Bumble Inc.

Hello and welcome to the Bumble fourth quarter 2024 earnings conference call. My name is Elliot and I'll be coordinating your call today. If you would like to register a question during today's event, please press star one on your telephone keypad. And I'd like to hand over to Wilt Averas, Investor Relations. Please go ahead.

Thank you for joining us to discuss Bumble's fourth quarter 2024 financial results. With me today are Bumble CEO, Lydianni Jones, Executive Chair, Whitney Wolf-Hird, and CFO, Anu Subramanian. 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 and 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 today's earnings press release and our periodic filings with the SEC. During the call, we also refer to certain non-GAAP financial measures. These non-GAAP financial 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 also referred to in the call. The non-GAAP financial measures are available in our earnings press release, which is available on the investor relations section of our website at .Bumble.com. With that, I will turn the call over to Lidianni.

Thank you, Will, and good afternoon, everyone. Today I'll share a recap of the year and offer some detail on Bumble's momentum entering 2025. We also have Whitney with us to share her thoughts on the path ahead upon her official return in a few weeks. Now turning to the fourth quarter. Our results were broadly consistent with our outlook. Total revenue and adjusted EBDOT came in at the high ends of their respective ranges. In Bumble app revenue outperformed our guidance. The modest decline in Bumble app net-eds 4Q4 also came in slightly ahead of our expectations. Continue to operate with strong financial discipline, allowing us to generate free cash flow of $114 million for the year. Most importantly, we achieved solid progress on our product roadmap, the leaner, more agile team. Come a long way over the last 12 months. 2024 was an important year in rebuilding Bumble's foundation, which prepares the company to boldly reimagine the future of online dating. We've reshaped our workforce and put in place a high performance culture. We aligned around a clear plan for moving Bumble app forward for the next generation of consumers, seeking fresh experiences and new ways to find love and connection. That plan is guided by the three pillars we have shared with you. Strengthening our ecosystem, driving innovation in our customer experiences, and enhancing our revenue strategy. When we talk about a healthy ecosystem, we're talking about creating a safe and relevant platform for customers who want to find great matches. Continue to focus in ecosystem health in a few key ways. One is continuing the effort of removing unhealthy and bad actor accounts. It is critical to providing a safe and quality experience for our customers. A second, being more intentional about the users we attract to our platform. We have increased our focus on organic marketing strategies, drive more of our targeted customers into Bumble app. We began testing on this initiative in the fall and have been rolling it out more broadly into the new year with continued success. We are very encouraged with the progress, but it's important to emphasize that our ecosystem health initiatives will continue to create headwinds to paying users growth in the coming quarters. As we continue to execute on these pillars, we're also making good progress on our product roadmap, which is set to deliver increasingly bold innovation for our customers. Last quarter, we talked about our fall relief, which focused on dating on your terms. The release delivered significant updates to our matching algorithm, leveraging the power of AI and new interest filters and powerful tools to enrich opening new interactions. This is launch. You have seen notable improvements in user adoption interest filters have quickly become one of our most popular filters and opening moves are now being used by approximately half of our members. Our upcoming winter release slated for mid March will focus on confidence, safety, engagement and discovery. We are introducing a brand new discovery tab to deliver a more curated and updated matching experience based on shared interest. We're also introducing a new AI assistant photo picker to improve confidence among our members, making it easier to create a profile that truly stands out. To advance our leadership and trust and safety, especially for women, we're introducing ID verification, share my date and review before send all features aimed at safe and healthy connections on our platform. And to provide more flexibility to our members, you will launch instant match, which allows members to share their profiles with one another in real life. Importantly, many of these features are free to our customers and our primary goal is to improve engagement and generate increased yes vote rates. A metric fundamental to our customer success. This in turn drives positive word of mouth and ultimately new users to Bumble. We have undertaken a rigorous approach to the launch and our testing of all of these features have shown promising results. The team is poised to ramp innovation this year that will align with key customer needs. The work we're undertaking will take some time to reaccelerate growth and Bumble app paying users and revenue. But we're confident that all of these improvements will put Bumble on a path to renewed strength in the years ahead. As we prioritize the execution of the important work we're undertaking to reposition Bumble app, we have taken a hard look at how we're allocating our resources across our portfolio. And after careful consideration, we have decided to sunset fruits and official. These are difficult decisions, but we are confident that honing our collective focus and attention on our core business is a prudent thing to do at this time. With our strong foundation, talented team and focus on execution, I'll be returning the reins Bumble's founder Whitney Wolfhard next month. Whitney is a true visionary and will be exciting to watch her bring her energy and passion to build on what the Bumble team has put in place. This changes catalyzes a pivotal moment for Bumble online dating has enormous potential and Bumble's iconic brand is the one to move the category in the next generation. I'll continue to partner with Whitney through the coming months, make sure that we're not missing a beat since we have so much to do and deliver on. Wrapping up, I want to acknowledge the extraordinary progress the team has made over the past year in service of Bumble's mission. I have every confidence in the team's ability to deliver exceptional results for our members. It's been an honor to lead Bumble through this period of transformation and I'm tremendously proud of the important work we accomplished as a team over the past year. I'll be cheering team Bumble on and I'm confident that the company's voice to capture the opportunity ahead. Now I'll turn it over to Whitney to share more about what's in store.

