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|
|
ý
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
For the Quarterly Period Ended June 30, 2017
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|
Or
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|
o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the transition period from__________to__________
|
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Delaware
(State or other jurisdiction of
incorporation or organization)
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26-4278917
(I.R.S. Employer
Identification No.)
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8750 North Central Expressway, Suite 1400, Dallas, Texas 75231
(Address of registrant's principal executive offices)
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||
(214) 576-9352
(Registrant's telephone number, including area code)
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Large accelerated filer
o
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Accelerated filer
ý
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Non-accelerated filer
o
(Do not check if a smaller
reporting company)
|
Smaller reporting company
o
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Emerging growth company
o
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Page
Number
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|
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June 30, 2017
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December 31, 2016
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||||
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(In thousands, except share data)
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||||||
ASSETS
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|
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||||
Cash and cash equivalents
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$
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492,705
|
|
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$
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253,651
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Accounts receivable, net of allowance of $898 and $676, respectively
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76,622
|
|
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63,853
|
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||
Assets of a business held for sale
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—
|
|
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133,272
|
|
||
Other current assets
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52,433
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|
|
39,618
|
|
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Total current assets
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621,760
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|
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490,394
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Property and equipment, net of accumulated depreciation and amortization of $84,565 and $70,667, respectively
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64,744
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|
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62,954
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|
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Goodwill
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1,229,911
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|
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1,206,447
|
|
||
Intangible assets, net of accumulated amortization of $10,599 and $9,350, respectively
|
224,517
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|
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217,682
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Long-term investments
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58,148
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|
|
55,355
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Other non-current assets
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15,573
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|
|
15,846
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TOTAL ASSETS
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$
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2,214,653
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$
|
2,048,678
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LIABILITIES AND SHAREHOLDERS' EQUITY
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|
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||||
LIABILITIES
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|
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||||
Accounts payable
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$
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11,337
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|
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$
|
7,357
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Deferred revenue
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173,406
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|
161,124
|
|
||
Liabilities of a business held for sale
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—
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|
|
37,058
|
|
||
Accrued expenses and other current liabilities
|
157,048
|
|
|
108,720
|
|
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Total current liabilities
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341,791
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|
|
314,259
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|
||
Long-term debt
|
1,177,989
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|
1,176,493
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|
||
Income taxes payable
|
8,845
|
|
|
9,126
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|
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Deferred income taxes
|
22,440
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25,339
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|
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Other long-term liabilities
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14,864
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20,877
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Redeemable noncontrolling interests
|
6,381
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6,062
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Commitments and contingencies
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|
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||||
SHAREHOLDERS' EQUITY
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|
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||||
Common stock, $0.001 par value, authorized 1,500,000,000 shares; 50,682,217 and 45,797,402 issued and outstanding at June 30, 2017 and December 31, 2016, respectively
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51
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|
|
46
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Class B convertible common stock; $0.001 par value; authorized 1,500,000,000 shares; 209,919,402 shares issued and outstanding
|
210
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|
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210
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|
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Class C common stock; $0.001 par value; authorized 1,500,000,000 shares; no shares issued and outstanding
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—
|
|
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—
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|
||
Preferred stock; $0.001 par value; authorized 500,000,000 shares; no shares issued and outstanding
|
—
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|
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—
|
|
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Additional paid-in capital
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530,495
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|
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490,587
|
|
||
Retained earnings
|
253,546
|
|
|
182,063
|
|
||
Accumulated other comprehensive loss
|
(141,959
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)
|
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(176,384
|
)
|
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Total Match Group, Inc. shareholders' equity
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642,343
|
|
|
496,522
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TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
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$
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2,214,653
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|
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$
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2,048,678
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Three Months Ended June 30,
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Six Months Ended June 30,
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||||||||||||
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2017
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2016
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2017
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2016
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||||||||
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(In thousands, except per share data)
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||||||||||||||
Revenue
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$
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309,572
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$
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275,309
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$
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608,336
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$
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535,710
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Operating costs and expenses:
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|
|
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||||||||
Cost of revenue (exclusive of depreciation shown separately below)
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62,665
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46,978
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121,513
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|
|
90,746
|
|
||||
Selling and marketing expense
|
87,713
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|
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83,763
|
|
|
194,836
|
|
|
193,267
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|
||||
General and administrative expense
|
43,871
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|
|
35,345
|
|
|
87,781
|
|
|
74,369
|
|
||||
Product development expense
|
24,061
|
|
|
19,653
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|
|
46,081
|
|
|
41,093
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|
||||
Depreciation
|
7,883
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|
|
7,176
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|
|
15,472
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|
|
12,927
|
|
||||
Amortization of intangibles
|
404
|
|
|
4,894
|
|
|
807
|
|
|
11,622
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|
||||
Total operating costs and expenses
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226,597
|
|
|
197,809
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|
|
466,490
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|
|
424,024
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|
||||
Operating income
|
82,975
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|
77,500
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|
|
141,846
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|
|
111,686
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|
||||
Interest expense
|
(19,072
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)
|
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(20,618
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)
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(38,022
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)
|
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(41,022
|
)
|
||||
Other expense, net
|
(9,550
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)
|
|
(5,229
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)
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(15,528
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)
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(1,645
|
)
|
||||
Earnings from continuing operations, before tax
|
54,353
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|
|
51,653
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|
|
88,296
|
|
|
69,019
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|
||||
Income tax provision
|
(2,809
|
)
|
|
(14,884
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)
|
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(12,197
|
)
|
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(21,642
|
)
|
||||
Net earnings from continuing operations
|
51,544
|
|
|
36,769
|
|
|
76,099
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|
|
47,377
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|
||||
Loss from discontinued operations, net of tax
|
(71
|
)
|
|
(2,668
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)
|
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(4,562
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)
|
|
(6,057
|
)
|
||||
Net earnings
|
51,473
|
|
|
34,101
|
|
|
71,537
|
|
|
41,320
|
|
||||
Net earnings attributable to redeemable noncontrolling interests
|
(43
|
)
|
|
(23
|
)
|
|
(54
|
)
|
|
(90
|
)
|
||||
Net earnings attributable to Match Group, Inc. shareholders
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$
|
51,430
|
|
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$
|
34,078
|
|
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$
|
71,483
|
|
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$
|
41,230
|
|
|
|
|
|
|
|
|
|
||||||||
Net earnings per share from continuing operations:
|
|
|
|
|
|
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|
||||||||
Basic
|
$
|
0.20
|
|
|
$
|
0.15
|
|
|
$
|
0.30
|
|
|
$
|
0.19
|
|
Diluted
|
$
|
0.17
|
|
|
$
|
0.14
|
|
|
$
|
0.25
|
|
|
$
|
0.18
|
|
Net earnings per share attributable to Match Group, Inc. shareholders:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
0.20
|
|
|
$
|
0.14
|
|
|
$
|
0.28
|
|
|
$
|
0.17
|
|
Diluted
|
$
|
0.17
|
|
|
$
|
0.13
|
|
|
$
|
0.24
|
|
|
$
|
0.15
|
|
|
|
|
|
|
|
|
|
||||||||
Stock-based compensation expense by function:
|
|
|
|
|
|
|
|
||||||||
Cost of revenue
|
$
|
427
|
|
|
$
|
313
|
|
|
$
|
816
|
|
|
$
|
715
|
|
Selling and marketing expense
|
1,026
|
|
|
772
|
|
|
2,107
|
|
|
1,702
|
|
||||
General and administrative expense
|
10,255
|
|
|
8,609
|
|
|
23,071
|
|
|
18,771
|
|
||||
Product development expense
|
3,946
|
|
|
2,950
|
|
|
7,684
|
|
|
8,904
|
|
||||
Total stock-based compensation expense
|
$
|
15,654
|
|
|
$
|
12,644
|
|
|
$
|
33,678
|
|
|
$
|
30,092
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
(In thousands)
|
||||||||||||||
Net earnings
|
$
|
51,473
|
|
|
$
|
34,101
|
|
|
$
|
71,537
|
|
|
$
|
41,320
|
|
Other comprehensive income (loss), net of tax
|
|
|
|
|
|
|
|
||||||||
Change in foreign currency translation adjustment
(a)
|
15,517
|
|
|
(1,528
|
)
|
|
34,690
|
|
|
5,959
|
|
||||
Change in fair value of available-for-sale securities
(b)
|
—
|
|
|
(2,964
|
)
|
|
—
|
|
|
(2,964
|
)
|
||||
Total other comprehensive income (loss)
|
15,517
|
|
|
(4,492
|
)
|
|
34,690
|
|
|
2,995
|
|
||||
Comprehensive income
|
66,990
|
|
|
29,609
|
|
|
106,227
|
|
|
44,315
|
|
||||
Comprehensive income attributable to redeemable noncontrolling interests
|
(431
|
)
|
|
(25
|
)
|
|
(319
|
)
|
|
(89
|
)
|
||||
Comprehensive income attributable to Match Group, Inc. shareholders
|
$
|
66,559
|
|
|
$
|
29,584
|
|
|
$
|
105,908
|
|
|
$
|
44,226
|
|
(a)
|
The six months ended June 30, 2017 includes amounts reclassified out of other comprehensive income into earnings. See "
Note 6—Accumulated Other Comprehensive Loss
" for additional information.
