Global ticketing and event business Eventbrite announced this morning that its business prospects will be significantly affected by the COVD-19 pandemic, as many have suspected. In particular, the company says it will withdraw its first quarter 2020 outlook due to the "growing impact" of the outbreak on global live events.
The announcement comes at a time when many places around the world have banned large gatherings – including U.S. states like California, New York, and Washington – and events like meetups, conferences, concerts, and more are not only badly advised but also illegal are. Local governments also urge residents to practice social distancing to reduce the spread of the virus. And on Sunday, the CDC recommended that no gatherings of more than 50 people be held over the next eight weeks to slow the spread of the novel corona virus in the United States.
This would include conferences, festivals, parades, concerts, sporting events and other gatherings – the kind of events that are carried out through Eventbrite's ticket platform and live event management systems.
"The global pandemic and impact on the live event industry are unprecedented," said Julia Hartz, Eventbrite's chief executive officer, in a statement released this morning. “We are working diligently to ensure the wellbeing of our global workforce and to support our customers when they make important decisions about their events during this period. The year started strongly across the board and we are now seeing a significant impact of the virus on our business. Although the final extent of these short-term effects is currently unclear, we remain confident about our future strategy, our market position and the long-term demand for live experiences, ”she added.
Eventbrite expanded its business in 2019 to reach a community of nearly 1 million developers who organized 4.7 million live events in 180 countries. Annual sales increased 12% annually to $ 327 million. Eventbrite expects these numbers to expand by 2020.
In February, the company announced that it expected sales of $ 84 to $ 88 million in the first quarter and sales of $ 342 to $ 359 million in 2020. The business outlook anticipated sales growth of 3% to 8% for the first quarter of 2020 and 5% to 10% for the full year 2020, with sales being stronger in the second half of the year.
In addition to the loss of revenue from events that are not even planned, the company is also likely to be affected by cancellations that result in chargebacks.
Eventbrite had previously highlighted the potential of the novel corona virus to affect aspects of its business during its fourth quarter 2019 earnings call, and found that 10% of its platform events attracted participants from over 100 miles away, with travel restrictions at a lower level Could lead to participation. In addition, 10% of tickets for paid tickets came from events with more than 5,000 attendees where cancellation of major events could affect business prospects.
Eventbrite had also spoken with a certain optimism at the time, adding that many of the events were smaller local gatherings and that there were only a limited number of cancellations so far.
Of course, a lot has changed between February and now.
The company did not offer revised projections at this point as it is not yet known how long it will take for the outbreak to be under control.