Thank you, Lydiany and hello everyone. First, I want to recognize Lydiany for her leadership over the past year in strengthening Bumble's foundation. She reshaped our workforce, rebuilt legacy systems and instilled strong operational efficiency into the business. All critical building blocks that set us up for a bright future. I'm grateful for her contributions. Thank you, Lydiany. I am deeply honored to be back and I'm ready to lead with fresh energy and a renewed sense of purpose. I have never been more confident in what's ahead for Bumble and in my vision for what we can achieve together in the future. Bumble is a much more mature company today with a dedicated, lean and talented team. We have a lot of work to do, but we are up to the challenge. As we execute this transition, my focus is on the following key things. The deep love and understanding for our product that only a founder can bring. Reinspiring the unique magic of the Bumble brand and operating with purpose, efficiency and excellence across the entire company with a particular focus on technology. I look forward to sharing more about our plans after I'm fully back into the role. Over the past year, I have worked at a high level with Lydiany and the team and we are all aligned around where Bumble is going. Our goal is simple. To make people fall back in love with the process of finding love. Our early work is rooted in a precise understanding of what our members want and what this category needs. More to come. Before I hand it over to Anu, I want to acknowledge her incredible impact over the past four and a half years. She has played a key role in taking Bumble public, driving international expansion and strengthening our financial position. Under her leadership, we achieved our first billion dollar revenue year, giving us the foundation to capture the opportunities ahead. And finally, to our investors and our team, thank you. Change is not always easy, but the team's commitment to each other, our mission and the millions who rely on us has never wavered. Together, we are shaping the future of love and this category. We have the team, the plan, the passion and the renewed energy to make it happen.

