StubHub (STUB) Q2 FY26 earnings call: guidance and Q&A

Inquired about the philosophy on sales and marketing efficiency, its potential for growth or further leverage in H2, and key strategic investments planned for H2.

Management highlighted that the Q2 sales and marketing efficiency (800 bps improvement) was expected due to market leadership and strong tailwinds. They expect this efficiency to continue in H2, combined with normalization of World Cup-related costs, leading to margin expansion. Strategic investments were implicitly in customer experience and regulatory advocacy.

“As you look into the second half, what I can say is that we do continue to expect to see this efficiency flowing through from sales and marketing providing a benefit, as well as the alleviation of some of those temporary costs subsiding allows us to see this clear pathway to margin expansion.”

asked by Eric Sheridan · answered by Constance James

Asked about the cautious implied H2 GMS outlook despite a robust event slate, and requested quantitative details on advertising revenue.

Management explained the cautious GMS outlook is due to monitoring consumer spending post-World Cup, emphasizing a disciplined approach to guidance. For advertising, they are focused on perfecting the product (sponsored listings) and optimizing mechanics before sharing more metrics, but expect full-year revenue in the tens of millions.

“We're trying to take a very disciplined approach. So we have high conviction and grounding in what we see as we move forward. And so we're also -- I think as we said, we always think on an annualized basis over the long haul because in any period of time, things can get moved forward or back, the event calendar, concert on sales can change.”

asked by Mark Stephen Mahaney · answered by Eric Baker

Asked to quantify World Cup's GMS impact in Q2/Q3, its longer-lasting benefits (customer acquisition), and addressed customer experience challenges.

Management stated the World Cup performed at the high end of expectations, validating resale's role and StubHub's global platform. They did not quantify specific GMS contribution but noted it was a key driver. They acknowledged a small subset of fulfillment issues due to complexity and a bespoke ticketing system, leading to proactive investments in customer support, which temporarily compressed gross margins.

“The event was an extremely positive experience for the overwhelming number of fans who used our service that we were able to deliver those people to those games to see the matches. ... That being said, we can prudently understand the frustration of -- there was a small subset, a very small subset of fans who didn't have the experience they wanted, had to get a refund, and that's unacceptable to us.”

asked by Douglas Anmuth · answered by Eric Baker

Inquired about demand differences between US and international markets, and sought an update/clarification on regulatory noise, particularly regarding 'scalpers' and price caps.

Management noted consistent strong demand for live events globally, with consumers resilient across all countries. On regulatory, they reiterated advocacy for open markets, stating price caps are rare and ineffective, leading to black markets. They clarified that regulatory focus on high-end concert tickets (10% of GMS) is limited, citing D.C. legislation carving out sports and failed price cap proposals in the U.K. and New York.

“Resellers that list large quantities of inventory on marketplaces for very high-demand concerts at high prices significantly above the original sale price. Based on our internal data, we estimate that approximately 10% of our global GMS in 2025 was attributable to these types of high-demand concert ticket sales by resellers.”

asked by Shweta Khajuria · answered by Eric Baker

Questioned the implied low single-digit GMS growth for H2 given World Cup benefit in July and easy Q4 comp, suggesting North America GMS might be flat to down. Also asked about the proactive vs. reactionary nature of World Cup customer support costs.

Management reiterated a disciplined and grounded guidance philosophy, monitoring post-World Cup consumer spending patterns. They stated that World Cup customer support investments were largely proactive, anticipating complexity, and emphasized their commitment to 100% customer satisfaction despite the law of large numbers making 0% problems difficult.

“I think I want to echo what Connie was saying, is that some of those expenses that she walked through are one-time to that type of event because of the nature of the ticketing system, the nature of the event calendar, et cetera.”

asked by Ryan Sigdahl · answered by Eric Baker