Bumble Inc. - Quarter Report: 2022 September (Form 10-Q)

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2022


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to __________

Commission File Number: 001-40054

Bumble Inc.

(Exact Name of Registrant as Specified in its Charter)


Delaware	85-3604367
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
1105 West 41st Street Austin, Texas	78756
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (512) 696-1409

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

Title of each class

Trading

Symbol(s)

Name of each exchange on which registered

Class A common stock, par value $0.01 per share

BMBL

The Nasdaq Stock Market LLC

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 (§232.405 of this chapter) 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, 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.

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 October 31, 2022, Bumble Inc. had 129,676,937 shares of Class A common stock, par value $0.01 per share, outstanding and 20 shares of Class B common stock, par value $0.01 per share, outstanding.

SPECIAL NOTE REGARDING Forward-Looking Statements

This Quarterly Report on Form 10-Q, or this Quarterly Report, contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect the current views of management of Bumble Inc. with respect to, among other things, its operations, its financial performance, its industry, and its business. Forward-looking statements include all statements that are not historical facts. In some cases, you can identify these forward-looking statements by the use of words such as “outlook,” “believe(s),” “expect(s),” “potential,” “continue(s),” “may,” “will,” “should,” “could,” “would,” “seek(s),” “predict(s),” “intend(s),” “trends,” “plan(s),” “estimate(s),” “anticipates,” “projection,” “will likely result” and or the negative version of these words or other comparable words of a future or forward-looking nature. Such forward-looking statements are subject to various risks and uncertainties. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. These factors include, but are not limited to, the following:

•

our ability to retain existing users or attract new users and to convert users to paying users

•

competition and changes in the competitive landscape of our market

•

our ability to distribute our dating products through third parties, such as Apple App Store or Google Play Store, and offset related fees

•

the impact of data security breaches or cyber attacks on our systems and the costs of remediation related to any such incidents

•

the continued development and upgrading of our technology platform and our ability to adapt to rapid technological developments and changes in a timely and cost-effective manner

•

our ability to obtain, maintain, protect and enforce intellectual property rights and successfully defend against claims of infringement, misappropriation or other violations of third-party intellectual property

•

our ability to comply with complex and evolving U.S. and international laws and regulations relating to our business, including data privacy laws

•

foreign currency exchange rate fluctuations

•

risks relating to certain of our international operations, including geopolitical conditions and successful expansion into new markets

•

the impact of current developments in Russia, Ukraine and surrounding countries on our business and users, including the impact of our decision to discontinue our operations in Russia and remove our apps from the Apple App Store and Google Play Store in Russia and Belarus

•

control of us by Blackstone and our Founder (each, as defined below)

•

the outsized voting rights of Blackstone and our Founder

•

the inability to attract hire and retain a highly qualified and diverse workforce, or maintain our corporate culture

•

changes in business or macroeconomic conditions, including the impact of the Coronavirus Disease 2019 (“COVID-19”) (and other widespread health emergencies or pandemics) and measures taken in response, lower consumer confidence in our business or in the online dating industry generally, recessionary conditions, increased unemployment rates, stagnant or declining wages, changes in inflation or interest rates, political unrest, armed conflicts or natural disasters

For more information regarding these and other risks and uncertainties that we face, see Part I, “Item 1A—Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2021 (“2021 Form 10-K”). These factors should not be construed as exhaustive and we caution you that the important factors referenced above may not contain all of the factors that are important to you. Bumble Inc. undertakes no obligation to publicly update or review any forward-looking statements, whether as a result of new information, future developments or otherwise, except as required by law.

Website and Social Media Disclosure

We use our websites (www.bumble.com and ir.bumble.com) and at times our corporate Twitter account (@bumble) to distribute company information. The information we post through these channels may be deemed material. Accordingly, investors should monitor these channels, in addition to following our press releases, filings with the Securities and Exchange Commission (“SEC”) and public conference calls and webcasts. In addition, you may automatically receive e-mail alerts and other information about Bumble when you enroll your e-mail address by visiting the “E-mail Alerts” section of our website at ir.bumble.com. The contents of our website and social media channels are not, however, a part of this Quarterly Report on Form 10-Q.

