GRND - Earnings call 4 2022

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Operator

Good afternoon. My name is JP, and I will be your conference operator today. At this time, I would like to welcome everyone to the Grindr Fourth Quarter and Full Year 2022 Earnings Conference Call. [Operator Instructions] Thank you. I would now like to turn the conference over to Patrick Lenihan, VP of Communications. ahead. go Please

Patrick Lenihan

we'll and letter led operator, Vanna everyone. call available we website and Today's They'll I'll our for Thank note on afternoon, also Grindr's good and CEO, be that then remarks, brief by a our CFO, investors.grindr.com. it George will up make questions. shareholder you, released few afternoon, open this Arison; at Krantz. is and that

and we I such begin, that remind performance. from may may discuss statements will and views outlook we as: believe, words call, today. we Before we similar during be our materially subject are the expressed our anticipate and everyone statements to future expect, by uncertainties, forward-looking results These actual or differ this preceded These risks statements. We could

have release Some the with in set been periodic our of reports forth these and filed our risks SEC. earnings

measures. call, today's non-GAAP and During financial will GAAP we both present also

measures, are website posted GAAP Investor Additional our has of been page disclosures on reconciliation the non-GAAP the with filings issued in which we our of in including release Relations included regarding today, a measures, and our non-GAAP SEC. and earnings

turn I'll over to the George. call that, With

George Arison

had talk call. Vanna closed of Hello, and XX%. shortly. an our and our to year-over-year $XXX that XXXX. XX% growing of to full pleased range, about adjusted margin will the million, our hitting great earnings financial welcome share to Grindr year everyone, near top EBITDA a We I'm more the results year revenue

and from past the last that want you of quickly key share year, the the evaluating and with my highlights Grindr business to initial awesome. minutes the business about I I take are company to When our opportunity saw First, insight some fundamentals year. few a product

while very user fantastic financial monetization. working We with years opportunity, young X.X done have attractive in and delivering a to growing our over outstanding engagement incredible in our marketplace, market underinvestment job address differentiated and has user results past margins. penetration global right strong passionate brand base, a development and niche the team historical strong recognition with a And the product technology, product

most profitability as business this super business, opportunity deliver sustainable our new to and highly the gets is opportunities confident experience, our plans international What to over and double-digit out our of app. a enhance Grindr's to about we community-focused add developing we're user continued better core in grow I'm value. monetize build revenue execute as generate me immense shareholder adjacent business high growth and time business excited part

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Vandana Mehta-Krantz

is help Thank search our important you, to lives, George. our their and for in Hello, our arguably companionship goal more The in be is search everyone. successful the most search. users

me attracted deep to the One relationship our things users. Grindr's of the business have that with we key was

to We My to particular monetizing day minutes who users more into focus to active higher paid our those and translate enhance our engagement user Product AJ high app. Officer, with fortunate on have monthly average our value. will million be we shareholder are XX on penetration, of users over XX Chief expect working a which spend on Balance,

on a that earlier. approach mentioned me our George Let more share detail X-pronged little

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and XXXX, uneven price brand revenue partnerships choices on made primarily fourth million in by flat in was intentional experience. we aggressively the management as growth QX focus advertising on was indirect due less which on the subscriber revenue. a relatively programmatic by Advertising to growth. approximately user quarter year-over-year was decline tested to in $XX offset This advertising subscription in to basis a or more previous optimization, partially Additionally, at of led

favor programmatic, typically serves just relevant is to beginning from transition to advertising are which in which We advertising our our predominantly advertising, users of direct less relevant.

period. management Total from million $X in expenses primarily administrative quarter Head and public a The QX services, in compensation in in and business due hiring we increased for million, $XX the equity driven public compared to over XXXX with QX by year expenses associated employees. consultancies and the company-related expense team, by was scaled $XX increased ended count year general full-time exiting and onetime were the increase with were expenses prior the as and the in to fourth company-related becoming operations. insurance we costs legal costs outside for which and XX the year, scaled Selling, by public up $XX operating operations, company. people as prior XXX million million for driven just we were

the expenses $XXX the increase expense million million, of uptick total was growth. recognized QX, significant and final prior which of $XX year, equity the were $XX The for incremental team. management from For direct year the from full fee in most a $X XXXX, also exiting compensation in consistent million million operating was portion an year. with of of revenue up The million distribution prior $XXX the

