NEW YORK, Jan 14, 2026, 12:50 EST
- Shares of StubHub dipped after shareholder law firms announced a Jan. 23 deadline to file as lead plaintiff in an IPO-related securities lawsuit.
- The complaint claims StubHub’s IPO filings overlooked a pattern in vendor-payment timing that eventually squeezed free cash flow.
- StubHub shares are still trading far under their $23.50 IPO price.
StubHub Holdings shares dropped roughly 1.8% Wednesday after shareholder law firms pushed investors to step forward for lead-plaintiff status by Jan. 23. The move relates to a securities class action linked to the ticket marketplace’s September IPO. Prnewswire
The deadline is crucial since it often decides who controls the case and selects legal counsel. For StubHub, it falls less than five months after the company’s IPO, with its stock still deep in the red.
The lawsuit focuses on free cash flow, which measures cash remaining after operating expenses and capital expenditures. According to the complaint, StubHub’s IPO filings failed to disclose a change in when payments to vendors were made — a move that allegedly squeezed cash and dragged down the stock, the law firms claim.
Faruqi & Faruqi announced a federal securities class action has been filed, alleging the IPO registration statement was misleading. The complaint points to the failure to disclose a change in vendor-payment timing and how it affected the trailing 12 months free cash flow, a rolling year measure. Globenewswire
Glancy Prongay & Murray revealed StubHub sold about 34 million Class A shares at $23.50 apiece in its September 17, 2025 offering. The company later posted a third-quarter free cash flow of negative $4.6 million, down from a positive $10.6 million the previous year. Globenewswire
StubHub noted in its quarterly filing that the year-over-year drop in free cash flow “primarily reflects changes in the timing of payments to vendors.” Sec
The stock ended at $14.87 on Nov. 14, tumbling almost 21% following the announcement, based on law-firm notices. By 12:34 p.m. EST Wednesday, StubHub had slid to $13.34, about 43% below its IPO price.
Investors who purchased shares connected to the IPO registration statement have until Jan. 23 to petition the court to be named lead plaintiff, the notices stated. Usually, the lead plaintiff is the investor holding the biggest financial stake and able to represent fellow shareholders in managing the lawsuit.
StubHub sounded upbeat in its report covering the quarter at the center of the controversy. “Our debut quarter as a public company underscores the strength and resilience of our global marketplace,” CEO Eric Baker said in the Nov. 13 earnings release. Stubhub
The lawsuit comes amid a packed ticketing landscape, with StubHub battling Live Nation Entertainment’s Ticketmaster and online competitor Vivid Seats for both buyers and sellers. Reuters
But securities class actions often drag on for years, with early complaints frequently targeted for dismissal. Cash-flow fluctuations may simply result from timing quirks—particularly in marketplaces that take payments from buyers upfront and pay counterparties afterward—giving both sides ample ground to debate what investors could reasonably have anticipated.
