(Reuters) - Match Group Inc beat Wall Street estimates for fourth-quarter revenue and profit on Wednesday as its popular dating app, Tinder, attracted more subscribers, sending its shares up as much as 12 percent in extended trading.
Match has been investing heavily in Tinder and its other dating services as it looks to grab a bigger slice of the online dating market, which is estimated to touch $12 billion (£9 billion) in 2020 by Nomura analysts.
Tinder — which has made “swipe left” and “swipe right” a point of pop culture conversations - added 233,000 average subscribers in the quarter, bringing its total average subscriber count to 4.3 million, or 1.2 million more than a year earlier.
Overall subscribers at Match rose to 8.2 million.
Match said it earned 58 cents per user on average, 3 cents more than last year as more users shifted to its premium services such as Tinder Gold.
Tinder Gold and Tinder Plus offer features such as unlimited likes, the ability to take back an accidental swipe and better profile visibility for a fee.
Marketing push leads to Tinder Growth png : tmsnrt.rs/2TyQXGN
The company, however, forecast first-quarter revenue of $455 million to $465 million, below analysts’ estimates of $469.7 million, according to IBES data from Refinitiv. The company said a strong dollar weighed on its forecast.
Match said it also expects first-quarter adjusted earnings before interest, tax, depreciation and amortisation of $150 million to $155 million. Analysts were expecting $155.28 million.
Operating expenses rose about 22 percent in the fourth quarter as Match boosted marketing spend on its money-spinner Tinder in emerging markets, including India and Latin America, while ramping up other services such as PlentyOfFish and Hinge.
The company faces stiff competition from a host of rivals including Bumble, which recently launched its app in India, a market with huge potential for dating-related services.
Total revenue rose 20.7 percent to $457.34 million, beating estimates of about $448.5 million.
Net earnings attributable to Match Group shareholders was $115.5 million, or 39 cents per share, for the three months ended Dec. 31, compared with a loss of $9 million, or 3 cents per share, a year earlier.
Excluding items, Match earned 43 cents per share, beating estimates of 38 cents, according to IBES data from Refinitiv.
The company’s shares were up 10.3 percent at $58.54. They have risen nearly 73 percent in the last 12 months.
(Click here tmsnrt.rs/2TBLVt8 for an interactive on Match subscriber growth)
Reporting by Arjun Panchadar and Pushkala Aripaka in Bengaluru; Editing by Anil D'Silva