluded from our presentation of adjusted EBITDA.

The following table presents a reconciliation of adjusted EBITDA to net income (loss), the most directly comparable U.S. GAAP financial measure, for the three and nine months ended September 30, 2025 and 2024 (in thousands):

(1) During the periods presented, we accrued for additional uncollected indirect tax liabilities in jurisdictions where we expect to remit payment to U.S. and foreign governmental tax authorities before all required amounts are collected from the customer. We also received abatements and recognized other reductions to the balance of the liability related to uncollected indirect taxes (including sales taxes).

(2) Consists of: (i) legal, accounting, tax, and other professional fees; (ii) personnel costs related to retention bonuses; (iii) integration costs; and (iv) other transaction-related expenses, none of which are considered indicative of our core operating performance. Costs in the three and nine months ended September 30, 2025 primarily related to the February 2025 refinancing of the 2024 First Lien Loan with the 2025 First Lien Loan (each as defined herein), repurchases of Class A common stock, the Reverse Stock Split, and various strategic transactions and investments. Costs in the three and nine months ended September 30, 2024 primarily related to the June 2024 refinancing of the 2022 First Lien Loan (as defined herein) with the 2024 First Lien Loan, repurchases of Class A common stock, acquisitions, and various strategic investments.

(3) Costs in the three and nine months ended September 30, 2025 primarily related to equity granted pursuant to our 2021 Incentive Award Plan (as amended, the “2021 Plan”), which is not considered indicative of our core operating performance. Costs in the three and nine months ended September 30, 2024 primarily related to equity granted pursuant to the 2021 Plan and profits interests issued prior to the 2021 transaction pursuant to which Horizon Acquisition Corporation merged with and into us (the “Merger Transaction”), neither of which are considered indicative of our core operating performance.

(4) Relates to external legal costs, settlement costs, and insurance recoveries, none of which are considered indicative of our core operating performance.

(5) Relates to the revaluation of warrants to purchase Intermediate Units (the “Intermediate Warrants”) held by Hoya Topco following the Merger Transaction, which is not considered indicative of our core operating performance.

(6) Relates to disposals of fixed assets, which are not considered indicative of our core operating performance.

(7) Relates to the revaluation of derivatives recorded at fair value, which is not considered indicative of our core operating performance.

(8) Relates to net losses (gains) resulting from the impact of exchange rate changes on transactions denominated in non-functional currencies, which are not considered indicative of our core operating performance.

(9) Relates to losses incurred during the nine months ended September 30, 2025 in connection with the extinguishment of the 2024 First Lien Loan, which are not considered indicative of our core operating performance.

(10) Relates to the remeasurement of the TRA liability, which is not considered indicative of our core operating performance.

(11) Relates to non-cash impairment charges related to our goodwill and certain indefinite-lived intangible assets triggered by the effects of recent declines in our financial performance, near-term outlook, and Class A common stock price, among other factors, during the nine months ended September 30, 2025.

(12) Relates to severance-related payments paid to terminated employees as a result of a reduction in employee headcount during the three and nine months ended September 30, 2025. The reduction was part of our strategic cost reduction program and is not considered indicative of our core operating performance.

Key Factors Affecting Our Performance

During the nine months ended September 30, 2025, there were no material changes to the “Key Factors Affecting Our Performance” discussed in our 2024 Form 10-K and our Quarterly Report on Form 10-Q for the quarter ended March 31, 2025. Our financial position and results of operations depend to a significant extent on those factors.

Results of Operations

Comparison of the Three and Nine Months Ended September 30, 2025 and 2024

The following table presents our results of operations for the three and nine months ended September 30, 2025 and 2024 (in thousands, except percentages):

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Revenues

Total Revenues

The following table presents total revenues by segment for the three and nine months ended September 30, 2025 and 2024 (in thousands, except percentages):

Total revenues decreased by $50.2 million, or 27% during the three months ended September 30, 2025 compared to the three months ended September 30, 2024 and decreased by $131.8 million, or 23%, during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The decreases resulted primarily from a decrease in Marketplace revenues.

