mtch-20210630

As filed with the Securities and Exchange Commission on August 5, 2021

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


☑	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended		June 30, 2021
Or
☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from__________to__________

Commission File No. 001-34148

Match Group, Inc.

(Exact name of registrant as specified in its charter)


Delaware						59-2712887
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

8750 North Central Expressway, Suite 1400, Dallas, Texas 75231

(Address of registrant’s principal executive offices)

(214) 576-9352

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol

Name of exchange on which registered

Common Stock, par value $0.001

MTCH

The Nasdaq Stock Market LLC

(Nasdaq Global Select Market)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☑

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

As of July 30, 2021, there were 276,810,727 shares of common stock outstanding.

TABLE OF CONTENTS


		Page Number

PART I
Item 1.	Consolidated Financial Statements	3
	Consolidated Balance Sheet	3
	Consolidated Statement of Operations	4
	Consolidated Statement of Comprehensive Operations	5
	Consolidated Statement of Shareholders’ Equity	6
	Consolidated Statement of Cash Flows	10
	Note 1—The Company and Summary of Significant Accounting Policies	11

	Note 2 —Income Taxes	14
	Note 3—Discontinued Operations	15
	Note 4—Goodwill	15
	Note 5—Financial Instruments	16
	Note 6—Long-term Debt, net	18
	Note 7—Accumulated Other Comprehensive Loss	23
	Note 8—Earnings per Share	24
	Note 9—Consolidated Financial Statement Details	26
	Note 10—Contingencies	26
	Note 11—Related Party Transactions	28
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	30
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	44
Item 4.	Controls and Procedures	44
PART II
Item 1.	Legal Proceedings	45
Item 1A.	Risk Factors	47
Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	48
Item 6.	Exhibits	49
	Signatures	50

Table of Contents

PART I

FINANCIAL INFORMATION

Item 1. Consolidated Financial Statements

MATCH GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEET (Unaudited)


	June 30, 2021		December 31, 2020

	(In thousands, except share data)
ASSETS
Cash and cash equivalents	$	236,460	$	739,164
Short-term investments	12,453		—
Accounts receivable, net of allowance of $307 and $286, respectively	259,325		137,023

Other current assets	126,238		144,025

Total current assets	634,476		1,020,212

Property and equipment, net of accumulated depreciation and amortization of $182,592 and $169,321, respectively	129,916		107,799
Goodwill	2,973,121		1,270,532
Intangible assets, net of accumulated amortization of $15,795 and $15,551, respectively	227,045		230,900
Deferred income taxes	314,029		293,487

Other non-current assets	155,346		123,524

TOTAL ASSETS	$	4,433,933	$	3,046,454
LIABILITIES AND SHAREHOLDERS’ EQUITY
LIABILITIES

Accounts payable	$	57,937	$	29,200
Deferred revenue	262,968		239,088

Accrued expenses and other current liabilities	257,062		231,748

Total current liabilities	577,967		500,036
Long-term debt, net	3,845,555		3,840,930
Income taxes payable	13,061		14,582
Deferred income taxes	16,415		17,213

Other long-term liabilities	114,783		86,428

Redeemable noncontrolling interests	1,240		640
Commitments and contingencies
SHAREHOLDERS’ EQUITY
Common stock; $0.001 par value; authorized 1,600,000,000 shares; 276,652,519 and 267,329,284 shares issued and outstanding at June 30, 2021 and December 31, 2020, respectively	277		267




Additional paid-in capital	8,068,659		7,089,007
Retained deficit	(8,107,092)		(8,422,237)
Accumulated other comprehensive loss	(104,089)		(81,454)

Total Match Group, Inc. shareholders’ equity	(142,245)		(1,414,417)
Noncontrolling interests	7,157		1,042
Total shareholders’ equity	(135,088)		(1,413,375)
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	4,433,933	$	3,046,454

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

Table of Contents

MATCH GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited)


