Bumble to Post Q4 Earnings: Key Metrics and Expectations to Watch

Core Viewpoint - Bumble (BMBL) is expected to report its fourth-quarter 2024 results on February 18, with anticipated revenues between $256 million and$262 million, reflecting a decline from the previous year [1][2]. Revenue and Earnings Estimates - The Zacks Consensus Estimate for fourth-quarter revenues is $260.11 million, indicating a 4.94% decline from the same quarter last year [2]. - The consensus estimate for earnings is 19 cents per share, which represents a 200% increase from the year-ago figure, despite a 5.3% downward revision over the past 30 days [2]. Recent Performance - Bumble has surpassed the Zacks Consensus Estimate for earnings in three of the last four quarters, with an average positive surprise of 8.69% [3]. Challenges and Market Conditions - The company has faced challenges due to sticky inflation and high borrowing costs, which have negatively impacted user spending and led to a decline in quarterly revenues for the first time since going public in 2021 [4]. - Total paying users grew by 11% year-over-year in the third quarter, but net additions are expected to decline by 70,000 to 80,000 in the fourth quarter, potentially affecting revenues [4]. Strategic Developments - Bumble's acquisition of Geneva aims to expand into non-romantic connection spaces, although it is not expected to contribute to revenues in the fourth quarter due to its current lack of revenue generation [5]. - The company has been optimizing pricing and paywall strategies to balance free and paid users, which is anticipated to improve conversion rates and revenues in the fourth quarter [6]. Marketing and Product Updates - Marketing expenditures originally planned for the third quarter were shifted to the fourth quarter to align with a fall product release, which included significant updates to the Bumble app [7]. - The reallocation of marketing expenses is expected to impact fourth-quarter margins negatively, despite higher-than-expected margins in the third quarter [7]. Competitive Landscape - The dating sector remains highly competitive, with Bumble facing pressure from competitors like Match Group's Tinder and Hinge, which may strain profit margins and market share [8]. Earnings Prediction Model - According to the Zacks model, Bumble currently has an Earnings ESP of -1.30% and a Zacks Rank of 3, indicating a lower likelihood of an earnings beat [9].