Thank you, Whitney and good afternoon, everyone. I'll walk through our fourth quarter and fully a result and then share more details around our outlook. Unless stated otherwise, all comparisons are on a year over year basis. In Q4, total Bumble Inc revenue was 262 million coming in at the high end of our outlook. Total revenue included an unfavorable impact from FX of approximately three million. Total paying users grew five percent in the quarter to 4.2 million and our people declined nine percent to twenty dollars and 58 cents. Bumble app revenue was 212 million above the high end of our outlook and down four percent on a year over year basis. Revenue was impacted by unfavorable FX of approximately two million, which negatively impacted growth by one percentage point. Bumble app paying users grew five percent year over year to 2.8 million and the increase in payers was offset by an eight percent decline in our people to twenty five dollars and seventeen cents, primarily driven by geographic mix shift. Payers declined 57,000 on a sequential basis. But do happen other revenue was 49 million representing a decline of seven percent FX was a one million headwind during the quarter and negatively impacted growth by two percentage points. But do happen other paying users grew seven percent to 1.4 million but declined 20,000 sequentially but do happen other our people decline 12 percent to eleven dollars and 13 cents. Turning now to expenses. Total Q4 gap operating costs and expenses were 225 million. On a non gap basis, which excludes stock based compensation and other non cash or non recurring items total costs and expenses declined five percent to 189 million. The year over year decline was primarily driven by lower headcount as a result of the restructuring plan we announced in February 2024. cost of revenue was 78 million and declined 2% as a percentage of revenue cost of revenue was 30% versus 29% in the year ago period. Sales and marketing expenses declined seven percent to 65 million this represents 25% of revenue versus 26% last year. DNA expenses were 27 million or 10% of revenue compared to 30 million or 11% of revenue last year. Product development expenses were 20 million or 7% of revenue versus 21 million or 8% of revenue in the year ago period. Adjusted EBITDA for Q4 was 73 million at the high end of our outlook representing 28% margin. For fully a 2024 total Bumble Inc revenue increased 2% to 1.072 billion in line with the high end of our outlook. Revenue from Bumble app increased 3% to 866 million and we grew paying users by 290,000 adjusted EBITDA was 304 million representing 28% margin up 220 basis points. We reported strong free cash flow of 114 million in 2024 and we ended the year with 204 million in cash and cash equivalent. During the fourth quarter we repurchased 40 million worth of shares under our current stock repurchase authorization. In aggregate for 2024 we repurchased 214 million worth of shares. At the end of 2024 we had 79 million left in our buyback program and as of today's call we have 65 million remaining. Now moving on to our outlook. As we look to the year ahead the company has an exciting product roadmap planned. Combined with our ecosystem and marketing efforts we believe that innovation is the key to attracting more users, increasing engagement and serving as the foundation for our monetization efforts. However, as Lidiani and Whitney have shared we are still in the early stages of our work. For example, the ecosystem work we highlighted will result in paying user declines near term as we focus on optimizing for the type of users we want on the platform and our product roadmap will take time to execute. Therefore, we are moving to providing guidance on a quarterly basis and we will provide updates on our product releases and marketing efforts throughout the year. For Q1 2025 we expect total BumbleInk revenue between 242 million and 248 million representing a decrease of 7 to 10%. Excluding FX this translates to a decrease between 4 and 7%. We expect BumbleApp revenue to be between 198 million and 202 million representing a decrease between 6 and 8%. Excluding FX headwinds and the loss of one day due to leap year in 2024 this translates to a decrease between 3 and 5%. Q1 BumbleApp revenue outlook assumes a sequential decline in paying users in the range of 100 to 120,000 as we prioritize our ongoing work to strengthen our ecosystem. While we continue to operate with disciplines to deliver solid cash flow the expected deleverage impact of lower revenue and our investments in product and technology will result in margin contraction in Q1. We estimate adjusted EBITDA will be between 60 million and 63 million representing a margin of 25% at the midpoint of the range. While we are not providing specific guidance for full year 2025 I wanted to provide some high level context on our planning assumptions for the year. For the year we expect unfavorable FX headwinds of approximately 2 percentage points. For BumbleApp rebuilding product momentum through the execution of our roadmap will take at least a few quarters. The work we are doing is designed to improve top of funnel and engagement metrics, the conversion to follow as our product initiative and the re-architecture of our monetization model begins to deliver improvement. As Lidiani noted, we have made the strategic decision to discontinue fruits and officials. We expect the closure of these apps to result in an approximately 12 million revenue headwind for the year. We expect adjusted EBITDA margins for the year to contract as we navigate revenue headwinds and invest in product and technology to reignite usage and engagement. We remain confident that we will return to expanding margins as revenue growth resumes. As always, and especially in this year of rebuilding, we plan to operate with financial discipline to ensure healthy cash flows. In closing, over the past year Bumble has established a strong foundation to build upon in the years ahead. We have set a bold product strategy, accelerated innovation and honed operations and execution. Our commitment to our three strategic pillars, strengthening our ecosystem, driving innovation and customer experience and enhancing our revenue strategy. But not only advance our mission of empowering individuals to build healthy and equitable relationships, but also help us to deliver profitable long term growth for our shareholders. And finally, as I wrap up my time at Bumble, I wanted to say that it has been an absolute honor to serve our team, our members and our shareholders over these past four and a half years. I'm grateful for the partnership with Whitney and Lydianni and I'm very confident in the bright and exciting future that Whitney and the team have planned for Bumble. And with that, I'll turn it over to the operator for Q&A.

Thank you. If you would like to ask a question, please press star followed by one on your telephone keypad. If you would like to withdraw your question, please press star followed by two. When preparing to ask a question, please ensure your device is unmuted locally. First question comes from Eric Sheridan with Goldman Sachs. Your line is open. Please go ahead.

Thank you so much for taking the question. Maybe two if I could. Whitney, would love to get your perspective as you return to the company in an operating role as CEO. What your take is on the broader online dating industry landscape as we get deeper into 2025, how you see some of the opportunities and challenges facing the industry more broadly. And then maybe a backward looking question, but as you've put in place some of the measures as a management team to address lower quality or bad actors in terms of profile and user growth. What are some of the key learnings you've had over the last couple of months and how do those inform some of the continuation of those strategic priorities looking deeper into 2025. Thanks so much.