	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020

	(In thousands, except per share data)
Revenue	$	707,760	$	555,450	$	1,375,372	$	1,100,092
Operating costs and expenses:
Cost of revenue (exclusive of depreciation shown separately below)	193,099		148,853		372,554		292,747
Selling and marketing expense	128,918		90,801		273,906		215,291
General and administrative expense	113,393		68,204		201,058		147,523
Product development expense	52,133		41,929		107,709		85,699
Depreciation	10,061		9,669		20,518		19,063
Amortization of intangibles	242		400		455		6,803
Total operating costs and expenses	497,846		359,856		976,200		767,126
Operating income	209,914		195,594		399,172		332,966
Interest expense	(32,219)		(34,751)		(64,057)		(66,645)
Other (expense) income, net	(355)		17,410		(1,674)		21,264
Earnings from continuing operations, before tax	177,340		178,253		333,441		287,585
Income tax (provision) benefit	(37,320)		(36,856)		(19,573)		11,346
Net earnings from continuing operations	140,020		141,397		313,868		298,931



Earnings (loss) from discontinued operations, net of tax	509		(34,611)		509		(366,578)
Net earnings (loss)	140,529		106,786		314,377		(67,647)
Net loss (earnings) attributable to noncontrolling interests	366		(31,869)		768		(60,266)
Net earnings (loss) attributable to Match Group, Inc. shareholders	$	140,895	$	74,917	$	315,145	$	(127,913)

Net earnings per share from continuing operations:
Basic	$	0.52	$	0.61	$	1.17	$	1.30
Diluted	$	0.46	$	0.54	$	1.04	$	1.15
Net earnings (loss) per share attributable to Match Group, Inc. shareholders:
Basic	$	0.52	$	0.41	$	1.17	$	(0.70)
Diluted	$	0.46	$	0.36	$	1.04	$	(0.63)

Stock-based compensation expense by function:
Cost of revenue	$	1,012	$	969	$	2,001	$	2,136
Selling and marketing expense	3,087		1,295		4,352		2,442
General and administrative expense	27,580		10,634		46,060		21,515
Product development expense	10,717		9,242		20,099		17,219
Total stock-based compensation expense	$	42,396	$	22,140	$	72,512	$	43,312

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

Table of Contents

MATCH GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF COMPREHENSIVE OPERATIONS (Unaudited)


	Three Months Ended June 30,				Six Months Ended June 30,
	2021		2020		2021		2020

	(In thousands)
Net earnings (loss)	$	140,529	$	106,786	$	314,377	$	(67,647)
Other comprehensive (loss) income, net of tax
Change in foreign currency translation adjustment	(2,136)		22,633		(22,745)		(3,460)
Change in unrealized losses on available-for-sale securities	—		11		—		(1)
Total other comprehensive (loss) income	(2,136)		22,644		(22,745)		(3,461)
Comprehensive income (loss)	138,393		129,430		291,632		(71,108)
Components of comprehensive loss (income) attributable to noncontrolling interests:
Net loss (earnings) attributable to noncontrolling interests	366		(31,869)		768		(60,266)
Change in foreign currency translation adjustment attributable to noncontrolling interests	77		(3,677)		110		1,089

Comprehensive loss (income) attributable to noncontrolling interests	443		(35,546)		878		(59,177)
Comprehensive income (loss) attributable to Match Group, Inc. shareholders	$	138,836	$	93,884	$	292,510	$	(130,285)

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

Table of Contents

MATCH GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF SHAREHOLDERS’ EQUITY (Unaudited)

Three Months Ended June 30, 2021


			Match Group Shareholders’ Equity
			Common Stock $0.001 Par Value
	Redeemable Noncontrolling Interests		$		Shares	Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive (Loss) Income		Total Match Group Shareholders’ Equity		Noncontrolling Interests		Total Shareholders’ Equity

			(In thousands)
Balance as of March 31, 2021	$	1,040	$	270	270,082	$	7,135,823	$	(8,247,987)	$	(102,030)	$	(1,213,924)	$	1,017	$	(1,212,907)
Net (loss) earnings for the three months ended June 30, 2021	(525)		—		—	—		140,895		—		140,895		159		141,054
Other comprehensive loss, net of tax	—		—		—	—		—		(2,059)		(2,059)		(77)		(2,136)
Stock-based compensation expense	—		—		—	44,656		—		—		44,656		—		44,656
Issuance of Match Group common stock pursuant to stock-based awards, net of withholding taxes	—		1		642	6,552		—		—		6,553		—		6,553


Issuance of common stock for the acquisition of Hyperconnect	—		6		5,929	890,845		—		—		890,851		—		890,851



