Match Group goes international (respectfully)

Wednesday, November 6, 2019 by Robinhood Snacks | Disclosures

The Profit Police just took down Peloton

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Hey Snackers,

What to do if you're an NFL player and a cat takes over your Monday Night Football game (literally).

Stocks dipped from record highs Tuesday, but we'll be looking for today's Consumer Credit Report to see how we're all spending.

1. Peloton's 8% drop highlights a classic Growth vs. Profits tradeoff

This is my first time, so cut me some slack... Fresh off its September IPO, Peloton announced its first quarterly earnings report as a publicly traded company Tuesday. The results and calorie count all beat analysts' expectations:

  • Revenue more than doubled to $228M.
  • The number of Peloton monthly subscribers (you buy the $2K bike, then you drop $39/month to be yelled at via streaming spin classes) more than doubled to 563K.
  • Peloton projected it'll add 100K Pelotonistas this holiday season.
  • Plus: The average number of workouts per month on Pelotons rose from 8.7 to 11.7 (more fun stats in this pretty presentation).

So it's a shocker that the stock dropped 8%... Peloton felt like a middle schooler who brought home A's when their parents expected B's — and then got grounded. Its CEO struggled to rationalize Wall Street's punishment for its rippling results: "The stock going backward is a bit of a head-scratcher, I’ve got to be totally honest with you." Well put.


This is a claaaassic "Profits vs. Growth" tradeoff... Peloton loses money each quarter, spending more than it brings in. Its $50M loss invited investor disgust, but the CEO pointed out the loss was necessary in order to grow quickly. You're either focused on profits or growth — in the saddle or out of it:

  • Peloton could cancel its expensive TV ads, stop adding stores at fancy malls, and layoff salespeople to become profitable.
  • But is that the right move at this crucial moment when Mirror and SoulCycle are chasing its head start?

1st date humble brag... Match owns the trademark on "Swipe" and "Swipe Right" — a huge advantage for the owner of Tinder and 44 other dating apps. Match shares dropped 15% Tuesday though on word that its projections for the upcoming quarter aren't worth bringing home to Mom and Dad. But its Tinder numbers are.

Tinder is a stage 5 clinger... Actually, its Tinderella users are. The app enjoyed (another) surge in downloads by 437K last quarter to hit 5.6M total users. The new "Swipe Night" interactive in-app choose-your-adventure show that debuted last month was a hit (especially among Gen Z and women). But 2 specific numbers in the charming earnings stood out to your Snacks team:

  • 5 days: On average, users check out Tinder 5 days a week.
  • 30%: That's the increase in users who now open the app 7 days a week compared to last year.

International is Match's opportunity — but it requires “product localization”... Uber barged into new countries and didn’t adapt to local culture. Match uses the opposite strategy as it heads abroad — it's all about being culturally sensitive. Take Match's OKCupid app tactics in India:

  • Situation: Online dating isn't the go-to option and arranged marriage is still common.
  • Response: Match made Indian OKCupid dating profiles include more user info than in other countries so that more conservative daters could get comfortable.
  • Result: A surge in app downloads to 1.4M over the last year.
What else we’re Snackin’
  • Spacial: Adidas partners with the international space station because it wants to test out its gear in, you know, space
  • De-paid: Boeing's CEO gives up his 2019 bonus in light of the 737 Max crisis
  • Twins: Xiaomi (aka the "Apple of China") just released its new smartwatch — looks a lot like Apple Watch
  • Fucci: TheRealReal shares dropped 11% after a CNBC investigation showed that the consignment company isn't perfectly sorting out fake products from the real stuff
  • Anti-Public: Walgreens reached out to private equity firms to take the company private — the 9,300-store chain wants to get out of the spotlight of public markets
Snacks Daily Podcast

Wag was supposed to be the "Uber for dog walking" — now it's struggling to sell itself after raising $300M from Softbank (the same VC that just bailed out WeWork).


ID: 1004317

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