Thank you so much. This is Whitney. I will take your first question. Great to be back with all of you. So, you know, when we look at industry trends, I think it's really important to reinforce that the demand for love right now is stronger than it arguably has ever been in modern time. People need to meet each other. People want to meet each other. We are a society that needs relationships. We need connection. We need love. What has happened in my opinion, and you know, just for those of you that are not familiar with me, I've been on the front line of dating apps since 2012. This has been my entire life. I have lived, breathed, and essentially been so thick in this since I was 22 years old. I'm now 35. So this is my whole adult life. People want love. They need love. They want to use technology to find love because it's easier and it's more efficient and it helps them bypass being at the right place at the right time. But what my opinion is, is that while we have been leaning on algorithms and product to find love, we maybe haven't paused to really say, what are these products doing to people? How are they making them feel? Dating was meant to be a fun and viral and easy way to connect. And as time has gone on, that low friction environment has led to people feeling judged, feeling insecure, feeling rejected. And when I started Bumble, a big part of our success was that it was about removing rejection and filling confidence. But we are in a new dawn. We need to make sure that that is being initiated in every touch point of our product. So this is exactly what we're focused on is bringing confidence, curiosity, joy back to this experience while enhancing the, what we said earlier in the script, the building blocks of the way this technology works. So this is everything we are focused on right now, which is making sure that the entire experience delivers you the most relevant matches, people that you want to meet, people that you don't just want to swipe right on, but you will actually end up meeting in real life. You'll have a great date. We want you to have the safest, most trusted experience possible. And we really do believe that the future of dating is about helping people fall back in love with falling in love again. And that's why I'm back. That's exactly what we're going to be focused on in this next chapter. And Litiani has already done exceptional groundwork here by reinforcing and rebuilding a lot of the underlying tech and systems. I will now turn the second question to Litiani.

Thank you, Whitney. And Eric, to emphasize the point Whitney made earlier, we have been partnering really closely together this past year. And one of the points that we've been always extremely aligned on is the importance of making sure that Bumble is incredibly safe and a trustworthy platform for all of our members. So a big part of our investments this past year has been strengthening our security systems, our safety guidelines, our policies and our technology to ensure that we are providing a really clean and powerful environment for our users. As we look forward, it's an investment that we want to continue to put a lot of energy in. And I'll say to you, the release coming up now in March, the winter release, has a lot of capabilities and features that are geared towards continuing to make sure Bumble is a leader in trust and safety for our customers, including rolling out ID verification, rolling out Share My Date that gives users more confidence of their location to trusted sources, along with Review Before Send. That's really about ensuring customers understand our policies about what it means to be a safe member of our platform. So we're extremely bullish about continuing to invest in trust and safety and I'm excited to pass the baton to Whitney as she takes on the team.

Our next question comes from Shweta Kajuria with Wolf Research. Your line is open. Please go ahead.

Thanks for taking my questions. Let me try two, please. Could you please provide an update on where you are with the CFO search? What your priorities are as you look for a new CFO, given you may be at a different stage as a company than you were back pre-IPO. And then the same similar question for Whitney in terms of Is it fair to assume you're in it for the long haul, given the recent change in terms of your investment as an operating CEO with the company? Thanks a lot.

Thanks so much. This is Whitney. Thanks for the questions. So here's a quick update on the CFO search. The CFO hire is going to be an incredibly important one. This is certainly a very high priority and we are actively interviewing candidates and we will update you when we've made an appointment. I just want to reinforce that this is top priority and we are looking for a leader that suits the needs of the business in this current environment and for our goals in the future. So more to come there. Yeah, let's let's talk about my tenure. So I really appreciate this question and I want to start by saying this is my passion. I love Bumble. And while I had, you know, no intention of Stepping back into the CEO role, I had the intention of remaining the executive chair. When this opportunity did arise, you know, there is no doubt in my mind that There is no one else on earth that can go and really bring love back to this category. Then the founder of You know, I was a co founder of Tinder. I founded Bumble as a 25 year old woman. I know this category. I love this category. I live for this. And so to answer your question. This is not an obligation for me. This is a true honor. This is something that I'm excited to dive back into and I have no plans of making this a short lived or interim Focus. I am in this to win this and I am in this to bring love back to the category and to people's lives around the world. And so you can expect me to be fully, fully, fully committed and there's, there's no expiration date on that.

We now turn to Corey carpenter with JP Morgan, your line is open. Please go ahead.

