Grindr Inc. Reports Strong Revenue Growth in Q1 2024
LOS ANGELES—Grindr Inc. (NYSE: GRND), a leading LGBTQ+ social networking platform, announced a revenue growth of 35% for the first fiscal quarter of 2024, ending on March 31. The company achieved a total revenue of $75 million and an operating income of $19 million. Despite this positive revenue growth, Grindr reported a net loss margin of 12.5%, though it posted an adjusted EBITDA margin of 41.9%.
George Arison, Grindr's Chief Executive Officer, highlighted the company’s solid start to 2024. "Grindr is off to an outstanding start to 2024, highlighted by revenue growth of 35% year-over-year and strong margins in our first quarter," Arison said. He also mentioned the progress towards Grindr's strategic priorities for the year, which include the development of two new products aimed at enhancing user experience. "We are excited about the opportunities ahead in 2024 and beyond as we execute on our long-term vision to build the ‘Global Gayborhood in Your Pocket’,” Arison added.
Grindr plans to discuss these financial results in a live webcast scheduled for May 9, 2024, at 2:00 p.m. Pacific Time. The webcast will be available on Grindr’s Investor Relations website, and an archived version will also be accessible thereafter.
Financial Breakdown
For the first quarter, Grindr reported a net loss of $9.4 million, a significant improvement from the net loss of $32.9 million in the same quarter the previous year. The adjusted EBITDA was $31.6 million, up from $22 million for the same period in 2023. The report also highlighted a marked decrease in interest expenses and income tax provisions.
Context and Considerations
Though the company's adjusted EBITDA margin stood at a strong 41.9%, the net loss is a point of concern. The CEO attributed some of this loss to stock-based compensation expenses and changes in the fair value of warrant liabilities, both impacted by fluctuations in Grindr's public warrant price.
Grindr also faced costs related to litigation and severance. Litigation expenses largely stemmed from ongoing legal issues and potential regulatory fines, such as the one posited by the Norwegian Data Protection Authority and challenges related to employee unionisation. Severance costs arose from employees opting out of a new hybrid working model that involves a phased return-to-office plan.
Forward-Looking Statements
Grindr's forward-looking statements express the company's expectations and projections for future business and market conditions. These statements, however, are subject to known and unknown risks, uncertainties, and changes in circumstances, making them inherently speculative. Factors such as compliance with privacy and data protection laws, competition, technological changes, and broader economic conditions could significantly influence future outcomes.
The company maintains a cautious stance on these projections, advising investors not to place undue reliance on them. Grindr commits to updating these forward-looking statements only as required by law, and investors are encouraged to consult the "Risk Factors" in Grindr’s reports filed with the Securities and Exchange Commission.
Non-GAAP Financial Measures
Grindr uses non-GAAP financial measures like Adjusted EBITDA to gauge its core operating performance. These measures exclude items not indicative of the company’s ongoing business operations, such as stock-based compensation, litigation-related costs, and changes in warrant liabilities. While these metrics help provide a clearer picture of performance, they are not a substitute for GAAP-based financial information.
About Grindr
Founded as a primary social connector for the LGBTQ+ community, Grindr boasts over 13.5 million monthly active users across 190 countries. The platform has become a key tool for communication, self-expression, and social discovery within the community. Furthermore, Grindr for Equality, an initiative started in 2015, continues to advance LGBTQ+ human rights, health, and safety through partnerships with global organisations.
Grindr's headquarters are in West Hollywood, with additional offices in the Bay Area, Chicago, and New York. The Grindr app is accessible on both the App Store and Google Play, reinforcing its expansive reach within the LGBTQ+ digital space.