Bumble Inc.

Good afternoon, ladies and gentlemen, and welcome to the Bumble Inc. 4th Quarter 2022 Financial Results Conference Call. At this time, all lines are in listen-only mode. Following the presentation, we will conduct a question and answer session. If at any time during this call you require immediate assistance, please press star zero for the operator. This call is being recorded on Wednesday, February 22, 2023. I would now like to turn the conference over to Cheryl Valenzuela, VP of Investor Relations.

Please go ahead. Thank you for joining us to discuss Bumble's fourth quarter and full year 2022 financial results. With me today are Whitney Wolf-Herd, founder and CEO, Tarek Shawkat, president, and Anu Subramanian, CFO of Bumble. Before we begin, I'd like to remind everyone that certain statements made on this call today are forward-looking statements. These forward-looking statements are subject to various risks and uncertainties, reflect our current expectations based on our beliefs, assumptions, and information currently available to us. Although we believe these expectations are reasonable, we undertake no obligation to revise any statement to reflect changes that occur after this call. Descriptions of factors and risks that could cause actual results to differ materially from these forward-looking statements are discussed in more detail in our earnings press release and filing with the SEC, including our annual report on Form 10-K, where the year ended December 31, 2021, and our subsequent periodic filings. During the call, we also referred to certain non-GAAP financial measures. These non-GAAP measures should be considered in addition to and not as a substitute for or in isolation from our GAAP results. Reconciliations to the most comparable GAAP measures are available in today's earnings press release, which is available on the investor relations section of our website at ir.bumble.com. And with that, I'll turn it over to Whitney.

