Live Nation (LYV)

Live events and entertainment company Live Nation (NYSE:LYV) missed Wall Street’s revenue expectations in Q3 CY2025, but sales rose 11.1% year on year to $8.50 billion. Its GAAP profit of $0.73 per share was 44.7% below analysts’ consensus estimates.

Company Overview

Owner of Ticketmaster and operator of music festival EDC, Live Nation (NYSE:LYV) is a company specializing in live event promotion, venue management, and ticketing services for concerts and shows.

Leisure facilities companies often sell experiences rather than tangible products, and in the last decade-plus, consumers have slowly shifted their spending from "things" to "experiences". Leisure facilities seek to benefit but must innovate to do so because of the industry's high competition and capital intensity.

Competitors in the live event promotion and management sector include Endeavor (NYSE:EDR), Disney (NYSE:DIS), and MSG Entertainment (NYSE:MSGE).

A company’s long-term performance is an indicator of its overall quality. Any business can have short-term success, but a top-tier one grows for years. Thankfully, Live Nation’s 40.3% annualized revenue growth over the last five years was incredible. Its growth beat the average consumer discretionary company and shows its offerings resonate with customers.

We at StockStory place the most emphasis on long-term growth, but within consumer discretionary, a stretched historical view may miss a company riding a successful new product or trend. Live Nation’s recent performance shows its demand has slowed significantly as its annualized revenue growth of 7.7% over the last two years was well below its five-year trend. Note that COVID hurt Live Nation’s business in 2020 and part of 2021, and it bounced back in a big way thereafter.

This quarter, Live Nation’s revenue grew by 11.1% year on year to $8.50 billion but fell short of Wall Street’s estimates.

Looking ahead, sell-side analysts expect revenue to grow 10.8% over the next 12 months. Although this projection implies its newer products and services will fuel better top-line performance, it is still below average for the sector.

Operating margin is an important measure of profitability as it shows the portion of revenue left after accounting for all core expenses – everything from the cost of goods sold to advertising and wages. It’s also useful for comparing profitability across companies with different levels of debt and tax rates because it excludes interest and taxes.

Live Nation’s operating margin might fluctuated slightly over the last 12 months but has remained more or less the same, averaging 4.5% over the last two years. This profitability was lousy for a consumer discretionary business and caused by its suboptimal cost structure.

In Q3, Live Nation generated an operating margin profit margin of 9.3%, in line with the same quarter last year. This indicates the company’s overall cost structure has been relatively stable.

We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.

Live Nation’s full-year EPS flipped from negative to positive over the last five years. This is a good sign and shows it’s at an inflection point.

In Q3, Live Nation reported EPS of $0.73, down from $1.62 in the same quarter last year. This print missed analysts’ estimates, but we care more about long-term EPS growth than short-term movements. Over the next 12 months, Wall Street expects Live Nation’s full-year EPS of $1.35 to grow 104%.

If you’ve followed StockStory for a while, you know we emphasize free cash flow. Why, you ask? We believe that in the end, cash is king, and you can’t use accounting profits to pay the bills.

Live Nation has shown weak cash profitability over the last two years, giving the company limited opportunities to return capital to shareholders. Its free cash flow margin averaged 6.5%, subpar for a consumer discretionary business.

Live Nation’s free cash flow clocked in at $712 million in Q3, equivalent to a 8.4% margin. The company’s cash profitability regressed as it was 1.1 percentage points lower than in the same quarter last year, but it’s still above its two-year average. We wouldn’t read too much into this quarter’s decline because investment needs can be seasonal, leading to short-term swings. Long-term trends trump temporary fluctuations.

Over the next year, analysts’ consensus estimates show they’re expecting Live Nation’s free cash flow margin of 6.3% for the last 12 months to remain the same.

EPS and free cash flow tell us whether a company was profitable while growing its revenue. But was it capital-efficient? A company’s ROIC explains this by showing how much operating profit it makes compared to the money it has raised (debt and equity).

Although Live Nation hasn’t been the highest-quality company lately, it found a few growth initiatives in the past that worked out wonderfully. Its five-year average ROIC was 32.7%, splendid for a consumer discretionary business.

We like to invest in businesses with high returns, but the trend in a company’s ROIC is what often surprises the market and moves the stock price. Over the last few years, Live Nation’s ROIC has increased. This is a great sign when paired with its already strong returns, but we also recognize its lack of profitable growth during the COVID era was the primary reason for the change.

Live Nation reported $6.76 billion of cash and $9.39 billion of debt on its balance sheet in the most recent quarter. As investors in high-quality companies, we primarily focus on two things: 1) that a company’s debt level isn’t too high and 2) that its interest payments are not excessively burdening the business.

With $2.78 billion of EBITDA over the last 12 months, we view Live Nation’s 0.9× net-debt-to-EBITDA ratio as safe. We also see its $81.65 million of annual interest expenses as appropriate. The company’s profits give it plenty of breathing room, allowing it to continue investing in growth initiatives.

We were impressed by how significantly Live Nation blew past analysts’ adjusted operating income expectations this quarter. On the other hand, its EPS missed and its EBITDA fell short of Wall Street’s estimates. Overall, this quarter could have been better. The stock traded down 5.6% to $142.37 immediately following the results.

Updated: December 4, 2025 at 9:59 PM EST

A common mistake we notice when investors are deciding whether to buy a stock or not is that they simply look at the latest earnings results. Business quality and valuation matter more, so we urge you to understand these dynamics as well.

We see the value of companies helping consumers, but in the case of Live Nation, we’re out. Although its revenue growth was decent over the last five years, it’s expected to deteriorate over the next 12 months and its number of events has disappointed. On top of that, the company’s projected EPS for the next year is lacking.

Live Nation’s P/E ratio based on the next 12 months is 78.7x. This multiple tells us a lot of good news is priced in - we think there are better stocks to buy right now.

Wall Street analysts have a consensus one-year price target of $169.14 on the company (compared to the current share price of $139.69).

Although the price target is bullish, readers should exercise caution because analysts tend to be overly optimistic. The firms they work for, often big banks, have relationships with companies that extend into fundraising, M&A advisory, and other rewarding business lines. As a result, they typically hesitate to say bad things for fear they will lose out. We at StockStory do not suffer from such conflicts of interest, so we’ll always tell it like it is.