Core Viewpoint - Ningi Research has taken a short position on Grindr Inc., alleging misleading investor metrics, an undisclosed SEC investigation, and a deteriorating product while insiders sell off significant stock holdings [1][2][6]. Group 1: Allegations and Metrics - Ningi claims that Grindr's management has inflated user metrics, particularly Average Paying Users (APU), leading to a "short-term sugar high" in revenue that conceals a declining user base and a fundamentally flawed business model [2][3]. - The report indicates that Grindr has redefined APU to count daily purchases instead of unique monthly users, allowing for inflated user counts [3]. Group 2: Product Issues - Grindr's app is described as suffering from technical glitches, leading to a user experience that is characterized as a "toxic wasteland," which is driving users away [4]. - A significant loss of talent occurred due to a Return-to-Office mandate, resulting in approximately 80% of the engineering team resigning, further exacerbating product issues [5]. Group 3: Insider Activity and Financial Risks - Insiders have sold over $236 million in stock in the past year, indicating a lack of confidence in the company's future [6]. - The two largest shareholders have pledged 59% of the company's total stock as collateral for personal loans, creating a potential margin call risk that could lead to forced liquidation of shares [6][7]. Group 4: Stock Performance - Grindr's stock has declined 12.87% year-to-date, despite a 33.79% increase over the past year, indicating volatility and potential investor concerns [8]. - The stock is trading at a significant premium compared to peers, which Ningi argues does not reflect the underlying issues within the company [7].

Core Viewpoint - Ningi Research has taken a short position on Grindr Inc., alleging misleading investor metrics, an undisclosed SEC investigation, and a deteriorating product while insiders sell off significant stock holdings [1][6]. Group 1: Allegations and Metrics - Ningi claims that Grindr's management has inflated user metrics, particularly Average Paying Users (APU), leading to a "short-term sugar high" in revenue that conceals a declining user base and a fundamentally flawed business model [2][3]. - The report indicates that Grindr has redefined APU to count daily purchases instead of unique monthly users, allowing for inflated user counts [3]. Group 2: Product Issues - Grindr's app is described as suffering from technical glitches, leading to a user experience characterized as a "toxic wasteland," which is driving users away [4]. - A significant loss of talent occurred due to a Return-to-Office mandate, resulting in approximately 80% of the engineering team resigning, further exacerbating product issues [5]. Group 3: Insider Activity and Financial Risks - Insiders have sold over $236 million in stock in the past year, indicating a lack of confidence in the company's future [6]. - The two largest shareholders have pledged 59% of the company's total stock as collateral for personal loans, creating a potential margin call risk that could lead to forced liquidation of shares [6][7]. Group 4: Stock Performance - Grindr's stock has declined 12.87% year-to-date, despite a 33.79% increase over the past year, indicating volatility and potential investor concerns [8]. - The stock is trading at a significant premium compared to peers, which Ningi argues does not reflect the underlying issues within the company [7].

Company Overview - Grindr has been operational for 16.5 years and is recognized for pioneering the use of mobile devices for local discovery, particularly within the LGBTQ+ community [3] - The platform was one of the first geolocated products on mobile, launching on iOS in March 2009, and gained rapid popularity through word of mouth among gay individuals in the United States [3] Market Impact - The introduction of Grindr coincided with the sale of approximately 0.5 million iPhones in 2010, highlighting the app's significant role in the early adoption of mobile technology within its target demographic [3]

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Company Overview - Grindr has undergone significant changes over the past three years, particularly under the leadership of its CEO, George Arison, who has been with the company for this duration [1] - The company went public shortly after Arison's arrival, indicating a rapid transition and the need for extensive preparations [1] Ownership History - Grindr was previously owned by a Chinese entity before being sold to a consortium of American owners in 2020, coinciding with the peak of the COVID-19 pandemic [2] - The new American ownership recognized the urgency to take the company public, leading to a swift execution of this plan [2]

