SEAT

Good morning, welcome to Vivid Seats' first quarter 2026 earnings conference call. Following management's prepared remarks, we will open the call for Q&A. I would now like to turn the call over to Austin Arnett.

Good morning, and welcome to Vivid Seats' first quarter 2026 earnings call. I'm Austin Arnett, Vivid Seats' General Counsel. I'm joined today by Larry Fey, Chief Executive Officer, and Joe Thomas, Chief Financial Officer. By now, everyone should have access to our earnings press release, which was issued earlier this morning. The release, as well as supplemental earnings slides, are available on our investor relations website at investors.vividseats.com. Today's call will include forward-looking statements within the meaning of federal securities laws. These statements are subject to risks and uncertainties that could cause actual results to differ materially from our projections, including the risks discussed in our earnings release, our most recent annual report on Form 10-K, and our subsequent filings with the SEC. Today's call will also include references to adjusted EBITDA, a non-GAAP financial measure that provides useful information to our investors.

To the extent reasonably available, a reconciliation of adjusted EBITDA to its most directly comparable GAAP financial measure can be found in our earnings release and supplemental earnings slides. Now I'll turn the call over to Larry.

Good morning, everyone, and thank you for joining us today. We entered fiscal year 2026 with a clear focus and roadmap to enhance our market position and financial trajectory. With that focus, we delivered measurable progress in the first quarter, resulting in meaningful improvements across our business. Our first quarter results came in at the high end or above guidance. On a sequential basis, we delivered growth in GOV, adjusted EBITDA, and our cash balance relative to Q4 2025. This momentum and sequential improvement support our confidence in returning to year-over-year growth in the second half of fiscal year 2026 and beyond. Our long-term strategy centers around Vivid Seats' foundational strengths, leading technology and product innovation, operational excellence, and a differentiated value proposition for our customers and partners. Pairing a seamless user experience with a differentiated value proposition is central to our mission.

Vivid Seats strives to be the most rewarding ticketing company, and we are increasingly aligning our product, pricing, and messaging around that core idea. We deliver value through competitive pricing, seamless user experiences, and meaningful rewards that deepen customer loyalty over time. We are currently focusing our product innovation efforts on the core customer journey. We are improving funnel efficiency, enhancing conversion, and delivering a faster, more intuitive experience. We recently deployed an upgraded app checkout experience, delivering a streamlined flow to accelerate the customer journey while improving conversion rates. We are encouraged by the early results and are excited about the pipeline of enhancements to both our app and web properties that will be deployed in Q2 and Q3. Our enhanced app value proposition continues to deliver encouraging results. In Q1 2026, Vivid Seats' app GOV was up 20% year-over-year.

This growth led to Vivid Seats' app share of GOV exceeding 40% for the quarter. Increasing app adoption reflects the combined impact of the Vivid Seats Rewards program, our lowest price guarantee, and continued product improvements. Together, these investments represent a highly differentiated value proposition. App users are more engaged, return more frequently, convert at higher rates, and touch paid performance marketing channels less often. As volume shifts into the app over time, we anticipate more efficient customer acquisition, alongside enhanced customer retention and growing lifetime value. Alongside our app progress, we are continuing to invest in innovation across customer acquisition by working closely with leading AI platforms. This includes our recently launched ads on ChatGPT. While still in the early stages, we believe these efforts will help us capitalize on the long-term opportunities AI presents within the ticketing ecosystem.

In tandem with the encouraging trends we are seeing with Vivid Seats branded properties, we were pleased to launch a significant new private label partner during Q1, with performance already exceeding our expectations. We also recently extended our agreement with a large existing private label customer, underscoring the value proposition we deliver to our private label partners. We are pleased to see the private label business deliver sequential revenue growth in Q1 2026 and believe this trend supports our expectation of a return to growth in the second half of the year. With that, I'll turn it over to Joe to walk through our first quarter financial results in more detail.

Thank you, Larry, and good morning, everyone. As Larry mentioned, our first quarter performance landed at or above the top end of our guidance, underscoring strong execution across the business. We achieved meaningful sequential increases in GOV and adjusted EBITDA compared to Q4 2025. This improvement is encouraging as we pursue a return to growth in fiscal year 2026 and beyond. Q1 2026 marketplace GOV was $612 million, compared to $581 million in Q4 2025, reflecting quarter-to-quarter growth of $31 million or 5.5%. This is particularly encouraging as the fourth quarter typically represents the highest GOV quarter each year, due in part to robust sports volumes with all major leagues in season. Q1 2026 consolidated revenue was $126 million, essentially flat with $127 million in Q4 2025.

Within consolidated revenue, private label revenue grew 20% quarter-to-quarter, highlighting a meaningful growth trend in the channel despite continued year-over-year private label declines as we lapped the 2025 loss of a large customer, as previously disclosed. Marketplace take rate was 15.9% in Q1 2026, compared to 16.8% in Q4 2025. The lower take rate primarily reflects mix shift as private label revenue tends to come with lower take rates. We continue to expect near term take rates to remain around 16% on a consolidated basis. Q1 2026 adjusted EBITDA was $9.5 million, compared to $1 million in Q4 2025. Adjusted EBITDA grew $8.5 million, marking substantial improvement on a sequential basis and highlighting the benefit of a material reduction in operating costs relative to a growing GOV and revenue base.

Cash increased over $40 million in the first quarter to $144 million. Cash flow benefited from improved profitability alongside seasonally strong working capital dynamics. Our first quarter results show significant progress across our operational and financial goals. Accordingly, we are reaffirming our 2026 outlook. For fiscal year 2026, we continue to expect marketplace GOV in the range of $2.2 billion-$2.6 billion and adjusted EBITDA in the range of $30 million-$40 million. This outlook reflects continued execution of our operating plan and financial profile. I will now turn the call back to Larry for closing remarks.

Our first quarter results indicate our strategy is working and we are moving in the right direction. We are excited about our momentum in the Vivid Seats app, where improving conversion and increasing engagement are supporting double-digit GOV growth. We are also encouraged by the sequential trends in our private label business as we seek a return to year-over-year growth later in the year. As we move through the year, we are confident that our core strengths, leading technology and data, operational excellence, and a differentiated customer value proposition will shine through. We are excited to continue executing against our strategy and to deliver long-term value to all stakeholders. With that, operator, please open the call for questions.

Thank you. At this time, we'll conduct a question and answer session. To ask a question, you'll need to press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Please limit yourself to one question and a follow-up. Please stand by while we compile our Q&A roster. Your first question comes from the line of Cameron Mansson-Perrone with Morgan Stanley. Your line is now open.

Thank you. Morning, guys.

Morning.

Larry, last quarter you highlighted that you're seeing some encouraging trends in terms of the competitive environment kind of rationalizing. Wondering if you're continuing to see that and whether there's any event category where you're seeing more or less industry competition for activity, and whether competitive intensity from an event-specific angle is that whether the rate of change is better or worse in any specific category? I appreciate it.

