Q4 2020 Match Group Inc Earnings Call
[music].
Good morning, and welcome to the match group fourth quarter 2020 earnings Conference call.
All participants will be in a listen only mode.
Should you need assistance. Please signal a conference specialist by pressing the star key followed by zero on your telephone keypad.
After todays presentation, there will be and opportunity to ask questions.
You ask a question you May press Star then one on your telephone keypad to withdraw your question. Please press Star then two I would now like to turn the conference over to Lance Barton Senior Vice President of corporate development and Investor Relations. Please go ahead.
Thank you operator, and good morning, everyone.
Today's call will be led by CEO, Shar do Bay, and our CFO and COO, Gary Swindler. They will make a few brief remarks, and then well open it up for questions before we begin I need to remind everyone that during this call. We may discuss our outlook and future performance. These forward looking statements may be preceded by words, such as we expect.
We believe we anticipate or similar statements. These statements are subject to risks and uncertainties and our actual results could differ materially from the views expressed today.
Some of these risks have been set forth and our earnings release and our periodic reports filed with the SEC with that I'd like to turn the call over to shop.
Thank you Lance.
Good morning, and thank you all for joining the call today.
Since this is the first one of the year I'm going to start out with sharing some of my thoughts and then Gary as you know adds a little more color to the financials.
The 'twenty and 'twenty with some year and even though it feels like we're still dealing with some of the hangover all of them.
And all I feel grateful for how we navigated the your both of the organization and as a business.
It is remarkable and despite COVID-19 and locked down and having put a real day important to dating and meeting and socializing.
We were still able to meet our goal of mid to high teens growth, we set out at the beginning of the year.
Needless to say without Covid, it would have been and even better year.
The thing I wanted to point out is the strength of our portfolio strategy as well as our ability to pull different levers quickly, which is what allowed us to manage through different levels of volatility we saw throughout the year.
And as you're probably aware of Covid has had a resurgence and the second half of Q4 and seven of large markets. Our U K being an example, where four of our largest brands have of meaningful presence are seeing and outsized drag still.
But despite all of that every one of our key brands grew revenue again in Q4.
And you know at the beginning of Covid back in March April.
I don't think I could've predicted exiting the year with a 19% revenue growth and more importantly, fueled by all of our major brands.
Investors should also take comfort in the institutional strength of the company.
In addition to having delivered on business goals consistently these last five years of being a public company and a.
And you're like 'twenty and 'twenty with all of our global employees working remotely.
We were also able to seamlessly navigate leadership changes and even a full separation to become an independent company.
So as I look ahead.
One thing I do see that 'twenty and 'twenty has done in particular is a real step change and user behavior.
Not the least of which was how much of our lives and activity has moved on line.
And while I do think as the world gets back to normal some of this online offline behavior will rebalance the parts of this online shift is definitely here of just stay.
And this of course has implications to our product both in terms of how we evolve the experiences on our apps as well as looking at new use cases, we all sort of to help people connect.
And we think this is going to be of big area for us this year.
And again, what we said similar levels of gold for ourselves at the beginning of the year.
It is important to keep in mind that the pandemic of still disrupting our lives and activities and we continue to see volatility, which makes predicting this you're a particularly challenging.
For instance, you know and many of our western markets. We generally see a positive seasonality post Christmas and into the New York I always like to say single people going home for the holidays and getting nabbed by their family is what causes this post Christmas Spike.
This year, however, as you can imagine it was less pronounced.
That said.
As in Q4, we're still expecting to see all of our major brands grow revenue again in Q1.
And as we saw last summer and and and countries that and.
Emerged from periods of Lockdowns and I do expect that adds a vaccines rollout and things look better on the pandemic front, we won't see more people pick up there of dating activities and turn to our apps.
One of the areas I wanted to talk about is an area of incremental.
It'll investment and focus we're planning to make this year, which we called out and I'll, let or it's in our trust and safety efforts.