Great. Thanks for the questions to maybe for Lidia. Could you just expand on the discovered have feature. I think this is the first time you mentioned That as being part of the of the winter release. So we'll be curious to hear more about that and what you're seeing and testing. And then secondly, just any update. You can provide us on what you are seeing on top of the final trends following the fall product release. Thank you.

Thank you. Let's talk a little bit about discover We're really excited about introducing discover as part of our winter release. This is a new tab on the bumble app that's really focused on helping users discover one another through shared interest. And for us, there's been, you know, a couple of key focuses. If you recall what I've been, you know, talking about these last few quarters around our transformation customer experience ecosystem and we imagining our Strategy for revenue growth and so discover is aimed at two major things. It's adding customer experiences that focus on relevance. So customers come to bumble to find relevant people and discover really helps accelerate that discover, but it also is a feature that is free for users everywhere around the world. And it's both to help us Re energize the public funnel for us, especially with younger users and to give that path to freemium. So we're really excited about the early signs of our testing with the regular Rigorously tested this feature in various markets. We're seeing great engagement users that are Already using discover today are getting more mattress or we know it's providing the value that we want. And we're excited to continue to evolve it over the year. And with regards to the fall relief that release was really aimed at engagement and success as well. And what we have seen from it is high interest in the filters interest filters, which has become a founding foundation for the discover capabilities really incredible rapid adoption there and increased in success for users as well. What that has helped us is really focused on near term engagement, which we in turn know will drive longer term revenue re acceleration. So we're optimistic based on what we've seen so far and are We're seeing exactly the right time for for what we know will be the right direction for the company.

Our next question comes from Andrew Marrock with Raymond James, your line is open. Please go ahead.

Thanks for taking my question. Um, we've seen some kind of anecdotal data kind of floating around that young people, especially are just Taking longer, maybe a little bit more hesitant to enter the dating market altogether. And I guess As you're thinking about that. How does that kind of impact your plans for monetizing these users as you start to get them in and you start to see to your point the engagement from the fall release in the winter lease release like you were talking about. Thank you.

Now we're aiming to be really deliberate here. One, we want to make sure that users across all age groups, but certainly younger users are Engaged that we're reigniting top of funnel, especially in our mature markets. And we aren't seeing a delay. Well, we want you know what we have seen from our research in the testing that we have done for fall and now winter. Is that users are looking for two big things relevant users. So the work In both innovation and ecosystem that we have been doing are incredibly focused on exactly that in safety. And that's, you know, so much of the work that we have done across this release, people want to know that they're going to be safe in our platform. And they're going to find users that is relevant to them. Those are the key indicators for younger users. And again, I really confident that we're in the right path, given the data that we have seen

Our next question comes from Nathan feather with Morgan Stanley, your line is open. Please go ahead.

Everyone thanks for the question. I want to dig a little bit more onto the guidance, you know, at the midpoint when you guide implies a 25% or so even a margin. To pretty big step down compared to for Q, give a little bit more color on what's driving the contraction. What are the areas of investment. That are pushing that and giving you talks of further investments to the year. How should we think about the slope of margin over Thank you.

Sure, I can take that. Hey, Nate. So as you know, as we said in our prepared remarks, we do expect That adjusted EBITDA margins for the year will contract for the year. Now we're not providing specific guidance for what this looks like for the full year. But, you know, we've given you the numbers for Q1, which, as you said, represents a margin of 25% of the midpoint of the range. I think a big, you know, one of the big reasons for the step down is Obviously, as we are navigating revenue headwinds that flows through to EBITDA. So that's obviously one thing that impacts margin. We are also making some deliberate investments this year, specifically in products and technology to reignite usage and engagement. So all the things that you've heard from us today around What does our product vision look like. What is the work that we're doing around safety. What is the work that we're doing to sort of drive the ecosystem. We are investing in both People resources as well as in platform resources to accelerate the work that we are doing. So that is the biggest investment that We are making in the company for 2025 and that's what's reflected in the guidance that you're seeing. Obviously, you know, we will continue to be very disciplined on all other areas of spend, including marketing marketing, as you know, is an area of spend that Includes both sort of always on approach as well as spend that we do that coincides with Big product moments. So we'll continue to be very diligent in terms of how we think about efficiency and ROI. On marketing and that's definitely an area that we've historically been very good at in terms of cost efficiency and discipline. And across every other part of the business. The goal is to be as disciplined as possible. So we're very confident that we will return to expanding margins as revenue growth resumes, but We do expect that in 2025 we will see a contraction.