|
(b)
|
The three and six months ended June 30, 2016 include unrealized gains reclassified out of other comprehensive income into earnings. See "
Note 6—Accumulated Other Comprehensive Loss
" for additional information.
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||
|
|
|
|
Common Stock
$0.001
Par Value
|
|
Class B Convertible Common Stock $0.001
Par Value
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
|
Redeemable
Noncontrolling
Interests
|
|
|
$
|
|
Shares
|
|
$
|
|
Shares
|
|
Additional Paid-in Capital
|
|
Retained Earnings
|
|
Accumulated
Other
Comprehensive
(Loss) Income
|
|
Total
Shareholders'
Equity
|
||||||||||||||||
|
|
|
|
(In thousands)
|
||||||||||||||||||||||||||||||
Balance as of December 31, 2016
|
$
|
6,062
|
|
|
|
$
|
46
|
|
|
45,797
|
|
|
$
|
210
|
|
|
209,919
|
|
|
$
|
490,587
|
|
|
$
|
182,063
|
|
|
$
|
(176,384
|
)
|
|
$
|
496,522
|
|
Net earnings for the six months ended June 30, 2017
|
54
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
71,483
|
|
|
—
|
|
|
71,483
|
|
|||||||
Other comprehensive income, net of tax
|
265
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
34,425
|
|
|
34,425
|
|
|||||||
Stock-based compensation expense
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
25,945
|
|
|
—
|
|
|
—
|
|
|
25,945
|
|
|||||||
Issuance of common stock pursuant to stock-based awards, net of withholding taxes
|
—
|
|
|
|
4
|
|
|
4,356
|
|
|
—
|
|
|
—
|
|
|
13,963
|
|
|
—
|
|
|
—
|
|
|
13,967
|
|
|||||||
Issuance of common stock to IAC pursuant to the employee matters agreement
|
—
|
|
|
|
1
|
|
|
529
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|||||||
Balance as of June 30, 2017
|
$
|
6,381
|
|
|
|
$
|
51
|
|
|
50,682
|
|
|
$
|
210
|
|
|
209,919
|
|
|
$
|
530,495
|
|
|
$
|
253,546
|
|
|
$
|
(141,959
|
)
|
|
$
|
642,343
|
|
|
Six Months Ended June 30,
|
||||||
|
2017
|
|
2016
|
||||
|
(In thousands)
|
||||||
Cash flows from operating activities attributable to continuing operations:
|
|
|
|
||||
Net earnings from continuing operations
|
$
|
76,099
|
|
|
$
|
47,377
|
|
Adjustments to reconcile net earnings from continuing operations to net cash provided by operating activities attributable to continuing operations:
|
|
|
|
||||
Stock-based compensation expense
|
33,678
|
|
|
30,092
|
|
||
Depreciation
|
15,472
|
|
|
12,927
|
|
||
Amortization of intangibles
|
807
|
|
|
11,622
|
|
||
Deferred income taxes
|
(3,850
|
)
|
|
(4,586
|
)
|
||
Acquisition-related contingent consideration fair value adjustments
|
4,338
|
|
|
2,406
|
|
||
Other adjustments, net
|
7,854
|
|
|
4,314
|
|
||
Changes in assets and liabilities
|
|
|
|
||||
Accounts receivable
|
(12,175
|
)
|
|
6,047
|
|
||
Other assets
|
(10,326
|
)
|
|
(12,137
|
)
|
||
Accounts payable and accrued expenses and other current liabilities
|
22,936
|
|
|
(9,941
|
)
|
||
Income taxes payable
|
8,516
|
|
|
14,951
|
|
||
Deferred revenue
|
9,870
|
|
|
17,311
|
|
||
Net cash provided by operating activities attributable to continuing operations
|
153,219
|
|
|
120,383
|
|
||
Cash flows from investing activities attributable to continuing operations:
|
|
|
|
||||
Acquisitions, net of cash acquired
|
—
|
|
|
(456
|
)
|
||
Capital expenditures
|
(14,792
|
)
|
|
(18,957
|
)
|
||
Proceeds from the sale of a business, net
|
96,144
|
|
|
—
|
|
||
Proceeds from sale of a marketable security
|
—
|
|
|
11,716
|
|
||
Purchase of investment
|
(5,076
|
)
|
|
—
|
|
||
Other, net
|
—
|
|
|
4,600
|
|
||
Net cash provided by (used in) investing activities attributable to continuing operations
|
76,276
|
|
|
(3,097
|
)
|
||
Cash flows from financing activities attributable to continuing operations:
|
|
|
|
||||
Proceeds from bond offering
|
—
|
|
|
400,000
|
|
||
Principal payment on Term Loan
|
—
|
|
|
(410,000
|
)
|
||
Debt issuance costs
|
—
|
|
|
(4,621
|
)
|
||
Proceeds from issuance of common stock pursuant to stock-based awards
|
39,403
|
|
|
8,671
|
|
||
Payment of withholding taxes on behalf of employees on net settled stock-based awards
|
(28,421
|
)
|
|
(6,495
|
)
|
||
Purchase of redeemable noncontrolling interests
|
—
|
|
|
(1,011
|
)
|
||
Other, net
|
—
|
|
|
(12,180
|
)
|
||
Net cash provided by (used in) financing activities attributable to continuing operations
|
10,982
|
|
|
(25,636
|
)
|
||
Total cash provided by continuing operations
|
240,477
|
|
|
91,650
|
|
||
Net cash used in operating activities attributable to discontinued operations
|
(6,061
|
)
|
|
(1,309
|
)
|
||
Net cash used in investing activities attributable to discontinued operations
|
(471
|
)
|
|
(2,992
|
)
|
||
Total cash used in discontinued operations
|
(6,532
|
)
|
|
(4,301
|
)
|
||
Effect of exchange rate changes on cash and cash equivalents
|
5,109
|
|
|
(1,529
|
)
|
||
Net increase in cash and cash equivalents
|
239,054
|
|
|
85,820
|
|
||
Cash and cash equivalents at beginning of period
|
253,651
|
|
|
88,173
|
|
||
Cash and cash equivalents at end of period
|
$
|
492,705
|
|
|
$
|
173,993
|
|
|
December 31, 2016
|
||
|
(In thousands)
|
||
Accounts receivable, net
|
$
|
8,677
|
|
Other current assets
|
3,847
|
|
|
Property and equipment, net
|
6,774
|
|
|
Goodwill
|
74,396
|
|
|
Intangible assets, net
|
31,488
|
|
|
Other non-current assets
|
8,090
|
|
|
Total assets of a business held for sale
|
$
|
133,272
|
|
|
|
||
Accounts payable
|
$
|
3,467
|
|
Deferred revenue
|
22,886
|
|
|