This has been an existential area from a category since the very beginning.
And here's how I think about it.
And the real world.
We've developed laws and enforcement tools and acceptable codes of behaviour and who's over hundreds of years.
The digital World by contrast is barely a couple of decades old and its popularity of you really has only increased and the last decade.
So it is going to take leadership from tech companies regulators law enforcement and the community at large to work through the acceptable rules of North of this digital world and so we're planning to increase investments and our own platforms, but more importantly, you will see us making.
Increased effort in broader initiatives like partnerships with third party organizations technologies non-profits, you're going to see us have increased collaboration with our law enforcement and regulators around the world in order to be and continue to be of leading voice on trust and safety and the digital world.
All and all I feel good about our product and our portfolio strategy that gives us multiple levers of growth.
The value proposition of our products remain strong and I am hopeful that the vaccine rollouts are months away.
And we will be looking at more normal fee of later this year.
And just as I am personally looking forward to getting on a plane and visiting with our teams again.
No our users will be out there of dating and meeting with the renewed perspective of what connections and relationships mean to them.
And with that I'm going to hand, it over to Gary.
Yeah.
Thanks Shar.
Q4 saw our fastest top line growth of the year, 19% year over year of one point acceleration from Q3 levels.
Tinder grew direct revenue, 13% and the non tinder businesses continued to accelerate with direct revenue up 28% year over year.
All major non tinder brands contributed year over year direct revenue growth in Q4.
This was the third consecutive quarter of non tinder brands showing growth in aggregate.
Pairs as well as our newer brands and <unk> BLK and plenty of fish live streaming all grew rapidly and the quarter.
We believe Q4 results would have been even better had COVID-19 lockdowns not since so many people back inside their homes and colder weather limited people's activities in many parts of the globe.
The growth in Q4 was very balanced by geography, with each of North America, and international contributing 19% year over year direct revenue growth.
Indirect revenue grew 35% year over year as many marketers look to deploy unspent budget in Q4.
Average subscribers increased $1 1 million over the prior year to $10 9 million, representing 12% year over year growth up, 9% and North America and 14% internationally.
Year over year, Tinder average subscribers were up over 800000, or 14% and non tinder brands were up over 300000 or 8%.
Recall that Q4 tends to be our weakest quarter seasonally for subscriber growth.
Virtually all of the sequential subscriber growth and Q4 came from Tinder.
Subscriber growth, particularly at Tinder and broad global business was impacted by Covid related effects and a number of key markets, including India, Brazil, and Western Europe, particularly the UK.
Total company <unk> was up 5% year over year to 62 up 7% and North America, and and 4% internationally.
Tinder ARPA was down slightly year over year due to a softness and the Ala Carte revenue as Covid lockdowns increased and of deliberately slower than expected rollout of tinder platinum, which we decided to only make available to existing tinder subscribers in Q4.
Non tinder brands and 16% year over year <unk> growth was remarkable.
And all major non tinder brands increased <unk> per year over year in Q4 per.
Pricing optimization of hinge you don't take Cupid the launch of Ala Carte features at hinge and plenty of fish live streaming revenue were major contributors to the ARPA of improvement in the quarter.
Operating income grew 17% and EBITDA grew 13% year over year and Q4.
EBITDA margins were 38% one eight points lower than in Q4, 19, primarily because of higher cost of revenue and sales and marketing spend.
Sales and marketing spend was up $34 million or 34% year over year as we tried to take advantage of new channels, and Japan and spent into the well received match meat and Hell campaign.
Marketing spend represented 21% of total revenue in Q4 in line with Q3 levels, but up three points from the year ago period.
Cost of revenue was impacted by higher Rfps web hosting cost and fees related to live streaming video and plenty of fish.
For the full year, we achieved nearly $2 4 billion of total revenue up 17% and almost $900 million of EBITDA up 15%.
Despite all of the challenges posed by Covid, we delivered on the mid to high teens revenue and EBITDA targets, we set a year ago.
