Match Group Q2 2022 Earnings Report
Key Takeaways
Match Group's Q2 2022 saw a 12% increase in total revenue to $795 million, driven by a 10% increase in payers and a 3% increase in RPP. However, the company reported an operating loss of $10 million due to a $217 million impairment of intangibles related to the Hyperconnect acquisition. Adjusted Operating Income was $286 million, up 9% year-over-year, with a margin of 36%.
Total Revenue grew 12% over the prior year quarter to $795 million (19% growth on foreign exchange (“FX”) neutral basis).
Tinder Direct Revenue grew 13% over the prior year quarter driven by 14% Payers growth to 10.9 million partially offset by RPP decline of 1%.
Operating loss of $10 million driven by a $217 million impairment of intangibles relating to the Hyperconnect acquisition.
Adjusted Operating Income was $286 million, an increase of 9% over the prior year quarter, representing an Adjusted Operating Income Margin of 36%.
Match Group
Match Group
Forward Guidance
Muted top-line growth is expected in the second half of 2022. Q3 Total Revenue is expected to be $790 to $800 million, essentially flat year-over-year. Q3 Adjusted Operating Income is expected to be $255 to $260 million, implying a margin of 32% at the midpoints.
Positive Outlook
- Changes made at Tinder will lead to improved product execution and velocity, monetization wins, and enhanced user growth.
- Tinder and the overall company top-line growth rates will accelerate as 2023 progresses.
- Hinge, BLK, and Chispa to continue to perform strongly and help offset declines at the Established Brands.
- Expect margins to improve modestly as we remain disciplined on marketing spend and hiring.
- Expect limited improvement in year-over-year top-line growth rates compared to Q3 with the teams focused on execution against the current product initiatives leading into 2023.
Challenges Ahead
- Muted top-line growth in the second half of 2022.
- FX to have an 8-point impact on year-over-year revenue growth in Q3.
- Tinder year-over-year Direct Revenue growth to be in the mid single-digits (low teens on an FX neutral basis).
- Higher overall app store fees.
- Weakness in live streaming business and the Japanese market has yet to show meaningful recovery following the lifting of COVID restrictions.