Accrued expenses and other current liabilities
|
8,771
|
|
|
Other long-term liabilities
|
1,934
|
|
|
Total liabilities of a business held for sale
|
$
|
37,058
|
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
(In thousands)
|
||||||||||||||
Revenue
|
$
|
—
|
|
|
$
|
25,810
|
|
|
$
|
23,980
|
|
|
$
|
50,692
|
|
Operating costs and expenses
|
—
|
|
|
(29,642
|
)
|
|
(29,601
|
)
|
|
(59,522
|
)
|
||||
Operating loss
|
—
|
|
|
(3,832
|
)
|
|
(5,621
|
)
|
|
(8,830
|
)
|
||||
Other expense
|
(71
|
)
|
|
(41
|
)
|
|
(1,003
|
)
|
|
(45
|
)
|
||||
Income tax benefit
|
—
|
|
|
1,205
|
|
|
2,062
|
|
|
2,818
|
|
||||
Loss from discontinued operations
|
$
|
(71
|
)
|
|
$
|
(2,668
|
)
|
|
$
|
(4,562
|
)
|
|
$
|
(6,057
|
)
|
•
|
Level 1: Observable inputs obtained from independent sources, such as quoted prices for identical assets and liabilities in active markets.
|
•
|
Level 2: Other inputs, which are observable directly or indirectly, such as quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active and inputs that are derived principally from or corroborated by observable market data. The fair values of the Company's Level 2 financial assets are primarily obtained from observable market prices for identical underlying securities that may not be actively traded.
|
•
|
Level 3: Unobservable inputs for which there is little or no market data and require the Company to develop its own assumptions, based on the best information available in the circumstances, about the assumptions market participants would use in pricing the assets or liabilities. See below for a discussion of fair value measurements made using Level 3 inputs.
|
|
June 30, 2017
|
||||||||||||||
|
Quoted Market
Prices in Active Markets for Identical Assets (Level 1) |
|
Significant Other Observable Inputs
(Level 2) |
|
Significant
Unobservable Inputs (Level 3) |
|
Total
Fair Value Measurements |
||||||||
|
(In thousands)
|
||||||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Cash equivalents:
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
$
|
338,836
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
338,836
|
|
Time deposits
|
—
|
|
|
5,596
|
|
|
—
|
|
|
5,596
|
|
||||
Total
|
$
|
338,836
|
|
|
$
|
5,596
|
|
|
$
|
—
|
|
|
$
|
344,432
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Contingent consideration arrangements
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(24,829
|
)
|
|
$
|
(24,829
|
)
|
|
December 31, 2016
|
||||||||||||||
|
Quoted Market
Prices in Active
Markets for
Identical Assets
(Level 1)
|
|
Significant Other Observable Inputs
(Level 2) |
|
Significant
Unobservable
Inputs
(Level 3)
|
|
Total
Fair Value
Measurements
|
||||||||
|
(In thousands)
|
||||||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Cash equivalents:
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
$
|
85,225
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
85,225
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Contingent consideration arrangements
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(19,418
|
)
|
|
$
|
(19,418
|
)
|
|
Three Months Ended June 30,
|
||||||
|
2017
|
|
2016
|
||||
|
Contingent
Consideration
Arrangements
|
||||||
|
(In thousands)
|
||||||
Balance at April 1
|
$
|
(21,821
|
)
|
|
$
|
(32,167
|
)
|
Total net (losses) gains:
|
|
|
|
||||
Fair value adjustments
|
(2,994
|
)
|
|
755
|
|
||
Included in other comprehensive loss
|
(14
|
)
|
|
(3,375
|
)
|
||
Other
|
—
|
|
|
55
|
|
||
Balance at June 30
|
$
|
(24,829
|
)
|
|
$
|
(34,732
|
)
|
|
Six Months Ended June 30,
|
||||||
|
2017
|
|
2016
|
||||
|
Contingent
Consideration
Arrangements
|
||||||
|
(In thousands)
|
||||||
Balance at January 1
|
$
|
(19,418
|
)
|
|
$
|
(28,993
|
)
|
Total net losses:
|
|
|
|
||||
Fair value adjustments
|
(4,338
|
)
|
|
(2,406
|
)
|
||
Included in other comprehensive loss
|
(1,073
|
)
|
|
(5,281
|
)
|
||
Fair value at date of acquisition
|
—
|
|
|
(185
|
)
|
||
Other
|
—
|
|
|
2,133
|
|
||
Balance at June 30
|
$
|
(24,829
|
)
|
|
$
|
(34,732
|
)
|
|
June 30, 2017
|
|
December 31, 2016
|
||||||||||||
|
Carrying Value
|
|
Fair Value
|
|
Carrying Value
|
|
Fair Value
|
||||||||
|
(In thousands)
|
||||||||||||||
Long-term debt
|
$
|
(1,177,989
|
)
|
|
$
|
(1,256,472
|
)
|
|
$
|
(1,176,493
|
)
|
|
$
|
(1,244,641
|
)
|
|
June 30, 2017
|
|
December 31, 2016
|
||||
|
(In thousands)
|
||||||
6.375% Senior Notes due June 1, 2024 (the "2016 Senior Notes"); interest payable each June 1 and December 1, which commenced December 1, 2016
|
$
|
400,000
|
|
|
$
|
400,000
|
|
6.75% Senior Notes due December 15, 2022 (the "2015 Senior Notes"); interest payable each June 15 and December 15, which commenced June 15, 2016
|
445,172
|
|
|
445,172
|
|
||
Term Loan due November 16, 2022
(a)
|
350,000
|
|
|
350,000
|
|
||
Total debt
|
1,195,172
|
|
|
1,195,172
|
|
||
Less: Unamortized original issue discount and original issue premium, net
|
4,801
|
|
|
5,245
|
|
||
Less: Unamortized debt issuance costs
|
12,382
|
|
|
13,434
|
|
||
Total long-term debt
|
$
|
1,177,989
|
|
|
$
|
1,176,493
|
|
(a)
|
The Term Loan matures on November 16, 2022; provided that, if any of the 2015 Senior Notes remain outstanding on the date that is
91 days
prior to the maturity date of the 2015 Senior Notes, the Term Loan maturity date shall be the date that is
91 days
prior to the maturity date of the 2015 Senior Notes.