Thanks, Cameron. I think the moderation that we saw start in Q4 from StubHub on the paid search side has continued. That's been somewhat counterbalanced by continued aggressiveness in that channel by some other players. No question they've stepped back from their peak spend that we saw early to middle of 2025 on the marketing spend side.

Yeah.

I think perhaps still surprising to us. In the last few weeks, we've seen them shift to some price testing, price competitiveness. You continue to see, particularly in sports, across the ecosystem, competitiveness across pricing, while the marketing landscape seems to have really stabilized and moderated a bit.

Got it. Anything to follow up on that? Anything that you could add on, you know, I think the benefits on the push to kind of drive activity in-app probably makes you a little bit more insulated in terms of the vagaries of competitive intensity in the industry. You know, any additional color on kind of how you think about that and what the opportunity could be as more activity shifts to in-app?

Yeah. I think that's exactly right in terms of the goal and the strategy. You know, we're happy to have exceeded 40%. I think implicitly though at 40%, we still have exposure to the winds of paid search and marketing expense. The objective is very much to control our own future, bring folks into the ecosystem once and then have it more about building a long-term relationship with those customers versus continually needing to go back into the pond and acquire folks. We do benefit when things moderate, right? Given the remaining piece of the business that's still out there. We're pleased to see that, the surface area of that exposure has shrunk quite a bit relative to what it was two years ago.

Got it. Helpful. Thank you.

Thank you. Your next question comes to the line of Ryan Sigdahl with Craig-Hallum. Your line is now open.

Hey, Larry, Joe. Nice job on the sequential improvements and stabilization. I want to start on industry volume. I'm curious what you guys saw in Q1 and then Q2 quarter to date, acknowledging I know April was a very tough comp, but just curious to try and compare your results to relative to the industry and what you saw there.

Yeah. In Q1, the data we're seeing, it was industry was probably up a smidge, low single digits. Started pretty nice in January and then, yeah, moderated a bit into February and March. Net growth but single digits. Q2 thus far, I'd say is roughly flat. Got off to a slower start with Easter timing, April picked up with a couple meaningful concert on sales in the last two weeks. We're back to roughly flattish. Yeah, I think at the moment, generally continue to subscribe to what we had put forward at the outset of the year of modest industry growth. I think we've all seen the increase in some cancellations of certain tours over the last few weeks.

I think most recent was The Pussycat Dolls. We also saw Zayn Malik, a couple others, Post Malone delayed, which I think on some level is reflecting either mispricing or some cap on potential for growth for the year.

Thanks, Larry. Just on market share, how that looked for you guys looking at Skybox data, on a sequential basis for the marketplace. Secondly, on the market share, what you guys are seeing from Skybox from your ERP customers.

Yeah. Our share has been sequentially steady in our data, when we look at Q4 into Q1 into Q2. As we've started to lap our most difficult comps last year, which started around now with the, call it, peak spending in the performance marketing channels, we've seen in our data, our share shift to being up year-over-year. Not dramatically, but up, which is refreshing. As you probably heard our theme throughout the call, yeah, I think we're well situated to return to growth in the back half of the year, and those are the types of metrics that you love to see flipping green in advance of that.

Great. Maybe just on Skybox too, if you're willing to comment specifically to the ERP customer market share.

There continues to be competition for those customers, but we have not seen any meaningful defections in recent months. We're vigilant. We're continuing to reinvest and refocus on upgrading the platform to defend those relationships. We've seen alongside our, you know, stabilizing and improving share and volumes, improvement in that dialogue and discourse with all of our sellers. Excited about the outlook on the Skybox front.

Excellent. Good luck, guys.

Thanks, Ryan.

Thank you. Your next question comes from the line of Ralph Schackart with William Blair. Your line is now open.

Good morning. Thanks for taking the question. Two, if I could. Just first on the macro environment and sort of the reads on the consumer, now that we have some elevated oil prices. Larry had said that maybe there's some cap on prices. I'm not sure if those are related, but just any comments as it relates to that, and then I have a follow-up.

There's nothing we could point to in terms of the kink in the curve where, you know, the Iran conflict started, oil prices moved, and you can see a discernible shift in demand or purchasing in any clear way. You know, as we touched on earlier with some of the concert tours being canceled, perhaps that's a reflection of at least some subset of the market being tapped out, or it also may just be part of the natural oscillation of some artists mispriced their tours, which is, I think the leaning at the moment. We have seen some weakness, you know, the lower end of the Vegas market has probably been the most palpable place where we've seen the impact of potential consumer weakness.

I think that's a comment you've heard or I believe seen a number of the local operators, reinforce, and we have continued to see that continue into the year. In Vegas, we're really looking ahead to 2027 when supply tailwinds arrive with the reopening of the Mirage. I think for this year, it's gonna be more of a blocking and tackling type year in Vegas.

Okay, great. Just maybe kind of switching gears to the app and some of the improvements you've talked about in conversion rates. I think you said you're above 40% traffic now on the app. Maybe just kind of a sense how that's trended over the last year or so, you know, just any thoughts on where you think that you could take that rate over time. Thank you.

We've seen really nice increases in the share of GOV coming through the app. Ultimately the GOV function is how do you get more people into the app and how do you drive higher conversion? Our activities are centered on both of those. A lot of effort in the back half of last year on how do we make folks who see the app want to download and keep it through better messaging with the better value proposition, reinforcing the value proposition. The focus this year has shifted to the conversion side of things. How do you optimize the product experience? How do you collect more data to have better personalized information appear in front of folks? Have a pretty exciting deployment calendar over Q2 and Q3 on the app side of things.

We're north of 40% in Q1. I think the ambition is for a majority of the business to come through the app. I think realistic timetable for that would be at some point in 2027 to achieve that on a run rate basis, that's what we're aspiring to deliver.

Okay, great. Thanks, Larry.

Thanks.

Thank you. Your next question comes to the line of Brad Erickson with RBC Capital Markets. Your line is now open.

Hey, morning, guys. Thanks for taking the question. In terms of the return to growth, you pointed to, I think, the new private label partner giving you some added confidence there for the second half. Can you remind us any other items that could go, kinda could go right this year that gets you back to that growth in the second half of the year or at a high end of the guide type scenario? What would those drivers be?

Yeah, I think, you know, as we frame why second half is where we draw the line for when we expect to flip back to growth. We lost the large private label customer in July of last year. July and really August will be the first true clean month without that customer in there. Subsequent to losing that customer, you know, as we noted, we brought a new meaningful private label customer on in Q1, which enabled sequential growth from Q4. Yeah, I think within private label, the path to incremental upside is twofold. There's always the option of winning and bringing additional customers on. There's an interesting stick or two in the fire on that front.

