Match smashes expectations – talks down Facebook Dating
Last week, we wrote about online dating kingpin Match’s reaction to the announcement that Facebook is entering its space. Since then, the company has released its best quarterly results since it went public in 2015. These earnings demonstrate a robust business, growing much faster than investors expected, and suggest that Facebook might have more of a fight on its hands than the market initially assumed.
Match’s revenue rose by 36%, year on year, to $407 million in the first three months of 2018. Its net income skyrocketed by 300% to $100 million, or earnings of 33¢ per share. This blew analysts’ expectations out of the water by a wide margin: the Street had hoped for revenue of $386 million, and net income of $56 million, converting into earnings of 19¢ per share. As usual, Tinder was the outperformer, seeing its revenue grow by 150% against the same period in the previous year.
Match’s share price rose last week on the back of a strong quarter
Source: Yahoo Finance
Match’s CEO, Mandy Ginsberg, said: “I’m glad we have everyone’s attention for our best results since our IPO. We continue to deliver innovative products that customers across our portfolio of brands find valuable, and we are not slowing down anytime soon. I am highly confident that our product road map, particularly at Tinder, will allow us to remain the clear leader in this category and deliver continued growth for Match Group shareholders.”
Speaking about Facebook directly, Ginsberg commented: “I really don’t think people are going to be comfortable mixing their dating lives with Facebook.” She was discussing, of course, the recent scandal around Cambridge Analytica, which saw a huge breach of private info from Facebook misused by an independent company. She added: “we have been in conversations with Facebook since the announcement.”
In separate news, Match Group announced that it’s settled a patent infringement lawsuit against Chinese dating service TanTan (which will have to redesign its US app and pay royalties based on its monthly active users) and remains in a “heated legal battle” with female-friendly dating app Bumble, which it has accused of “patent infringement and stealing trade secrets.”
Dominion holds Match Group in its Global Trends Ecommerce Fund.
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