Our next question comes from Egal Arunian with Citi. Your line is open. Please go ahead.

Yeah, definitely. Maybe Whitney, just as you step back in and there's been a lot of changes on strategy front. And any changes to how you think about the strategy going forward and maybe you can also talk about them in the context of there's been a number of executive level changes over the course of the last year. So is everything in place the way you think it should be at this point, or is there more work to do and then have a follow up.

Thanks so much for the question. So I think shareholders should have peace of mind in the fact that Lidiani and I have been super aligned from day one. When she stepped into the role, we made a commitment to each other that we were going to be a customer first company. That is the most important thing that we can be and our members candidly deserve better than what this category has been giving them over the last several years. So we have been on a joint and dual quest the last year together under her leadership to make sure that we are solving customer pain points. That is the strategy. There's not some You know, off the beaten path strategy is quite simple. It is getting back to basics and solving the problems that are getting in the way of our members finding love and love that is actually fruitful that brings them joy that makes them feel good. It's not about just getting people matches and then leaving dead end conversations like that's not What matters to us. And so moving back to, you know, strict customer centricity is the roadmap. That is the plan. And so so much of what you've just heard Lidiani Talk about as far as the winter release. This is all about what the customer needs and wants getting back to being You know the most safe trusted platform for people to come and and meet new people. So I think the the long and the short of it is The strategy is not changing from making sure that we deliver the most value, the most confident curious joyful experience that we possibly can to our members. And that is the number one priority. And so that is not a departure or a pivot. We are super aligned there and that's a continuum. So moving to the team. Another exciting update that I think you've all kind of, you know, been following along is that Lidiani has really Upped the talent at the company. Over the last few quarters, there have been, you know, layoffs and making sure that we've moved to a very strict performance model. So it is the best players, you know, people come do great work. They stay and we are really diligent about this. And So I feel really proud and excited by the folks that Lidiani has recruited both at the top level at the team, but also throughout the org. So obviously this is You know a process. It's not a one one stop, you know, ride, but we are definitely in the best place we've ever been from a talent standpoint. In the history of Bumble very sophisticated experience folks that are really deeply passionate and believe in the opportunity. Does that mean I won't be adding More strategic hires that are experts in their field, you know, of course I will. There's always going to be an opportunity to Introduce you know experts in their field and make sure that we always have the best team players across the org. But I think it's important for everybody here to know that I'm coming back as a real operating CEO with my focus on excellence efficiency. You know, a lean passionate dedicated hard working team that is all on the same page. We are one team rowing in the same direction on one roadmap and I'm really, really excited about the opportunity ahead. I wouldn't be here if I wasn't. So I really look forward to sharing more like next quarter when I'm back in the seat.

Okay, great. That's really helpful. Thanks. And then just one on the third strategic priority on enhancing the revenue strategy and I know that's a little bit further Down the line and we're focused more on engagement right now, but maybe just any help thinking about that path from engagement monetization. How you're thinking about it today, or if it's really just get the engagement down and then focusing on monetization later. Thanks.

Thank you. You know, as, as you've been hearing from me. There's three pillars to our transformation. The health of our ecosystem innovation. Those first two pillars are very much about strengthening the foundation and getting engagement right. That's the reason why you've been hearing so much emphasis on that over the last few quarters. But in parallel to that has been a revenue strategy effort, which is really about ensuring that we have a very thoughtful Balancing of our revenue across each tier of our subscription and that is ensuring that we have a great free experience that our paid paywalls are in the right places that we're driving conversions at the right moment for our users so that not only do they Come to the app, they pay and they feel valued and valuable returns for for being a subscriber in our platform. So that work is ongoing already. And it is really important for us to get the foundation of engagement right because we know then conversion and revenue growth as a next step as part of this process, but we are testing quite a few different frameworks in terms of that rebalancing and I'm excited, you know, for what Whitney is bringing in and envisioning the value that she wants to add across across the board and the platform. So lots of focus on revenue strategy for the company moving forward for sure.

Our next question comes from John Blackledge with TD Cohen. Your line is open. Please go ahead.

Hi there. It's Logan on for john. Could you talk us through puts and takes on the one queue Bumble app guidance in terms of how you're thinking about pair conversion, namely as you focus on the user ecosystem and could you discuss any short term negative impacts from new safety features, if any.