The other piece that we've redoubled efforts is how do we make sure our product and our support of our partners to maximize their organic performance is where it needs to be. We're seeing encouraging progress on that front as well. With one of the big changes being any product enhancement that we are developing for the Vivid Seats marketplace, we wanna make sure we make it configurable and available to our partners in short order. Some of the upgrades that get us excited on the Vivid side, as they get pushed to our private label platform, I think provide an opportunity for organic outperformance in the second half of this year, but probably more prominent if you think about growth into 2027 and full year impact.

You know, beyond that, I think the concert calendar and supply slate is largely baked at this point. you know, upside from here I think will largely be driven by fundamental performance, right? Can these new product releases that we have upcoming in Q2 and Q3 deliver the type of conversion uplift that we anticipate, or event mix? I think the World Cup is probably the elephant in the room. If you get some great matchups in the quarterfinals, semifinals, finals, and you have, you know, a series of Super Bowl size events, that would be a wonderful tailwind. We'll see.

Got it. And then just bigger picture, as you continue to have conversations, assumably with the LLM companies, I don't know, have you seen any indications or just any updates you can give us on how you're thinking about, you know, their desire, ability, et cetera, to potentially grab economics of bringing the booking kind of closer to the four walls of the LLM? And then just, you know, generally, when you think about the risks related to that, remind us, like what do you point to as kind of the specific points of insulation where the ticketing sector can maintain all of its economics within an kind of an LLM booking environment?

Yeah. I'd say on the AI journey broadly, we've actually seen to date quite little progress on the top of the funnel disruption and quite a bit of progress on optimizing the way we operate the business on our side. Not to say it can't change, but everything we've seen to date has been more in the camp of the tools and capabilities allow us to be much more efficient and effective on a series of parameters to deliver a better customer experience, whether that's building the software more quickly, automating processes, better information sharing. It really has been a nice tailwind on the operational side, including specifically our customer service experience.

If you look longer term, you know, nothing that we've seen indicates that the premise of like a fully captive transaction where the marketplace is boxed out, is likely in the near term or the focus of the LLMs in the near term. I think the biggest barrier, it's this idea of when you have dynamic inventory in a deep vertical search category where you have a ton of individual preference. You need a lot of data. The LLMs don't have that data across every subcategory that they service. They're ultimately reliant on the folks like Vivid Seats or our competitors who have aggregated the inventory, have built the seat maps, have the dynamic real-time pricing. Unless we compile all that information and provide to them, they won't have it.

It's incumbent on, you know, us in the industry to make sure that we don't, just, you know, give away the farm, without being properly compensated. That, I think, is at least what we're seeing today. That's a multi-year journey, and not one we're seeing progress being made on the LLM front at the moment.

Understood. Thanks, Larry.

Thank you.

Thank you. Your next question comes to the line of Steven McDermott with Bank of America. Your line is now open.

Hi, thank you for taking the question. I was wondering if we could shift a little bit to your partnership with United. Kinda any updates there, and is that really driving any incrementality that you're seeing? I have a follow-up after.

Yeah. You know, United's a great example of one of the, they call it many partnerships and partners we have across the ecosystem. You know, it's been a nice tailwind throughout the year. It's not a, you know, explicit needle mover of results. It's been great to add them. Excited to continue to grow the partnership and iterate on how to maximize it. Would not consider that a primary influence on the results that you're seeing in Q1.

Gotcha. Thank you. you know, as we look at your cost position after your recent reductions, do you feel as though you're kinda in a comfortable position to return to growth? To that, can we expect a more aggressive OpEx spend in the second half of this year?

Yeah. I think the cost side of the equation continues to be a bright spot. I think first and foremost, the cost reductions that we've actioned are flowing through, so they are real. Second, we have not seen any loss in productivity or capability. In fact, I think I've actually seen our productivity and deployment rates increase alongside the efficiency gains. That's, you know, one part optimizing and getting the right people in the right seats and one part utilizing some of these AI capabilities I was alluding to earlier. As we sit here today, you know, our objective is operating leverage. As we grow, disproportionate amount of that growth flows through to the bottom line.

I think we have more opportunity to capture on the expense side as we move into next year. There are some variable costs, right? As you, as you complete transactions, even including in our G&A line, right, some software that's per dip and that type of thing. I think our objective is, even as we return to growth, our expenses remain steady on the G&A side.

Gotcha. Thank you so much.

Thank you.

Thank you. Your next question comes to the line of Thomas Forte with Maxim Group.

Great. First off, Larry and Joe, congrats on the quarter. Larry, sorry about the Illini, and at least, OKC is playing the Lakers in this round. My first question's more exciting, my second question's a little boring. On the more exciting front, what gives you confidence you can maintain your share and capitalize on World Cup this year? If you're able to do that, how might World Cup contribute to your numbers this year?

I think World Cup has been a pretty meaningful tailwind. I think broadly consistent with what we've touched on in prior quarters, where we framed the opportunity as something larger than an A-list concert tour, but perhaps less than Taylor Swift. What we've seen in terms of volume flowing through to date, so the World Cup first went on sale in November, so we've been selling for six, seven months now. With a couple months to go as we approach the start of the games, it's tracking to those levels, right? If a typical A-list tour is 1% of GOV for the year, Taylor Swift, you know, more like high single digits. It looks like overall the event will be low to mid single digits as a percentage of full year GOV.

We've had, you know, really nice performance and strength to-date. These are high AOS events, and what we've generally found is that value proposition matters quite a bit when you're talking about these high AOS events. Incumbent on us to continue to get the message out that our app is the place to purchase these high AOS tickets. If we're able to continue doing that, I think we'll get our fair share a little bit better as we enter the playing phase of the tournament.

Great. For my boring one, now that we're a quarter in, do you wanna give your updated thoughts on cash conversion for adjusted EBITDA for 2026?

I think largely consistent where if anything, our CapEx is maybe coming in a little bit lower than we had previously estimated. Directionally, net interest expense in the $20 million range, CapEx software in the low to mid-teens, and then a smidge of taxes relating to our international operations. If you get to EBITDA in the $35 million-$40 million range, you'll be cash flow positive before considering working capital. As we have outlined, we feel pretty good about our volume trajectory and that overall working capital will be a source of cash on balance over the course of the year. Believe what we're tracking, assuming we continue to deliver against the numbers and guidance for a cash flow positive year.

Great. Thank you, Larry. Thank you, Joe.

Thank you.

Thank you. Your next question comes to the line of Kunal Madhukar with DB. Your line is now open.

Hi, thank you for taking the question. A couple if I could. One, on the app side, wanted to understand how the app user demographic differs from the, you know, the regular customers that you have on the website, in terms of maybe age, in terms of their interest, in terms of engagement, in terms of geography, in terms of the type of tickets, concert versus sports, that they are buying. Then I have a follow-up.

