Bumble Inc. (BMBL)·Q1 2025 Earnings Summary

Executive Summary

• Q1 revenue declined 7.7% YoY to $247.1M, with Bumble App revenue down 6.5% YoY to $201.8M; total payers were ~4.0M (flat YoY) and Bumble App payers fell 104k QoQ to 2.71M as management prioritized member-base quality over near‑term payer growth .
• Adjusted EBITDA was $64.4M (26.1% margin) vs. $74.0M (27.6%) a year ago; GAAP net earnings were $19.8M (8.0% margin) .
• Q2 guide: total revenue $235–$243M, Bumble App revenue $193–$199M, Adjusted EBITDA $79–$84M (~34% margin midpoint), reflecting reduced performance marketing and accelerated member‑base cleanup; management identified ~$15M in opex savings and plans ~$20M lower Q2 marketing spend .
• Narrative pivot: CEO Whitney Wolfe Herd re-centered the strategy on “quality, quality, quality,” removing bots/bad actors, ramping verification, and modernizing the AI‑driven matching algorithm; management will de‑emphasize payer guidance during the reset .
• Catalyst focus: investors will key on execution of the quality reset (early algorithmic lift, engagement gains) vs. near‑term top‑line pressure and whether cost actions sustain margin outperformance relative to guide .

What Went Well and What Went Wrong

• What Went Well

  • Delivered at the high end of the Q1 outlook; Adjusted EBITDA of $64.4M (26.1%) with solid operating cash flow of $43.2M and $202.2M cash on hand .
  • Strategic clarity and cost discipline: ~$15M new near‑term savings identified; Q2 marketing down by ~$20M as the company pivots away from lower‑quality performance channels .
  • Product/AI momentum: early positive results from a modernized AI/ML matching algorithm; new safety/verification features (ID Verification, Review Before Send, Share Date) and a Discover tab to increase relevancy and matches .

• What Went Wrong

  • Revenue contraction and payer pressure: total revenue -7.7% YoY; Bumble App payers -1% YoY and -104k QoQ as the quality reset reduces near‑term payers and ARPPU fell (Total ARPPU $20.24 vs. $21.84) .
  • FX headwinds: ~$6M unfavorable FX on total revenue, contributing to top‑line pressure .
  • Margin compression YoY: Adjusted EBITDA margin 26.1% vs. 27.6% a year ago; net margin 8.0% vs. 12.6% as restructuring/impairment and investment posture weigh on GAAP profitability .

Financial Results

Revenue and profitability trend (oldest → newest)

GAAP earnings (oldest → newest)

Segment revenue (oldest → newest)

KPIs and ARPPU (oldest → newest)

Additional balance sheet/capital returns (Q1 2025)

• Cash & equivalents: $202.2M; Total debt: $616.1M .
• Share repurchases: $28.7M in Q1; $50.1M authorization remaining at 3/31/25 .

Guidance Changes

Note: Management also indicated ~$15M of 2025 opex savings and ~$20M lower Q2 marketing spend, with additional performance marketing reductions through year‑end .

Earnings Call Themes & Trends

Management Commentary

• “The key to enduring growth…is quality. We are refreshing and intensifying our efforts to remove bots, scammers and bad intention members… and modernizing our personalized matching algorithm with AI” — Whitney Wolfe Herd, CEO .
• “We have identified $15 million in new near‑term savings… and… taken down our marketing budget by $20 million in Q2… focusing on organic marketing strategies” — Whitney Wolfe Herd .
• “Q1 total revenue was $247 million… FX headwind of approximately $6 million… Adjusted EBITDA was $64 million… cash flow of $43 million… Q2 revenue $235–$243 million; Adjusted EBITDA $79–$84 million (~34% margin midpoint)” — Ron Fior, Interim CFO .

Q&A Highlights

• Strategy/TAM and quality focus: Management reiterated a large, durable TAM but will “shrink a little bit before we grow” as they remove low‑quality members; quality and relevancy trump scale; payer guidance paused during the reset .
• What to measure: Near‑term focus on engagement quality (match/chat success) and member experience vs. payer counts; forthcoming disclosure framework in next quarter .
• AI roadmap: Four vectors—safety/verification, profile/coaching, matching algorithm, internal efficiency—with personalization as the primary value unlock for users .
• International: Similar member pain points across geographies; defer aggressive spend until product quality and verification improvements are in place; 2026 flagged for bigger push .
• Cost/margins: ~$15M opex savings identified; ~$20M Q2 marketing reduction; Q2 Adj. EBITDA margin guided to ~34% midpoint while top‑line remains under pressure .

Estimates Context

Q1 2025 actuals vs. S&P Global consensus

• Company‑reported GAAP diluted EPS was $0.13 .
• Commentary: Revenue slightly exceeded consensus; EPS outperformed S&P “Primary EPS” estimates. Management also noted Q1 delivered at the high end of company outlook, with Q2 revenue guided down as the quality reset accelerates .
• Values with asterisks (*) are retrieved from S&P Global.

Key Takeaways for Investors

• The Bumble narrative has reset to “quality-first”: expect near‑term payer and revenue pressure as bots/bad actors are removed and verification increases, with engagement/match quality as the primary KPI during the transition .
• Q2 guide implies a 10–13% YoY revenue decline and a mix shift toward margin (Adj. EBITDA ~$79–$84M; ~34% margin midpoint), supported by ~$20M lower Q2 marketing and ~$15M opex savings—key for cash flow resilience while top‑line dips .
• Early AI/ML matching and Discover/safety features should drive relevancy and engagement; execution proof points over the next two quarters (match/chat rates, user sentiment) are potential stock catalysts .
• Segment trends show sequential softness: Bumble App revenue $201.8M and payers 2.71M in Q1; sustained ARPPU pressure highlights the importance of the monetization “re‑balance” once engagement rebuilds .
• Balance sheet remains sound (cash $202M; debt $616M) with continued buybacks ($28.7M in Q1); liquidity supports the reset without sacrificing investment in product/AI .
• Watch for the updated disclosure framework (beyond payer counts) next quarter and any signs of stabilization in payer trends as quality improvements compound .
• Medium‑term, the path back to growth hinges on measurable improvements in match quality and verification adoption; a successful reset could expand monetization opportunities and restore sustainable revenue growth into 2026 .

S&P Global estimates disclaimer: Values marked with an asterisk (*) are retrieved from S&P Global.