Adjustment of redeemable noncontrolling interests to fair value	725		—		—	(725)		—		—		(725)		—		(725)


Purchase of noncontrolling interest	—		—		—	943		—		—		943		(2,571)		(1,628)

Adjustment of noncontrolling interests to fair value	—		—		—	(1,835)		—		—		(1,835)		1,835		—
Noncontrolling interest created by the exercise of subsidiary denominated equity awards	—		—		—	(7,102)		—		—		(7,102)		7,102		—






Other	—		—		—	(498)		—		—		(498)		(308)		(4,033)
Balance as of June 30, 2021	$	1,240	$	277	276,653	$	8,068,659	$	(8,107,092)	$	(104,089)	$	(142,245)	$	7,157	$	(135,088)

Table of Contents

MATCH GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF SHAREHOLDERS’ EQUITY (Unaudited) (Continued)

Three Months Ended June 30, 2020


			Match Group Shareholders’ Equity
			Common Stock $0.001 Par Value			Former IAC Common Stock $0.001 Par Value			Former IAC Class B Convertible Common Stock $0.001 Par Value
	Redeemable Noncontrolling Interests		$		Shares	$		Shares	$		Shares	Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive Loss		Treasury Stock		Total Match Group Shareholders’ Equity		Noncontrolling Interests		Total Shareholders’ Equity

			(In thousands)
Balance as of March 31, 2020	$	42,431	$	—	—	$	264	263,502	$	16	16,157	$	11,106,503	$	1,522,216	$	(157,285)	$	(10,309,612)	$	2,162,102	$	1,030,414	$	3,192,516
Net (loss) earnings for the three months ended June 30, 2020	(608)		—		—	—		—	—		—	—		74,917		—		—		74,917		32,477		107,394
Other comprehensive (loss) income, net of tax	(785)		—		—	—		—	—		—	—		—		18,967		—		18,967		4,462		23,429
Stock-based compensation expense	—		—		—	—		—	—		—	61,560		—		—		—		61,560		41,777		103,337
Issuance of Former IAC common stock pursuant to stock-based awards, net of withholding taxes	—		—		—	—		181	—		—	(14,002)		—		—		—		(14,002)		—		(14,002)
Issuance of Former Match Group and ANGI Homeservices common stock pursuant to stock-based awards, net of withholding taxes	—		—		—	—		—	—		—	(72,705)		—		225		—		(72,480)		(1,963)		(74,443)





Adjustment of redeemable noncontrolling interests to fair value	2,389		—		—	—		—	—		—	(2,389)		—		—		—		(2,389)		—		(2,389)






Purchase of Former Match Group and ANGI Homeservices treasury stock	—		—		—	—		—	—		—	(67,077)		—		—		—		(67,077)		—		(67,077)
Retirement of treasury stock	—		—		—	(184)		(184,340)	(10)		(10,368)	194		(10,309,612)		—		10,309,612		—		—		—
Exchange Former IAC common stock and Class B common stock for Match Group common stock and completion of the Separation	(43,583)		184		183,749	(80)		(79,343)	(6)		(5,789)	(4,745,520)		—		13,781		—		(4,731,641)		(498,792)		(5,230,433)
Acquire Former Match Group noncontrolling interest	—		58		57,868	—		—	—		—	608,110		—		—		—		608,168		(608,168)		—
Other	—		—		—	—		—	—		—	(132)		—		—		—		(132)		130		(2)
Balance as of June 30, 2020	$	(156)	$	242	241,617	$	—	—	$	—	—	$	6,874,542	$	(8,712,479)	$	(124,312)	$	—	$	(1,962,007)	$	337	$	(1,961,670)

Table of Contents

MATCH GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF SHAREHOLDERS’ EQUITY (Unaudited) (Continued)

Six Months Ended June 30, 2021


			Match Group Shareholders’ Equity
			Common Stock $0.001 Par Value
	Redeemable Noncontrolling Interests		$		Shares	Additional Paid-in Capital		Retained Deficit		Accumulated Other Comprehensive (Loss) Income		Total Match Group Shareholders’ Equity		Noncontrolling Interests		Total Shareholders’ Equity