Yeah. I think the biggest delineation between app and web users tends to be that the most frequent live event attendees, those who repeat most often are the ones intuitively, right, who would download an app for buying live event tickets. That generally corresponds to the categories that have the highest recurrence, which would be sports, right? The highest recurrence example would be Major League Baseball, right? There's 81 home games. If you go to one baseball game a year, there's a decent chance you'll consider going to two or three. In contrast, Taylor Swift goes on tour once every five or six years. The fact that you bought a Taylor Swift ticket might mean that you're interested in buying a Sabrina Carpenter ticket.

The fact that you bought a Cubs ticket means you're really likely to be interested in buying another Cubs ticket. The biggest element that we see across the app is folks repeat more often, right? If you buy on our app, the prospect for you buying again is higher. The second is that you over-index the sports because of the inherent recurrence within sports. Beyond that, there's not a lot to flag across like geography or demographics that I would say is of note. It's really more the frequency profile with a bit more sports orientation.

Got it. Then, when I was doing basic back of the envelope math, given app GOV grew 20% and is now over 40% of the overall GOV, that suggests that the non-app GOV probably declined about 40%. Then you mentioned that we should expect that by 2027, app GOV on a run rate basis should be a majority of the business. What kind of growth rate should we expect on the app side versus the non-app side for the remainder of the year?

First, first definitionally, when we reference app GOV, that's of our Vivid Seats properties, so we're not speaking across the entire GOV footprint of the business, namely, you know, Vegas and Wavedash and our private label would not be part of that definition. I would tweak the math a bit. You know, I don't think we're in the business of forecasting or projecting by device type explicitly. I think implicitly, we're expecting the business to grow, app to grow disproportionately. You know, as we start lapping some of the most competitively intensive periods, I think we expect that we can get web back to growth. Whenever you're looking at these aggregate GOV numbers, you just have to fully decompose it, right? You have to pull private label out.

We lose private label partner that is different than competitiveness in the web, competitive landscape lens, us versus StubHub, versus SeatGeek. Yes, it is, it's an implicitly true statement that app was up and other parts of the business were down, but decomposing is pretty important.

Got it. Thank you.

Thank you. Your next question comes to the line of Andrew Marok with Raymond James. Your line is now open.

Hi. Thanks for taking my questions. One, with this quarter's results coming in nicely and the reiteration of the guide, is the business just kind of becoming a bit more visible in your view? Are you able to maybe have a little bit more forecasting confidence than you have had in the past? Then I have a follow-up.

Yeah. Thanks, Andrew. I think I would agree with the statement overall. Certainly as we move through a year, right? As we get to Q4, where the concert on-sale calendar solidifies and crystallizes that through the back half of Q4, first half of Q1, we sit here with a pretty good sense of what the supply side of the calendar will look like. I think the fact that we've really tightened up our expense base lowers the bar, if you will, which helps mute impact. Then the last piece is we've reduced the surface area and exposure to paid search. It's still present, but we've reduced it. I think that helps diminish volatility from things that are exogenous, namely competitive or competitor posture. There will still be variance, right?

Event mix is still a real thing, right? If we have great World Cup matchups or bad World Cup matchups, long series, short series, more concert cancellations, right? Those are all exogenous and can introduce volatility. Competitor behavior, competitor posture can still introduce some volatility. In terms of the controllables, I think we've dialed them in quite a bit and feel better about putting outlooks in place.

Appreciate that. Then maybe as it relates to the app business, I think you mentioned this, a little bit in your prepared remarks, but I just kinda wanna ask it directly. There's kind of this, you know, meme out there for older people, especially, where big purchases are done on the desktop, right? Like ticketing, hotel bookings, flights, et cetera. How do you sorta combat that to drive app growth? Is it purely demographic, or are there kind of nudges that you can give your consumers to get them to buy on the app? Thank you.

Yeah. Thanks, Andrew. It's a great question because, you know, I guess this probably reveals where I sit on the age bucket, but I will do that as well, right? When you're in discovery mode, you wanna be able to, you know, either consider a bunch of different events or a bunch of different seating areas. Sometimes I'll actually do some searching on the bigger screen. But I think the objective we have is to make sure folks know that there's a better value proposition available in the app. If you wanna transact on desktop, that's great, and we're gonna deliver the optimal experience for that.

If you also wanted to discover on desktop and then download the app, properly messaging that the lowest price guarantee and typically our lowest prices will be available in the app. You know, increasingly, we're gonna have, you know, our rewards program prominently appear in the app and less so on web. There'll be material inducement to transact in the app, but we of course wanna support people wherever their you know workflow wants them to transact.

Appreciate it.

Thank you.

Thank you. Your last question comes from the line of Maria Ripps with Canaccord. Your line is now open.

Great. Good morning. Thanks for taking my questions. First, I just wanted to follow up on your private label business. You mentioned a new customer addition there, which is encouraging. How should we think about that segment going forward beyond sort of returning to growth? Do you think it can return to the run rate you had the business at about a year or two ago?

I think in absolute size, it's unlikely that we'll, in the near term, reclaim where we had been before the large customer loss. What I think we aspire to deliver is that the segment will grow at or above the broader marketplace and at or above industry rates. I think the two paths there would be enabling our existing customers to organically outpace the industry. Where it gets exciting is you have the option and the opportunity to add new customer wins on top of that organic growth. We're seeing all of those signs pointing in the right direction, where we can have both happening in parallel, which could lead to some nice sequential growth, and starting in Q3 set us up for delivering sustained year-over-year growth.

From an absolute standpoint, I don't think returning to the pre-customer loss levels that we saw in 2024 or early 2025 is a near-term target that we think we can deliver.

Got it. That's helpful. Just a quick follow-up. Can you maybe update us on your international strategy and how important is it, kind of on the list of your investment priorities at this point?

Yeah, we continue to be encouraged by the international opportunity. I think we mentioned in our last call or two that we're positive on the contribution margin standpoint in 2025. We grew GOV triple digits in 2025. We've continued to see GOV grow into 2026. In the spirit of focusing our efforts on the highest impact priorities, what we're focusing on are upgrades that benefit not only international but also North America. As you think about things like our checkout, regardless of your location or your geography, that'll benefit the business. The near-term roadmap is really focused on that type of improvement. As we get through these universal upgrades, they will benefit international but also benefit North America.

We do have an interesting roadmap of international upgrades queued up. It's just a matter of if we can get to it in the next quarter or the next couple quarters.

Got it. That's helpful. Thank you, Larry.

Thank you.

Thank you. I'm showing no further questions at this time. Thank you for your participation in today's conference. This does conclude the program, and you may now disconnect.

Good day, ladies and gentlemen, and thank you for standing by. Welcome to the Vivid Seats Fourth Quarter 2025 Earnings Webcast and Conference Call. [Operator Instructions]. I would now like to introduce your host for today's presentation, [ Mr. Austin Arnett ]. Sir, please begin.