Grindr (GRND) 2025 Conference Summary Company Overview - **Company**: Grindr (GRND) - **Industry**: Social Networking and Dating Apps - **Key Executives Present**: CEO George Arison, CFO Anna Krantz Key Points and Arguments Company Transformation and Vision - Grindr has undergone significant changes since George Arison joined three years ago, focusing on transforming the company into a public business with a clear vision and high-caliber team [4][5][6] - The company aims to build a "gay brotherhood" and expand its offerings beyond dating to include health, wellness, and luxury experiences [7][8][10][12] Growth Initiatives - **Health and Wellness**: Launched a product called Woodwork for ED medications, with plans to expand into other health-related products, including PrEP for HIV prevention [10][11] - **Luxury Experiences**: Targeting the affluent gay demographic in the U.S. to offer luxury experiences, leveraging their higher disposable income [12][13] - **AI Innovations**: Developing AI-driven products to enhance user experience and engagement, focusing on understanding the unique needs of the gay community [13][66] User Engagement and Monetization - Grindr is positioned as a social network rather than just a dating app, with users engaging in various activities beyond dating, such as social networking and lifestyle discussions [15][20] - The platform has a high engagement level, with users sending approximately 130 billion messages annually, surpassing traditional dating apps [20][21] - Monetization strategies include subscription services (85% of revenue) and advertising (15% of revenue), with plans to increase subscription prices after seven years without adjustments [24][26][27] User Growth and Market Potential - Monthly Active Users (MAUs) increased by 6% sequentially in Q2, with growth primarily driven by organic word-of-mouth [30] - The company estimates adding between 500,000 and 1 million net users annually, with significant growth potential in international markets [31][32] - Current international revenue mix is under 50%, with 75% of MAUs being international users [36][40] Financial Performance and Targets - Grindr is tracking towards long-term financial targets of 20%-25% revenue growth and 39%-42% EBITDA margins, with recent performance exceeding these expectations [45][46] - Advertising revenue has grown to 15%-16% of total revenue, with a focus on increasing direct advertising opportunities [50][51] AI and Product Development - Grindr is investing in AI to create unique products tailored to its user base, such as A-List and Chat Summaries, which enhance user interactions and experiences [65][66][68] - The company is cautious about rolling out AI features, ensuring users opt-in to participate in AI-driven experiences [71] New Features and User Experience - The introduction of the "Right Now" feature has expanded the app's functionality, allowing users to engage in new ways while maintaining the core casual connection aspect of Grindr [74][75] Additional Important Insights - Grindr's user base is predominantly young, with a significant portion of users turning to the platform for educational and social purposes as they explore their identities [21] - The company emphasizes maintaining a balance between monetization and user experience, avoiding degradation of the free experience that attracts new users [20][23] This summary encapsulates the key discussions and insights from the Grindr conference, highlighting the company's strategic direction, growth initiatives, and financial performance.