Thank you, Cheryl, and thank you all for joining us today. Q4 was a strong finish to the year with total revenue of $242 million and adjusted EBITDA of $60 million, both exceeding our outlook. In 2022, we continued to execute against our strategic priorities, advanced our mission, and delivered strong revenue growth and profitability for our shareholders. Bumble Ink's revenue for the full year reached $904 million, up 19% year-over-year, with Bumble app revenue growing 31%, driven by a year-over-year increase of over 500,000 paying users. We also drove strong profitability, delivering full-year adjusted EBITDA margin of 25% and free cash flow of $117 million. These results are a testament around the globe who continue to execute incredibly well amidst geopolitical and macroeconomic uncertainty. These results also demonstrate the enduring power of our mission to create a world in which all relationships are healthy and equitable to find connections. Now let me touch briefly on each of our brands. Bumble app had a strong fourth quarter with revenue of $191 million, up 28% year over year. This strength was broad-based with strong revenue growth in both our established markets as well as in growing markets such as Germany, Spain, France, and India. Bumble added over 130,000 paying users in the quarter. Based on third-party data sources in Q4, we continued to grow download share in key markets like the U.S. and Canada and maintained our position as the number two most downloaded dating app in these markets. We are also excited to say that As of Valentine's Day, Bumble app is the most downloaded dating app in our top markets, including the US, Canada, Australia, the UK, and Germany. Bumble app's net promoter scores in the US during the fourth quarter led other online dating apps, especially in two of our most important audiences, women and Gen Z. Our 2023 plans extend the momentum we've generated over the last several years. These are built on four pillars. One, continuing our rapid global expansion. Two, reinforcing our brand and product strength, especially with women. Three, growing revenue through new monetization experiences. And four, remaining a leader in safety by design. Let me describe each in turn. First, global expansion has been core to Bumble's growth in recent years, and we believe there's still tremendous runway in both existing and new markets. Building depth and expanding into secondary cities are critical components for our growth strategy. For example, we've been in Germany for a couple of years now, and it continues to grow rapidly as we push into more cities beyond the original launch markets and is now on track to be our third largest revenue market in 2023. We will also be launching in new countries this year. One advantage we have in most markets around the world is a strong baseline level of demand due to the resonance of our brand and our women-first approach. We'll be building on this foundation with active go-to-market efforts to further our expansion in Western and Central Europe, for example, in Italy, Portugal, and Poland, as well as major Latin American and Southeast Asian countries. Second, Bumble is where it is today because of our brand strength and loyalty especially with women, and this remains our priority. We listen intently to our women customers, and we've been steadily launching new features that are most requested by them, including our Astrology Tuesday offering last year, and this year we expect to launch a series of enhancements to the Beeline, the Matching Experience, and roll out new women-focused offerings. We are further investing in our college programs to continue our share gain with Gen Z women. As we mentioned last quarter, we recently launched a dedicated customer experience for users who are verified college students. We have seen several hundred thousand college students verified on our platform and we believe the dedicated experience is resonating. We are also using this verification program to improve targeting of our college bundles and recently launched virtual gifts to this group. Our early tests suggest that virtual gifts lead to almost 20% higher reciprocation rates, especially with Gen Z, and we are optimistic about the future of this initiative. Machine learning and data science have been strong enablers of Bumble's customer experience and growth. We see more and more opportunities to integrate AI further into our user journey, ranging from helping them better optimize their profile and initiate chats to improving relevance and matching. Over the last two years, we have been working on rebuilding our recommendation engine with machine learning at the core. We've tested this new model in several markets in Western Europe over the last six months and saw a substantial improvement in voting behavior and double-digit improvements in match rates. In Q2, we expect to leverage this model to begin testing our new paid Best Bees offering, highlighting highly curated, highly compatible people to you. This brings me to our third pillar, creating new experiences to grow revenue. Over the last year, we've been performing foundational engineering work to build more modularity and agility into our monetization platform. This work was required to enable us to launch our next wave of monetization. Going forward, this enhanced platform will enable the ability to launch new subscription offerings. additional bundles, and a greater variety of a la carte offerings. It will also enable us to target these offerings in an increasingly precise manner to grow customer lifetime value. We will also use this sophisticated platform to accelerate our highly impactful pricing and promotional optimization initiatives. One feature the new platform has enabled is our message before match feature, compliments, which is now fully rolled out with monetization in our major markets. We've seen strong initial user response in markets where we've launched, where we have seen compliments be 70% more likely to result in a match than a typical guest vote. We are now starting to roll out the corresponding marketing plans. Compliments is our first major feature in the Message Before Match space, and we are excited to build upon this with new offerings throughout the rest of the year. In addition to compliments and Best Bees offerings, I'm also excited about the potential for our speed dating experience. In Q4, we transitioned from a branded partnership version of speed dating and launched it as a standalone, unbranded experience in a number of our major markets, including the US, Germany, and India. We are actively testing monetization approaches, including making the experience a ticketed event. Lastly, we know that many of our users, particularly those in their 20s, are looking for more ways to express themselves and their personality with a high level of authenticity. In Q2 and Q3, we will be experimenting with a range of new paid experiences, leaning into this desire for self-expression. This will include expanding our virtual gift offering, as well as creating the ability to add stickers, mood boards, and photo effects to their profiles and chats, just to name a few examples. Our last pillar is safety by design and mission by design. Safety is not an afterthought or a marketing campaign for us. We remain fiercely committed to our mission, and we are working relentlessly to create kind connections. Our approach at Bumble has always been to build safety into our products at the outset and to continue to build new safety capabilities as we see these products in the field. We are also deploying an increasing amount of machine learning into our safety efforts. Our in-house content and photo moderation models continuously monitor our experience to prevent harassment and toxicity, and we are experimenting with GPT-3 and other large language model services to further augment our already strong approach. Now, turning to Bumble BFF, we remain the only scale dating app to have a successful friend-finding offering due to our strong and unique brand. We believe the market opportunity around online friendship is sizable, given the prevalence of loneliness, with the U.S. Surgeon General sharing a 2018 to 2020 survey that revealed 60% of Americans struggle with loneliness. That figure climbs to 75% among younger people. To reflect this significant opportunity, we're increasingly managing Bumble BFF as a separate brand. We continue to be excited by the user traction on BFF. with MAU growth of 26% year-over-year in Q4, alongside strong global appeal. We have a very important set of product and marketing initiatives we expect to launch around mid-year, which we believe will unlock further user growth and look forward to sharing these with future quarters. In summary, we have a lot of exciting initiatives planned for Bumble app in 2023, and we are off to a strong start to the year. Now turning to Badoo. We made solid progress in stabilizing Bidoo back in half of 2022. Despite facing some macroeconomic challenges, Bidoo continues to have a large user base and was ranked among the top three dating apps by downloads in 48 countries, including Brazil, Italy, Mexico, Spain, and France. Bidoo and other revenue also grew year over year when adjusted for FX and the impact of the conflict in Ukraine. We focused recent product efforts on amplifying what Bidoo's loyal and long-tenured user base appreciates most about the platform, how it creates quick and easy, authentic connections, which has had a positive impact on user engagement and retention. The monetization platform enhancements that I mentioned earlier also apply to Bidoo, illustrating the power of our shared platform model. A lot of our focus in 2023 is on continued optimization of our experience using these platform enhancements. For example, we now have a much greater ability on Bidu to offer promotional bundles and new consumables, and we'll be focusing on these to drive increasing payer penetration. In addition, we have a number of exciting new product features launching, all designed to lean into the chat-based experience on Bidu and drive faster time to quality connection. While we still have work to do to fully stabilize Bidu, we believe that we are on the right path. Lastly, I'd like to share an update on Fruits as we celebrate the one-year anniversary of its acquisition. Over the past year, its revenue contribution has steadily grown, and its integration with our shared platform has proceeded smoothly. In French-speaking markets, where its organic growth has been most concentrated, Fruits enjoys strong download share and Gen Z brand identity. I have never been more excited about the tremendous opportunity for our brands, our business, and our mission. We have solid user momentum, and our apps have significant runway for growth. We also have a strong product roadmap and the team to advance it. We continue to be true to our mission of providing safe and kind connections by design. And as always, we will operate with financial discipline and a focus on execution. Thank you to Team Bumble. Thank you for everyone's hard work. We succeeded only because of your dedication and contributions. I'd like to thank our customers, partners, and investors for the continued trust and support. And with that, I will turn it over to Anu for a discussion of our financial results and outlook.