Good morning, and welcome to the Vivid Seat's Fourth Quarter 2025 Earnings Call. I'm Austin Arnett, Vivid Seat's General Counsel. I'm joined today by Larry Fey, Chief Executive Officer; and Joe Thomas, Chief Financial Officer. By now, everyone should have access to the earnings press release we issued earlier this morning. The release as well as supplemental earnings slides are available on our Investor Relations website at investors.vividseats.com. Today's call will include forward-looking statements within the meaning of federal securities laws. These statements are subject to risks and uncertainties that could cause actual results to differ materially, including those discussed in our earnings release, our annual report on Form 10-K and our other filings with the SEC. Today's call will also include references to adjusted EBITDA and net debt, which are non-GAAP financial measures that provide useful information to investors. To the extent reasonably available, A reconciliation of these non-GAAP financial measures to their most directly comparable GAAP measures can be found in our earnings release and supplemental earnings slides. And now I'll turn the call over to Larry.

Good morning, everyone, and thank you for joining us today. I'm excited to share what we are working on as we chart a refreshed course for Vivid Seats in 2026 and beyond. We believe we have the right team and the right strategy to drive innovation, thought leadership and profitable growth in the coming quarters and years. I'd like to begin with an update on our leadership team. Austin Arnett who provided opening remarks for this call was named General Counsel in December. Austin previously led our corporate legal team after prior roles at Latham & Watkins and McDonald's. Austin steps into the GC role with extensive legal expertise and substantial familiarity with our business. I'd also like to introduce Joe Thomas, our new Chief Financial Officer. Joe, who joined us in January is an accomplished executive with a strong track record of driving financial discipline through data-driven decisions while supporting long-term growth initiatives. I'm excited to join forces with both of them as we embark on this new chapter for Vivid Seats. I'd also like to thank Ted Pikes, who served as our interim CFO during this transition. Ted's deep institutional knowledge and steady hand were critical during a pivotal period for the company. I'm grateful for his continued partnership as our Chief Accounting Officer. With our new team in place, we have refined our long-term strategy and have quickly begun executing against it. Our strategy builds and expands upon visits foundational strength, our leading technology our unique data, a relentless focus on efficiency and an increasingly compelling and differentiated value proposition to customers. I will spend a few minutes touching on our efforts across each of these foundational elements. Starting with our technology and product, we are redoubling our focus on product innovation and efficiency and expect this to benefit our results as we move through 2026. Across both our web and app properties, we are bringing a renewed focus on our core customer funnel to ensure a seamless user experience. Beyond this foundational focus, we are continuing to innovate in an increasingly AI world. In 2023, Vivid Seats became the first company in the live events industry to launch a live events plug-in for open AI's ChatGPT. That early partnership underscored our commitment to innovating at the intersection of technology and live entertainment. Building on that foundation, we recently introduced a dedicated Vivid Seats app within ChatGPT, further advancing our AI-driven shopping capabilities. This new app is designed to capture real-time consumer intent and transform event discovery by making it more personalized, intuitive and efficient while reinforcing our position as a leader, shaping the future of how fans discover and access live events. This launch is an example of our continuous efforts to evolve our platform in a highly dynamic environment. Our path forward will combine innovation with a disciplined focus on efficiency. As previously announced, we significantly expanded our cost reduction program increasing our initial fixed cost savings target from $25 million to $60 million. We have now achieved our increased target of $60 million of annualized savings with reductions in spanning marketing, G&A and stock-based compensation. These savings position us to reinvest selectively in growth initiatives such as our enhanced app value proposition while improving our operating leverage as we return to growth. We also executed our corporate simplification early in the fourth quarter, which included the termination of our tax receivable agreement and the collapse of our dual-class share structure. This meaningfully reduces complexity, improves transparency and generates both immediate and long-term financial benefits. Taken together, our cost reduction program and corporate simplification are creating a more efficient, agile organization that can invest strategically for growth, while maintaining financial discipline. Moving to the compelling and differentiated value proposition we present to customers. Vivid Seats is the most rewarding ticket company. We are centering the Vivid Seats message and experience around that simple but powerful fact. No one rewards fans more than we do. We're sharpening our messaging to highlight how Vivid Seats delivers more value at every step of the journey from rewarding prices to a seamless, stress-free shopping experience to tangible rewards that deepen loyalty over time. By delivering the most rewarding experience in ticketing, we seek to build long-term relationships with our customers and our app ecosystem. App users return more frequently, convert at higher rates and rely less on paid performance marketing channels. We believe the combination of our rewards program and our lowest price guarantee represents the most compelling value proposition in ticketing. We are seeing encouraging trends as we pursue this strategy. App GOV is up over 20% year-over-year through the first 2 months of 2026. Since launching our enhanced app value proposition during Q3 of last year, we have seen app share of GOV increase by more than 500 basis points. We also remain confident that information transparency will only increase as AI continues to reshape how consumers discover and evaluate offerings across the Internet. We believe we are well positioned to benefit as AI-guided consumers increasingly gravitate towards platforms that are delivering the most value to consumers. While we are early in our execution journey, the trends we are seeing thus far in Q1 indicate we are making substantial progress and that our strategy is gaining traction. Accordingly, we are reaffirming our 2026 outlook. We continue to expect marketplace GOV in the range of $2.2 billion to $2.6 billion and adjusted EBITDA in the range of $30 million to $40 million. In addition, we are providing Q1 2026 guidance of $570 million to $620 million of GOV, $8 million to $10 million of adjusted EBITDA and a cash balance of $125 million to $135 million. Turning to the fourth quarter. While our results were challenging, they were largely in line with what we anticipated as we work through a transitional period for the business. As we shared last quarter, a softer Q4 industry backdrop, private label declines and ongoing execution of our strategic realignment were expected to pressure results. While these pressures played out as expected, we were encouraged by emerging momentum across our own properties. In particular, our app performance remained a bright spot, reflecting the impact of our ongoing product investments and enhanced value proposition. The trends we are seeing thus far in the first quarter confirm the actions taken by this new team are translating to tangible progress. These indicators reinforce our belief that the path forward we have put in place is the right one. and that the investments we are making will enable us to return to growth in the second half of 2026 and deliver sustainable, profitable growth for many years to come. With that, I'll turn it over to Joe to walk through our fourth quarter financial results and outlook in more detail.