Marketplace Revenues

The following table presents Marketplace revenues by event category for the three and nine months ended September 30, 2025 and 2024 (in thousands, except percentages):

Marketplace revenues decreased by $47.8 million, or 31%, during the three months ended September 30, 2025 compared to the three months ended September 30, 2024 and decreased by $129.7 million, or 27%, during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The decreases resulted primarily from, and were relatively consistent with, the 29% and 27% decreases in Marketplace orders during the same respective periods.

Marketplace cancellation charges, which generally have a negative impact on Marketplace revenues, represented a reduction to Marketplace revenues of $1.5 million and $11.0 million during the three and nine months ended September 30, 2025, respectively, compared to a reduction to Marketplace revenues of $7.3 million and $20.4 million during the three and nine months ended September 30, 2024, respectively. The decreases resulted primarily from lower payment-related chargeback activity primarily due to a decrease in Marketplace orders, partly offset by lower Marketplace revenues recognized from customer credit breakage.

The following table presents Marketplace revenues by business model for the three and nine months ended September 30, 2025 and 2024 (in thousands, except percentages):

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The decrease in both Owned Properties and Private Label Offering revenues during the three and nine months ended September 30, 2025 compared to the three and nine months ended September 30, 2024 resulted primarily from a decrease in Marketplace orders, as well as the loss of a significant Private Label partner.

We also earn Marketplace revenue in the form of referral fees charged to third-party insurance providers in exchange for offering event insurance to ticket buyers. Marketplace revenue earned from referral fees was $3.6 million and $13.9 million during the three and nine months ended September 30, 2025, respectively, compared to $6.0 million and $19.6 million during the three and nine months ended September 30, 2024, respectively. The decreases resulted primarily from a decrease in Marketplace orders.

Resale Revenues

Resale revenues decreased by $2.4 million, or 7%, during the three months ended September 30, 2025 compared to the three months ended September 30, 2024 and decreased by $2.1 million, or 2%, during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The decreases resulted primarily from lower average revenue per Resale order, while Resale orders remained nearly the same.

Resale cancellation charges, which generally have a negative impact on Resale revenues, represented a reduction to Resale revenues of $0.3 million during the three months ended September 30, 2025, which was consistent with the $0.3 million reduction to Resale revenues during the three months ended September 30, 2024. Resale cancellation charges represented a reduction to Resale revenues of $1.5 million during the nine months ended September 30, 2025 compared to $1.1 million during the nine months ended September 30, 2024. The increase was due to a higher number of cancelled orders.

Cost of Revenues

Total Cost of Revenues

The following table presents total cost of revenues by segment for the three and nine months ended September 30, 2025 and 2024 (in thousands, except percentages):

Total cost of revenues decreased by $6.7 million, or 13%, during the three months ended September 30, 2025 compared to the three months ended September 30, 2024 and decreased by $18.1 million, or 12%, during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The decreases resulted primarily from a decrease in Marketplace cost of revenues.

Marketplace Cost of Revenues

Marketplace cost of revenues decreased by $6.3 million, or 27%, during the three months ended September 30, 2025 compared to the three months ended September 30, 2024 and decreased by $18.4 million, or 25%, during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The decreases, which were primarily due to a decrease in Marketplace orders, were relatively consistent with the 29% and 27% decreases in Marketplace GOV during the same respective periods.

Resale Cost of Revenues

Resale cost of revenues decreased by $0.4 million, or 1%, during the three months ended September 30, 2025 compared to the three months ended September 30, 2024 and increased by $0.3 million, or less than 1%, during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. These changes were not consistent with the 7% and 2% decreases in Resale revenues during the same respective periods, primarily due to lower margins for certain Marketplace event categories.

Marketing and Selling

Total Marketing and Selling

The following table presents total marketing and selling expenses, which relate entirely to our Marketplace segment, by advertising category for the three and nine months ended September 30, 2025 and 2024 (in thousands, except percentages):

Total marketing and selling expenses decreased by $11.9 million, or 17%, during the three months ended September 30, 2025 compared to the three months ended September 30, 2024 and decreased by $31.8 million, or 15%, during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The decreases were not consistent with the 31% and 27% decreases in Marketplace revenues during the same respective periods, primarily due to higher investment intensity in digital performance marketing channels.

