Eventbrite (NYSE:EB) stock dove Tuesday after the company reported plunging revenue and a ballooning loss in the first quarter. Live events around the world have been canceled due to COVID-19, so investors had expected a dismal report from the event-management and ticketing specialist, but the degree of the pandemic's impact still surprised them.
Eventbrite shares were down by around 20% as of 1:35 p.m. EDT.
Acknowledging that its business has been severely impacted by COVID-19 and the social-distancing measures being taken to stem its spread, Eventbrite said revenue in the first quarter fell year over year from $81.3 million to $49.1 million, which was well below estimates of $71.9 million. Results were impacted by a $19.1 million increase in refunded ticket fees, refund reserves, and allowance for bad debts.
Those charges also made up nearly all of its adjusted EBITDA loss of $119.6 million, which compared to an adjusted EBITDA profit of $4.1 million in Q1 2019. Similarly, its GAAP loss per share widened to $1.71. That compared to a GAAP loss of $0.13 per share a year ago, and was much worse than analysts' consensus expectation of a $0.24 per share loss.
Eventbrite has taken a number of steps to shore up its financial position recently, including reducing operating expenses by $100 million and receiving up to $225 million in term loans from Francisco Partners, a private equity firm.
Management said it was focusing its strategy on delivering a self-service creator experience for online events and small gatherings with strong unit economics, and said that sales trends had improved since the low point in mid-March. However, the company expects restrictions on live events and other social-distancing protocols will impact its business for several quarters. It forecast a substantial decline in revenue for the year.
Given that the company was struggling to turn a profit even before the advent of the crisis, it's not surprising that its stock is tumbling today.