Certain Definitions

As used in this Quarterly Report, unless otherwise noted or the context requires otherwise:

•

“Badoo App and Other Average Revenue per Paying User” is a metric calculated based on Badoo App and Other Revenue in any measurement period, excluding any revenue generated from Fruitz, advertising and partnerships or affiliates, divided by Badoo App and Other Paying Users in such period divided by the number of months in the period.

•

a “Badoo App and Other Paying User” is a user that has purchased or renewed a subscription plan and/or made an in-app purchase on Badoo app in a given month (or made a purchase on one of our other apps that we owned and operated in a given month (excluding Fruitz), or purchase on other third-party apps that used our technology in the relevant period). We calculate Badoo App and Other Paying Users as a monthly average, by counting the number of Badoo App and Other Paying Users in each month and then dividing by the number of months in the relevant measurement period.

•

“Badoo App and Other Revenue” is revenue derived from purchases or renewals of a Badoo app subscription plan and/or in-app purchases on Badoo app in the relevant period, purchases on one of our other apps that we owned and operated in the relevant period, purchases on other third party apps that used our technology in the relevant period and advertising, partnerships or affiliates revenue in the relevant period.

•

“Blackstone” or “our Sponsor” refer to investment funds associated with Blackstone Inc.

•

“Blocker Companies” refer to certain entities that are taxable as corporations for U.S. federal income tax purposes in which the Pre-IPO Shareholders held interests.

•

“Blocker Restructuring” refers to certain restructuring transactions that resulted in the acquisition by Pre-IPO Shareholders of shares of Class A common stock in exchange for their ownership interests in the Blocker Companies and Bumble Inc. acquiring an equal number of outstanding Common Units.

•

“Bumble,” the “Company,” “we,” “us” and “our” refer to Bumble Inc. and its consolidated subsidiaries.

•

“Bumble App Average Revenue per Paying User” is a metric calculated based on Bumble App Revenue in any measurement period, divided by Bumble App Paying Users in such period divided by the number of months in the period.

•

a “Bumble App Paying User” is a user that has purchased or renewed a Bumble app subscription plan and/or made an in-app purchase on Bumble app in a given month. We calculate Bumble App Paying Users as a monthly average, by counting the number of Bumble App Paying Users in each month and then dividing by the number of months in the relevant measurement period.

•

"Bumble App Revenue” is revenue derived from purchases or renewals of a Bumble app subscription plan and/or in-app purchases on Bumble app in the relevant period.

•

“Bumble Holdings” refers to Buzz Holdings L.P., a Delaware limited partnership.

•

“Class B Units” refers to the interests in Bumble Holdings called “Class B Units,” including the Class B units held by Buzz Management Aggregator L.P., that were outstanding prior to the Reclassification.

•

“Common Units” refers to the new class of units of Bumble Holdings created by the Reclassification and does not include Incentive Units.

•

“Founder” refers to Whitney Wolfe Herd, the founder of Bumble app, our Chief Executive Officer and member of our board of directors, together with entities beneficially owned by her.

•

“Fruitz” refers to Flashgap SAS, which operates the Fruitz app.

•

“Incentive Units” refers to the class of units of Bumble Holdings created by the reclassification of the Class B Units in the Reclassification. The Incentive Units are “profit interests” having economic characteristics similar to stock appreciation rights and having the right to share in any equity value of Bumble Holdings above specified participation thresholds. Vested Incentive Units may be converted to Common Units and be subsequently exchanged for shares of Class A common stock.

•

“IPO” refers to the initial public offering of Class A common stock, which was completed on February 16, 2021.

•

“Offering Transactions” refers to the offering of Class A common stock in the IPO and certain related transactions, as defined in “Item 2―Management’s Discussion and Analysis of Financial Condition and Results of Operations―Factors Affecting the Comparability of Our Results of Operations―Initial Public Offering and Offering Transactions”.

•

“Pre-IPO Common Unitholders” refer to pre-IPO owners that hold Common Units following the Reclassification.

•

“pre-IPO owners” refer to our Founder, our Sponsor, an affiliate of Accel Partners LP and management and other equity holders who were the owners of Bumble Holdings immediately prior to the Offering Transactions.

•

“Pre-IPO Shareholders” refer to pre-IPO owners that received shares of Class A common stock of Bumble Inc. pursuant to the Blocker Restructuring.

