Bumble’s first quarter results were met with a positive market reaction despite revenue declining year over year. Management attributed the performance to a deliberate shift in strategy, aiming to prioritize user quality over scale. CEO Whitney Wolfe Herd highlighted the importance of improving member experience, stating, “Quality is the key to enduring growth.” The company has accelerated efforts to remove bots, scammers, and low-quality profiles while refreshing its matching algorithm. These actions, combined with reduced performance marketing spend, have led to a more focused and disciplined approach. Wolfe Herd acknowledged that this pivot has resulted in near-term headwinds to growth metrics, but believes it lays the groundwork for sustainable momentum.
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Bumble (BMBL) Q1 CY2025 Highlights:
- Revenue: $247.1 million vs analyst estimates of $246.4 million (7.7% year-on-year decline, in line)
- Adjusted EBITDA: $64.4 million vs analyst estimates of $61.74 million (26.1% margin, 4.3% beat)
- Revenue Guidance for Q2 CY2025 is $239 million at the midpoint, below analyst estimates of $243.4 million
- EBITDA guidance for Q2 CY2025 is $81.5 million at the midpoint, above analyst estimates of $58.94 million
- Operating Margin: 18.1%, in line with the same quarter last year
- Paying Users: 4.01 million, in line with the same quarter last year
- Market Capitalization: $666.2 million
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions Bumble’s Q1 Earnings Call
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Ygal Arounian (Citigroup) asked how reducing performance marketing and focusing on user quality affects Bumble’s long-term market opportunity. CEO Whitney Wolfe Herd explained the global demand remains strong, but emphasized, “We have to shrink a little before we grow,” prioritizing quality over scale.
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Shweta Khajuria (Wolfe Research) inquired about the metrics Bumble will use to assess progress during this transition. Wolfe Herd responded that success will be measured by improvements in engagement, match quality, and member satisfaction rather than short-term paying user counts.
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Eric Sheridan (Goldman Sachs) asked about Bumble’s approach to integrating AI across the business. Wolfe Herd detailed AI’s role in profile verification, member coaching, matchmaking, and organizational efficiency, stating, “AI is going to be an accelerator for us here.”
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Nathan Feather (Morgan Stanley) questioned what caused Bumble’s product to drift from its high-quality roots and how AI might help. Wolfe Herd attributed it to an overemphasis on growth via new features and user acquisition, and said the focus is now on curated, personalized matches.
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John Blackledge (TD Cowen) sought clarity on international opportunities and user behavior differences. Wolfe Herd noted that user needs are universal across markets, and international expansion will resume after foundational problems are addressed.
Catalysts in Upcoming Quarters
In future quarters, the StockStory team will be closely watching (1) the effectiveness of AI-powered personalization and verification tools in driving higher engagement and match success, (2) the impact of ongoing cost reductions and operational efficiency efforts on margins, and (3) early indicators of organic growth through improved word-of-mouth and user satisfaction. Execution on new product launches and leadership transitions will also be key markers of progress.
Bumble currently trades at $6.46, up from $4.39 just before the earnings. In the wake of this quarter, is it a buy or sell? The answer lies in our full research report (it’s free).
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