Match Group Q2: Shares Jump 20% as Market Leader Acquires ‘Harmonica’

7th August 2019 Scott Harvey

Match Group, parent company to iconic dating brands including Tinder, OkCupid and Hinge, released its Q2 earnings on Tuesday.

Total revenue was up 18% year-on-year, rising from $421 million to $498 million. The average number of subscribers also climbed 18%, to a total of 9.1 million.

Of these subscribers, 5.1 million were signed up to premium tiers on flagship property Tinder. This was a 503,000 increase from Q1 2019, and a 1.5 million increase from Q2 2018.

Operating income came in at $173 million, up 15% year-on-year. Adjusted EBITDA rose 16% to $204 million.

ARPU was up 2% on the prior year quarter to $0.58. This figure was dampened by foreign exchange effects, however; if these are controlled for, ARPU climbs 5%.

The investor presentation highlighted a range of other positive figures relating to Asian expansion – a key strategy for the group going forward. Match-owned Pairs is now the fastest growing dating app in Japan, complemented by Tinder in second place.

OkCupid has seen over 700,000 quarterly downloads in India, meanwhile, up from around 100,000 in the prior year quarter.

Further, Tinder Lite is set to roll out in South East Asia in the coming months, enabling users with poor internet connections and old devices to swipe and subscribe. Lite is 1/25th the size of the main Tinder product, and uses significantly less battery and data.

Match Group’s presentation also announced moves in the Muslim world. The firm has acquired Harmonica, a marriage-focused Egyptian startup headquartered in Dallas, TX.

Founded in 2017, the app had previously been backed by 500 Startups and Cairo-based accelerator Flat6Labs. The deal sees the latter secure its first high-profile exit.

CEO Sameh Saleh said: “Two years ago, we founded Harmonica with our sisters, cousins, and friends in mind, with the goal of helping them find a perfect partner. It was critical that what we built was something to protect them and represent the values that our community cares deeply about. It was also important that our parents would be comfortable with them using our app.”

Mandy Ginsberg, CEO of Match Group, added: “As we think about international growth and expansion, there are huge populations of young singles — mostly across Asia and the Middle East — that will be looking for their life partners in the near future, and that are not properly served by Western products”

“The Harmonica team is not only smart and innovative, but has built a highly differentiated and technologically impressive product that, although early-stage, truly understands the needs of this culture. We believe we’ve found great talent, with local expertise and insights that will help us further succeed in our international expansion strategy.”

Harmonica is live in more than 30 countries across the MENA region and Asia, and is only available in Arabic. It currently has a team of 12 full-time employees.

Match Group’s stock jumped 20% in after hours trading. At the time of writing, the umbrella is priced at $87.16 per share and, for the first time, it has cleared a market cap of $25 billion.