|
|
Three Months Ended June 30, 2017
|
||||||
|
Foreign Currency Translation Adjustment
|
|
Accumulated Other Comprehensive (Loss) Income
|
||||
|
(In thousands)
|
||||||
Balance at April 1
|
$
|
(157,088
|
)
|
|
$
|
(157,088
|
)
|
Other comprehensive income
|
15,129
|
|
|
15,129
|
|
||
Balance at June 30
|
$
|
(141,959
|
)
|
|
$
|
(141,959
|
)
|
|
Three Months Ended June 30, 2016
|
||||||||||
|
Foreign Currency Translation Adjustment
|
|
Unrealized Gain on Available-For-Sale Security
|
|
Accumulated Other Comprehensive Loss
|
||||||
|
(In thousands)
|
||||||||||
Balance at April 1
|
$
|
(132,294
|
)
|
|
$
|
2,964
|
|
|
$
|
(129,330
|
)
|
Other comprehensive (loss) income before reclassifications
|
(1,530
|
)
|
|
94
|
|
|
(1,436
|
)
|
|||
Gain on sale of available-for-sale security reclassified into earnings
|
—
|
|
|
(3,058
|
)
|
|
(3,058
|
)
|
|||
Net period other comprehensive loss
|
(1,530
|
)
|
|
(2,964
|
)
|
|
(4,494
|
)
|
|||
Balance at June 30
|
$
|
(133,824
|
)
|
|
$
|
—
|
|
|
$
|
(133,824
|
)
|
|
Six Months Ended June 30, 2017
|
||||||
|
Foreign Currency Translation Adjustment
|
|
Accumulated Other Comprehensive (Loss) Income
|
||||
|
(In thousands)
|
||||||
Balance at January 1
|
$
|
(176,384
|
)
|
|
$
|
(176,384
|
)
|
Other comprehensive income
|
33,711
|
|
|
33,711
|
|
||
Amounts reclassified into earnings
|
714
|
|
|
714
|
|
||
Net current period other comprehensive income
|
34,425
|
|
|
34,425
|
|
||
Balance at June 30
|
$
|
(141,959
|
)
|
|
$
|
(141,959
|
)
|
|
Six Months Ended June 30, 2016
|
||||||||||
|
Foreign Currency Translation Adjustment
|
|
Unrealized Gain on Available-For-Sale Security
|
|
Accumulated Other Comprehensive (Loss) Income
|
||||||
|
(In thousands)
|
||||||||||
Balance at January 1
|
$
|
(139,784
|
)
|
|
$
|
2,964
|
|
|
$
|
(136,820
|
)
|
Other comprehensive income before reclassifications
|
5,960
|
|
|
94
|
|
|
6,054
|
|
|||
Gain on sale of available-for-sale security reclassified into earnings
|
—
|
|
|
(3,058
|
)
|
|
(3,058
|
)
|
|||
Net period other comprehensive (loss) income
|
5,960
|
|
|
(2,964
|
)
|
|
2,996
|
|
|||
Balance at June 30
|
$
|
(133,824
|
)
|
|
$
|
—
|
|
|
$
|
(133,824
|
)
|
|
Three Months Ended June 30,
|
||||||||||||||
|
2017
|
|
2016
|
||||||||||||
|
Basic
|
|
Diluted
|
|
Basic
|
|
Diluted
|
||||||||
|
(In thousands, except per share data)
|
||||||||||||||
Numerator
|
|
|
|
|
|
|
|
||||||||
Net earnings from continuing operations
|
$
|
51,544
|
|
|
$
|
51,544
|
|
|
$
|
36,769
|
|
|
$
|
36,769
|
|
Net earnings attributable to redeemable noncontrolling interests
|
(43
|
)
|
|
(43
|
)
|
|
(23
|
)
|
|
(23
|
)
|
||||
Net earnings from continuing operations attributable to Match Group, Inc. shareholders
|
51,501
|
|
|
51,501
|
|
|
36,746
|
|
|
36,746
|
|
||||
Loss from discontinued operations, net of tax
|
(71
|
)
|
|
(71
|
)
|
|
(2,668
|
)
|
|
(2,668
|
)
|
||||
Net earnings attributable to Match Group, Inc. shareholders
|
$
|
51,430
|
|
|
$
|
51,430
|
|
|
$
|
34,078
|
|
|
$
|
34,078
|
|
|
|
|
|
|
|
|
|
||||||||
Denominator
|
|
|
|
|
|
|
|
||||||||
Basic weighted average common shares outstanding
|
258,973
|
|
|
258,973
|
|
|
249,296
|
|
|
249,296
|
|
||||
Dilutive securities including subsidiary denominated equity, stock options and RSU awards
(a)(b)
|
—
|
|
|
47,860
|
|
|
—
|
|
|
18,680
|
|
||||
Dilutive weighted average common shares outstanding
|
258,973
|
|
|
306,833
|
|
|
249,296
|
|
|
267,976
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Earnings (loss) per share:
|
|
|
|
|
|
|
|
||||||||
Earnings per share from continuing operations
|
$
|
0.20
|
|
|
$
|
0.17
|
|
|
$
|
0.15
|
|
|
$
|
0.14
|
|
Loss per share from discontinued operations, net of tax
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(0.01
|
)
|
|
$
|
(0.01
|
)
|
Earnings per share attributable to Match Group, Inc. shareholders
|
$
|
0.20
|
|
|
$
|
0.17
|
|
|
$
|
0.14
|
|
|
$
|
0.13
|
|
|
Six Months Ended June 30,
|
||||||||||||||
|
2017
|
|
2016
|
||||||||||||
|
Basic
|
|
Diluted
|
|
Basic
|
|
Diluted
|
||||||||
|
(In thousands, except per share data)
|
||||||||||||||
Numerator
|
|
|
|
|
|
|
|
||||||||
Net earnings from continuing operations
|
$
|
76,099
|
|
|
$
|
76,099
|
|
|
$
|
47,377
|
|
|
$
|
47,377
|
|
Net earnings attributable to redeemable noncontrolling interests
|
(54
|
)
|
|
(54
|
)
|
|
(90
|
)
|
|
(90
|
)
|
||||
Net earnings from continuing operations attributable to Match Group, Inc. shareholders
|
76,045
|
|
|
76,045
|
|
|
47,287
|
|
|
47,287
|
|
||||
Loss from discontinued operations, net of tax
|
(4,562
|
)
|
|
(4,562
|
)
|
|
(6,057
|
)
|
|
(6,057
|
)
|
||||
Net earnings attributable to Match Group, Inc. shareholders
|
$
|
71,483
|
|
|
$
|
71,483
|
|
|
$
|
41,230
|
|
|
$
|
41,230
|
|
|
|
|
|
|
|
|
|
||||||||
Denominator
|
|
|
|
|
|
|
|
||||||||
Basic weighted average common shares outstanding
|
257,517
|
|
|
257,517
|
|
|
248,870
|
|
|
248,870
|
|
||||
Dilutive securities including subsidiary denominated equity, stock options and RSU awards
(a)(b)
|
—
|
|
|
41,859
|
|
|
—
|
|
|
19,168
|
|
||||
Dilutive weighted average common shares outstanding
|
257,517
|
|
|
299,376
|
|
|
248,870
|
|
|
268,038
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Earnings (loss) per share:
|
|
|
|
|
|
|
|
||||||||
Earnings per share from continuing operations
|
$
|
0.30
|
|
|
$
|
0.25
|
|
|
$
|
0.19
|
|
|
$
|
0.18
|
|
Loss per share from discontinued operations, net of tax
|
$
|
(0.02
|
)
|
|
$
|
(0.02
|
)
|
|
$
|
(0.02
|
)
|
|
$
|
(0.02
|
)
|
Earnings per share attributable to Match Group, Inc. shareholders
|
$
|
0.28
|
|
|
$
|
0.24
|
|
|
$
|
0.17
|
|
|
$
|
0.15
|
|
(a)
|
If the effect is dilutive, weighted average common shares outstanding include the incremental shares that would be issued upon the assumed exercise of subsidiary denominated equity and stock options or vesting of restricted stock units ("RSUs"). For the
three and six months ended June 30, 2017
,
0.3 million
and
5.0 million
, potentially dilutive securities, respectively and for the
three and six months ended June 30, 2016
,
11.5 million
and
11.8 million
potentially dilutive securities, respectively, are excluded from the calculation of diluted earnings per share because their inclusion would have been anti-dilutive.