[Special Note Regarding Forward-Looking Statements](index=4&type=section&id=Special%20Note%20Regarding%20Forward-Looking%20Statements) Forward-looking statements are subject to numerous risks and uncertainties that may cause actual results to differ materially - Forward-looking statements in this report are subject to numerous known and unknown risks, uncertainties, assumptions, and changes in circumstances that may cause actual results to differ materially from those expressed. There are no guarantees that described transactions or events will occur as anticipated[10](index=10&type=chunk)[12](index=12&type=chunk) - Key factors that could cause actual results to differ include the ability to retain and add users, regulatory compliance, cybersecurity, strategic transactions, talent retention, economic conditions, competition, technology adaptation, adoption of AI/ML, dependence on third-party systems, intellectual property protection, stock ownership concentration, share repurchases, and macroeconomic/geopolitical events[13](index=13&type=chunk) [PART I. FINANCIAL INFORMATION](index=7&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This part presents the company's unaudited condensed consolidated financial statements and related disclosures [Item 1. Financial Statements (Unaudited)](index=7&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) This section presents Grindr Inc.'s unaudited condensed consolidated financial statements and detailed notes [Condensed Consolidated Balance Sheets](index=7&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This section details the company's financial position, presenting assets, liabilities, and equity at specific dates Condensed Consolidated Balance Sheets (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :------------ | :---------------- | | Cash and cash equivalents | $120,825 | $59,152 | | Accounts receivable, net | $57,085 | $49,599 | | Total current assets | $189,345 | $116,984 | | Total assets | $547,620 | $479,090 | | Accounts payable | $1,769 | $3,261 | | Accrued expenses and other current liabilities | $37,886 | $29,578 | | Deferred revenue | $21,769 | $19,970 | | Total current liabilities | $76,424 | $67,809 | | Long-term debt, net | $268,463 | $275,580 | | Warrant liability | $— | $252,178 | | Total liabilities | $359,930 | $610,660 | | Total stockholders' equity (deficit)| $187,690 | $(131,570) | [Condensed Consolidated Statements of Operations](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) This section details the company's financial performance, including revenues, expenses, and net income or loss Condensed Consolidated Statements of Operations (in thousands, except per share data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Revenue | $104,220 | $82,345 | $198,158 | $157,690 | | Cost of revenue | $27,408 | $20,999 | $51,950 | $40,619 | | Selling, general and administrative expense | $36,457 | $24,802 | $66,697 | $51,411 | | Product development expense | $12,941 | $7,754 | $23,228 | $13,495 | | Depreciation and amortization | $3,068 | $4,235 | $6,545 | $8,354 | | Total operating expenses | $79,874 | $57,790 | $148,420 | $113,879 | | Income from operations | $24,346 | $24,555 | $49,738 | $43,811 | | Interest expense, net | $(3,564) | $(6,669) | $(7,439) | $(13,854) | | Other income (expense), net | $510 | $(227) | $658 | $(344) | | Gain (loss) in fair value of warrant liability | $— | $(35,118) | $9,905 | $(53,798) | | Net income (loss) before income tax | $21,292 | $(17,459) | $52,862 | $(24,185) | | Income tax provision | $4,654 | $4,965 | $9,205 | $7,645 | | Net income (loss) | $16,638 | $(22,424) | $43,657 | $(31,830) | | Basic EPS | $0.08 | $(0.13) | $0.23 | $(0.18) | | Diluted EPS | $0.08 | $(0.13) | $0.17 | $(0.18) | [Condensed Consolidated Statements of Stockholders' Equity (Deficit)](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders'%20Equity%20(Deficit)) This section tracks changes in the company's equity, reflecting net income, stock compensation, and share transactions Condensed Consolidated Statements of Stockholders' Equity (Deficit) (in thousands, except share data) | Metric | Balance at December 31, 2024 | Net Income | Stock-based Compensation | Exercise of Warrants | Repurchase and Retirement of Common Stock | Balance at June 30, 2025 | | :-------------------------------- | :--------------------------- | :--------- | :----------------------- | :------------------- | :---------------------------------------- | :----------------------- | | Common Stock (shares) | 178,567,403 | — | 770,713 (vested RSUs) | 30,733,623 | (15,995,957) | 195,498,498 | | Common Stock (amount) | $18 | — | — | $3 | $(2) | $19 | | Treasury Stock (amount) | $(14,295) | — | — | — | $(15,473) | $(29,768) | | Additional paid-in capital | $74,519 | — | $14,689 | $556,337 | $(294,125) | $365,594 | | Accumulated deficit | $(191,812) | $43,657 | — | — | — | $(148,155) | | Total stockholders' equity (deficit)| $(131,570) | $43,657 | $14,689 | $556,340 | $(309,598) | $187,690 | [Condensed Consolidated Statements of Cash Flows](index=11&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This section details cash flows from operating, investing, and financing activities over specific periods Condensed Consolidated Statements of Cash Flows (in thousands) | Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------------- | :----------------------------- | :----------------------------- | | Net income (loss) | $43,657 | $(31,830) | | Stock-based compensation | $27,476 | $15,590 | | (Gain) loss in fair value of warrant liability | $(9,905) | $53,798 | | Depreciation and amortization | $6,545 | $8,354 | | Net cash provided by operating activities | $61,311 | $36,299 | | Net cash used in investing activities | $(1,508) | $(2,844) | | Proceeds from the exercise of warrants | $314,124 | $— | | Repurchases of common stock under the stock repurchase program | $(290,667) | $— | | Principal payments on debt | $(7,500) | $(43,300) | | Net cash provided by (used in) financing activities | $1,870 | $(45,503) | | Net increase (decrease) in cash, cash equivalents and restricted cash | $61,673 | $(12,048) | | Cash, cash equivalents and restricted cash, end of the period | $121,430 | $16,950 | [Notes to Unaudited Condensed Consolidated Financial Statements](index=13&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed explanations of accounting policies and specific line items in the financial statements [Note 1. Nature of Business](index=13&type=section&id

