What factors drove GRND's EPS surprises in 2024?

Grindr Inc. (GRND) experienced a negative EPS surprise of $0.78 in 2024, primarily driven by the following factors: 1. **Revenue Growth**: Grindr's revenue reached $344.6 million in 2024, marking a significant year-over-year growth of 32.7%. This growth was fueled by increases in both direct and indirect revenue streams. The company's direct revenue, which includes subscription and premium add-on revenue, rose to $290.9 million, reflecting a 29.1% increase. Indirect revenue, primarily from advertising, increased by 56.1% to $53.7 million. Advertising revenue grew by 43% year-over-year in Q3 2024, driven by new native ad formats and strong demand from third-party advertising partners. 2. **User Engagement and International Expansion**: Grindr reported a 33% increase in revenue and unveiled a $500 million share repurchase program amid strong user engagement and advertising growth. The company experienced significant user engagement, with over 130 billion chats and more than 70 minutes spent on the app daily. The expansion of its "Right Now" feature to 15 new cities highlights its commitment to enhancing user experience and expanding its global presence. The largest markets for Grindr are North America and Europe, which together contributed 84.7% of total revenue in 2024. Revenue from North America increased by 31.2%, while Europe saw a 34.7% increase. The rest of the world experienced a 35.9% growth in revenue. 3. **Operational Efficiency and Cost Management**: Grindr's operating income reached $92.6 million, reflecting an increase in efficiency and cost management. The company's adjusted EBITDA margin was reported at 43% for 2024, indicating strong operational performance. The company's cost of revenue increased to $87.6 million, mainly due to higher distribution fees paid to mobile app stores and increased infrastructure costs. Selling, general, and administrative expenses rose to $114.7 million, reflecting higher personnel-related expenses and increased marketing costs. Product development expenses increased by 11.9% to $32.8 million, primarily due to higher contractor fees and stock-based compensation expenses. In conclusion, Grindr's EPS surprise was primarily driven by strong revenue growth, user engagement, international expansion, and operational efficiency. These factors collectively contributed to the company's robust financial performance in 2024. |code|Ticker|Name|Date|Estimate EPS|EPS Surprise|market_code| |---|---|---|---|---|---|---| |GRND|GRND.N|Grindr|2024 Q1|0.04|-0.09|169| |GRND|GRND.N|Grindr|2024 Q2|0.05|-0.18|169| |GRND|GRND.N|Grindr|2024 Q3|0.07|0.02|169| |GRND|GRND.N|Grindr|2024 Q4|0.09|-0.78|169|