Our gross and net leverage declined to four three times and three five times, respectively down from four eight times and four six times at the time of the separation from IAC.
We are pleased to see net leverage already well below four times, we ended the quarter with $739 million of cash on hand.
Due to timing of certain payments, our EBITDA of free cash flow conversion rate was higher in Q4 than it had been year to date through September as a result, our 2020 full year free cash flow conversion was similar to 2019 levels.
As we discussed in our shareholder letter there is much uncertainty as we begin 2021, we expect Covid will continue to be of headwind for subscriber growth in the first half of 2021, but are hoping for improvement as the vaccine rollout gains steam and.
Factoring this and we believe we can generate $2 75 to $2 $85 billion of total revenue in 2021, representing another year of mid to high teens top line growth.
We anticipate strong contributions to growth by both the tinder and non tinder brands.
We expect the combination of low double digit subscriber growth and single digit ARPA growth to drive company direct revenue growth.
Our outlook also assumes indirect revenue is essentially flat year over year.
While we.
Spec tinder subscriber net additions to gradually improve as 2021 progresses. Our Q4 performance is testament to the fact that our growth is no longer dependent on tinder subscriber additions. We now are of business with multiple growth drivers and we expect the combination of these will drive strong growth in the foreseeable future.
<unk>.
We expect 2021 EBITDA to exceed $1 billion with mid to high teens year over year growth driven by the revenue growth and additional spend and product development Trust and safety and somewhat higher legal costs of <unk>.
Legal cost increase includes cost of defend the lawsuit by former Tinder employees, which is scheduled to go to trial late this year.
Incremental product development spend will be focused in three buckets. One continued investment in our emerging brands such as I'll blow of Hawaii and pairs engage the latter two of which are targeted primarily at growth and Asia to adding to our tech and video capabilities as we expand our product use cases.
And three supporting growth of Tinder hinge and our other key brands.
Given the investments we think are appropriate we may not expand margins this year.
Underlying that is an assumption that conditions will create an environment, where our anticipated spend levels, particularly in marketing makes sense and that is far from certain and the current tumultuous climate.
And we intend to continue to be flexible and adjust quickly as we have throughout the past year in the face of the pandemic.
In 2021, we expect to again drive meaningful growth from newer brands, such as <unk>, <unk> and BLK and <unk>.
Which have recently reached or are close to reaching profitability.
As these brands continue to improve their margins overall company margins will benefit as well we continue to expect to gradually increased company margins and subsequent years to reach our long term target of 40%.
We expect 2021 capital expenditures of approximately $80 million as we build out new office space, and New York and L. A.
We expect free cash flow conversion levels in 2021 to be similar to those of the prior two years, we do not expect to be of full U S. Federal cash taxpayer until 2023.
We expect stock based compensation for full year 2021 to be approximately $100 million and depreciation and amortization to total approximately $45 million.
For Q1, we expect total revenue of 645% to $655 million, which would represent 18% to 20% year over year growth.
And Q1, we expect continued 20 plus percent year over year revenue growth levels at the non tinder brands and slightly stronger year over year growth at tinder than we saw and Q4.
We expect EBITDA of $210 million to $215 million and Q1, which reflects margins that are consistent with our typical Q1 levels.
Our ranges for Q1 and full year 2021 factor in anticipated impacts from Google's, new requirement to use their in App billing system beginning in September.
The outlook does not include potential impact from changes to <unk>, which remains difficult to quantify at this time.
Any relief that might be achieved on app store fees as a result of all of the regulatory actions challenging Apple and Google conduct where changes that the stores themselves may decide to impose.
We are delighted to be able to provide an outlook, which includes mid to high teens revenue and EBITDA growth again for 2021 as we did for 2020 a year ago. We are hopeful that 2021 will gradually provide calmer waters on which we can execute our plan and deliver another solid year performance for our shareholders.
Yeah.
With that I'll ask the operator to open the line for questions.
