Bumble (NASDAQ:BMBL), which owns the popular dating platform of the same name, just disclosed that it will dismiss roughly 350 employees. According to the firm, roughly 30% of its workers will be affected by the Bumble layoffs.
Importantly, Bumble also reported weaker-than-expected fourth-quarter results with the news. The company also provided guidance that came in below analysts’ average estimates. Now, BMBL stock is sinking by more than 8%.
The Bumble Layoffs and Q4 Results
Bumble decided to carry out the job cuts in order to “better align its operating model with future strategic priorities and to drive stronger operating leverage.” As a result of the layoffs, the firm will pay one-time charges of between $20 million and $25 million. Most of the charges will be recognized in the first half of 2024.
Speaking on an earnings call last night, CEO Lidiane Jones indicated that Bumble decided to downsize to enable itself to meet its goals more “quickly.” Jones joined the company as CEO back in January. “We’ve really focused all of our transformation decisions based on speed and agility,” the executive noted.
For Q4, Bumble reported revenue growth of 13.2% year-over-year (YOY) to $273.6 million. However, analysts had expected the firm’s top line to come in closer to $275.3 million, per Seeking Alpha. Bumble also reported an EPS loss of 19 cents, well below estimates for a profit of 12 cents per share.
On the guidance front, the company expects revenue for the current quarter to come in between $262 million and $268 million. That’s below estimates for $277.5 million.
Jones noted on the earnings call that Bumble has been negatively impacted by macro issues and “company-specific execution challenges”
The Price Action of BMBL Stock
As of this writing, BMBL stock is down more than 15% for the past one month and roughly 25% for the past six months. For the past 12 months, shares are down by about 50%.
On the date of publication, Larry Ramer did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
