By Steve Gelsi
StubHub has faced criticism over the high price of secondary-market tickets, but the newly public company says it serves a necessary function in the market
StubHub’s IPO fell 6.4% in its its first trading day on Wednesday.
StubHub Inc.’s initial public offering dipped 6% below its offering price on Wednesday as investors balanced its strong brand and rising demand for tickets against mixed signals on the overall health of the economy.
Born out of a need by co-founder Eric Baker to quickly find tickets to see “The Lion King” in 1999, StubHub now describes itself as the largest global secondary-ticketing marketplace, with worldwide expansion plans and a serviceable addressable market of up to $194 billion.
At the closing bell, StubHub’s stock (STUB) ended trading at $22.17 a share, close to its low of $22 during the session and $1.33 a share below its $23.50 offering price.
The IPO first crossed the tape at a price of $25.10 a share and traded as high as $27.89 before losing steam later in the day, as the Fed cut interest rates by a quarter-point and signaled concern over inflation and unemployment.
These signs of economic uncertainty could dampen the prospects for a consumer-focused company such as Stubhub.
“StubHub is a strong company and brand,” said Mark Lehmann, president of Citizens California and head of Citizens JMP, an investment bank that worked on the IPO. “The first day of trading can sometimes be volatile, especially when there are macro factors such as an [interest-rate] announcement.”
IPO investors gave a warmer reception to Waterbridge Infrastructure (WBI), a water management company for oil and gas fracking in the Permian Basin of the U.S. that priced 31.1 million shares at $20 a share for proceeds of $634 million.
The IPO, which was backed by private investment firm Five Point Energy, ended trading at $22.83 a share, up $2.83 , or 14.2%, in its opening day of trading.
In another sign that the IPO market is receptive to deals, cybersecurity software company Netskope Inc. on Wednesday increased its price range to $17 to $19 a share from $15 to $17 a share for its stock-market debut expected on Thursday.
At the midpoint of the upped range, Netskope’s IPO will raise $860 million with lead underwriters Morgan Stanley and J.P. Morgan for trading under the ticker symbol NTSK on the Nasdaq.
Stubhub priced IPO in the middle of its range
StubHub offered more than 34 million shares of Class A common stock at the midpoint of its estimated price range of $22 to $25 a share on the New York Stock Exchange.
The face value of an average concert ticket for one of the top 100 North American tours clocks in at $135.88, up 400% since 1996, according to industry data cited by StubHub.
StubHub’s IPO raised about $800 million, with J.P. Morgan and Goldman Sachs the lead underwriters. That translates to a market capitalization of about $8.64 billion, which is much higher than that of Vivid Seats Inc. (SEAT) ($176 million) but lower than that of Ticketmaster owner Live Nation Entertainment Inc. (LYV) ($40 billion), whose business extends beyond ticketing.
StubHub’s is testing the fervor around the IPO market. Klarna Group Plc (KLAR) and Gemini Space Station Inc. (GEMI) saw their stocks close above their respective IPOs prices when they began trading last week, while Circle Internet Group Inc. (CRCL) and Figma Inc. (FIG) saw more dramatic post-IPO surges earlier this year.
Also read: StubHub’s IPO is this week. Here’s how it stacks up in the world of online ticketing.
What to know about StubHub
StubHub operates an online marketplace, allowing fans to scoop up tickets for shows if they didn’t gain access to them originally, and allowing sellers to unload tickets to events they can’t attend.
But some people use the platform to make a quick profit – buying up tickets to high-profile events and then quickly turning around to offload them on real fans at a markup. Critics say resellers can buy up tickets more quickly than consumers, only to jack up prices.
On this front, rival Ticketmaster, which is owned by Live Nation, is reportedly being investigated by the Federal Trade Commission over whether it’s following the U.S. Better Online Ticket Sales Act’s rules on automated ticket selling through bots.
On the issue of higher ticket prices, StubHub said its role in providing a liquid reselling platform helps keep ticket prices lower, but cautioned it remains subject to changing regulations as ticket prices rise.
Meanwhile, StubHub said several U.S. states and cities, Canadian provinces, the U.K. and certain European countries do not allow the resale of tickets at prices greater than the original face value, and that new rules on this front could emerge.
“Complying with this new set of regulations could result in increased costs and additional liabilities,” the company said in the “risks” section of its IPO prospectus.
StubHub reported a loss of $76 million on revenue of $827.9 million in the six months ended June 30; in the year-prior period, it lost $24 million on revenue of $803.45 million.
“There is a critical need for a global marketplace that ensures liquidity, transparency and trust for all ticketing transactions, whether they involve secondary sales or original issuance,” StubHub said in its IPO prospectus.
By bringing its technology and distribution to more categories of live events and experiences, “we will capture a larger market opportunity and play an even more vital role in the ecosystem in the future,” the company said.
Growth in the secondary market for tickets has been outpacing overall growth in the live-events business, while resale technology advances and the face values of tickets move up, the company said. The face value of an average concert ticket for one of the top 100 North American tours clocks in at $135.88, up 400% since 1996, according to industry data cited by StubHub.
-Steve Gelsi
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09-17-25 1647ET
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