Online Advertising

Online advertising costs decreased by $11.5 million, or 18%, during the three months ended September 30, 2025 compared to the three months ended September 30, 2024 and decreased by $29.5 million, or 16%, during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. Because online advertising spending generally changes together with our Marketplace order volumes, the decreases resulted primarily from a decrease in Marketplace orders, partly offset by higher investment intensity in digital performance marketing channels.

Offline Advertising

Offline advertising costs decreased by $0.4 million, or 9%, during the three months ended September 30, 2025 compared to the three months ended September 30, 2024 and decreased by $2.3 million, or 14%, during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The decreases resulted primarily from lower spending in traditional brand marketing channels.

Contribution Margin

Total Contribution Margin

The following table presents total contribution margin by segment for the three and nine months ended September 30, 2025 and 2024 (in thousands, except percentages):

Total contribution margin decreased by $31.7 million, or 47%, during the three months ended September 30, 2025 compared to the three months ended September 30, 2024 and decreased by $81.9 million, or 37%, during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The decreases resulted primarily from a decrease in Marketplace contribution margin.

Marketplace Contribution Margin

Marketplace contribution margin decreased by $29.7 million, or 48%, during the three months ended September 30, 2025 compared to the three months ended September 30, 2024 and decreased by $79.5 million, or 39%, during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The decreases resulted primarily from a decrease in Marketplace orders and higher investment intensity in digital performance marketing channels.

Resale Contribution Margin

Resale contribution margin decreased by $2.0 million, or 33%, during the three months ended September 30, 2025 compared to the three months ended September 30, 2024 and decreased by $2.5 million, or 14%, during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The decreases resulted primarily from lower margins for certain Resale event categories.

Total General and Administrative

The following table presents total general and administrative expenses by category for the three and nine months ended September 30, 2025 and 2024 (in thousands, except percentages):

Total general and administrative expenses decreased by $1.1 million, or 2%, during the three months ended September 30, 2025 compared to the three months ended September 30, 2024 primarily due to a decrease in other general and administrative expenses. Total general and administrative expenses decreased by $10.2 million, or 7%, during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 primarily due to a decrease in personnel expenses.

Personnel Expenses

Personnel expenses decreased by $0.1 million, or less than 1%, during the three months ended September 30, 2025 compared to the three months ended September 30, 2024 and decreased by $8.4 million, or 8%, during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The decreases resulted primarily from a decrease in equity-based compensation expense.

Non-Income Tax Expense

Non-income tax expense decreased by less than $0.1 million, or 1%, during the three months ended September 30, 2025 compared to the three months ended September 30, 2024 and decreased by $3.6 million, or 93%, during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The decreases resulted primarily from receiving higher abatements and recognizing other reductions to the balance of the liability related to uncollected indirect taxes (including sales taxes).

Other General and Administrative

Other general and administrative expenses decreased by $1.0 million, or 8%, during the three months ended September 30, 2025 compared to the three months ended September 30, 2024. The decrease resulted primarily from lower professional services fees. Other general and administrative expenses increased by $1.9 million, or 5%, during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The increase resulted primarily from an increase in computer and telecom expenses.

Depreciation and Amortization

Depreciation and amortization expenses increased by $3.1 million, or 29%, during the three months ended September 30, 2025 compared to the three months ended September 30, 2024 and increased by $6.0 million, or 19%, during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The increases resulted primarily from an increase in intangible assets as a result of our October 2024 acquisition of a domain name that we had previously licensed and, to a lesser extent, an increase in capitalized development activities related to our platform.

Impairment Charges

Impairment charges were $320.4 million during the nine months ended September 30, 2025 compared to zero during the nine months ended September 30, 2024. The impairment charges resulted primarily from the effects of recent declines in our financial performance, near-term outlook, and Class A common stock price, among other factors, during the nine months ended September 30, 2025 that resulted in a reduction in the fair values of our goodwill and certain indefinite-lived intangible assets.

Interest Expense – Net

Interest expense – net decreased by $0.2 million during the three months ended September 30, 2025 compared to the three months ended September 30, 2024 and increased by $0.7 million during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The 3% decrease and 4% increase were primarily due to variations in the amount of interest income earned on our cash balances in each respective period.