•

“Principal Stockholders” refers collectively to our Founder and our Sponsor.

•

“Reclassification” refers to the reclassification of the limited partnership interests of Bumble Holdings in connection with the IPO pursuant to which certain outstanding Class A units were reclassified into a new class of limited partnership interests that we refer to as “Common Units” and certain outstanding Class B Units were reclassified into a new class of limited partnership interests that we refer to as “Incentive Units.”

•

“Reorganization Transactions” refer to certain transactions that occurred prior to the completion of the IPO which were accounted for as a reorganization of entities under common control.

•

“Sponsor Acquisition” refers to the acquisition on January 29, 2020 by our Sponsor of a majority stake in Worldwide Vision Limited and certain transactions related thereto.

•

“Total Average Revenue per Paying User” is a metric calculated based on Total Revenue in any measurement period, excluding any revenue generated from Fruitz, advertising and partnerships or affiliates, divided by the Total Paying Users in such period divided by the number of months in the period.

•

“Total Paying Users” is the sum of Bumble App Paying Users and Badoo App and Other Paying Users.

•

“Total Revenue” is the sum of Bumble App Revenue and Badoo App and Other Revenue.

•

“user” is a user ID, a unique identifier assigned during registration.

Table of Contents


		Page
PART I.	FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)	5
	Condensed Consolidated Balance Sheets	5
	Condensed Consolidated Statements of Operations	6
	Condensed Consolidated Statements of Comprehensive Operations	7
	Condensed Consolidated Statements of Changes in Equity	8
	Condensed Consolidated Statements of Cash Flows	13
	Notes to Unaudited Condensed Consolidated Financial Statements	14
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	44
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	60
Item 4.	Controls and Procedures	61
PART II.	OTHER INFORMATION
Item 1.	Legal Proceedings	62
Item 1A.	Risk Factors	62
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	62
Item 6.	Exhibits	63
	Signatures	64

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited).

Bumble Inc.

Condensed Consolidated Balance Sheets

(In thousands, except share and per share information)

(Unaudited)


	September 30, 2022			December 31, 2021
ASSETS
Cash and cash equivalents	$	365,105		$	369,175
Accounts receivable, net of allowances		56,524			47,538
Other current assets		30,384			52,751
Total current assets		452,013			469,464
Right-of-use assets		19,784			26,410
Property and equipment, net		12,973			14,627
Goodwill		1,576,266			1,540,112
Intangible assets, net		1,673,776			1,696,798
Deferred tax assets, net		23,106			19,572
Other noncurrent assets		34,920			10,013
Total assets	$	3,792,838		$	3,776,996
LIABILITIES AND BUMBLE INC. SHAREHOLDERS’ / BUZZ HOLDINGS L.P. OWNERS’ EQUITY
Accounts payable	$	10,504		$	19,169
Deferred revenue		44,898			39,569
Accrued expenses and other current liabilities		78,477			111,482
Current portion of long-term debt, net		5,750			5,750
Total current liabilities		139,629			175,970
Long-term debt, net		620,239			623,231
Deferred tax liabilities, net		9,398			—
Payable to related parties pursuant to a tax receivable agreement		388,980			388,780
Other long-term liabilities		72,288			119,246
Total liabilities		1,230,534			1,307,227
Commitments and contingencies (Note 18)
Bumble Inc. Shareholders’ / Buzz Holdings L.P. Owners’ Equity:
Class A common stock (par value $0.01 per share, 6,000,000,000 shares authorized; 129,645,692 and 129,212,949 shares issued and outstanding as of September 30, 2022 and December 31, 2021, respectively)		1,297			1,292
Class B common stock (par value $0.01 per share, 1,000,000 shares authorized; 20 shares issued and outstanding as of September 30, 2022 and December 31, 2021, respectively)		—			—
Preferred stock (par value $0.01; authorized 600,000,000 shares; no shares issued and outstanding as of September 30, 2022 and December 31, 2021, respectively)		—			—
Additional paid-in capital		1,661,410			1,588,426
Accumulated deficit		(29,301	)		(60,125	)
Accumulated other comprehensive income		62,075			78,603
Total Bumble Inc. shareholders’ / Buzz Holdings L.P. owners’ equity		1,695,481			1,608,196
Noncontrolling interests		866,823			861,573
Total shareholders’ / owners’ equity		2,562,304			2,469,769
Total liabilities and shareholders’ / owners’ equity	$	3,792,838		$	3,776,996

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Bumble Inc.