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execute as million full Adjusted primarily revenue. up of to manage XXXX the our on to year was public $XX as requirements driven our million from quarterly The and the XXXX $XX quarter as of of we year decrease adjusted EBIT EBITDA increased XX% million infrastructure and prior for revenue expenses XX% by enhance Full well fourth total company in $XX or scale XX% was year. year-over-year adjusted strategic challenging priorities revenue was or comparisons. in EBITDA

drivers expense the of the QX in EBITDA continue into XXXX. Some XXXX that lowered margin will

or higher. However, our XX% stated as guidance is George EBITDA earlier, margin XXXX for

an QX. Turning impacted year, XXXX EBITDA and sheet Grindr quickly which cash transaction, strong was from the our operating activities, its liquidity. generates to given margins. balance unusual given its

service our We expect cadence us which fund to our business. a more normal of enables generation, easily and cash in the to to return debt investments

coming we be at the capital Additionally, structure looking debt over allow. our agreement will our market optimization conditions quarters the and as

inspiring seen we've we the call thank I the date the and community. find to I engaging company. and Lastly, as that with goal a in, is support this into believe look we investors company an forward exciting everyone future for journey our analysts on embark all on helping to to their and community look a translating from Grindr public shareholder We them value. want as forward global interest goal investment the connecting with to companionship.

And to with it back that, pass George. I'll

George Arison

company Thank I'm experience your glad year. our to next you, into lead Vanna. to and have partnership its

an our profitable strong and amazing continue on product, excited our update on opportunity to have a and progress We foundation growth as you I'm build in developments. community-minded to regularly

the to for line the operator ask up I'll time, questions. open this At

Operator

from [Operator comes Shyam Instructions] of question first Susquehanna. Patil from Your line the

Unknown Analyst

for on This is Margaret Shyam.

to much marketing And ask higher-priced wanted you walk would the these in shareholder First, Could additional in the of us thinking had you from historically, the example, around the subscription that? you For dig increase spend. features premium through marketing tiers? more past include X Could offerings few in years? range company you spend letter. Grindr increased why a the Also, has drive you spend what release low little company the on to would here? as I what help to years, plan about the an mentioned in has next marketing in

George Arison

Great and Vanna. over it start, very Thank then hand you Maybe I'll to I'll questions. much.

let And known remember like, -- like the a product of well, you Grindr. and I've guys back get week God, could so and word you out me show later who kind to in just primary the the at I So in of as really building me mobile an mine, company mouth he's phone Grindr, going in and iPhone. D.C., amazing a use start Washington, point, thing." Blackberry, show in I XXXX. was a because this with on bar like, is my pulled cool. with on our month bar was anecdote, I I I'm and that He to all Grindr, "Oh but something same iPhone of a didn't a on in was are friend the Grindr. most And as an a see about product these

of powerful. ever mouth a word product and the So really XXXX this continued the back case experience since. in is really, be My of demonstration that, in that's is to

to app brand word that we've lot be continue through a It's able of people in out penetration. to mouth. young And have else. back sense so we'll them my is of to applications Unlike maintain been bring with there go into XX% effective really somewhere versus work our social, able to

life that's Now marketing. do to much do job absolutely not can. job marketing. we in in marketing. in product improve to We need can't much a We to cycle need better a things Those better the Vanna We do. question. really second for over opportunities are I'll That's of in-house all huge that, needs but continue not to for hand dollar and to kind And to spend. us, we'll that do a expertise say

Vandana Mehta-Krantz

Sure.

expense. of finer the point kind a marketing to sales and on put Just

really of George benefit from have I awareness, top a having and brand we overall a already our XX% helps the of tremendous said, by fill really funnel awareness. global think that as perspective

We also of amazing that every year. fill with funnel the we user our top features develop

And of so funnel. and a efficient that's top of really generating way more MAU

start Unlimited, and provides is tiers, at increase, month, the is an that the profiles Both about XTRA and the one $XX.XX. said, really then what about in think to users that's about we XXX, premium now, to tiers, for and right performance ready free other essentially And we it $XX.XX to free one. And up profiles. really remove -- and like like would Unlimited over called you called and to them feature when the features get incognito. the of marketing, we And the overall we brings X seriously ads, XXX I both terms might drive to get XTRA happen what George offer while and unlimited as are feel when marketing would subscription sales handle time you more of think probably

higher over pay So $XX.XX tier. of more understand require research work is for, say the in going the from user terms look I that tier us of that what to a tier think XXXX will what premium very real that than develop would a premium to I'd or about they for would XXXX, and premium time. until maybe think we end then for it Don't little

