Tinder logo displayed on smartphone.
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match group, the parent company of dating apps Tinder and Hinge, is trading at its lowest price since spinning off from IAC in July 2020. The stock price has fallen more than 16% to about $29 per share.
Match reported 3rd quarter earnings Tuesday’s results beat analyst estimates provided by LSEG (formerly Refinitiv), with revenue of $881.6 million compared to expectations of $880.6 million and earnings per share of 57 cents, 3 cents above expectations. Recorded.
Analysts expressed concern about lower fourth-quarter revenue estimates and a decline in the number of people paying for Tinder.
JPMorgan analysts called the third-quarter results “solid,” but the biggest surprise was the fourth-quarter revenue forecast, with Mutch predicting sales of $855 million to $865 million. He said he had a vision. This is significantly lower than the consensus estimate of more than $890 million.
“The fourth-quarter outlook is the biggest surprise, despite revenue guidance of $855 million to $865 million, well below the $894 million estimate,” JPMorgan analysts said Tuesday. “In our view, this is why MTCH stock is declining.”
The number of people paying for Tinder is down 6% compared to the same period last year, and analysts at Baird Equity Research said this is likely to be a factor in the company’s valuation.
“Beyond the guide, a key area of scrutiny appears to be on Tinder payer trends. This metric was down 6% year over year in Q3 (in line with guidance). However, MTCH noted that there is a sustained headwind of up to 200,000 in the fourth quarter, with weekly subscribers flowing out of the system.
Match also announced that it has settled a lawsuit with Google. That means his $40 million in escrow will be returned to Match and Google will owe no more money. Match also agrees that he will use Google’s User Choice Billing by March 31, 2024, which will obligate Match to pay a portion of his subscription fees to Google. .
“This is likely to include a favorable app store position for the Match app, similar to when Bumble was added to the program as well,” Deutsche Bank analysts said in a note to investors. “We believe there is potential for download growth over several quarters.”
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