(Bloomberg) — Match Group Inc., the owner of dating apps including Tinder and OkCupid, rose after reporting revenue that beat analysts’ estimates and as it pledged to control costs to meet a darkening economic outlook.
(Bloomberg) — Match Group Inc., the owner of dating apps including Tinder and OkCupid, rose after reporting revenue that beat analysts’ estimates and as it pledged to control costs to meet a darkening economic outlook.
Third-quarter revenue was $809.5 million, the Dallas-based company said Tuesday in a statement, compared to estimates for $794.4 million.
The number of paying users rose 2% to 16.5 million, compared with analyst estimates. The shares rose about 11% in extended trading.
The results suggest more people are turning to one of Match’s myriad offerings, and are willing to pay for premium features to find a better match.
The company is nevertheless now confronting a squeeze on consumer spending from soaring inflation alongside pressure on overseas sales from a strong dollar. New Chief Executive Officer Bernard Kim is trying to reverse the fortunes of a company whose shares are down about 65% this year, outpacing the 19% decline in the S&P 500.
“Because we expect a challenging operating environment for the foreseeable future, we plan to accelerate our efforts to control costs, especially in headcount-related expenses and marketing spend, in other areas of the business,” Kim and Chief Financial Officer Gary Swidler said in a letter to shareholders.
Match has had a tumultuous year.
In addition to the departure of former CEO Shar Dubey in May, the company also lost the head of Tinder. Match is searching for a permanent leader for its key revenue driver, which is now being run by a leadership team composed of its chief operating, product, marketing and technology officers.
Tinder is a priority for Kim, Swidler said at a Goldman Sachs conference in September.
The CEO plans to focus on attracting more female users to the app, though will push out some virtual products like so-called Tinder coins to 2023 for the time being. Direct revenue from the division grew 6% from a year earlier, according to the statement.
The company said sales will be $780 million to $790 million in the quarter ending in December, missing the average analyst estimate of $808.4 million.
Match is also focusing on expanding its global reach after launching Hinge in Germany in September.
Hinge has been a bright spot for the company, which has thrived in English-speaking markets outside the US. Last year’s purchase of South Korean video chat company Hyperconnect is part of its focus on Asia.
The number of paying users in the region rose 12% in the period, compared with a 1% drop in the Americas and Europe.
And the currency fluctuations that have hammered tech giants like Microsoft Corp.
are weighing on Match’s finances. Match said it expects currency fluctuations to create a nine-point drag on total revenue in the current quarter. Competitor Bumble Inc. will announce third quarter results Nov.
9.
The company reported adjusted operating income of $284.2 million. Adjusted earnings per share was 44 cents, missing an analyst estimate for 51 cents per share.
–With assistance from Michael Tobin.
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