Company Performance - Grindr Inc. reported quarterly earnings of $0.08 per share, missing the Zacks Consensus Estimate of $0.10 per share, but showing an increase from $0.07 per share a year ago, representing an earnings surprise of -20.00% [1] - The company posted revenues of $104.22 million for the quarter ended June 2025, missing the Zacks Consensus Estimate by 0.55%, compared to revenues of $82.35 million in the same quarter last year [2] - Over the last four quarters, Grindr has not surpassed consensus EPS estimates, although it has topped consensus revenue estimates twice [2] Market Outlook - Grindr shares have increased approximately 4.5% since the beginning of the year, while the S&P 500 has gained 7.9% [3] - The company's future stock performance will largely depend on management's commentary during the earnings call and the earnings outlook, including current consensus earnings expectations for upcoming quarters [4][6] - The current consensus EPS estimate for the next quarter is $0.11 on revenues of $112.8 million, and for the current fiscal year, it is $0.47 on revenues of $434.1 million [7] Industry Context - The Internet - Software industry, to which Grindr belongs, is currently ranked in the top 28% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Financial Data and Key Metrics Changes - In Q2 2025, total revenue grew 27% year over year to $104 million, with an adjusted EBITDA margin of 43% or $45 million, aligning with the raised full-year guidance [11][14] - Direct revenue for the quarter was $87 million, up 24% year over year, driven by subscription offerings and optimizations [12] - Average monthly active users (MAUs) increased by 6% year over year to 14.9 million, while average paying users rose 16% to 1.2 million [12] - Net income for Q2 was $17 million, representing 16% of revenue, compared to a net loss of $22 million in the same period last year [13] Business Line Data and Key Metrics Changes - Direct revenue growth was led by subscription offerings, with average direct revenue per paying user increasing 7% to $23.65 [12] - Indirect revenue reached $17 million, up 39% year over year, driven by new third-party advertising partners and traction in international markets [12] Market Data and Key Metrics Changes - The company noted strong engagement in the Explore feature, with over 25% of users utilizing it monthly, and launched Explore heat maps across 21 markets [6][12] - The company is focusing on expanding its presence in developing markets like India and the Philippines, where there is significant growth potential [27] Company Strategy and Development Direction - The company aims to build one of the leading AI-native consumer companies, leveraging GenAI to enhance user experiences and drive long-term revenue growth [7] - The introduction of mapping features is expected to enhance local discovery and user engagement, with plans for future product initiatives [31] - The company is committed to improving its marketing strategies in various regions, particularly in Latin America and Asia, to better penetrate those markets [25] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to deliver strong results while executing its long-term vision [5][10] - The company reaffirmed its full-year 2025 outlook of at least 26% revenue growth and an adjusted EBITDA margin of at least 43% [14] Other Important Information - The CFO transition is underway, with the current CFO continuing in her role until a successor is identified [9] - The company has repurchased $325 million in common stock year to date, with $175 million remaining under the share repurchase program [14] Q&A Session Summary Question: What drove the MAU growth in Q2? - Management highlighted three drivers: strong engagement among younger user cohorts, reliance on unique device counting for MAUs, and organic growth from brand recognition [20][21][24] Question: Can you elaborate on the acceleration in indirect revenue? - The CEO noted that indirect revenue growth was driven by increased ad placements and new third-party advertising partnerships, with a focus on maintaining CPM levels [38][39] Question: What are the key drivers behind the increase in operating expenses? - The CFO indicated that increased operating expenses reflect investments in product development and marketing, as well as a more predictable expense profile [43][44] Question: Are there any early learnings from pricing experiments? - Management emphasized that pricing changes will not materially impact 2025 and that the focus is on driving revenue growth through product enhancements [46][47]

Grindr's AI-Native Strategy - Grindr is building a global super app for gay & bi men, enhancing the core use case with AI and creating new DTC businesses[6] - The company is developing Grindr AI (gAI), a full-stack foundation with three layers: Application, Architecture, and Foundational Models[13] - gAI is designed to capture gay cultural context, behavior patterns, and intent signals at scale, driving user experiences and competitive advantage[17] User Base and Engagement - Grindr has a valuable, trendsetting user base with unmatched reach and engagement[9] - The platform is present in 190+ countries and territories[10] - Users send over 130 billion chats annually[10, 31, 37] - Grindr boasts 2.5 billion+ album shares[10] - The median household income for male-male couples on Grindr is $128,000, compared to $75,000 for all households[10] - Grindr has 14.9 million monthly active users who spend approximately an hour a day on the app[37] A-List and gAI Deployment - A-List, Grindr's first AI-native product at scale, redefines how users connect by prioritizing high-potential chats and summarizing conversations[29, 31] - Agentic AI is supporting the engineering team, boosting productivity per workload by up to 10x and contributing up to 20% of shipped code[32]