Condensed Consolidated Statements of Operations

(In thousands, except per share / unit information)

(Unaudited)



	Three Months Ended September 30, 2022			Three Months Ended September 30, 2021			Nine Months Ended September 30, 2022			Nine Months Ended September 30, 2021
Revenue	$	232,639		$	199,147		$	661,875		$	553,865
Operating costs and expenses:
Cost of revenue		64,581			55,265			181,702			151,597
Selling and marketing expense		64,316			55,105			180,628			151,654
General and administrative expense		29,815			45,726			107,636			215,631
Product development expense		25,828			24,231			73,479			84,197
Depreciation and amortization expense		19,755			27,022			73,835			80,882
Total operating costs and expenses		204,295			207,349			617,280			683,961
Operating earnings (loss)		28,344			(8,202	)		44,595			(130,096	)
Interest income (expense)		(6,866	)		(5,676	)		(18,446	)		(18,861	)
Other income (expense), net		6,545			3,773			24,729			7,489
Income (loss) before income taxes		28,023			(10,105	)		50,878			(141,468	)
Income tax benefit (provision)		(1,618	)		(280	)		(5,756	)		437,122
Net earnings (loss)		26,405			(10,385	)		45,122			295,654
Net earnings (loss) attributable to noncontrolling interests		8,342			(3,052	)		14,298			(26,603	)
Net earnings (loss) attributable to Bumble Inc. shareholders / Buzz Holdings L.P. owners	$	18,063		$	(7,333	)	$	30,824		$	322,257
Net earnings (loss) per share / unit attributable to Bumble Inc. shareholders / Buzz Holdings L.P. owners
Basic earnings (loss) per share / unit	$	0.14		$	(0.06	)	$	0.24		$	1.57
Diluted earnings (loss) per share / unit	$	0.14		$	(0.06	)	$	0.23		$	1.53

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Bumble Inc.

Condensed Consolidated Statements of Comprehensive Operations

(In thousands)

(Unaudited)



	Three Months Ended September 30, 2022			Three Months Ended September 30, 2021			Nine Months Ended September 30, 2022			Nine Months Ended September 30, 2021
Net earnings (loss)	$	26,405		$	(10,385	)	$	45,122		$	295,654
Other comprehensive income (loss), net of tax:
Change in foreign currency translation adjustment		(14,220	)		(2,878	)		(24,398	)		(7,304	)
Total other comprehensive income (loss), net of tax		(14,220	)		(2,878	)		(24,398	)		(7,304	)
Comprehensive income (loss)		12,185			(13,263	)		20,724			288,350
Comprehensive income (loss) attributable to noncontrolling interests		4,051			(3,564	)		6,428			(28,751	)
Comprehensive income (loss) attributable to Bumble Inc. shareholders / Buzz Holdings L.P. owners	$	8,134		$	(9,699	)	$	14,296		$	317,101

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Bumble Inc.

Condensed Consolidated Statements of Changes in Equity

Three months ended September 30, 2022

(In thousands, except per share amounts)

(Unaudited)


	Class A Common Stock					Class B Common Stock				Additional Paid-in			Accumulated			Accumulated Other Comprehensive			Total Bumble Inc. Owners'/ Shareholders'			Noncontrolling			Total Shareholders’ / Owners'
	Shares			Amount		Shares		Amount		Capital			Deficit			Income (Deficit)			Equity			Interests			Equity
Balance as of June 30, 2022		129,559,112		$	1,296		20	$	—	$	1,623,562		$	(47,364	)	$	72,004		$	1,649,498		$	863,707		$	2,513,205
Net earnings (loss)		—			—		—		—		—			18,063			—			18,063			8,342			26,405
Stock-based compensation expense		—			—		—		—		38,072			—			—			38,072			—			38,072
Cancellation of restricted shares		(3,329	)		—		—		—		(45	)		—			—			(45	)		45			—
Restricted stock units issued, net of shares withheld for taxes		89,909			1		—		—		(179	)		—			—			(178	)		(980	)		(1,158	)
Other comprehensive loss, net of tax		—			—		—		—		—			—			(9,929	)		(9,929	)		(4,291	)		(14,220	)
Balance as of September 30, 2022		129,645,692		$	1,297		20	$	—	$	1,661,410		$	(29,301	)	$	62,075		$	1,695,481		$	866,823		$	2,562,304

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Bumble Inc.