|
(b)
|
Market-based awards and performance-based stock options ("PSOs") and units (“PSUs”) are considered contingently issuable shares. Shares issuable upon exercise or vesting of market-based awards, PSOs and PSUs are included in the denominator for earnings per share if (i) the applicable market or performance condition(s) has been met and (ii) the inclusion of the market-based award, PSOs and PSUs is dilutive for the respective reporting periods. For the
three and six months ended June 30, 2017
,
1.3 million
and
2.0 million
shares underlying market-based awards, PSOs and PSUs, respectively, and for the
three and six months ended June 30, 2016
,
10.1 million
and
10.2 million
shares underlying market-based awards, PSOs and PSUs, respectively, were excluded from the calculation of diluted earnings per share because the market or performance conditions had not been met.
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||
|
2017
|
|
2016
|
|
2017
|
|
2016
|
||||||||
|
(In thousands)
|
||||||||||||||
Revenue
|
|
|
|
|
|
|
|
||||||||
United States
|
$
|
174,914
|
|
|
$
|
168,024
|
|
|
$
|
348,651
|
|
|
$
|
331,803
|
|
All other countries
|
134,658
|
|
|
107,285
|
|
|
259,685
|
|
|
203,907
|
|
||||
Total
|
$
|
309,572
|
|
|
$
|
275,309
|
|
|
$
|
608,336
|
|
|
$
|
535,710
|
|
•
|
North America
- consists of financial results and metrics associated with customers located in the United States and Canada.
|
•
|
International
- consists of financial results and metrics associated with customers located outside of the United States and Canada.
|
•
|
Direct Revenue
- is revenue that is directly received from an end user of our products.
|
•
|
Indirect Revenue
- is revenue that is not received directly from an end user of our products, substantially all of which is advertising revenue.
|
•
|
Average PMC
- is calculated by summing the number of paid members, or paid member count ("PMC"), at the end of each day in the relevant measurement period and dividing it by the number of calendar days in that period. PMC as of any given time represents the number of users with a paid membership at that time. Users who only purchase à la carte features from us do not qualify as paid members for purposes of PMC by virtue of such purchase.
|
•
|
Average Revenue Per Paying User ("ARPPU")
- is Direct Revenue from paid members included in Average PMC in the relevant measurement period (whether in the form of subscription payments or à la carte payments) divided by the Average PMC in such period divided by the number of calendar days in such period.
|
•
|
Cost of revenue -
consists primarily of compensation (including stock-based compensation) and other employee-related costs for personnel engaged in data center and customer care functions, in-app purchase fees, credit card processing fees, hosting fees, and data center rent, energy and bandwidth costs. In-app purchase fees are monies paid to Apple and Google for the distribution and facilitation of in-app purchases of product features.
|
•
|
Selling and marketing expense -
consists primarily of advertising expenditures and compensation (including stock-based compensation) and other employee-related costs for personnel engaged in selling and marketing, and sales support functions. Advertising expenditures includes online marketing, including fees paid to search engines, offline marketing (which is primarily television advertising), and partner-related payments to those who direct traffic to our brands.
|
•
|
General and administrative expense -
consists primarily of compensation (including stock-based compensation) and other employee-related costs for personnel engaged in executive management, finance, legal, tax and human resources, acquisition-related contingent consideration fair value adjustments (described below), fees for professional services and facilities costs.
|
•
|
Product development expense -
consists primarily of compensation (including stock-based compensation) and other employee-related costs that are not capitalized for personnel engaged in the design, development, testing and enhancement of product offerings and related technology.
|
•
|
Acquisition-related contingent consideration fair value adjustments
- relate to the portion of the purchase price (of certain acquisitions) that is contingent upon the future operating performance of the acquired company. The amounts ultimately paid are generally dependent upon earnings performance
|
•
|
Term Loan
- The Company's seven-year term loan entered into on November 16, 2015. On March 31, 2016, a $10 million principal payment was made. On June 1, 2016, the Company issued $400 million of 6.375% Senior Notes (described below). The proceeds from the offering were used to prepay a portion of the $790 million of indebtedness then outstanding under the Term Loan. On December 8, 2016, an additional $40 million principal prepayment was made and the outstanding balance was repriced at LIBOR plus 3.25%, with a LIBOR floor of 0.75%. At
June 30, 2017
, a balance of
$350 million
is outstanding.
|
•
|
2015 Senior Notes
- The Company's 6.75% Senior Notes due December 15, 2022, with interest payable each June 15 and December 15, which were issued on November 16, 2015.
|
•
|
2016 Senior Notes
- The Company's 6.375% Senior Notes due June 1, 2024, with interest payable each June 1 and December 1, which were issued on June 1, 2016.
|
•
|
Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization ("Adjusted EBITDA")
- is a Non-GAAP financial measure. See "Match Group Inc.'s Principles of Financial Reporting" for the definition of Adjusted EBITDA.
