After a highly successful IPO, shares of Bumble Inc (BMBL -0.09%) have fallen 24% from their highs. Like many technology companies, Bumble benefited from the pandemic-driven stay-at-home economy, as online dating became one of the only mediums to meet a match. Yet despite the seemingly perfect environment for its business, the company still struggled to generate positive earnings. As vaccinations rise and the pandemic subsides, investors may be wondering if this is as good as it gets. 

A hand holding a mobile device with the other hand operating it. Red lovehearts are espousing from the phone surface

Image Source: Getty Images

A tale of two apps

Bumble Inc is mainly known for its flagship platform, the Bumble dating app, which is famous for shaking up the industry by empowering women. When two people "match," the woman holds the cards — she must initiate the first interaction while her male counterpart waits and wonders. This was a revolutionary concept, and in developed markets like the US, the app is considered second only to Tinder. 

The company also owns Badoo, which is more conceptually plain, without Bumble's signature women-first feature. While it is focused on dating, it's also popular as a truly social network, connecting users who would like to make friends.


Calendar Year 2020 Revenue (millions)

Share of Bumble Inc.'s Total Revenue

Geographical Footprint

Bumble App



US, Canada, parts of Asia




Latin America, Europe

Data source: Company filings

Of the two, the Bumble app has fewer paying subscribers, but charges twice as much per paying user, and therefore generates the lion's share of the revenue. 

The overall company posted an impressive 32% growth in paying subscribers in 2020, with Bumble growing faster than Badoo. Since Bumble is the more expensive service, this trend works well for the company. 


CY19 Paying Subscribers

CY20 Paying Subscribers

CY19 Revenue Per Subscriber

CY20 Revenue Per Subscriber

Bumble App













$19.99 (average)

$20.02 (average)

Data source: Company filings

Trouble in paradise

The company faces a drag on its business from Badoo, whose revenue per paying subscriber fell 9.8% in 2020. That's difficult to stomach given the seemingly perfect stay-at-home social environment  for online dating. The same metric for the Bumble app did offset this slightly, growing 2.9%, but overall total revenue per paying subscriber was basically flat. Badoo did add close to 300,000 new subscribers though, so it's carrying its weight from a revenue perspective. 

Despite a huge year, Bumble Inc suffered an overall net loss of $142.8 million, which was in stark contrast to the $85 million profit in 2019. The swing owes to a significant 74% ($292 million) increase in operating expenses, which grew much faster than the 19% increase in revenue.

Granted, some of the additional expenses may not recur in 2021. For example, the company recognized an $85 million increase in depreciation and amortization expenses, plus a $156 million increase in general and administrative costs, both partly attributable to an acquisition the company made in early 2020. Even with both of these costs removed entirely (which isn't realistic), Bumble Inc would have earned only slightly more than it did in 2019. At yesterday's closing stock price, this would mean an earnings multiple of almost 70-times -- though keep in mind, this is a hypothetical assumption on cost reduction that may not happen in 2021. 

70-times earnings would be a comparable multiple to the company's closest competitor, and parent of Tinder, Match Group (MTCH -0.36%). However, this company holds multiple dating assets generating over $2.4 billion in yearly revenue, with a consistent track record of positive earnings. It's worth noting, however, that 2020 earnings growth at Match was a not-so-impressive 2.8%. This could signal a broader industry issue when it comes to growing profitability. 

The question now is whether Bumble (and the industry more broadly) can grow revenues in line with 2020, given widespread vaccinations and more people out in the freshly opened economy. If not, the company could face stagnant to possibly negative share price performance as the market reigns in its multiple.