Other Income – Net

Other income – net decreased by $9.0 million, or 100%, during the three months ended September 30, 2025 compared to the three months ended September 30, 2024. The decrease resulted primarily from net losses resulting from the impact of exchange rate changes on transactions denominated in non-functional currencies. Other income – net increased by $151.1 million, or 4,670%, during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The increase resulted primarily from income related to the remeasurement of the TRA liability, net gains resulting from the impact of exchange rate changes on transactions denominated in non-functional currencies, and higher unrealized gains related to the fair value remeasurement of the warrants issued by Hoya Intermediate to Hoya Topco in connection with the Merger Transaction.

Loss on Extinguishment of Debt

Loss on extinguishment of debt increased by $0.8 million, or 100%, during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The increase resulted entirely from the February 2025 refinancing of the 2024 First Lien Loan with the 2025 First Lien Loan. There was no change in Loss on extinguishment of debt during the three months ended September 30, 2025 compared to the three months ended September 30, 2024.

Income Tax Expense (Benefit)

Income tax benefit increased by $13.5 million, or 315%, during the three months ended September 30, 2025 compared to the three months ended September 30, 2024. The increase was primarily due to a reversal of an uncertain tax position. Income tax expense increased by $63.0 million, or 882%, during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The increase resulted primarily from an increase to the valuation allowance.

Liquidity and Capital Resources

We have historically financed our operations primarily through cash generated from operations. Our primary short-term requirements for liquidity and capital are to fund general working capital, capital expenditures, and debt service requirements. Our primary long-term liquidity needs are related to debt repayment and potential acquisitions.

Our primary source of funds is cash generated from operations. Our existing cash and cash equivalents are sufficient to fund our liquidity needs for the next 12 months and thereafter for the foreseeable future. As of September 30,

2025, we had $145.1 million of cash and cash equivalents, which consist of interest-bearing deposit accounts, money market accounts managed by financial institutions, and highly liquid investments with maturities of three months or less. During the nine months ended September 30, 2025 we generated negative cash flows from operating activities, primarily due to lower Marketplace and Resale orders causing a contraction in accounts payable and accrued expenses and other current liabilities at the end of the period.

Loan Agreements

In 2022, we refinanced the outstanding balance of our former first lien debt facility with a $275.0 million term loan (the “2022 First Lien Loan”) and a $100.0 million revolving credit facility with a maturity date of February 3, 2027 (the “Revolving Facility”).

On June 14, 2024, we refinanced the outstanding balance of the 2022 First Lien Loan with a $395.0 million term loan with a maturity date of February 3, 2029 (the “2024 First Lien Loan”). The 2024 First Lien Loan carried an interest rate equal to the secured overnight financing rate (“SOFR”) (subject to a 0.5% floor) plus a margin of 3.00%.

On February 5, 2025, we refinanced the outstanding balance of the 2024 First Lien Loan with a $393.0 million term loan with a maturity date of February 3, 2029 (the “2025 First Lien Loan”). The 2025 First Lien Loan carries an interest rate equal to SOFR (subject to a 0.5% floor) plus a margin of 2.25%; provided that such margin may be reduced to 2.00% if the corporate rating assigned to us by Moody’s Investors Service, Inc. and S&P Global Ratings is at least Ba3/BB- (in each case, stable or better). The 2025 First Lien Loan requires quarterly principal payments of $1.0 million. The Revolving Facility, which was unaffected by the 2022 and June 2024 refinancings, does not require periodic payments. All obligations under the 2025 First Lien Loan are unconditionally guaranteed by Hoya Intermediate and substantially all of Hoya Intermediate’s existing and future direct and indirect wholly owned domestic subsidiaries (collectively, the “Guarantors”). All obligations under the 2025 First Lien Loan are secured, subject to permitted liens and other exceptions, by first-priority perfected security interests in substantially all of our and the Guarantors’ assets.

In connection with our acquisition of Wavedash, we assumed long-term debt owed to Shoko Chukin Bank (the “Shoko Chukin Bank Loan”) of JPY 458.3 million (approximately $3.1 million), which had an original maturity date of June 24, 2026 and was subject to a fixed interest rate of 1.3% per annum. On April 4, 2024, we paid off the Shoko Chukin Bank Loan balance in its entirety.

As of September 30, 2025, we had the 2025 First Lien Loan outstanding and we had no outstanding borrowings under the Revolving Facility.

