First Quarter Revenue Up 28%
Operating Income of $8.6 Million, Adjusted
EBITDA of $22 million and Adjusted EBITDA Margin of 39%
Maintaining FY 2023 Guidance of 25% or Greater
Revenue Growth and 38%+ Adjusted EBITDA Margin
Grindr Inc. (NYSE: GRND), the world’s largest social network for
the LGBTQ community, today posted its financial results for the
first quarter ended March 31, 2023 in a Letter to Shareholders. The
Letter to Shareholders can be accessed on Grindr’s Investor
Relations website.
“The year is off to a strong start indicated by our financial
performance, user engagement and our unwavering commitment to
providing value to the growing community we serve,” said George
Arison, Chief Executive Officer of Grindr. “We are executing well
against our strategic priorities, with a focus on improving the
user experience and testing new subscription plans, a la carte
offerings and product features to increase monetization. We are on
track to meet our full year goals and look forward to continuing to
delight our users, serve our community, and create long-term value
for our shareholders.”
Earnings Webcast Information
Grindr will host a live webcast today at 2:00 p.m. Pacific Time
to discuss the Company’s first quarter financial results. The
webcast of the conference call can be accessed as follows:
Event: Grindr First Quarter 2023 Earnings Conference Call
Date: Monday, May 15, 2023
Time: 2:00 p.m. Pacific Time (5:00 p.m. Eastern Time)
Live Webcast Site: https://investors.grindr.com/
An archived webcast of the conference call will also be
accessible on Grindr’s Investor Relations page,
https://investors.grindr.com/.
Forward-Looking Statements
This press release contains “forward-looking statements” within
the meaning of the “safe harbor” provisions of the United States
Private Securities Litigation Reform Act of 1995 regarding Grindr’s
current views with respect to our industry, operations and future
business plans and performance. These forward-looking statements
can generally be identified by the use of forward-looking
terminology, including the terms “believes,” “estimates,”
“anticipates,” “expects,” “seeks,” “projects,” “intends,” “plans,”
“may,” “will” or “should” or, in each case, their negative or other
variations or comparable terminology, but the absence of these
words does not mean that a statement is not forward-looking. These
forward-looking statements include, among others, statements about
our growth opportunities, expectations regarding new product
launches, our 2023 strategic priorities, our plan to generate
sustainable double-digit revenue growth and strong profitability
and our full year 2023 guidance. Forward-looking statements,
including guidance related to Revenue Growth and Adjusted EBITDA
Margin, are predictions, projections and other statements about
future events that are based on current expectations and
assumptions and, as a result, are not guarantees of future
performance and are subject to risks and uncertainties that may
cause actual results to differ materially from our expectations
discussed in the forward-looking statements. Many factors could
cause actual future events to differ materially from the
forward-looking statements in this press release, including but not
limited to: (i) our reliance on historical data, which may be of
limited reliability, in providing revenue guidance; (ii) the impact
of the regulatory environment and complexities with compliance
related to such environment; (iii) our ability to respond to
general economic conditions; (iv) factors relating to the business,
operations and financial performance of Grindr and its
subsidiaries, including: (a) competition in the dating and social
networking products and services industry; (b) the ability to
maintain and attract users; and (c) fluctuation in quarterly and
yearly results; (v) natural disasters, outbreaks and pandemics,
including the COVID-19 pandemic and MPox; (vi) our ability to adapt
to changes in technology and user preferences in a timely and
cost-effective manner; (vii) our ability to maintain compliance
with privacy and data protection laws and regulations; (viii) our
ability to protect systems and infrastructures from cyber-attacks
and prevent unauthorized data access; (ix) our dependence on the
integrity of third-party systems and infrastructure; and (x) our
ability to protect our intellectual property rights from
unauthorized use by third parties. The foregoing list of factors is
not exhaustive. Further information on these and additional risks,
uncertainties and other factors that could cause actual outcomes
and results to differ materially from those included in or
contemplated by the forward-looking statements contained in this
press release are included under the caption “Risk Factors” in our
Annual Report on Form 10-K filed by Grindr with the SEC on March
17, 2023 as well as other filings that we make with the SEC from
time to time. Forward-looking statements speak only as of the date
they are made. Readers are cautioned not to put undue reliance on
forward-looking statements, and the Company assumes no obligation
and does not intend to update or revise these forward-looking
statements, whether as a result of new information, future events,
or otherwise.