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||||||||||||||
|
2017
|
|
Change
|
|
% Change
|
|
2016
|
|
2017
|
|
Change
|
|
% Change
|
|
2016
|
||||||||||||
|
(In thousands, except ARPPU)
|
||||||||||||||||||||||||||
Direct Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
North America
|
$
|
180,483
|
|
|
$
|
9,987
|
|
|
6%
|
|
$
|
170,496
|
|
|
$
|
357,845
|
|
|
$
|
22,967
|
|
|
7%
|
|
$
|
334,878
|
|
International
|
118,940
|
|
|
26,015
|
|
|
28%
|
|
92,925
|
|
|
229,330
|
|
|
51,759
|
|
|
29%
|
|
177,571
|
|
||||||
Total Direct Revenue
|
299,423
|
|
|
36,002
|
|
|
14%
|
|
263,421
|
|
|
587,175
|
|
|
74,726
|
|
|
15%
|
|
512,449
|
|
||||||
Indirect Revenue
|
10,149
|
|
|
(1,739
|
)
|
|
(15)%
|
|
11,888
|
|
|
21,161
|
|
|
(2,100
|
)
|
|
(9)%
|
|
23,261
|
|
||||||
Total Revenue
|
$
|
309,572
|
|
|
$
|
34,263
|
|
|
12%
|
|
$
|
275,309
|
|
|
$
|
608,336
|
|
|
$
|
72,626
|
|
|
14%
|
|
$
|
535,710
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Percentage of Total Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Direct Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
North America
|
58%
|
|
|
|
|
|
62%
|
|
59%
|
|
|
|
|
|
63%
|
||||||||||||
International
|
39%
|
|
|
|
|
|
34%
|
|
38%
|
|
|
|
|
|
33%
|
||||||||||||
Total Direct Revenue
|
97%
|
|
|
|
|
|
96%
|
|
97%
|
|
|
|
|
|
96%
|
||||||||||||
Indirect Revenue
|
3%
|
|
|
|
|
|
4%
|
|
3%
|
|
|
|
|
|
4%
|
||||||||||||
Total Revenue
|
100%
|
|
|
|
|
|
100%
|
|
100%
|
|
|
|
|
|
100%
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Average PMC:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
North America
|
3,503
|
|
|
192
|
|
|
6%
|
|
3,311
|
|
|
3,471
|
|
|
205
|
|
|
6%
|
|
3,266
|
|
||||||
International
|
2,598
|
|
|
608
|
|
|
31%
|
|
1,990
|
|
|
2,536
|
|
|
610
|
|
|
32%
|
|
1,926
|
|
||||||
Total
|
6,101
|
|
|
800
|
|
|
15%
|
|
5,301
|
|
|
6,007
|
|
|
815
|
|
|
16%
|
|
5,192
|
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
(Change calculated using non-rounded numbers)
|
|||||||||||||||||||||||||||
ARPPU:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
North America
|
$
|
0.56
|
|
|
|
|
(1)%
|
|
$
|
0.57
|
|
|
$
|
0.56
|
|
|
|
|
—%
|
|
$
|
0.56
|
|
||||
International
|
$
|
0.49
|
|
|
|
|
(4)%
|
|
$
|
0.51
|
|
|
$
|
0.49
|
|
|
|
|
(3)%
|
|
$
|
0.50
|
|
||||
Total
|
$
|
0.53
|
|
|
$
|
(0.01
|
)
|
|
(3)%
|
|
$
|
0.54
|
|
|
$
|
0.53
|
|
|
$
|
(0.01
|
)
|
|
(2)%
|
|
$
|
0.54
|
|
|
Three Months Ended June 30,
|
||||||
|
2017
|
|
$ Change
|
|
% Change
|
|
2016
|
|
(Dollars in thousands)
|
||||||
Cost of revenue
|
$62,665
|
|
$15,687
|
|
33%
|
|
$46,978
|
Percentage of revenue
|
20%
|
|
|
|
|
|
17%
|
|
Six Months Ended June 30,
|
||||||
|
2017
|
|
$ Change
|
|
% Change
|
|
2016
|
|
(Dollars in thousands)
|
||||||
Cost of revenue
|
$121,513
|
|
$30,767
|
|
34%
|
|
$90,746
|
Percentage of revenue
|
20%
|
|
|
|
|
|
17%
|
|
Three Months Ended June 30,
|
||||||
|
2017
|
|
$ Change
|
|
% Change
|
|
2016
|
|
(Dollars in thousands)
|
||||||
Selling and marketing expense
|
$87,713
|
|
$3,950
|
|
5%
|
|
$83,763
|
Percentage of revenue
|
28%
|
|
|
|
|
|
30%
|
|
Six Months Ended June 30,
|
||||||
|
2017
|
|
$ Change
|
|
% Change
|
|
2016
|
|
(Dollars in thousands)
|
||||||
Selling and marketing expense
|
$194,836
|
|
$1,569
|
|
1%
|
|
$193,267
|
Percentage of revenue
|
32%
|
|
|
|
|
|
36%
|
|
Three Months Ended June 30,
|
||||||
|
2017
|
|
$ Change
|
|
% Change
|
|
2016
|
|
(Dollars in thousands)
|
||||||
General and administrative expense
|
$43,871
|
|
$8,526
|
|
24%
|
|
$35,345
|
Percentage of revenue
|
14%
|
|
|
|
|
|
13%
|
|
Six Months Ended June 30,
|
||||||
|
2017
|
|
$ Change
|
|
% Change
|
|
2016
|
|
(Dollars in thousands)
|
||||||
General and administrative expense
|
$87,781
|
|
$13,412
|
|
18%
|
|
$74,369
|
Percentage of revenue
|
14%
|
|
|
|
|
|
14%
|
|
Three Months Ended June 30,
|
||||||
|
2017
|
|
$ Change
|
|
% Change
|
|
2016
|
|
(Dollars in thousands)
|
||||||
Product development expense
|
$24,061
|
|
$4,408
|
|
22%
|
|
$19,653
|
Percentage of revenue
|
8%
|
|
|
|
|
|
7%
|
|
Six Months Ended June 30,
|
||||||
|
2017
|
|
$ Change
|
|
% Change
|
|
2016
|
|
(Dollars in thousands)
|
||||||
Product development expense
|
$46,081
|
|
$4,988
|
|
12%
|
|
$41,093
|
Percentage of revenue
|
8%
|
|
|
|
|
|
8%
|
|
Three Months Ended June 30,
|
||||||
|
2017
|
|
$ Change
|
|
% Change
|
|
2016
|
|
(Dollars in thousands)
|
||||||
Depreciation
|
$7,883
|
|
$707
|
|
10%
|
|
$7,176
|
Percentage of revenue
|
3%
|
|
|
|
|
|
3%
|
|
Six Months Ended June 30,
|
||||||
|
2017
|
|
$ Change
|
|
% Change
|
|
2016
|
|
(Dollars in thousands)
|
||||||
Depreciation
|
$15,472
|
|
$2,545
|
|
20%
|
|
$12,927
|
Percentage of revenue
|
3%
|
|
|
|
|
|
2%
|
|
Three Months Ended June 30,
|
|
Six Months Ended June 30,
|
||||||||||||||||||
|
2017
|
|
Change
|
|
% Change
|
|
2016
|
|
2017
|
|
$ Change
|
|
% Change
|
|
2016
|
||||||
|
(Dollars in thousands)
|
||||||||||||||||||||
Operating income
|
$
|
82,975
|
|
|
$
|
5,475
|
|
|
7%
|
|
$
|
77,500
|
|
|
$141,846
|
|
$30,160
|
|
27%
|
|
$111,686
|
Percentage of revenue
|
27%
|
|
|
|
|
|
28%
|
|
23%
|
|
|
|
|
|
21%
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Adjusted EBITDA
|
$
|
109,910
|
|
|
$
|
8,451
|
|
|
8%
|
|
$
|
101,459
|
|
|
$196,141
|
|
$27,408
|
|
16%
|
|
$168,733
|
Percentage of revenue
|
36%
|
|
|
|
|
|
37%
|
|
32%
|
|
|
|
|
|
31%
|
|
Three Months Ended June 30,
|
||||||
|
2017
|
|
$ Change
|
|
% Change
|
|
2016
|
|
(Dollars in thousands)
|
||||||
Interest expense
|
$19,072
|
|
$(1,546)
|
|
(7)%
|
|
$20,618
|
|
Six Months Ended June 30,
|
||||||
|
2017
|
|
$ Change
|
|
% Change
|
|
2016
|
|
(Dollars in thousands)
|
||||||
Interest expense
|
$38,022
|
|
$(3,000)
|
|
(7)%
|
|
$41,022
|
|
Three Months Ended June 30,
|
||||||
|
2017
|
|
$ Change
|
|
% Change
|
|
2016
|
|
(Dollars in thousands)
|
||||||
Other expense, net
|
$(9,550)
|
|
$(4,321)
|
|
83%
|
|
$(5,229)
|
|
Six Months Ended June 30,
|
||||||
|
2017
|
|
$ Change
|
|
% Change
|
|
2016
|
|
(Dollars in thousands)
|
||||||
Other expense, net
|
$(15,528)
|
|
$(13,883)
|
|
NM
|
|
$(1,645)
|
|
Three Months Ended June 30,
|
||||||
|
2017
|
|
$ Change
|
|
% Change
|
|
2016
|
|
(Dollars in thousands)
|
||||||
Income tax provision
|
$2,809
|
|
$(12,075)
|
|
(81)%
|
|
$14,884
|
Effective income tax rate
|
5%
|
|
|
|
|
|
29%
|
|
Six Months Ended June 30,
|
||||||
|
2017
|
|
$ Change
|
|
% Change
|
|
2016
|
|
(Dollars in thousands)
|
||||||
Income tax provision
|
$12,197
|
|
$(9,445)
|
|
(44)%
|
|
$21,642
|
Effective income tax rate
|
14%
|
|
|
|
|
|
31%
|
|
Three Months Ended June 30, 2017
|
||||||||||||||||||||||
|
Operating Income
|
|
Stock-based compensation
|
|
Depreciation
|
|
Amortization
of Intangibles |
|
Acquisition-related Contingent Consideration Fair Value Adjustments
|
|
Adjusted EBITDA
|
||||||||||||
|
(In thousands)
|
||||||||||||||||||||||
Match Group, Inc.
