Overview and Basis of Presentation

9 Months Ended

Sep. 30, 2022

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Description of Business

Eventbrite, Inc. (Eventbrite or the Company) has built a powerful, broad technology platform to enable creators to solve the challenges associated with creating in-person and online live experiences. The Company’s platform integrates components needed to seamlessly plan, promote and produce live events. To further enhance the value of the creators’ self-service experience, the Company is working to reframe the Eventbrite product around the ongoing operational needs of creators in addition to the requirements of individual events. To this end, the Company has improved events calendaring, streamlined the event creation process and launched tools to assist creators in promoting multiple events and increasing audience size for their events.

Impact of COVID-19 and Macroeconomic Conditions on our Business

The Company continues to be significantly impacted by the COVID-19 pandemic. The full extent and duration of the impact of the COVID-19 pandemic on the Company’s business, results of operations and financial condition remain uncertain and dependent on future developments that cannot be accurately predicted at this time, such as the introduction and spread of new variants or mutant strains of the virus, the continuation of existing or implementation of new government restrictions, and the extent of containment actions taken on event gatherings in general, and the impact of these and other factors on the Company’s business in particular, which may result in a reduction in events and an increase in event cancellation losses. The effect of and uncertainties surrounding the COVID-19 pandemic have caused the Company to make significant estimates in its consolidated financial statements as of and for the three and nine months ended September 30, 2022, specifically related to chargebacks and refunds due to cancelled or postponed events, which impact net revenue, advance payouts, creator signing fees and creator advances.

The COVID-19 pandemic is ongoing in nature and the Company will continue to revise such estimates in future reporting periods to reflect management's best estimates of future outcomes. Significant uncertainty remains regarding the extent and duration of the impact that the COVID-19 pandemic will have on the Company’s business, and the impact of COVID-19 may persist for an extended period of time or become more pronounced.

Furthermore, as a result of economic pressures, including inflation, labor challenges, rising interest rates, economic recession and other factors, creators may scale back events which could materially and adversely affect our paid ticket volume, and consequently our net revenue and financial results.

Basis of Presentation

The accompanying condensed consolidated financial statements of the Company are unaudited. The unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP) and the applicable rules and regulations of the Securities and Exchange Commission (SEC) for interim financial information. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements.

The accompanying unaudited condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements and, in the opinion of management, reflect all adjustments of a normal and recurring nature considered necessary to state fairly the Company's consolidated financial position, results of operations and cash flows for the interim periods. All intercompany transactions and balances have been eliminated. The interim results for the three and nine months ended September 30, 2022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2022 or for any other future annual or interim period.

The information included in this Quarterly Report on Form 10-Q should be read in conjunction with "Management's Discussion and Analysis of Financial Condition and Results of Operations," "Quantitative and Qualitative Disclosures About Market Risk" and the Consolidated Financial Statements and notes thereto included in Items 7, 7A and 8, respectively, in the Company's Annual Report on Form 10-K for the year ended December 31, 2021 (2021 Form 10-K).

Restatement and Revision of Previously Issued Unaudited Condensed Consolidated Financial Statements

The Company identified an error within the unaudited condensed consolidated statement of cash flows for the nine months ended September 30, 2022 and comparative period of September 30, 2021 primarily related to cash balances held on behalf of creators that are denominated in currencies other than the functional currency. The effect of exchange rate changes on these cash balances were not disclosed as a separate item in the reconciliation of beginning and ending balances of cash. Additionally, the unrealized foreign currency transaction gains and losses were not disclosed as a reconciliation item in the cash flow from operating activities. The unaudited condensed consolidated financial statements for the period ended September 30, 2022 have been amended and restated to correct for such errors. The unaudited condensed consolidated financial statements for the period ended June 30, 2021 has been revised to correct for the error, which was immaterial. This restatement had no impact on the Company's previously reported consolidated net income, financial position, net change in cash, cash equivalents, and restricted cash, or total cash, cash equivalents, and restricted cash as reported on the Company's consolidated statements of cash flows.

The following tables summarize the impact of these adjustments for the periods presented:


	Nine Months Ended September 30, 2022
	As Reported		Adjustments		As Restated
Net cash provided by operating activities	$	47,271	$	25,196	$	72,467
Net cash used in investing activities	(4,684)		—		(4,684)
Net cash used in financing activities	(1,585)		—		(1,585)
Effect of exchange rate changes on cash, cash equivalents and restricted cash	—		(25,196)		(25,196)
Change in cash and cash equivalents	$	41,002	$	—	$	41,002

	Nine Months Ended September 30, 2021
	As Reported		Adjustments		As Revised
Net cash provided by operating activities	$	116,239	$	4,917	$	121,156
Net cash used in investing activities	(1,658)		—		(1,658)
Net cash provided by financing activities	46,634		—		46,634
Effect of exchange rate changes on cash, cash equivalents and restricted cash	—		(4,917)		(4,917)
Change in cash and cash equivalents	$	161,215	$	—	$	161,215

Significant Accounting Policies

There have been no changes to our significant accounting policies described in our 2021 Form 10-K that have had a material impact on our unaudited condensed consolidated financial statements and related notes.

Use of Estimates

In order to conform with U.S. GAAP, the Company is required to make certain estimates, judgments and assumptions when preparing its consolidated financial statements. These estimates, judgments and assumptions affect the reported assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenue and expenses during the reported periods. These estimates include, but are not limited to, the recoverability of creator signing fees and creator advances, chargebacks and refunds reserve, certain assumptions used in the valuation of equity awards, assumptions used in determining the fair value of business combinations, the allowance for credit losses, and indirect tax reserves. The Company evaluates these estimates on an ongoing basis. Actual results could differ from those estimates and such differences could be material to the Company’s consolidated financial statements.

Comprehensive Loss

For all periods presented, comprehensive loss equaled net loss. Therefore, the condensed consolidated statements of comprehensive loss have been omitted from the unaudited condensed consolidated financial statements.

Segment Information

The Company’s Chief Executive Officer (CEO) is the chief operating decision maker. The Company's CEO reviews discrete financial information presented on a consolidated basis for purposes of allocating resources and evaluating the

Company’s financial performance. Accordingly, the Company has determined that it operates as a single operating segment and has one reportable segment.