Shares of online dating firm Bumble Inc. dipped 13 percent in Wednesday’s extended trading after the company reported weaker-than-expected third-quarter earnings results and weak guidance for the fourth quarter.
The company is dealing with issues such as product launch delays, a strong dollar, the Ukraine war, etc. While speaking on an earnings call, Chief Executive Officer Whitney Wolfe Herd said that “Some of our user segments are facing greater pressure on disposable income, and these segments are renewing their subscriptions at a modestly lower rate.” The CEO also mentioned that revenue growth would have been 10 percent higher but for foreign exchange and the Ukraine crisis. Many companies across different sectors have been hit by the surge in the dollar, and consumers cutting down on their spending.
Bumble is also facing competition from Match Group Inc., its biggest rival. Match Group Inc. reported a good quarter as well as an increase in users for its flagship app Tinder.
Bumble reported a third-quarter profit of 14 cents per share, while analysts had expected 1 cent per share, according to Refinitiv. Total paying users for the quarter increased to 3.3 million from 2.9 million last year. Although Bumble saw an increase in usage and popularity, its sister app Badoo which is mostly used in Western Europe is still under quite a lot of pressure.
For the fourth quarter, Bumble expects to take a forex hit of $16 million and a $5 million impact, primarily on its Badoo app and other revenue due to the ongoing war. The company also expects revenue for the fourth quarter to come in between $232 million and $237 million. Analysts’ estimates for fourth-quarter revenue stand at $254.5 million, according to Refinitiv data.
Ibhadojemu Lucky Emmanuel is a graduate of Education and Economics from the University of Benin. He has a passion for tech and business and has been writing professionally for over a period of five years. He's written across various topics and segments and knew tech-business was it when he first stumbled on it. He has a great passion for music and arts, and wants to visit as many countries as he can someday.
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