Thank you we will now begin the question and answer session to ask a question you May Press Star then one on your telephone from pad.
If you are using a speakerphone please pick up your handset before pressing the keys.
If at any time of your question has been and trust and you would like to withdraw. Your question. Please press Star then two at this time, we will pause momentarily to assemble the roster.
Your first question comes from Benjamin Black of Evercore. Please go ahead.
Great. Good morning. Thank you. Thank you for my questions I have two.
Couple of them on Tinder.
And curious if you could dig a little bit more and to the sorts of the revenue growth slowdown and the quarter and and perhaps of how sustainable the drag is likely to be and the first half of 'twenty. One and then secondly on your product roadmap that would be great to hear the latest on that.
And rollout more and more.
More broadly to the non subscribers and.
And how should we think about the impact of other had throughout 2021. Thank you.
Thank you Ben.
So let me maybe first give a broader picture of how the second wave of Covid Xeljanz is playing out and then I'll.
Get into Tinder specific impacts so the second half of the of.
Of Q4 in particular and into the new year as we saw there's been a surge in COVID-19 and lockdowns and reduced mobility and many markets in fact as I mentioned in my remarks of normal peak season looks a little different this year.
U K that'd be called out specifically.
It looks to be one of the worst impacted.
A combination perhaps of both Covid and Brexit there, but there are also less severely impacted markets throughout Europe.
Story here and the U S. As we saw before California, and New York are more impacted than Florida, Arizona, Texas for instance.
Again few markets in Asia, and Latam have been impacted and sort of similar to what we saw earlier and the year.
And the impacts are on Uh huh.
New users as well as propensity to pay, particularly a la carte and it of course varies by market.
So with all of that said broadly tinder.
Specifically, obviously the geographic exposure was greater.
And so if you think about keeping just markets like India, and Brazil alone could create 100000 swing and subs at Tinder and.
And then there is the impact to all of the card, which is a win propensity to pay goes down a little bit of it. That's the first one that gets impacted and it.
It hurts tinder more because it does have a higher portion of its revenue is all of card compared to the other brands.
So with that all said.
That hopefully answers the question of what we.
We saw in Q4, we do and as I mentioned, the new Euro is seeing and and.
Impacts from Covid, but we are optimistic that adds the corridor goes tinder is going to see accelerated growth rates here on.
The based on everything that we saw over summer and what we're seeing in markets like India in particular and more recent weeks as lockdowns ease and mobility increases people do turn to our apps.
On platinum and we've always said its and <unk> play and because it is a higher price product given the current environment, we have chosen to not roll it out of all users and <unk>.
Currently available for current and previous subscribers only and we will evaluate when it makes sense to roll it out to all users what.
And what they use of SAP that we rolled it out to them. It has gone as we expected.
The good news is it has meaningfully improve the efficacy of the bulk of the product in terms of driving messages and matches, which was the intention of this package tier. So we do believe it is a good product and we will be watching to see what the right time to roll it out fully.
Excellent. Thank you so much.
And next question comes from John Blackledge from Cowen. Please go ahead.
Great. Thank you and this is for sure and or Gary.
Non tinder brand performance and as Gary called out we saw further acceleration of non Tinder brands and <unk> can you just discussed and kind of the key drivers of growth and the quarter and then what kind of thoughts unexpected contribution of non tinder brands and 2021 and longer term would be super helpful. Thank you.
Sure.
And I can take this.
You know, we we laid this out last quarter, our non Tinder performance is driven by three main vectors first of the legacy brands like match me take Oki, Cupid, and North America et cetera, they continue to accelerate through product and marketing work.
And then there are the new brands like hinge cicisbeo be okay.
Which have seen tremendous user and monetization growth.
Pairs has been of great contributor.
It's open to new marketing channels.
Which.
Of which sort of puts it in a really good position from 2021, and then there are new revenue.
And initiatives like pulp line, which became.
Meaningful contributors and day basically you had zero revenue at the beginning of the year.