			(In thousands)
Balance as of December 31, 2020	$	640	$	267	267,329	$	7,089,007	$	(8,422,237)	$	(81,454)	$	(1,414,417)	$	1,042	$	(1,413,375)
Net (loss) earnings for the six months ended June 30, 2021	(935)		—		—	—		315,145		—		315,145		167		315,312
Other comprehensive loss, net of tax	—		—		—	—		—		(22,635)		(22,635)		(110)		(22,745)
Stock-based compensation expense	—		—		—	76,087		—		—		76,087		—		76,087
Issuance of Match Group common stock pursuant to stock-based awards, net of withholding taxes	—		4		3,395	25,974		—		—		25,978		—		25,978


Issuance of common stock for the acquisition of Hyperconnect	—		6		5,929	890,845		—		—		890,851		—		890,851



Adjustment of redeemable noncontrolling interests to fair value	1,535		—		—	(1,535)		—		—		(1,535)		—		(1,535)


Purchase of noncontrolling interest	—					943		—		—		943		(2,571)		(1,628)

Adjustment of noncontrolling interests to fair value	—		—		—	(1,835)		—		—		(1,835)		1,835		—
Noncontrolling interest created by the exercise of subsidiary denominated equity awards	—		—		—	(7,102)		—		—		(7,102)		7,102		—






Other	—		—		—	(3,725)		—		—		(3,725)		(308)		(4,033)
Balance as of June 30, 2021	$	1,240	$	277	276,653	$	8,068,659	$	(8,107,092)	$	(104,089)	$	(142,245)	$	7,157	$	(135,088)

Table of Contents

MATCH GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF SHAREHOLDERS’ EQUITY (Unaudited) (Continued)

Six Months Ended June 30, 2020


			Match Group Shareholders’ Equity
			Common Stock $0.001 Par Value			Former IAC Common Stock $0.001 Par Value			Former IAC Class B Convertible Common Stock $0.001 Par Value
	Redeemable Noncontrolling Interests		$		Shares	$		Shares	$		Shares	Additional Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive (Loss) Income		Treasury Stock		Total Match Group Shareholders’ Equity		Noncontrolling Interests		Total Shareholders’ Equity

						(In thousands)
Balance as of December 31, 2019	$	44,527	$	—	—	$	263	263,230	$	16	16,157	$	11,378,160	$	1,725,046	$	(136,349)	$	(10,309,612)	$	2,657,524	$	970,276	$	3,627,800
Net (loss) earnings for the six months ended June 30, 2020	(2,070)		—		—	—		—	—		—	—		(127,913)		—		—		(127,913)		62,336		(65,577)
Other comprehensive loss, net of tax	(686)		—		—	—		—	—		—	—		—		(2,372)		—		(2,372)		(403)		(2,775)
Stock-based compensation expense	15		—		—	—		—	—		—	73,059		—		—		—		73,059		86,363		159,422
Issuance of Former IAC common stock pursuant to stock-based awards, net of withholding taxes	—		—		—	1		453	—		—	(34,518)		—		—		—		(34,517)		—		(34,517)
Issuance of Former Match Group and ANGI Homeservices common stock pursuant to stock-based awards, net of withholding taxes	—		—		—	—		—	—		—	(212,270)		—		628		—		(211,642)		(11,405)		(223,047)



Purchase of redeemable noncontrolling interests	(3,165)		—		—	—		—	—		—	—		—		—		—		—		—		—

Adjustment of redeemable noncontrolling interests to fair value	4,807		—		—	—		—	—		—	(4,807)		—		—		—		(4,807)		—		(4,807)






Purchase of Match Group and ANGI treasury stock	—		—		—	—		—	—		—	(187,735)		—		—		—		(187,735)		—		(187,735)
Retire treasury stock	—		—		—	(184)		(184,340)	(10)		(10,368)	194		(10,309,612)		—		10,309,612		—		—		—
Exchange Former IAC common stock and Class B common stock for Match Group common stock and completion of the Separation	(43,583)		184		183,749	(80)		(79,343)	(6)		(5,789)	(4,745,520)		—		13,781		—		(4,731,641)		(498,792)		(5,230,433)
Acquire Former Match Group noncontrolling interest	—		58		57,868	—		—	—		—	608,110		—		—		—		608,168		(608,168)		—
Other	(1)		—		—	—		—	—		—	(131)		—		—		—		(131)		130		(1)
Balance as of June 30, 2020	$	(156)	$	242	241,617	$	—	—	$	—	—	$