Match Group smashes expectations, share price skyrockets to new all-time high
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Match Group smashes expectations, share price skyrockets to new all-time high

Digital dating specialists Match Group, the giant behind popular “hook-up” app Tinder as well as Match.com, PlentyOfFish, and more, reported earnings that beat the Street’s expectations this week. The financial beats were relatively modest – but a massive increase in Tinder subscriptions and undeniable strength across Match’s entire portfolio of sites sent a clear message to investors: this is a healthy business primed for growth. As a result, the company’s share price skyrocketed, hitting a new all-time high point.

Match Group’s share price has been ascending through 2019, and is now up 120% year to date

Match Aug 9

Source: Yahoo Finance

First of all, let’s look at why the share price jumped like that. Match’s popular Tinder app (a darling of Wall Street thanks to its fast growth and market dominance) saw a staggering increase in subscriber numbers. Both Match itself and analysts had expected Tinder to do well in this regard, and guidance was pegged at the addition of 1 million new subscribers. The actual figure overshot that by an enormous margin, as 600,000 additional daters signed up. That’s over the rolling year. That puts Tinder at 5.2 million average subscribers during the second quarter – a sequential rise of 503,000, the second highest in Tinder’s history. Clearly, investors’ favourite hook-up platform is nowhere near running out of growth yet.

Tinder’s results were extraordinary, but that doesn’t mean the rest of the company’s platforms (which include Hinge and OKCupid) were weak. All of the company’s platforms saw growth, and taken together, the average subscriber numbers were up by 18% against the year-ago quarter (a new high of 9.1 million overall).

Looking to the financials, Match was able to deliver results that beat the Street’s expectations. Revenue for the quarter was up 18% from a year ago (22% if currency effects are stripped out) to $498 million. That’s 10 million dollars more than analysts had predicted. And earnings came in at 43c per diluted share. That’s 2c ahead of analysts’ expectations.

Disclosure

Dominion holds Match Group in its Global Trends Ecommerce Fund.


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