Thank you, Larry, and good morning, everyone. I'm excited to join Vivid Seats and help shape the company's next phase of growth. The business is a strong foundation and significant opportunity. I look forward to working closely with Larry and the leadership team to deliver long-term value. Turning to the results. In Q4 2025, we generated $581 million of marketplace GOV compared with $994 million in the prior year period. Q4 2025 total marketplace orders were down 32% year-over-year with average order size down to $329 from $380 in Q4 2024. According to our SkyBox data, industry volumes were down double digits in Q4, primarily due to less content on sales and a difficult world series comparison, which pressured results when combined with the loss of a large private label customer that occurred in early Q3 2025. Q4 2025 revenues were $127 million, compared to prior year revenues of $200 million. Our Q4 2025 marketplace take rate was 16.8%, up slightly from 16.6% in Q4 2024. We expect our near-term take rates to stay in the 16% range. Adjusted EBITDA for the quarter was $1 million, reflecting the impact of lower volume and negative operating leverage. Importantly, we achieved our annualized cost reduction target of $60 million during the quarter. While we saw a partial benefit from these efforts in Q4 2025, we anticipate full benefit starting in Q1 2026 and with a more agile cost structure, allowing for improved operating leverage moving forward. We ended the fourth quarter with $103 million of cash and $390 million of debt resulting in net debt of $287 million. As a reminder, the fourth quarter brings seasonally lower working capital flow with that flood reduction accounting for a majority of our cash outflows in the quarter. Q1 2026 is seasonally stronger in terms of cash inflow, which supports our guidance for a cash balance range of $125 million to $135 million by the end of Q1 2026. We expect Q1 2026 marketplace GOV in the range of $570 million to $620 million. This GOV level is consistent with Q4 2025 and despite the fourth quarter traditionally being the strongest volume quarter of the year, which reflects sequential improvement in share. We expect Q1 2026 adjusted EBITDA in the range of $8 million to $10 million. This represents a substantial improvement relative to Q4 2025 EBITDA and reflects consistent volumes, improved unit economics and the full impact of our cost reduction efforts. For fiscal year 2026, we continue to expect marketplace GOB in the range of $2.2 billion to $2.6 billion and adjusted EBITDA in the range of $30 million to $40 million. This outlook reflects an expectation of modest industry growth and continued competitive pressures, but also benefits from our cost reduction program and strategic investments and an enhanced customer value proposition. Back to you, Larry.

In closing, the positive trends we are seeing in the first quarter support our belief that we are now on the right path. We are seeing encouraging progress across numerous leading indicators. Pointing to a return to volumetric growth across the business outside of private label. We are particularly excited about the app trajectory and believe the combination of a return to growth, a streamlined cost structure and more efficient tax profile positions us to deliver growing profitability and cash flow as we execute our strategy. We are confident that visits foundational advantages our leading technology, unique data, best-in-class efficiency and the differentiated customer value proposition remains. And with disciplined execution, will support our return to profitable growth. With that, operator, please open the call for questions.

[Operator Instructions]. Our first question or comment comes from the line of Ryan Sigdahl from Craig-Hallum Capital Group.

Welcome, Joe. Larry, I want to start, you've dealt with unfavorable competitive dynamics for the better part of 2 years now. We've heard from that may appear that they plan to focus more on customer acquisition efficiency in 2026, nice change, a fairly big change, I guess, in statement versus the user acquisition Blitz Creek, that they've been going under. I guess curious if you've seen any of that and then how you think about the competitive dynamics heading into 2026 or as we start and how you plan to balance your customer acquisition efficiency versus the value proposition, the app, direct traffic, et cetera, et cetera?

Yes. Thanks, Ryan. In terms of competitive landscape and competitive intensity, I think we have seen a degree of moderation, particularly as it relates to some of the peak intensity from StubHub in particular. I think others in the space continue to be pretty aggressive, and I think there continues to be a meaningful priority placed on GOV and volume across a number of our competitors relative to fundamental unit economics and profitability. But I think we continue to see that over time economics play out, financial realities ultimately win. And so I think we will stay the course that we've been on for the last couple of years where -- there is certainly inherent tension between volume and profitability, but we're going to stay true to our unit economics. And in particular, the focus on the app ecosystem, the focus on the app value proposition is trying to enhance our lifetime value which enables you -- if you know you are keeping people in your ecosystem longer with a longer relationship with more repeat rates, you can still solve your unit economic question while being more aggressive on the customer acquisition front. So we think we can try to accomplish both, right, stay true to our unit economic frameworks and enable ourselves to drive better volumetric performance as we continue to execute against that.

Very good. Then just you mentioned ChatGPT plug-in in '23. Your main competitor press released, I guess, a relationship and partnership with ChatGPT a few months ago. So I guess curious kind of how you fit with your competitive set within there. I think you also have perplexity that you didn't mention, but just talk broadly speaking about LLM if you're willing to quantify kind of the percentage of whether it's customers or GMV or anything there, that would be helpful.

Yes. AI, as you can imagine, top of mind an incredibly dynamic space. We haven't yet seen consumer behavior in our space reflects the height, right? It's still a pretty small percentage, very small percentage, probably 1% is the best estimate I would put out there for what we're seeing in terms of direct traffic through the AI channel today. That said, I think we are fundamentally of the belief that this is a one-way street where AI will have more, not less impact and that there are fundamental unlocks that AI can bring for the benefit of consumers in our space, the benefit of consumers across e-commerce with better information transparency. And so we've been in a space where, for many years, being at the top of a search was critical to driving customer awareness and you could charge in many instances, premium pricing to facilitate that. So it hasn't changed yet, but we are making the bet that there will be evolution there where customers will be better able to surface differentiated value propositions over time, better able to research and compare. We do think there's still a place in ticketing where the seat you're in, the angle of your view, the size of the stadium there's a lot of deeply personal preferences. So the desire to do detailed shopping, detailed comparisons in an app, we think will be a longer-term home for a lot of customers, but AI at the top of the funnel when people are researching their options, understanding the choices out there we think will be meaningfully disruptive over the coming quarters.

Our next question comment comes from the line of Cameron Mansson-Perrone from Morgan Stanley.

One follow-up on the industry trends. Just curious, there's a competitive dynamic, but then there's also been some potentially favorable dynamics happening as well. Wondering if you've seen any benefit or seen anything in the marketplace in conjunction with the changes that Ticketmaster has made around its resale platform and activity. And then as we look forward to 2026, wondering what -- how you guys are framing your thinking about the World Cup and any expectations around participating in that resale activity this summer.

Yes. Thanks, Cameron. On the industry front, Q4, not a great quarter. We saw it down double digits I think we mentioned tough MLP comp, but in particular, concert on sales were down dramatically year-over-year. Those on sales picked back up in Q1, whether that was just normal variation in timing or something reflective of some other planning or considerations on the Ticketmaster side, not clear to us. We haven't seen any meaningful impact beyond that in terms of Ticketmaster's overall posture level of aggressiveness in the space. So I'd say those kind of rumored changes or adjustments not to a degree that we could say we've seen, felt or can measure, but we'll continue to keep an eye on it. for broader industry overall, the last time when we gave guidance, we had pointed to expectations of flat over the year. I think with the Q1 on sales, we continue to feel equally as good, if not a little bit better with World Cup volumes equally as good, if not a little bit better. So I think stable to slight growth in the industry is our new estimate. And as we look at the World Cup, I think if you think of the benchmarks or the goalpost -- goalpost as a typical A-List tour would be 1% of GOV for the year. Taylor Swift be the other side of that, that's ever mid- to high single digits as a percentage of I think World Cup is an event will end up somewhere in between. Where in between will be, I think, dictated by do you have great matchups, does the U.S. play Mexico and the semifinals. So that would be a dream. But we think it will be substantial, a couple of hundred basis points of GOVs our best guess.

