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StubHub expects 2010 revenue growth as parent company eBay posts solid financials
Unlike rival Live Nation, which last week threw cold water on investors' hopes for the rest of 2010, ticket marketplace giant StubHub is projecting revenue growth for 2010, despite a drop in ticket prices.
The company, bought by online auctions giant eBay in 2007 for more than $300 million, expects to grow revenues by 20 percent in 2010, the same amount of increase as in 2009, according to StubHub President Chris Tsakalakis. StubHub is part of eBay's Marketplaces division, but eBay does not disclose specific sales figures for the unit.
"Last year, we grew over 20 percent and this year we have similar growth rates on a year-over-year basis. We're gaining share," Tsakalakis told Reuters. StubHub is the nation's leading secondary ticket company, according to TicketNews' exclusive industry rankings, a title the company has held for years.
On Wednesday, July 21, eBay reported its overall second quarter net revenues grew 6 percent to $2.2 billion, an increase of more than $100 million, primarily on the strength of its Paypal unit, which has been a perennial growth engine for the company. Net revenues for the Marketplaces division grew 11 percent, reaching $1.4 billion.
Tsakalakis said ticket resale volume is up 30 percent this year over 2009, but prices are down about 2 percent. Prices had dropped by 9 percent each year in the two previous years.
"What we see is that our volume increases are above and beyond those price decreases. Those decreases are a reflection of the economy and what I think we're seeing now is that the prices are leveling off as the economy is leveling off," he told Reuters.
While the overall concert industry has taken its fair share of lumps so far this year, StubHub's sports business, its core customers, are pushing the increase in resale volume. The company's deal with Major League Baseball continues to pay dividends, and NBA and NHL playoff ticket sales were strong during the quarter.
“We delivered strong second quarter results, demonstrating the global strength and increasing diversity of our business,” John Donahoe, President and CEO of eBay, said in a statement.
Shares of eBay stock, which trades under the symbol EBAY, were up at the more than 3 percent to a shade under $21 at the close of the financial markets today, July 22.