Online dating provider Spark Networks has released its financial report for the third quarter of 2015, and has revealed a number of interesting results.
The company suffered a 22 percent drop in its year-on-year revenue, taking a total of $11.7m for the third quarter.
In addition to the dip in profit, the company also recorded a net income loss of $822,000 for the quarter, compared to its $95,000 loss for Q2 of 2015.
Spark Networks attributed its loss of revenue to a reduction in average paying subscribers and ARPU for its Christian and Jewish Networks segments.
But despite the considerable drop in profit, the report also highlights some positive results that will give the struggling company optimism for next year.
One of the key takeaways from the new report was that in Q3, the company’s mobile presence exceeds over 200,000 monthly active users across five brand, following its launch of a number of mobile applications over the past year.
Its direct marketing expenses for the quarter were $4.4m – down 27 percent from the comparable quarter in 2014.
Commenting on the results, CEO of Spark Networks, Michael Egan said: “The last three months represent a true inflection point for Spark Networks and the clearest indication yet that we are on the right path towards turning this business around.
“There are four specific achievements that I believe represent this inflection, and each sets us up to start to run in the near future.”
A particular achievement Egan refers to is its record contribution margin on dating platform ChristianMingle.
Standing at 44 percent for Q3, the performance represents the “highest incremental acquisition margins ever for the brand during a period of subscriber growth”.
Last month, the provider also completed its acquisition of Jewish dating startup JSwipe’s owner Smooch Labs, Inc for a sum of $7m.
The company hopes that both JSwipe and the Smooch team will become major contributors to its overall future growth.
Speaking about the performance and its plans for the future, Egan said: “We recognize that the online dating industry is highly fragmented and believe that only those firms that achieve scale will survive.
“Accordingly we are in the early stages of retaining a financial advisor to best position the company to further participate in the ongoing industry consolidation.
“When we started this turn around at the beginning of the year we spoke of a crawl, walk, run strategy. While our ‘pace’ definitely quickened in Q3, there is still plenty of work to be done. We remain committed to driving revenue and EBITDA growth and continuing to execute against our product improvement roadmap.
“We’ve assembled a team that is finding its stride, hitting its goals and finding ways to scale. We’ve significantly bolstered our product development capabilities and are proving that we can launch innovative and valuable products for our customers.
“And finally through both organic development and acquisitions we are proving that we can build and grow fantastic brands that serve important market niches. It is a very exciting time for Spark.”
Download the full report here.