Our next question comment comes from the line of Dan Kurnos from Benchmark.

Great. Thanks. Good morning. Welcome, Joe. For -- I guess, Larry, just as we think about your customer acquisition strategy around app, I know we've talked about it a little bit, but I don't know if you want to take a second to kind of maybe flesh out obviously, without giving away any trade secrets, how you're thinking about driving incremental traffic beyond just pointing to the value prop? Like are you thinking about different marketing channels, you thinking about better more efficient ways to kind of get people to understand the message there? And then I have a follow-up for you.

Yes. I think the last thing you said, having people clearly understand the value prop is a critical threshold element where if we don't do that successfully, we have no reason to believe people will come back more often. We'll build a lifetime relationship. So we're mid-flight on it, but you should see continued improvements in the journey as an app customer. So your onboarding experience. How do we build that initial report if you make it feel like a win-win where you're providing us your information, and we're providing you something of value and return to kick off on the right foot. Well-situated messaging to drive home not only the everyday pricing, but this idea of ongoing rewards, ongoing benefits for loyalty and repeat purchasers, such that if you are a customer who has intentions of going to multiple live events per year for presumably decades to come, you can get peace of mind that you've completed your research, right? You'll do the research and depth, you'll compare the pricing, you'll validate the claims and once that validation is complete, you can with peace of mind buy from us. I think the second dimension beyond making sure that once you arrive at the app, it's very clear what we're doing and why we are making claims about our value proposition. We have a very large database of people who have purchased from us over the years. And so really thoughtfully targeting and messaging that database of folks continuing to use growing AI capabilities to have personalized messages that could resonate right message at the right time. I think that's the second major dimension. And then over time, I think we'll continue to explore complementary marketing channels that are outside of that core paid search funnel, right, whether it's social or other adjacencies. There continues to be an opportunity there, but it has been a relatively long-term play to build that awareness. And so that will be a steady as she goes element.

Got it. That's super helpful. And then I'll just ask if you care to opine on -- I know we've already had sort of the competitive question, but clearly, while you guys aren't in primary, we've had movement from DOJ and live now, and there's always knock-on effects to the competitors that are maybe hybrid or trying to get in there. Into that space, you guys have tested the waters in primary and small doses in the past. Just curious if how you think about regulatory either from that perspective or the bulk seller stuff might just impact overall industry dynamics, consolidation, just anything that you would like to opine on how you think kind of the broader group adjusts to some of the regulatory stuff.

Yes. I mean, we've certainly been through the term sheet. I think devil in the details is probably the operative phrase here. So we'll wait for more to come out and probably premature for us to comment in too much depth given the lack of detail on some pretty important provisions in the term sheet. From everything we've seen, I can't see anything that would be deemed or even considered potentially adverse to our position in the marketplace. And at least from our position, I don't see a lot that will change anything meaningfully. But put the [indiscernible] for devil in the details, and we'll see if there's more to it.

Our next question comment comes from the line of Maria Ripps from Canaccord.

Welcome, Joe. First, I just wanted to follow up on your within. Can you maybe just talk about sort of the type of consumer that you're attracting within ChatGPT and sort of conversion rate? And then do you maintain sort of the customer profile or customer data after that initial engagement?

Yes. Thanks, Maria. I think the ChatGPT app is a good example of you need to play in traffic while this world situates itself. As it sits today, finding apps in the LOM journey requires someone who's looking for the app or you need to come in with a targeted search and seek out, whether it's ours or a competitor's app and that open up a different use case, but I don't think it's gone mainstream. I don't think most people have unlocked how to access apps within the LLM journey. And so as a result, what you do see is folks who come through LLM and folks who come through that app convert at structurally higher rates. What is probably too early to tell. Is that because you have a selection bias or the folks who are doing that are the most intent thoughtful tech savvy users and thus you're just revealing that their intent versus tool is fundamentally changing their behavior journey. So we're looking at all the data with eager anticipation. But I don't think we have clear answers yet on that. separately to the broader question on customer personalization, the more interactions you have with someone, right, where you can see if they're logging in, in Chicago, and they're searching cubs tickets. And then 6 months later, they search their tickets, you can start to create a profile of a Chicago-based sports fan and make sure that they see content aligned with those sports preferences and you perhaps deemphasize comedy shows, if they've never shown any interest and over time, figuring out ways to round out that profile, right? There's numerous sources that I think we're increasingly focused on capturing more customer information to create a more bespoke experience. And one of the exciting elements over the intermediate term that we think AI offers aside from the top of the funnel, as you ingest more of this customer information, how do you create a fundamentally better experience for your users. And at the core of that, I think is thoughtful personalization built around a growing dataset.

Got it. That's very helpful. And then can you maybe give us a little bit more color on what you're seeing on the supply side in concert sort of this year? And to what extent that's a factor for sort of improving trends and returning to growth in the second half of the year?

Yes. Yes. Pretty nice lineup of on sales that has come out in Q1. BTS was -- is probably the highest profile of those, but steady stream of meaningful artists coming out in January and February, Harry Styles, Noah Khan, et cetera, which was welcome because the Q4 lineup was underwhelming. When you sum up Q4 and Q1, and we've seen this before where timing moves a little bit between the quarters. It was a solid concert lineup. And so I think maybe consistent with what we've heard Auto Live Nation, where they continue to point to steady growth perhaps double digits for them across their global footprint, but still continued growth in North America on the lower end of that range. I think everything we've seen from the supply side continues to support that perspective. And we had a little bit of hesitation based on how Q4 industry trends were shaping up, and it's been refreshing to see Q1 strengthen from there.

Our next question comment comes from the line of Thomas Forte from Maxim Group.

So I also want to welcome Joe to the call. One question, one follow-up. Can you talk about your ability to capitalize record recurring sporting events that are not always held on an annual basis, including World Cup, Olympics and World Baseball Classic, in particular, when this type of event is in 1 of your geographies, how confident are you in your ability to get a similar share of GOV as in other sports, baseball, football, et cetera?