Thanks. Sure. Hey, Logan, I can take that. So, you know, Just to maybe reiterate what we are expecting for Q1 for total revenue. We are guiding on an XFX basis to be declining between four and 7% and for Bumble app excluding effects and also the impact of the, you know, loss of one day. Due to last year being a leap year, we are providing an outlook of revenue declining between three and 5%. You know, and if you look at our Q4 2024 numbers for Bumble app, we declined at 4%. So we are effectively saying we are declining at sort of similar levels as where we were in Q4. Um, In terms of the puts and takes for payers, we are also guiding to a sequential decline in paying users in the range of about 100 to 120,000. And this sequential decline encompasses all of the work that we are doing around Strengthening our ecosystem. So it includes the work that we are doing around safety. It includes the work that we're doing around marketing, you know, in terms of how do we think about What kind of users we bring on to our platform. If you remember, You know, for the last two quarters, we've talked, we've been talking a lot about what strengthening our ecosystem means and it's not just about You know, weeding out bad actors. It's also about how do we get the right people on the ecosystem that can match with other relevant people. And there's a lot of work that we're doing from a marketing perspective that also impacts that To sort of reinforce what Lidiani said earlier, our focus is very much on ensuring that we strengthen our top of the funnel. Strengthen our engagement metrics and then that will lead into strengthening conversion and then strengthening revenue. So that's How you should sort of think about the arc of the work that we are doing. A lot of these are in parallel. So like Lidiani mentioned about, you know, our revenue strategy. We are also looking at ways to strengthen our revenue strategy, but the focus in the short term. Is very much on making sure that we get the top of the funnel back to growth. I'll just mention if you look at third party data numbers between Q4 and Q1, you know, we've seen green shoots, right. We've seen some stabilization of metrics. We've seen green shoots in terms of the things that we are testing. Obviously, it's still very early days, but it's, you know, It's very encouraging to see the progress because we absolutely believe that we are in the right direction in terms of our overall strategy.

My next question comes from Robert Corbriff with Evercore ISI. Your line is open. Please go ahead.

Great. Thank you. Wanted to follow up on an earlier question. It seems like there's been a reset or there's reset ongoing a bumble and maybe more broadly across the category to maybe enhance consumer surplus or the user value proposition. Do you think that's a temporary change around maybe the Gen Z generational shift? Or do you think it's perhaps more structural just given that we've had, you know, years in some cases of, you know, sort of micro adjustment or optimization of things like paywalls, swipe limits and things like that. Thank you.

Yeah, I'm happy to jump in here. This is Whitney. Thanks for the question. So I think here's what happened. Online dating really, you know, took off for the millennial audience in 2012. And it just was explosive because the demand is there. And I stand by this. The demand is still there. What happened was, you know, there was never really a moment and you kind of alluded to this. There was never really a moment for, and I'll speak just for ourselves, for us to pause and reset and say, are we still delivering the most value to the customer? What are they here looking for? Okay, they're here to be matched with someone great. Are we doing that at the best of our ability? What are the struggles our members are running into? And you kind of said this by saying, you know, it was this game of cat and mouse of, okay, a new feature here or a new filter there or a new paywall here. And the time has come to say, you know what, we have a great business. We serve one of the most important needs on planet Earth, help people find love. I mean, truly, this is why I'm here. What is more important than that? I cannot think of something. I'd be off doing it if I could. This is the most important thing I could get my time to. And I think that this is the moment, and Lidiani has already been, you know, deep in the in the throes of this, of spearheading this, to reset and say, let's look at this house of love and understand the foundational work that needs to be reset. So when people come in here, they feel love, they feel home, they feel safe, they see who they want to see. It's a reset. It's bringing back the right people to the right environment and really giving people the opportunity to meet in a way that is both, you know, fulfilling and current. I actually don't think this is so generational. Everyone all over the internet, you know, speculates about this. Love is universal. Doesn't really matter how old you are or where you come from or what you're looking for. We all just want to get to that special person. You know, this is our opportunity to really say how, what's the best way to get you there? And this is where we're really just working backwards from customer pain points. And so I'm super, super confident that, you know, the work ahead of us, which is what I'm stepping back in to carry on and to do, it's all about saying, how do we fulfill the demand of helping people find love in the safest, most compatible, most joyful way? And so that's really what we're setting out to do. And I think it's going to be a huge reset. And I don't think it's a forever reset. I think that this is hard work. It's foundational. It's a remodel. It's not a rebuild. It's a redesign. It's not a start from scratch. We don't need to knock this thing down and build again. That is certainly not what's going on. This still serves a lot of value. I mean, the countless babies and love stories across the board. So I think watch this space and I'm really excited to share more in detail when I'm back in the seat in a few weeks and you'll hear from me at the next earnings. So thank you so much.