Share Repurchase Program

On February 29, 2024, our Board authorized a share repurchase program for up to $100.0 million of Class A common stock (the “Share Repurchase Program”), which was publicly announced on March 5, 2024 and does not have a fixed expiration date.

During the three and nine months ended September 30, 2025, we repurchased 0.1 million and 0.4 million shares of Class A common stock, respectively, under the Share Repurchase Program, for which we paid $2.1 million and $18.1 million, respectively, and incurred commissions and excise taxes of $0.1 million and $0.2 million, respectively. As of September 30, 2025, we recognized a liability of less than $0.1 million for unpaid excise taxes related to repurchases of Class A common stock.

Cumulatively as of September 30, 2025, we have repurchased 0.6 million shares of Class A common stock under the Share Repurchase Program, for which we have paid $40.9 million and incurred commissions and excise taxes of $0.3 million. As of September 30, 2025, $59.1 million remained available for future repurchases under the Share Repurchase Program.

Tax Distributions to Redeemable Noncontrolling Interests

Pursuant to its Limited Liability Company Agreement, Hoya Intermediate is required to make pro rata tax distributions to its members, of which zero and $1.7 million was distributed to redeemable noncontrolling interests during the three and nine months ended September 30, 2025, respectively.

Tax distributions will cease as a result of the Corporate Simplification. See the “Recent Developments – Corporate Simplification” section for more information.

Tax Receivable Agreement

In connection with the Merger Transaction, we entered into a Tax Receivable Agreement (the “TRA”) with the existing Hoya Intermediate unitholders that provides for our payment to such unitholders of 85% of the amount of any tax savings that we realize (or, under certain circumstances, are deemed to realize) as a result of, or attributable to: (i) increases in the tax basis of assets owned directly or indirectly by Hoya Intermediate or its subsidiaries from, among other things, any redemptions or exchanges of Intermediate Units; (ii) existing tax basis (including depreciation and amortization deductions arising from such tax basis) in long-lived assets owned directly or indirectly by Hoya Intermediate or its subsidiaries; and (iii) certain other tax benefits (including deductions in respect of imputed interest) related to us making payments under the TRA.

Amounts payable under the TRA are contingent upon the generation of future taxable income over the term of the TRA and future changes in tax laws. If we do not generate sufficient taxable income in the aggregate over the term of the TRA to utilize the tax benefits, then we would not be required to make the related payments. As of June 30, 2025, we believe, based on applicable accounting standards, that it is no longer probable that we will generate sufficient future taxable income to support a significant amount of the balance of the TRA liability previously recorded as of March 31, 2025. As of June 30, 2025, after evaluating all available positive and negative evidence, we determined that significant negative objective and verifiable evidence in the form of cumulative losses by our domestic operations exists to change our conclusion regarding the future realization of our deferred tax assets, which therefore significantly impacts the amount of future TRA payments that are probable to be made. As of September 30, 2025, we estimate that a $5.9 million TRA liability is probable, of which $5.8 million is due within the next 12 months. During the three and nine months ended September 30, 2025, we recorded income of $0.6 million and $149.8 million, respectively, for the change in the TRA liability. The total TRA payment obligation, if there is sufficient taxable income to recognize all TRA attributes, was $155.7 million and $159.7 million as of September 30, 2025 and December 31, 2024, respectively. During the three and nine months ended September 30, 2025, we made payments of zero and $4.0 million, respectively, pursuant to the TRA. Both the TRA-related deferred tax assets and the TRA obligation are estimates that are subject to change. If utilization of the deferred tax assets subject to the TRA becomes more likely than not in the future, we expect to record a liability and corresponding expense related to the TRA.

As of October 31, 2025, all rights and obligations under the TRA were terminated in exchange for the issuance of shares of Class A common stock in connection with the Corporate Simplification (other than certain terms thereof that expressly survived), including $5.8 million of cash payments that would have otherwise been due in the first quarter of 2026. As a result of the Corporate Simplification, we will no longer have a TRA liability. See the “Recent Developments – Corporate Simplification” section for more information.

