StubHub's IPO debut was the worst in 17 years. Is there any chance for growth?

American online platform for selling and reselling tickets StubHub has shown the worst start after IPO in the USA for the last 17 years. In the first week after the offering, its shares fell 25% and its capitalization dropped by more than $2.2 billion. The company had been preparing to go public for many years and twice postponed listing due to market turbulence. Now the risks to it remain significant, and analysts say StubHub remains a speculative bet.

StubHub has lost more than $2.2 billion in market capitalization since its IPO last week. Investors who bought securities at the IPO and kept them faced a loss of about 25%. That's the worst first-week trading result among companies that have raised more than $500 million in U.S. IPOs since 2007, when Sculptor Capital Management shares collapsed after debuting on the stock exchange, Bloomberg data show.

The fall came amid a revival of the U.S. IPO market: September was the best month in terms of placement volumes since the end of the 2021 boom, the agency said.

The company, founded in 2000, makes money primarily from commissions for connecting buyers with ticket sellers. StubHub's $800 million offering took place Sept. 19 at the midpoint of the range price offered to investors and came years after the company began preparing to go public.

The platform has postponed the listing twice, CNBC notes. The last delay occurred in April after U.S. President Donald Trump announced sweeping duties, which caused turbulence in the markets.

StubHub CEO Eric Baker told CNBC that recently enacted federal rules on ticket price transparency will result in a "one-time hit" to the company's financial results.

StubHub's IPO documents show both the company's strengths and weaknesses at the same time, Trefis Team analysts wrote for Forbes. The company's growth rate is slowing: for the first half of 2025, revenue totaled $827.9 million, up only 3% from a year earlier. The company has not yet turned a profit and recorded a net loss of $111.8 million.

The combination of the company's indicators looks atypical: formally, the business is unprofitable, but it continues to generate live money. This distinguishes StubHub from many other newcomers to the stock market, who simply "burn" capital when they go public, analysts say.

Nevertheless, investors should not count on dividends: the management has already made it clear that all earnings will be used for further development of the company, Trefis Team analysts wrote for Forbes.

StubHub has a number of strengths that can support the company's development, analysts emphasize. Firstly, the secondary ticket market industry itself is showing strong growth - according to forecasts, it will add 8-11% annually until 2029. This creates a favorable background for business expansion.

Secondly, StubHub is benefiting from the so-called impression economy: consumers are increasingly choosing events and emotions over material purchases, which means that demand for concerts and sporting events can only increase.

Finally, the financial resources from the IPO remain an important asset. These funds allow the company to reduce its debt load, invest in new technologies and scale operations more aggressively than in the period before going public, the analysts summarize.

"If you believe in the long-term prospects of the live industry and StubHub's ability to adapt - this could be an interesting growth opportunity. If you value stable profits and predictability, it's better to be patient," the Trefis Team adds.

This article was AI-translated and verified by a human editor