We now turn to Eli Winter with Deutsche Bank. Your line is open. Please go ahead.

Hi, thanks for the question. This is Eli for Ben. With the exit of official and fruits and your continued focus on product innovation with dating, I'm curious also to hear about your thoughts on products beyond dating. So how is the adoption of Fumble BFF trended? And what learnings have you been able to leverage from Geneva that could help with Fumble BFF scale?

Thank you, Eli. I can get started on this one. You know, one of the most exciting things about Bumble is that Bumble has always been a brand that stands for more than romantic love. And to Whitney's point, the love is the most important thing. And what Bumble has learned over the years with BFF is that friendship love is so important in people's lives. So we're really excited about continuing to focus our energy not only in reimagining dating, the dating category of our core businesses, this decision around fruits and official, which is always an extremely hard decision to make, is about putting our resources and our focus on reimagining dating for our core businesses with Bumble and Buzzu, but also putting resources in the opportunity that we see for BFF and Geneva with community. So truly excited about that. And as you know, Whitney has been the founder and originator of BFF and so passionate about that. So really excited to see her carry the torch moving forward.

Thanks, Lydianni. I might just add a couple quick points there. So what's really fascinating about BFF in particular and friend finding is this is actually the most relevant entry point for the broader category of love. Let's get away from the the label dating app for a moment. When you look at the post grad audience, which is Gen Z, they are eager and I hate to use this word, but quite literally, they are eager to get into the dating app. They are really desperate to find friends. You know, they've left this super dense environment where they're surrounded by friends. They've gone out into the real world. They're young, they're social, they want to meet people, and they're looking for community and friends. And so what's really exciting about the extensibility and the stretchiness, if you will, of our brand is it is not associated with merely a quote unquote dating app. Bumble really lends itself to a much broader lifestyle brand. So, you know, women in particular have no issue joining our product, even when they're in a romantic relationship, so that they can find community and friends. So the on-ramp opportunity here is quite exclusive to us. You know, other other category players don't really have this opportunity because they don't have the same brand from a lifestyle standpoint. And so what we're really looking at is how can we go after these audiences of post grads and, you know, there's a lot of different audiences that are more interested in starting as friends first. How can we do that to also be a ramp back into love? Because as we all know, you know, most folks in their 20s, the first relationship they have is not generally their forever relationship. And so because of the nature of romantic relationships, when someone is in your product as a, you're looking for friends, then they go through a breakup. Now they're much more likely to on-ramp into the love category from a romantic standpoint. So there is a flywheel here, and we are really excited about how we can leverage BFF both, you know, with women here, you know, in America, but it's also a great on-ramp for new markets that are a bit more hesitant to adopting to a dating app right away. So more to come here and watch this space.

Our next question comes from Curtis Nagel with Bank of America. Your line is open. Please go ahead.

Great. Thanks so much for taking the question. Just one for me. Your largest competitor noted, I think in their last call, they'd seen a pickup in peak season dating trends. Did you observe anything similar? And I guess if so, have they faded?

Can you please repeat the question? Oh, hi there. I'll start at the very beginning.

Yeah, the question was a bit fuzzy at the beginning for us for some reason.

Yeah, sorry about that, Whitney. It might be my headset. But the question was, your largest competitor had noted they'd seen a pickup in peak season dating trends. And just asking if you'd seen something similar. And if so, you know, had they faded or,

you

know, had they faded? That's the question.

Lydia, why do you take that as the CEO? Thank you.

Thank you. What we are seeing, you know, as Whitney just called out, a general interest, especially for younger users, to start more casual first, to start with friendship, to find an on-ramp that is less intimidating, which is why we're very excited about having a broader set of products that can serve that user base. But we are continuing to see important trends in finding connections that are relevant in ensuring that safety is top of mind for platforms like ours. For us, what we're seeing as well is how relevant it is to have a woman's first focus. And that has always been such an important priority and focus and mission for Bumble. And it continues to be incredibly relevant in this category. So all in all, we're seeing, you know, great opportunity for the company moving forward. And as Whitney called out at the start of this Q&A, love has not been as relevant as we see it today. And I'm excited to see the company capture the opportunity ahead.

Ladies and gentlemen, this concludes our Q&A and today's conference call. We'd like to thank you for your participation. You may now disconnect your lines.