Patrick Lenihan

read from Great. of here. few Well, them Say for the investors. to everybody excited to platform we We're of our off those going are very and now number have a of questions a retail answer

pace Technologies, other is gay the up you keep the The apps, all it how with the first are from one keeping date? what Grindr dating dating Being doing of original and to Say to up question apps? of fresh

George Arison

question. submitted investors who Patrick, Great Thank you, the you to and our that. users thank and

think through and it So is. it's does first of important all, talk to I what Grindr how differentiated

very out then We other like and anybody grid. on they'd can are dating users see they people from on all to there. to different they We that the almost speak allow see that them, users around their the to app every grid --

we though That messages product truly X don't are really incredible. XXX billion last that who a think messages in engagement we the engaging, There launched talk of only matching, QX We Album sent. million in I product we makes That's albums And limit shared different. day can even app, were one-on-one nearly in were our which Last billion numbers the pretty over makes XXX the year, is product, to. that force know So don't right? there and product fantastic. you also the very to year.

company from or our That that said, So want when that's product product users. really came the other numbers underinvested are that's very ownership really address we for which chat by very technology the think it fact I improvements. the keep But the now team obviously, applications on we've is driven and significant fresh that's in They've of product there. to actually already is the to to some investing done and and new make been Historically, and differentiated application dating make want. the engagement the something Albums, technology in for to the I every be lot UI making been it's the work us features where through. a and world-class out infrastructure we've truly something deserve that's launching work our think been new working last here, into years be the and today, seen the underlying done and Boost start technology, whether allows of UX our better had the hard like X.X better high, users can some

and Some on things can of we'll on that messaging continue improved, the very is we'll as liked be work that be both cascade will hopefully better. by will offer do we better think happy make that users, with the are things product so well. Inbox year being grid. to our a them much and you infrastructure this monetization features drive the all Those

Patrick Lenihan

Thank Vincent from was M. question you George. very That much,

Drew accounts of next or H. identities are from welcome government where are identity is preventing cetera? LGBTQ+ user This What for areas countries the ensuring undercover is discrimination, police, et purposes ensure and safe safe, question you privacy safeguards, e.g., or in targeted George? doing to Grindr not

George Arison

really talk the almost than focused a safety other out important care probably about of really something there. users, about It's more we a and it's much Grindr, that our something on. and at we're any question, lot so it's We really company

to a out by country, from accepted being me my in how is Georgia, is background a very with It's hard with means, people that. any and the still and born I'm -- not have but being bit was well people time little that very I not Let difficult. illegal where gay relates this. start

a So being in manage what in harder it's is I safe know say, States. the much like place than, and probably gay live to where United not to

around experience actually the that means by challenges face, illegal that the the what no very much countries my might compared of approach I people gay. from in I other world that to to and the so face worse personal be it's some where And are

lot top in it's provide and themselves to be kinds designate we we certain information of when should our a our to they mind users help do and terms safe, there product. keep We neighborhoods, behave of users always of how safe. to build We

that We like specifically countries are also users over in designed our have launched help to features the that. years

to feature, our people take get screenshot, Album. are to our of in in a example, from avoid For Album purposely and allowed able to you done that's not users pictures being

if basically -- want being they discreet. to more So help they be them

and is way really from handle to each are us appreciate of it's and want meet different really connect to is where local places our gay being maintained. had powerful because to that about hard is And the difficult. privacy they what We've heard gay community. your in users, we've to being to those come is that and in Grindr definitely focused Grindr and activist it's we oftentimes a critical organizations are for who in being really constantly think for really, together that on where other, important organizations rights ensuring world be -- for how a Also in privacy people people and is especially places there you parts really to to

for company. thing deal continue come. vital and in as really for really are a is to is investing in really this for that we'll Grindr and public years us division, good us, we a to as a Equality So a the

Operator

Instructions] [Operator

Patrick Lenihan

we'll Say H. question another questions, is we're from analyst for Drew waiting take any This a While further Technologies. question from

are tired more only play their plans ads? would targeted on iPad. users Many Any games an for for of grandparents ads