So we do believe that all of these growth drivers and non tinder brands are sustainable and they will continue to make strong contributions and 'twenty 'twenty one.
And even beyond 2021. These brands are positioned to contribute a meaningful amount of our growth.
As our current drivers get and.
Further supplemented by emerging brands like Hawaii, I'll blow and upward for instance, so all in all we feel very good about a broad set of drivers for growth.
Within our portfolio.
Thank you.
Okay.
The next question comes from Mario Lu Barclays Group.
Oh.
Great. Thanks for taking the question. So you touched upon this in your prepared remarks, but curious to see if there are any new developments to point to.
Regarding the potential gross margin or EBITDA impact from not being able to sidestep Google play payments starting in September.
And just to clarify is the full year guide assuming all Android payments will go through the billing system starting in September.
Yeah.
Sure Let me, let me take that one.
First of all of just to kind of step back a little bit on what's going on with gross margins I would say that in general our cost of revenue.
<unk> is is relatively stable and that's despite a lot of initiatives we have in there for video and other things. So we're seeing relative stability.
On the IHOP side first naturally we are seeing a little bit of and increase from the fact that we are of a number of apps like Haynes cheese and <unk>.
K that are contributing increasing revenue and are growing quickly and those are fully.
Paying the 30% across the board to the App store. So the mix of our brand contributions is having some impact on the overall.
<unk> as a percentage of revenue.
That said when we look at Apple, which is the largest component of our App store fees.
There's not really a flexibility there from Apple and so we'll have to see kind of how that plays out there's a lot of scrutiny as I'm sure you know related to the App stores.
And conduct generally and so we'll see how that plays out on the upfront.
On Google and more specifically.
<unk> announced a change in policy.
And that would go effective in September and that would have a meaningful impact on us if that policy change goes into effect later this year.
We are having productive we have of productive relationship with them and we're having good conversations they understand the financial impact on us of their policy change and so we're hopeful that we'll be able to find a solution that will avoid this added cost for us.
Our ranges for the year contemplate the impact in Q4 from the Google change, so we'd be lower and the range of that played through and there was no solution higher if there is and so we'll see how this all plays out and.
In general there's a lot of moving pieces.
And with regulators around the world and a lot going on related to the App store fees. So this is going to be.
Very important year, and we'll see how this plays out over the coming months of related to all of those discussions and considerations around the app store fees.
Great. Thanks, guys.
Yep.
And next question is from line of.
Morgan Stanley. Please go ahead of them.
Great. Thanks, so much and I guess as we look to him specifically in <unk> and 'twenty. One how are you thinking about balancing further ARPA growth and burst is an acceleration of subscriber growth of our payer penetration rates and sort of any K key kpis of our milestones that you can offer about that business.
Exiting 'twenty and 'twenty.
And then just a follow up on your on your comments and ideas. They obviously had a lot of unknowns, but just any sort of range of scenarios or outcomes that you're contemplating in terms of the rollout of idea of and it would be great. Thanks, so much.
Sure.
Yeah about hinge.
Our first goal of that Hank list of establish a strong subscription product.
And then we have since launch two solid all of the card products.
The rows and stand outs, which is the equivalent of super likes on Tinder and that has already surpassed the take rates relative to super likes on Tinder for instance.
Roses.
And interestingly are not just of revenue product, they're actually of Sally effective.
Engagement product that they're getting two and half times more likely to lead to a con.
Conversation off the platform.
No.
No ALC revenue at hinge is already becoming a meaningful component.
Of revenue and it's important to note at the beginning of 'twenty and 'twenty. It was basically zero and so in 'twenty and 'twenty one there's a flow roadmap to bank both of subscription product, which are and then focus on making the overall product engagement Ah Ah features.
The other thing.
Of course, Mahindra is user of growth and towards that and in addition to the existing markets that we already play and hinges castings and.
Select international markets, but with this broader view of.