About Non-GAAP
Grindr uses Adjusted EBITDA and Adjusted EBITDA margin, which
are non-GAAP measures, to understand and evaluate its core
operating performance. These non-GAAP financial measures, which may
differ from similarly titled measures used by other companies, are
presented to enhance investors’ overall understanding of Grindr’s
financial performance and should not be considered as a substitute
for, or superior to, the financial information prepared and
presented in accordance with GAAP. Grindr defines Adjusted EBITDA
as net (loss) income excluding income tax provision, interest
expense, net of interest income from the related party loan to
Catapult GP II, depreciation and amortization, stock-based
compensation expense and non-core expenses/losses (gains). Non-core
expenses/losses (gains) include transaction-related costs,
litigation-related costs, management fees, change in fair value of
warrant liability and other expense, which includes asset
impairments. Adjusted EBITDA Margin represents Adjusted EBITDA as a
percentage of revenue. Grindr’s management uses Adjusted EBITDA and
Adjusted EBITDA margin internally to evaluate the performance of
our business and this measure is one of the primary metrics by
which our internal budgets are based and by which management is
compensated. Grindr believes Adjusted EBITDA and Adjusted EBITDA
Margin are also helpful to investors, analysts, and other
interested parties because they can assist in providing a more
consistent and comparable overview of our operations across our
historical financial periods. Grindr excludes the above items as
some are non-cash in nature, and others are non-recurring that they
may not be representative of normal operating results. Adjusted
EBITDA and Adjusted EBITDA margin adjust for the impact of items
that Grindr does not consider indicative of the operational
performance of our business. While Grindr believes that these
non-GAAP financial measures are useful in evaluating our business,
this information should be considered as supplemental in nature and
is not meant as a substitute for the related financial information
prepared and presented in accordance with GAAP.
Unaudited Reconciliation of Net Income to Adjusted EBITDA
Three Months Ended March
31,
($ in thousands)
2023
2022
Reconciliation of net income to adjusted
EBITDA
Net (loss) income
(32,899)
4,501
Interest expense, net
10,793
2,956
Income tax provision
15,503
1,253
Depreciation and amortization
7,952
9,026
Transaction-related costs (1)
-
7
Litigation related costs (2)
1,211
1,504
Stock-based compensation expense
3,341
734
Management fees (3)
-
178
Change in fair value of warrant liability
(4)
15,317
-
Other expense (5)
781
-
Adjusted EBITDA
21,999
20,159
Revenue
55,809
43,530
Adjusted EBITDA Margin
39.4%
46.3%
_______________
1) Transaction-related costs consist of
legal, tax, accounting, consulting, and other professional fees
related to the Business Combination and other potential
acquisitions, that are non-recurring in nature.
2) Litigation related costs primarily
represent external legal fees associated with the outstanding
litigation or regulatory matters such as the potential Datatilsynet
fine or the CFIUS review of the Business Combination, which are
unrelated to Grindr’s core ongoing business operations.
3) Management fees represent
administrative costs associated with San Vicente Holdings LLC's
("SVE") administrative role in managing financial relationships and
providing directive on strategic and operational decisions, which
ceased to continue after the Business Combination.
4) Change in fair value of warrant
liability relates to our warrants that were remeasured to fair
value resulting in a loss of $15.3 million for the three months
ended March 31, 2023.
5) Other expense primarily represents
costs incurred from reorganization events that are unrelated to
Grindr's core ongoing business operations, including severance and
employment related costs.
About Grindr Inc.
With roughly 13 million monthly active users in virtually every
country in the world, Grindr has grown to become a fundamental part
of the queer community since its launch in 2009. The company
continues to expand its ecosystem to enable gay, bi, trans and
queer people to connect, express themselves, and discover the world
around them. Grindr is headquartered in West Hollywood, California.
The Grindr app is available on the App Store and Google Play.
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version on businesswire.com: https://www.businesswire.com/news/home/20230515005765/en/
Investors: IR@grindr.com
Media: Press@grindr.com
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