|
$
|
82,975
|
|
|
$
|
15,654
|
|
|
$
|
7,883
|
|
|
$
|
404
|
|
|
$
|
2,994
|
|
|
$
|
109,910
|
|
Interest expense
|
(19,072
|
)
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Other expense, net
|
(9,550
|
)
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Earnings from continuing operations, before tax
|
54,353
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Income tax provision
|
(2,809
|
)
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net earnings from continuing operations
|
51,544
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Loss from discontinuing operations, net of tax
|
(71
|
)
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net earnings
|
51,473
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net earnings attributable to redeemable noncontrolling interests
|
(43
|
)
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net earnings attributable to Match Group, Inc. shareholders
|
$
|
51,430
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30, 2016
|
||||||||||||||||||||||
|
Operating Income
|
|
Stock-based compensation
|
|
Depreciation
|
|
Amortization
of Intangibles |
|
Acquisition-related Contingent Consideration Fair Value Adjustments
|
|
Adjusted EBITDA
|
||||||||||||
|
(In thousands)
|
||||||||||||||||||||||
Match Group, Inc.
|
$
|
77,500
|
|
|
$
|
12,644
|
|
|
$
|
7,176
|
|
|
$
|
4,894
|
|
|
$
|
(755
|
)
|
|
$
|
101,459
|
|
Interest expense
|
(20,618
|
)
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Other expense, net
|
(5,229
|
)
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Earnings from continuing operations, before tax
|
51,653
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Income tax provision
|
(14,884
|
)
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net earnings from continuing operations
|
36,769
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Loss from discontinuing operations, net of tax
|
(2,668
|
)
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net earnings
|
34,101
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net earnings attributable to redeemable noncontrolling interests
|
(23
|
)
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net earnings attributable to Match Group, Inc. shareholders
|
$
|
34,078
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30, 2017
|
||||||||||||||||||||||
|
Operating Income
|
|
Stock-based compensation
|
|
Depreciation
|
|
Amortization
of Intangibles |
|
Acquisition-related Contingent Consideration Fair Value Adjustments
|
|
Adjusted EBITDA
|
||||||||||||
|
(In thousands)
|
||||||||||||||||||||||
Match Group, Inc.
|
$
|
141,846
|
|
|
$
|
33,678
|
|
|
$
|
15,472
|
|
|
$
|
807
|
|
|
$
|
4,338
|
|
|
$
|
196,141
|
|
Interest expense
|
(38,022
|
)
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Other expense, net
|
(15,528
|
)
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Earnings from continuing operations, before tax
|
88,296
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Income tax provision
|
(12,197
|
)
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net earnings from continuing operations
|
76,099
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Loss from discontinuing operations, net of tax
|
(4,562
|
)
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net earnings
|
71,537
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net earnings attributable to redeemable noncontrolling interests
|
(54
|
)
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net earnings attributable to Match Group, Inc. shareholders
|
$
|
71,483
|
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended June 30, 2016
|
||||||||||||||||||||||
|
Operating Income
|
|
Stock-based compensation
|
|
Depreciation
|
|
Amortization
of Intangibles
|
|
Acquisition-related Contingent Consideration Fair Value Adjustments
|
|
Adjusted EBITDA
|
||||||||||||
|
(In thousands)
|
||||||||||||||||||||||
Match Group, Inc.