Our broader international rollout in 2022 all of it all.
We're very pleased at how hinge has been executing on their plan and all of the confidence and the world that 2021 will be of great to you for that.
An.
I would say so obviously since we're not and AD supported business day.
Impact to us is mostly on the marketing spend and the user acquisition efficiency and.
And so you know there are a lot of puts and takes and it is a little bit unclear. How this all shakes out.
For instance of the targeting becomes weaker it will have an impact on marketing efficiency at the same time, it's unclear to what extent are rates may or may not come down and.
Terms of hot how we measure and our spend and marketing spend attribution framework goes we do have experience in evaluating and brand spend like out of home and TV et cetera. So net net I don't think we know quite how the market will sort of.
I do believe it will eventually sort itself out in the short term what sort of dislocation happens is unclear, particularly.
And in terms of what the impact will be to our marketing spend efficiency. So we're not really currently building it into our outlook yet.
Yeah, well you wanted to add anything.
No I think that's exactly right.
Thank you.
The next question is from Brent Thill with.
Jeffrey Please go ahead of.
Good morning, Gary I'm curious if you could just walk through the second half of.
The year and kind of what you're embedding in your own expectations as many of US are envisioning a return to more normal.
What are you embedding for the second half of the year.
Yeah, I mean, Brent you've watched us for a long time in terms of how we think about outlooks and theres a lot of uncertainty as we come into this year. We're early in the year and so naturally.
And we're trying to be thoughtful about not assuming too much. Good news of the year goes on we're hoping things improve but as we provide ranges and so forth.
And we're trying to be cautious and thoughtful of just because there are so many.
Questions out there so.
Right now when you look at kind of the year for the first quarter, we gave specific expectations, which obviously assumes continued COVID-19 headwinds from.
The second quarter, we're still assuming some COVID-19 headwinds.
And it'll be an easier comp in Q2 over last year, because obviously there was severe impact from COVID-19.
In the second quarter. So that's something we're factoring into our growth thoughts for Q2, when we get to the back half of the year, which obviously still pretty far out.
We have assumed some reduction in the current COVID-19 headwinds, but not a full return to normalcy for the back half of the year and we certainly havent assumed any major resurgence from pent up demand for dating activity in the second half of the year, it's certainly possible that that could happen and I know there.
Who believe that that's what's going to happen, it's just too hard to predict and so in our normal way of providing an outlook, we haven't assumed and abnormal level of dating activity of major.
Burst from pent up demand and the back half of the year. So our plan is to kind of watch this all for a quarter to see how the vaccine rollout to go.
And how mobility starts to improve clearly as mobility improves we see dating activity improve and how the world starts to open up and as the year progresses, if those trends start to be better than we had been expecting we will adjust our outlook, but sitting here today and we felt that this was the right approach in terms of providing the outlook for the year.
But it is something that could get adjusted later, depending on what trends we see.
Thank you.
And next question is from now and Mastercard.
Please go ahead.
Hi, Thanks for taking the question.
Actually that's just just a follow up to that of the last one in terms of that.
The improvement that you're seeing in India with regards to mobility all of us back that up and back to.
Things like engagement and <unk>.
Use the space.
The time that they spend on the platform bid activity levels.
And.
And more specifically with regards to how one can kind of take that learning from India that experience from India into other markets as they kind of open up.
And the rest of 2021.
Okay.
I think share is trying to speak but I can't hear her so I can oh there you go.
And Gary.
Hey come out of sorry.
I was on mute I didn't realize.
You know I, while I don't want it.
Extrapolate too much India has been one of the hardest hit countries, we mentioned that before.
And in more recent weeks, Inc. We have seen a real downturn and cases and as people have been coming back to normal we've actually seen a fairly significant rebound.
And I'm now.
You know it was still even though it's gotten better in recent weeks.
It was a material impact on some additions in Q4, because the first half of Q4 was still fairly impacted.
As much of I don't want to extrapolate, but India specific.