Cash Flows

The following table summarizes our cash flows for the nine months ended September 30, 2025 and 2024 (in thousands):

Net Cash Provided by (Used In) Operating Activities

Net cash used in operating activities was $53.4 million during the nine months ended September 30, 2025 due to a net loss of $292.8 million, net non-cash charges of $317.4 million, and net cash outflows from a $78.0 million change in operating assets and liabilities.

Net cash provided by operating activities was $6.1 million during the nine months ended September 30, 2024 due to $18.7 million in net income, net non-cash charges of $70.2 million, and net cash outflows from a $82.8 million change in operating assets and liabilities.

Both of the net cash outflows referred to above were primarily due to a decrease in Accounts payable resulting from a decrease in amounts payable to ticket sellers as a result of lower Marketplace GOV and a decrease in Accrued expenses and other current liabilities due to lower Marketplace GOV, as well as the timing of disbursements.

Net Cash Used in Investing Activities

Net cash used in investing activities during the nine months ended September 30, 2025 and 2024 was $16.3 million and $17.8 million, respectively, which in each case was primarily related to capital spending on development activities for our online platform.

Net Cash Provided by (Used In) Financing Activities

Net cash used in financing activities during the nine months ended September 30, 2025 was $29.5 million, which was primarily related to repurchases of Class A common stock under the Share Repurchase Program and payment of liabilities under the TRA.

Net cash provided by financing activities during the nine months ended September 30, 2024 was $87.9 million, which was primarily related to the June 2024 refinancing of the 2022 First Lien Loan with the 2024 First Lien Loan.

Critical Accounting Policies and Estimates

Our condensed consolidated financial statements are prepared in accordance with U.S. GAAP, which requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, costs and expenses, and related disclosures. On an ongoing basis, we evaluate our estimates and assumptions. Actual results may differ from these estimates under different assumptions or conditions. The estimates and assumptions associated with revenue recognition, equity-based compensation, warrants and earnouts, recoverability of our goodwill, indefinite-lived intangible assets, definite-lived intangible assets, long-lived assets, and valuation allowances have the greatest potential impact on our condensed consolidated financial statements. Accordingly, these are the policies that are the most critical to aid in fully understanding and evaluating our unaudited condensed consolidated financial statements. For a description of our critical accounting policies and estimates, see our 2024 Form 10-K. During the three and nine months ended September 30, 2025, there were no material changes to the critical accounting policies disclosed in our 2024 Form 10-K.

We closely monitor the financial and operating results impacting our lone reporting unit with a goodwill balance (the "Marketplace Reporting Unit") and indefinite-lived intangible assets and, as deemed necessary, we make comparisons to the key assumptions used in our fair value estimate at the time of our annual impairment test, in addition to operational initiatives and macroeconomic conditions, which may impact the fair value of the Marketplace Reporting Unit and indefinite-lived intangible assets. We perform an annual impairment assessment of our goodwill and indefinite-lived intangible assets as of October 31 of each fiscal year. During the second quarter of 2025, we assessed the changes in circumstances that occurred during the quarter to determine if it was more likely than not that the fair value of the Marketplace Reporting Unit and indefinite-lived intangible assets were below the respective carrying amounts. We identified several factors related to the Marketplace Reporting Unit and certain indefinite-lived intangible assets that led us to conclude that it was more likely than not that the fair value of the Marketplace Reporting Unit and indefinite-lived intangible assets were below the respective carrying values, which triggered us to perform an interim goodwill impairment assessment for the Marketplace Reporting Unit and certain indefinite-lived intangible assets. These factors included recent declines in our financial performance, near-term outlook, and Class A common stock price, among other factors. As a result of the interim test, we recognized a goodwill impairment loss of $297.4 million related to the Marketplace Reporting Unit during the nine months ended September 30, 2025. We also recognized an impairment loss of $23.0 million related to certain indefinite-lived trademarks during the nine months ended September 30, 2025.

The fair value estimates used in our interim quantitative impairment test were based on assumptions we believe to be reasonable, but that are unpredictable and inherently uncertain, including estimates of future growth rates and operating margins and assumptions about the overall economic and competitive environment. There can be no assurance that the estimates and assumptions used at the time of our interim assessment will not change over time. If near-term profitability trends, or our long-term profitability outlook, decline below our expectations, it is possible that our annual assessment could result in an additional impairment of our goodwill and indefinite-lived intangible assets.

