Match Group Releases Impressive Q1 2018 Earning Results

Match Group
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It’s been a tumultuous month for Match Group. The company’s share price dropped over 25% in the wake of Facebook's announcement that it was entering the online dating space, prompting CEO Mandy Ginsberg to assure users and investors that Match Group had little to fear from its new competitor.

“People don’t want to mix Facebook and their dating lives,” she said in an interview with Bloomberg.

She may be right. Looking at Match Group’s Q1 2018 Earning Results, also released this month, the company appears to be in a strong position despite the recent hit.

Match Group revenue grew 36% (up from 28% in Q4 2017) to $407 million, the highest quarterly growth since its IPO in 2015. Tinder Average Subscribers were 3.5 million in Q1 2018, increasing 368,000 sequentially and 1.6 million year-over-year. Operating income increased 91% to $112.2 million and Adjusted EBITDA increased 60% to $137.7 million.

“We are delivering all-time best across virtually all of our key operating metrics,” Ginsberg said in an earnings call, “and our momentum is fantastic.”

Match Group owes much of its blockbuster growth to Tinder, which remains the company’s most popular property. Tinder year-over-year revenue growth in the first quarter exceeded 150% thanks to an 87% year-over-year surge in new subscribers and a 37% jump in average revenue per user (ARPU).

Ginsberg attributes the latter gains to the success of Tinder Gold, a premium subscription that offers upgraded features for a higher membership fee, and a la carte revenue from subscribers.

“We are seeing that Tinder subscribers, both Gold and Plus, are willing to pay for additional features if those features improve the chances to connect with someone,” she said. “The combination of dramatically higher ARPU driven by Gold and a la carte purchases and strong subscriber growth led to phenomenal revenue growth for Tinder in Q1.”

Looking ahead, the company is focused on driving long-term revenue growth at Tinder by giving customers more reasons to use the app and more reasons to use it more frequently, primarily by enhancing its free features.

Tinder launched a feed feature to all users in Q1 and is currently testing its first video feature, two-second user-generated clips called Loops. The company is also working on location-based features to enhance the Tinder experience in the real world. Tinder Places will be a new way for users to connect with potential matches who enjoy the same locations and activities they do.

These strong results prompted Match Group to raise its full-year financial outlook, which includes total revenue of $1.6 billion to $1.7 billion, up from a previous forecast of $1.5 billion to $1.6 billion, and adjusted EBITDA of $600 million to $650 million, up from $550 million to $600 million.

"We continue to deliver innovative products that customers across our portfolio of brands find valuable, and we are not slowing down anytime soon," Ginsberg said in a press release. "I am highly confident that our product roadmap, particularly at Tinder, will allow us to remain the clear leader in this category and deliver continued growth for Match Group shareholders."

To find out more about dating service owned by Match Group you can read our, Tinder, OkCupid, and POF reviews.