Earnings on a GAAP basis were 44 cents per share, 11 cents higher than consensus estimates, according to Bloomberg data. Revenue increased 29% year-over-year to $444 million, exceeding the average forecast of $438.21 million. Total subscribers across Match Group’s dating app portfolio came in at more than 8 million for the quarter, up from about 7.7 million for the period ending in June.
However, Match provided fourth-quarter guidance that fell short of consensus estimates. Fourth-quarter revenue is expected to come in between $440 million and $450 million, falling short of consensus expectations of $454.5 million, according to Bloomberg data.
Shares of Match fell 9.66% to $46.50 each as of 5:03 p.m. ET.
Tinder, the swipe-based dating app popular among millennials, continues to be a growth driver for the company, with direct revenue doubling in the quarter from a year earlier. The bulk of Tinder’s revenue comes from paid subscriptions to tiers including Tinder Gold, which helps users interact with most likely matches first.
Average subscribers for Tinder grew to 4.1 million in the third quarter from about 3.8 million in the previous period. The platform is on pace to bring in $800 million for the full-year 2018, as the company had previously estimated. Match said it expects full-year revenue to be near the top end of its previous forecast, approaching $1.72 billion.
Match also announced a special dividend of $2.00 per share on the company’s common stock and Class B common stock, to be paid out on December 19. The dividend will be paid out from cash on hand and with incremental debt as needed, the company said. This is the first time Match has issued a dividend, but the company will consider future dividends going forward, CEO Mandy Ginsberg told Yahoo Finance.
“I think this is going to give our shareholders real confidence that we can both grow the business, be great stewards of our capital, give them returns and continue to really look aggressively at M&A and investment,” Ginsberg said.
Match Group in June purchased a controlling stake in Hinge, a platform that promoted itself as a Tinder alternative for users seeking more serious relationships. Downloads for the application increased fivefold to more than 750,000 in the third quarter from the year-ago period, Match reported. Ginsberg said Match plans to invest in product resources, engineering talent and marketing for Hinge in order to build it out its brand awareness outside of its current major market in New York City.
In addition to growing Match’s existing apps – which include other dating forums including OkCupid and PlentyofFish – the company will continue to pursue M&A opportunities and is seeking further expansion in overseas markets, Ginsberg said. Match already operates internationally based dating platforms including Meetic in Europe and Pairs in Japan. International subscribers grew 29% in the third quarter from the year-ago period, outpacing the 18% rate of increase this quarter for new subscribers in North America.
Shares of Match Group were up 60% for the year-to-date as of market close Tuesday.
Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter: @emily_mcck
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