The story I do we are seeing a correlation between increased mobility and increased activity and.
On our platforms as markets ease out of Lockdowns, and we've seen that hap and throughout summer and a number of other of markets that have that go through long periods of Lockdown and then aesop.
And India again, and put all of the other thing.
To note about it is we did pull back a lot of marketing spend there and we saw the real.
A significant impact last year.
But things are looking much better there and we're going back in and it will become an area of a refocus for growth and 2020 line for us.
Thank you somewhat true.
The next question is from Nick Jones of Citi. Please go ahead.
Great. Thanks, I think I suppose play for you Shar.
And the shareholder letter you talked about and other call you talked about investing and kind of emerging markets do improve the stigma of through improving kind of trust and safety and you maybe unpack that a little bit.
What are these investments and what kind of kind of impact can.
And we expect from these investments you know how I guess, how material can be of the vessels to be improving the stigma and.
That show up and.
And international growth.
Near term or just more of longer term. Thanks.
Yeah, and so in addition to everything I said earlier about you know the <unk>.
And sort of trust and safety and the digital World broadly, we have firsthand and seen the effects of this on our category as we develop this category over the last 15 years right.
And we know for applied that it has.
And impact on category perception and penetration and.
We've done a lot of work in this area, particularly in the western market more.
More recently, you know Japan of of that.
A good example of a market where we've been very active on this front from initiatives that'll be done on our platforms with features like notifications are enhanced community and customer care processes.
And we've worked with local regulators and authorities we've done.
A lot of education, and outreach to marketing and PR and all of this work.
As you and a very directly and Japan actually allowed us to open up new marketing channels for instance out of home some of those digital channels of our hoping we can unlock television advertising soon there as well and so those are very sort of short term definitive things, we can point to them but.
Overall the perception.
Changes are meaningful and the long term for a lot of these higher stigma market.
And we're starting to do similar work in India.
Which is why I do think.
You know, we will continue to focus on moderation and safety features boat internally on all platforms.
But one of the things we're going to amplify this year is engaging more with our outreach with other organisations toward party technologies and <unk>.
Partnerships with non profits and working with regulators and engaging law enforcement.
I think it's important I'm personally committed to this and there is a lot of a lot of our work and leadership, we can provide in this area and more generally for our digital platforms.
Great.
Oh of course, who moved from Macquarie Park, and more I'm thinking more of than people home.
Thanks, I had two questions on Asia and you touched on this a bit just now around trust and safety, but could you talk about some of your of key initiatives and brands.
More broadly and the agent and Asian region this year and.
And then secondly, you mentioned in Japan, and your second largest market today, and so we still think about Asia being 25% of revenue longer term I mean, the region or based on your early progress could it potentially and not being a much bigger part of the business.
Thanks.
Yeah, I'll take at least part of that.
Look in terms of kind of Asia and percentage of revenue of 25% does remain our kind of medium term target.
We didn't make as much progress on that and 2020 as we would've liked.
Of Covid, we're probably in that 17, and 18% range, but Asia is still very strategically important to us we think there's real opportunity. There. We've got a lot of different ways of attacking of product wise and we.
We think we ultimately will get there and perhaps surpass it but I think the intermediate term goal is to kind of get to the 25%. We had said that would be and 2023 I think maybe we've got and one year delayed from Covid and we'll see how things kind of play out.
When you look at it I think Asia being such a big market and you've got to take it.
And pieces and so as we did say, Japan is going extremely well for us we've got a great team there on the ground of great. One two punch with Tinder and pairs and we think there's much more opportunity we've got a matrimony product as well, which we think makes a lot of sense and that market and we think theres more opportunity in Japan to work.
Multiple brands, so that's a major focus for us.
India also continues to be a big focus for us it's a bit of of longer term play. We've got tinder, there, which has been very successful as well as okcupid Okcupid has gotten good traction, but with all of the Covid cases, and that market and 2020, we really didn't push as hard.