Recent Accounting Pronouncements

See Note 2, New Accounting Standards, to our unaudited condensed consolidated financial statements included elsewhere in this Report for a description of recently adopted accounting pronouncements and issued accounting pronouncements not yet adopted.

As a “smaller reporting company” (as defined in Rule 12b-2 under the Exchange Act), we are not required to provide this information.

Disclosure Controls and Procedures

Limitations on Effectiveness of Disclosure Controls and Procedures

In designing and evaluating our disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) under the Exchange Act), management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.

Evaluation of Disclosure Controls and Procedures

Disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) are designed to ensure that the information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to management, including our principal executive and principal financial officers, as appropriate, to allow timely decisions regarding required disclosures.

Management, with the participation of our principal executive and principal financial officers, has evaluated the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this Report. Based on such evaluation, our principal executive and principal financial officers concluded that our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) were not effective at the reasonable assurance level as of September 30, 2025 due to the material weakness in our internal control over financial reporting described below.

Internal Control Over Financial Reporting

Material Weakness and Remediation Activities

In connection with the audit of our consolidated financial statements as of December 31, 2024, 2023, and 2022, we identified and disclosed deficiencies in our internal control over financial reporting (as defined in Rules 13a-15(f) or 15d-15(f) under the Exchange Act) related to the implementation of segregation of duties as part of our control activities, the establishment of clearly defined roles within our finance and accounting functions, and the number of personnel in those functions with an appropriate level of technical accounting and SEC reporting experience, which, in the aggregate, constitute a material weakness.

Management, with the participation of our Board and its Audit Committee, began the implementation of remediation activities in 2022 and has since continued to develop and implement additional remediation activities. We believe significant progress has been made in our remediation efforts, which through September 30, 2025 included continuing to:

• implement segregation of duties over business process and information technology control activities;
• establish clearly defined roles within our finance and accounting functions;
• increase the number of personnel in our finance and accounting functions that have an appropriate level of technical accounting and SEC reporting experience; and
• design and implement additional internal controls.

While not yet remediated, management believes that the measures described above will remediate the material weakness and strengthen our overall internal control over financial reporting. The material weakness will not be considered remediated until the applicable remediated controls operate for a sufficient period of time and management has concluded, through testing, that these controls are operating effectively. We continue to devote significant time and attention to these efforts.

Changes in Internal Control over Financial Reporting

Except with respect to our continuing remediation activities discussed above, there were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) or 15d-15(f) under the Exchange Act) during the three and nine months ended September 30, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

In addition to the information set forth in this Report, you should carefully consider the risks and uncertainties discussed in the “Risk Factors” sections of our 2024 Form 10-K and our Quarterly Report on Form 10-Q for the quarter ended June 30, 2025. These risks and uncertainties could cause actual results to differ materially from historical results or the results contemplated by the forward-looking statements contained in this Report. Except as set forth below and in our Quarterly Report on Form 10-Q for the quarter ended June 30, 2025, as of September 30, 2025, there have been no material changes to the risk factors discussed in our 2024 Form 10-K.

We may not realize the excepted benefits of the Corporate Simplification.

We expect to realize certain benefits as a result of the Corporate Simplification, including retaining 100% of future realized tax savings that, but for the TRA termination, would have been payable to the former TRA parties, and realizing annual savings from reduced compliance and financial reporting costs associated with a single-class stock structure. However, these benefits are dependent on a number of factors, including applicable laws and the amount of our future taxable income. We may not ultimately realize all of the expected benefits of the Corporate Simplification on the anticipated timeline, or at all.

New shares of Class A common stock were issued in connection with the Corporate Simplification. In addition to diluting the ownership and/or voting power of existing stockholders, this increase in the number of shares eligible for resale in the public market could adversely affect the market price of our Class A common stock.

In connection with the Corporate Simplification, (i) all 3,811,250 shares of Class B common stock (and corresponding Intermediate Units) were cancelled and exchanged for shares of Class A common stock on a one-for-one basis and (ii) we issued an additional 403,022 shares of Class A common stock (after rounding down any fractional share) to the TRA Parties. Sales of substantial numbers of such shares in the public market, or the fact that such sales could occur, could adversely affect the market price of our Class A common stock.