|
$
|
111,686
|
|
|
$
|
30,092
|
|
|
$
|
12,927
|
|
|
$
|
11,622
|
|
|
$
|
2,406
|
|
|
$
|
168,733
|
|
Interest expense
|
(41,022
|
)
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Other expense, net
|
(1,645
|
)
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Earnings from continuing operations, before tax
|
69,019
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Income tax provision
|
(21,642
|
)
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net earnings from continuing operations
|
47,377
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Loss from discontinuing operations, net of tax
|
(6,057
|
)
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net earnings
|
41,320
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net earnings attributable to redeemable noncontrolling interests
|
(90
|
)
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net earnings attributable to Match Group, Inc. shareholders
|
$
|
41,230
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended June 30,
|
||||||||||||
|
2017
|
|
$ Change
|
|
% Change
|
|
2016
|
||||||
|
(Dollars in thousands, except ARPPU)
|
||||||||||||
Revenue, as reported
|
$
|
309,572
|
|
|
$
|
34,263
|
|
|
12%
|
|
$
|
275,309
|
|
Foreign exchange effects
|
5,028
|
|
|
|
|
|
|
|
|||||
Revenue excluding foreign exchange effects
|
$
|
314,600
|
|
|
$
|
39,291
|
|
|
14%
|
|
$
|
275,309
|
|
|
|
|
|
|
|
|
|
||||||
(Percentage change calculated using non-rounded numbers)
|
|
|
|
|
|
|
|
||||||
International ARPPU, as reported
|
$
|
0.49
|
|
|
|
|
(4)%
|
|
$
|
0.51
|
|
||
Foreign exchange effects
|
0.02
|
|
|
|
|
|
|
|
|||||
International ARPPU, excluding foreign exchange effects
|
$
|
0.51
|
|
|
|
|
—%
|
|
$
|
0.51
|
|
|
Six Months Ended June 30,
|
||||||||||||
|
2017
|
|
$ Change
|
|
% Change
|
|
2016
|
||||||
|
(Dollars in thousands, except ARPPU)
|
||||||||||||
Revenue, as reported
|
$
|
608,336
|
|
|
$
|
72,626
|
|
|
14%
|
|
$
|
535,710
|
|
Foreign exchange effects
|
8,504
|
|
|
|
|
|
|
|
|||||
Revenue excluding foreign exchange effects
|
$
|
616,840
|
|
|
$
|
81,130
|
|
|
15%
|
|
$
|
535,710
|
|
|
|
|
|
|
|
|
|
||||||
(Percentage change calculated using non-rounded numbers)
|
|
|
|
|
|
|
|
||||||
International ARPPU, as reported
|
$
|
0.49
|
|
|
|
|
(3)%
|
|
$
|
0.50
|
|
||
Foreign exchange effects
|
0.02
|
|
|
|
|
|
|
|
|||||
International ARPPU, excluding foreign exchange effects
|
$
|
0.51
|
|
|
|
|
1%
|
|
$
|
0.50
|
|
|
June 30, 2017
|
|
December 31, 2016
|
||||
|
(In thousands)
|
||||||
Cash and cash equivalents:
|
|
|
|
||||
United States
(a)
|
$
|
310,058
|
|
|
$
|
114,035
|
|
All other countries
(b)
|
182,647
|
|
|
139,616
|
|
||
Total cash and cash equivalents
|
492,705
|
|
|
253,651
|
|
||
|
|
|
|
||||
Long-term debt:
|
|
|
|
||||
2016 Senior Notes
|
$
|
400,000
|
|
|
$
|
400,000
|
|
2015 Senior Notes
|
445,172
|
|
|
445,172
|
|
||
Term Loan due November 16, 2022
(c)
|
350,000
|
|
|
350,000
|
|
||
Total long-term debt
|
1,195,172
|
|
|
1,195,172
|
|
||
Less: Unamortized original issue discount and original issue premium, net
|
4,801
|
|
|
5,245
|
|
||
Less: Unamortized debt issuance costs
|
12,382
|
|
|
13,434
|
|
||
Total long-term debt
|
$
|
1,177,989
|
|
|
$
|
1,176,493
|
|
(a)
|
Domestically, cash equivalents include AAA rated government money market funds.
|
(b)
|
Internationally, cash equivalents include money market funds and time deposits with maturities of less than 91 days. If needed for our U.S. operations, most of the cash and cash equivalents held by the Company's foreign subsidiaries could be repatriated, which, under current tax law, would be subject to U.S. federal and state income taxes. We currently do not anticipate a need to repatriate these funds to finance our U.S. operations and it is our intent to indefinitely reinvest these funds outside of the U.S.; therefore, we have not provided for any U.S. income taxes related to these funds.
|
(c)
|
The Term Loan matures on November 16, 2022; provided that, if any of the 2015 Senior Notes remain outstanding on the date that is 91 days prior to the maturity date of the 2015 Senior Notes, the Term Loan maturity date shall be the date that is 91 days prior to the maturity date of the 2015 Senior Notes.
|
|
Six Months Ended June 30,
|
||||||
|
2017
|
|
2016
|
||||
|
(In thousands)
|
||||||
Net cash provided by operating activities attributable to continuing operations
|
$
|
153,219
|
|
|
$
|
120,383
|
|
Net cash provided by (used in) investing activities attributable to continuing operations
|
76,276
|
|
|
(3,097
|
)
|
||
Net cash provided by (used in) financing activities attributable to continuing operations
|
10,982
|
|
|
(25,636
|
)
|
Exhibit
Number
|
Description
|
Location
|
|
10.1
|
|
First Amendment to the Match Group, Inc. 2015 Stock and Annual Incentive Plan.(1)
|
|
10.2
|
|
Match Group, Inc. 2017 Stock and Annual Incentive Plan.
|
Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed on May 24, 2017.
|
10.3
|
|
First Amendment to the Match Group, Inc. 2017 Stock and Annual Incentive Plan.(1)
|
|
31.1
|
|
Certification of the Chairman and Chief Executive Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.(1)
|
|
31.2
|
|
Certification of the Chief Financial Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.(1)
|
|
32.1
|
|
Certification of the Chairman and Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.(2)
|
|
32.2
|
|
Certification of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.(2)
|
|
101.INS
|
|
XBRL Instance
|
|
101.SCH
|
|
XBRL Taxonomy Extension Schema
|
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation
|
|
101.DEF
|
|
XBRL Taxonomy Extension Definition
|
|
101.LAB
|
|
XBRL Taxonomy Extension Labels
|
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation
|
|
(1)
|
Filed herewith.
|
(2)
|
Furnished herewith.
|
August 4, 2017
|
|
MATCH GROUP, INC.
|
||
|
|
By:
|
|
/s/ GARY SWIDLER
|
|
|
|
|
Gary Swidler
|
|
|
|
|
Chief Financial Officer
|
|
|
|
|
Signature
|
Title
|
|
Date
|
|
|
|
|
/s/ GARY SWIDLER
|
Chief Financial Officer
|
|
August 4, 2017
|
Gary Swidler
|
|
|
|
1.
|
Types and Nature of Stock Appreciation Rights
.
The last two sentences of Section 5(b) of the Plan are deleted in their entirety and replaced with the following:
|
2.
|
IAC Shares
. New Section 14(m) is added immediately following Section 14(l).
|
By:
|
/s/ Jared Sine
|
|
Jared Sine
|
|
General Counsel and Secretary
|
|
Match Group, Inc.
|
1.
|
Types and Nature of Stock Appreciation Rights
.
The last two sentences of Section 5(b) of the Plan are deleted in their entirety and replaced with the following:
|
2.
|
IAC Shares
. New Section 14(l) is added immediately following Section 14(k).
|
By:
|
/s/ Jared Sine
|
|
Jared Sine
|
|
General Counsel and Secretary
|
|
Match Group, Inc.
|
1.
|
I have reviewed this
quarterly report on Form 10-Q for the quarter
ended
June 30, 2017
of Match Group, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a 15(f) and 15d 15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Dated:
|
August 4, 2017
|
|
/s/ GREGORY R. BLATT
|
|
|
|
Gregory R. Blatt
Chairman and Chief Executive Officer
|
1.
|
I have reviewed this
quarterly report on Form 10-Q for the quarter
ended
June 30, 2017
of Match Group, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a 15(f) and 15d 15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Dated:
|
August 4, 2017
|
|
/s/ GARY SWIDLER
|
|
|
|
Gary Swidler
Chief Financial Officer
|
(1)
|
the
Quarterly Report on Form 10-Q for the fiscal quarter
ended
June 30, 2017
of Match Group, Inc. (the "Report") which this statement accompanies fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and
|
(2)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Match Group, Inc.
|
Dated:
|
August 4, 2017
|
|
/s/ GREGORY R. BLATT
|
|
|
|
Gregory R. Blatt
Chairman and Chief Executive Officer
|
(1)
|
the
Quarterly Report on Form 10-Q for the fiscal quarter
ended
June 30, 2017
of Match Group, Inc. (the "Report") which this statement accompanies fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and
|
(2)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Match Group, Inc.
|
Dated:
|
August 4, 2017
|
|
/s/ GARY SWIDLER
|
|
|
|
Gary Swidler
Chief Financial Officer
|