But we are pushing hard again at the start of 2021 with our Okcupid business.
And India, and we remain optimistic that we have some good products to work and the India market and then you've got other markets like South Korea, that's a market, we havent quite cracked with of product yet we think there's real opportunity there and we have to keep trying to find something.
Of that work so there's a number its a multi product strategy pairs tinder okcupid, the matrimony product pairs engage across the Asian continent, and then we've got Hawaii.
Which we're still working on the product and feel very good about.
That could be of real player in Asia over time, especially in countries, where theres a large Muslim populations like Indonesia, We think Hawaii gained significant share there so again a bit of of longer term play.
Something that we are actively focused on and.
And working on and then we talked last year about tinder rolling out and our currency to focus on the Asia market and which we think is important to the Asian market and the way Asian users.
Pay and use the products, we didn't roll that out in 2020, mostly because of Covid.
We are planning to resume that initiative for 2021 and expect to rollout in a currency at first and a couple of Asian markets and kind of go from there. So again something that got delayed because of COVID-19, but we are planning to bring that back in 2021, and so a lot going on and Asia remains a big focus for us our goals remain of.
Same and.
And we're hoping to make more progress as we have turned the corner here into 2021.
Thanks very helpful.
And the last question today comes from Jason and I'll sign of Oppenheimer. Please go ahead.
Thanks.
And maybe can you comment about the success of.
Although.
And that you mentioned and the letter and your focus on non dating applications as you think out and how you're thinking about the monetization of these products and could we see development of AD platform to support these apps.
Sure.
Okay.
You know so as more of our lives are moving online yeah, the opportunities for them in real life connections are decreasing and Meanwhile, loneliness is on the rise around the world and.
And there's been some interesting lessons we've learned.
Boat from all blow, which was designed with the pieces that.
And during these.
Times and this shift is going on there are benefits to having deeper connections and conversations and communities with people on line.
And you know Theres a feature on all blow called around the world, which allows people to connect on themes like food and culture of local culture and travel and allows them share of their parts of the world with each other and we're seeing people use that.
Contacts to connect and chat and video chat one on one and half sort of deeper conversations with people around the world and.
And sometimes these are Microsoft and relationships.
The other big lesson for US was on a path lives.
Yeah, there's a few interesting anecdotes and stories, but sort of illustrate what it is that we're trying to.
Do here there was and there was a very recently one of the.
And one of the user was on par fly with.
It was a homeless man who.
Started building of community and.
And his entire he's trying to turn of life around with the power of the message of positivity and he's built a real community around it and he talks to people about positive thoughts and.
He's made 100 K on pulse lives and it's turned his life around one of the other are sort of top streamers. There is and ex VAT, who was suffering from D. P. T. S. D, who has managed to turn that around and engage and build a network and of <unk>.
Unity on pulse line and he you know attribute said to having saved lives and so this is the type of sort of human connection and that we're trying to enable which is in the context of our mission, which is of helping people make meaningful connections. So.
And this is what's informing our beliefs that our you.
You know social discovery is going to which is already by the way.
<unk> and other parts of the world, but we think this is going to become a more.
More and more popular broadly and hence we're looking into this space for expansion.
They are in terms of monetization, we do believe this and sort of a platform lends itself well to virtual currencies and consumables people gifting one another and.
Etcetera, and those are sort of the initial things we're testing out on.
I'll blow and of course pulse line has a fairly well.
Well established a monetization by way of gifting as we know and so you know of well it's still early days and we're going to try a bunch of different things, we do obviously per floor direct to consumer revenue.
And as opposed to I based models and so that's going to be of course, and Ah Ah part of the work that we're going to do all of the coming year.
Thank you alright, and with that and.
Thank you all again for supporting us and being on the call today.
And my real hope is.
Vaccines come soon we're out of this pandemic fraught and and how soon and thank you again.
This concludes and match group conference call. Thank you for attending today's presentation you may now disconnect.