Yes. Thanks, Tom. Those intermittent sporting events. They're really interesting hybrid because as a general statement, if you were to look at sports versus our concert and theater customer journey, sports. If you're a Cubs fan, you're a Cub's fan, right? You're going to a Cub's game this year, you're probably going to Cub's next year, you'll probably go in the year after that. Same with baseball, football, pick your sport a preference. And so the proclivity for repeat is just higher on sports, whereas concerts are more episodic. Even if you're a lifelong die hard Taylor Swift fan. She's in town once every 5 years, right? And maybe you're going to take it one time and you're not a town the next time so you see our once in a lifetime, right, once every 10 years. And the interest in Taylor Swift may or may not map to Sabrina Carpenter or Pop Star X. And so it's a different relationship, right? It's a bit more intermittent on all things concert comedy theater relative to that more continuous sports relationship. And these intermittent events kind of straddle those. It's pretty hard to say like what on any individual customer basis, their soccer preferences or their World Cup preferences in particular, would be. And whatever we learn about them, it's probably not going to be that valuable going forward as what is going to be 30 years before we get the World Cup here again. But we can leverage folks who are MLSs are soccer fans and target those folks in a thoughtful way. But we actually see the nits of World Cup folks who it ends up being more new customers than you would see in a typical sports league because there is that intermittent element. But less so than concerts because you do have that stable base of sports fans who knows where they want to come and buy a ticket from.

And then for a follow-up, can you give your thoughts on cash conversion and free cash flow generation for full year '26?

Yes. I appreciate that question. So our major cash obligations or CapEx, interest expense and taxes. The sum of those, we think, will fall between $35 million and $40 million. And so a majority of that amount would be our net interest expense. Our CapEx and cap software we think will be in the $15-ish million range. And then post tax simplification, taxes will be quite a bit lower to low single-digit millions. And thus, we need $35 million to $40 million of EBITDA before considering working capital to be cash flow neutral to generative. And then I think as we've demonstrated in spades this past few quarters, if you are growing GOV, working capital can be a source of cash, the inverse is also true. So as we project a return to growth, which we're feeling quite good about as we approach the second half of the year on a year-over-year basis and equally good earlier in the year on a sequential basis. Within working capital shift to being a source of cash and thus, we expect to be modestly but cash generative in 2026. Thank you.

Our next question comes from the line of Andrew Marok from Raymond James.

One on the comps. I know you called out a difficult world series. This year as a headwind. I guess as we're looking forward into the 2026 trajectory, how are the 2025 championships and maybe special events and sports playing out from a comp perspective as we look into the model?

Yes. Great question, Andrew. I think if we were to just go through the calendar, we've already seen some benefit when you had the, call it, up down up in the Super Bowl. So 2024 sort of peak experience with Vegas 2025 with the kind of repeat participants in New Orleans was been underwhelming, much stronger performance, Super Bowl in 2026. As we look at the rest of the year, I'd say there's nothing daunting. I'd say, it ranges from, call it, slightly below -- slightly above average matchups. NCAA tournament was relatively strong last year. We'll see how that goes in the next few weeks. Nothing I would say of note in terms of NDA or NHL I love that Oklahoma City has 47 traffics over the next couple of years, except for the fact that Oklahoma City is not the most dynamic market from a secondary standpoint. So we'll see if anyone topples them on the MBA side. And MLB was off of the peak Yankees Dodgers levels, but Yankee Blueray wasn't bad. So I'd say that was still above average last year. So the MLB comp is probably the most daunting of the remaining major championships coming through the rest of the year.

Our next question comment comes from the line of Benjamin Black from Deutsche Bank.

This is Jeff on for Ben. Can you just talk a little bit about the puts and takes to getting to the high and the low end of your guidance, particularly in GLD, would you need to see the competitive dynamics kind of continue to soften from here? Or could you get to the high end with just better performance from events in the industry?

Yes, it's a great question. Our presumption is that we can get to the high end of our GOV and EBITDA range. through our own execution. So steady performance from industry volumes consistent with current competitive intensity and continued delivery of a pipeline of product enhancements that we're really excited about that we think will start coming out over the next couple of months and have a meaningful portion of the year to benefit in terms of the back half contribution. And if we deliver in those enhancements flow through as expected. That's the path to the top end of the range. cure if there's better industry volume and/or a further shift in competitive landscape that would make it easier and/or create a path to outperforming.

Understood. Got it. And then maybe just one quick follow-up on sort of the app share growth in the gains. You talked about the increase in the FPD. Is that more driven by bringing new customers to the app? Or is it sort of just increasing the velocity or the repeat purchases of existing customers already using the app.

I'm happy to say yes to that. So it is across both dimensions, we are seeing app sessions increasing year-over-year. We are seeing app repeat rates increased double digits when we're looking at our cohort subsequent to these changes. And one of the things we talk about a lot over here that when you're playing a longer game with trying to build lifetime relationships to drive long-term repeat, the toughest day of that journey is the first day because you feel all the pain on the enhanced value proposition. We haven't given folks an opportunity to come back and repeat. So we feel like we started the snowball down the hill, and now as we move through subsequent quarters and years, that benefit will compound. And we're seeing all the underlying -- we talk about leading indicators that are flash and positive. That's a perfect example. These repeat rates, the growing size of the cohort and the growing proclivity to repeat within them. are the types of leading indicators that if you could stack over time, become a really powerful trend.

Next question or comment comes from the line of Ralph Schackart from William Blair.

Larry, you talked about sort of entering Q2 with a refined strategy. Maybe talk about, I guess, maybe your top 1 or 2 key priorities or adjustments to that strategy? I know you talked about the APRA new focus, I'm not sure if that's [indiscernible] two of them. But just maybe if you could sort of highlight or underscore what those are in progress to date and kind of how that progresses through 2026. That would be great.

Yes. Thanks, Ralph. I think as you noted, parts of the strategy were starting to be rolled out back half of last year, executed throughout Q4 and will continue. And so the efficiency, the cost reduction program was the starting point of that, reinvesting some of those savings into the structurally enhanced at value proposition was a part of that. I think when you look at what incrementally we're pursuing, I think there's a refreshed focus on the core customer journey, where you need -- when someone has decided that they want to attend an event, a relentless focus on making that journey as quick, efficient and pleasurable as possible for the customer. Don't distract them with superfluous information, but make sure all of the relevant information is in front of them, make sure every step of the journey works efficiently, you aren't introducing undue friction. And that's been an area where I think we were pursuing a lot of different paths and distracting a little bit. So ultimately, that will manifest in, I think, an enhanced conversion profile, particularly on our web journey. We're very excited about that. I won't go into too much detail on this. I think there's some enhancements to our private label philosophy and approach that we're working on that get that business line returning to growth as we lap the tough comps starting in Q3. They're a little more operational in nature. But if I were to say it in a word, getting back to being operationally elite, it's the core focus in addition to the cost efficiency and the app value proposition, each which has their own sub elements where we'll continue to build on the early gains and wins.

I'm showing no additional questions in the queue at this time. Ladies and gentlemen, this concludes today's program. Thank you for your participation. You may now disconnect. Everyone, have a wonderful day.