Fiserv earnings missed by $0.61, revenue fell short of estimates
CHICAGO - Vivid Seats Inc. (NASDAQ:SEAT) announced Monday it has entered into a Corporate Simplification Agreement to eliminate its dual-class, umbrella partnership C corporation structure and terminate its Tax Receivable Agreement. The company, which currently trades near its 52-week low of $10.55 and has seen its stock decline 88% year-to-date according to InvestingPro data, is making strategic moves to streamline its operations.
Under the agreement, Vivid Seats will issue 403,022 shares of Class A common stock in exchange for terminating the Tax Receivable Agreement. The transaction eliminates $6 million in cash payments that would have been due in the first quarter of 2026 and is expected to result in up to $180 million in lifetime savings for the company. This move comes as particularly significant given the company’s substantial debt burden of $406.62 million and current ratio of 0.72, as revealed by InvestingPro analysis.
The ticket marketplace expects to reduce its annual cash tax payments to approximately $3 million, with future taxes primarily resulting from income generated in foreign jurisdictions. The company also anticipates about $1 million in annual savings from reduced compliance and financial reporting costs associated with the simplified stock structure.
"This agreement results in near-term cash savings while enhancing our long-term cash flow profile with substantial tax amortization offsetting domestic income for the foreseeable future," said Stan Chia, Vivid Seats’ Chief Executive Officer, according to the press release.
As part of the transaction, former Tax Receivable Agreement parties will exchange all outstanding shares of Vivid Seats’ Class B common stock for Class A common stock on a one-for-one basis. Following completion, Vivid Seats will have approximately 10.7 million shares of Class A common stock outstanding.
A special committee of Vivid Seats’ Board of Directors, comprised solely of independent and disinterested directors, approved the agreement. Paul, Weiss, Rifkind, Wharton & Garrison LLP served as legal advisors to the special committee, while Latham & Watkins LLP advised Hoya Topco, LLC.
Founded in 2001, Vivid Seats operates an online ticket marketplace connecting fans to live events across North America, generating annual revenue of $694.01 million. While InvestingPro analysis suggests the stock is currently undervalued, subscribers can access over 15 additional ProTips and a comprehensive Pro Research Report for deeper insights into the company’s financial health and growth potential.
In other recent news, Vivid Seats Inc. reported its second-quarter 2025 earnings, revealing mixed results. The company slightly exceeded earnings per share expectations with an EPS of -$0.03 compared to the anticipated -$0.0345. However, it missed revenue estimates, reporting $143.57 million against the forecasted $152.04 million. This performance comes amid a challenging competitive landscape, as highlighted by Canaccord Genuity’s decision to downgrade Vivid Seats from Buy to Hold. The downgrade was accompanied by a significant reduction in the price target from $80.00 to $23.00, following a notable decline in marketplace gross order value. Meanwhile, Benchmark maintained its Buy rating and set a $26.00 price target, even as StubHub, a key competitor, prepares for its IPO. The IPO has reportedly been "20x oversubscribed," marking a pivotal moment in the ticketing industry. These developments underscore the competitive pressures Vivid Seats faces in the current market.
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