George Arison

extensively. pretty feel this much pain, our We've shareholder and I asking I very why appreciate discussed that. in he's letter Drew's

ads -- direct agencies users, of ads. in something more are by to some that a in our focused and making And with on time know we better advertisers order them and That's partnerships that relationships that of our building want platform. more those relevant have our takes product, those we and terms in initiatives with direct that received work We those happen. bring significant already ads are ad really our and to we

base also Doing We for by we that is that advertisers, X much the is we can ads to to take good not can in significant our are relevant us. have that's think both very Grindr and and that time. year. advertisers, demand really in that the users, going good know focus really That's user the something and we for for accomplish that

And so as on a the these and ad wouldn't help we a become year. that to That's direct dependent initiative. it, would in to the invest be less and expect in business depreciate idea grow multiyear third-party ads. But I happen

Patrick Lenihan

Great. you. Thank

from Say Next V. Robert question Technologies,

be How services. all to paid encourage does memberships With most Vanna? of subscription for dating to one of to growth? plan it cost for expensive more prices encourage and Grindr lower the pay apps, Wouldn't paid the being better

Vandana Mehta-Krantz

is actually are doing. That we question what because great a exactly it's

really are experimenting and maximize testing ultimately monetization price users subscription meet where we free points plans, now. to right and opportunities conversion looking We looking they at well our new as with from In are as paid. XXXX, are we're new to

this, to users going some So what we're conduct they're and pay willing for. user to understand fully to our want what research do to

greater So terms MAU as of and in in each acceptance out know the then as we're term on we'll of X levels business we users the looking get a first, markets both cylinders of internationally. really domestic roll our well in all it countries. well firing international pretty those and paid medium And Tier to having sense our

the in that for term. medium look So

Patrick Lenihan

very you much. Thank

Brian from question D. Next

on This verification Grindr would real have excessive eliminate Why option? deceive and numbers. the platform, which fake the a doesn't bots profiles

George Arison

It's Brian. good you, Thank a question.

this. we've added So some like already features

a perspective. a number advantage that. do For your remember, example, can think reasons. users from and discreet though, take also large verify being as really are live be and I in to to want they good it's our is to asked which who variety of couple where users Instagram they countries questions you a that and of be, already is are, of gay a a earlier, to link profile difficult that large discreet, and way that really could important of It for is you Twitter, portion that of

an they're that legality to have be and that not in not to might in stay we private. is they be communities to to or where be and places need use accepting on product encourage the only is important discreet, connect they want effort a to to Grindr But able even community, their our them very could really reasons oftentimes It the personal with issue, part. be that's well those people way our as since for in

And discreet so really are user think I who work do needs are who users privacy focused we on to very verification not. being with important. those whatever and And is both for

we're approaching regard. think be product balance who job I we're And to and the that I think doing we in we're -- not. discreet that who ones need good types of are approaching a think that users, a great for balance I both are from that perspective, and

Patrick Lenihan

We and is to close we're call. question from Say This Technologies, Adam from S. the then more question will X take going

am a As engagement but concerned an be anecdotal, It market drop-off share active user, as competitors. I significant may with an I have in other to noticed users. losing George? about investor,

George Arison

the and mean it's think stay the even in we People messages million product in though last I Yes. year, nearly last that's a QX is, per in on day, app letter. nearly hour shareholder which chats had the was Over launched albums shared XXX day. last frankly, for of really really incredible. Albums engagement, amazing billion have billion an outlined year. XXX X We I year,

in drive strong. our really active engagement as users able well, growth monthly very happy to We've is been So think with. which we're I

confident on we'll to that future all do so these and And the metrics, continue the well, company really, doing really in as well. is we're

about spoke competitors, strong that has is to Grindr need differentiated product and we different of to this nurture connection community, type to of think and very we mouth experience, a I earlier. as little users that. very far and it As a continue a offers word the bit

subscription carte something that whether I are excited people actively we is features enabling do a uses use. to offerings with are by that expect And as like working a features, want think that, frequently we to provide of us that they a la us. as users on we what have that we they features a platform need or ensure those within the think very And user do. we'll that launched are haven't I continuation There is really many they yet doing product, on. that to our base

Patrick Lenihan

you the in Thank happening With that, on Grindr participating you keeping we'll quarters close to come. the look speed forward today. to We everything call. to for up all at

George Arison

much. very you Thank

Vandana Mehta-Krantz

Thank you.

Operator

and Ladies participation. gentlemen, concludes Thank you your this today's conference for call.

disconnect. You may now

Grindr (GRND) 6 Mar 232022 Q4 Earnings call transcript