Condensed Consolidated Statements of Changes in Equity

Three months ended September 30, 2021

(In thousands, except per share amounts)

(Unaudited)


	Class A Common Stock						Class B Common Stock				Additional Paid-in			Treasury Stock				Accumulated			Accumulated Other Comprehensive			Total Bumble Inc. Owners'/ Shareholders'			Noncontrolling			Total Owners’ / Shareholders’
	Shares			Amount			Shares		Amount		Capital			Shares		Amount		Deficit			Income (Deficit)			Equity			Interests			Equity
Balance as of June 30, 2021		119,799,036		$	1,198			20	$	—	$	1,432,125			—		—	$	(40,350	)	$	77,572		$	1,470,545		$	1,006,571		$	2,477,116
Net loss		—			—			—		—		—			—		—		(7,333	)		—			(7,333	)		(3,052	)		(10,385	)
Stock-based compensation expense		—			—			—		—		23,763			—		—		—			—			23,763			—			23,763
Impact of Tax Receivable Agreement due to exchanges of Common Units		—			—			—		—		(26,085	)		—		—		—			—			(26,085	)		—			(26,085	)
Cancellation of restricted shares		(145,416	)		(1	)		—		—		(2,154	)		—		—		—			—			(2,155	)		2,155			—
Exercise of stock options		12,668			—			—		—		734			—		—		—			—			734			(189	)		545
Restricted stock units issued, net of shares withheld for taxes		230,389			2			—		—		(4,953	)		—		—		—			—			(4,951	)		(3,444	)		(8,395	)
Exchange of Common Units for Class A common stock		9,344,903			93			—		—		139,581			—		—		—			—			139,674			(139,674	)		—
Other comprehensive loss, net of tax		—			—			—		—		—			—				—			(2,366	)		(2,366	)		(512	)		(2,878	)
Balance as of September 30, 2021		129,241,580		$	1,292			20	$	—	$	1,563,011			—		—	$	(47,683	)	$	75,206		$	1,591,826		$	861,855		$	2,453,681

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Bumble Inc.

Condensed Consolidated Statements of Changes in Equity

Nine months ended September 30, 2022

(In thousands, except per share amounts)

(Unaudited)


	Class A Common Stock					Class B Common Stock				Additional Paid-in			Accumulated			Accumulated Other Comprehensive			Total Bumble Inc. Owners'/ Shareholders'			Noncontrolling			Total Shareholders’ / Owners'
	Shares			Amount		Shares		Amount		Capital			Deficit			Income			Equity			Interests			Equity
Balance as of December 31, 2021		129,212,949		$	1,292		20	$	—	$	1,588,426		$	(60,125	)	$	78,603		$	1,608,196		$	861,573		$	2,469,769
Net earnings (loss)		—			—		—		—		—			30,824			—			30,824			14,298			45,122
Stock-based compensation expense		—			—		—		—		79,363			—			—			79,363			—			79,363
Impact of Tax Receivable Agreement due to exchanges of Common Units		—			—		—		—		(200	)		—			—			(200	)		—			(200	)
Cancellation of restricted shares		(28,988	)		—		—		—		(109	)		—			—			(109	)		109			—
Exercise of stock options		—			—		—		—		—			—			—			—			—			—
Restricted stock units issued, net of shares withheld for taxes		399,887			4		—		—		(6,000	)		—			—			(5,996	)		(1,356	)		(7,352	)
Exchange of Common Units for Class A common stock		61,844			1		—		—		(70	)		—			—			(69	)		69			—
Other comprehensive loss, net of tax		—			—		—		—		—			—			(16,528	)		(16,528	)		(7,870	)		(24,398	)
Balance as of September 30, 2022		129,645,692		$	1,297		20	$	—	$	1,661,410		$	(29,301	)	$	62,075		$	1,695,481		$	866,823		$	2,562,304

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Bumble Inc.

Condensed Consolidated Statements of Changes in Equity

Nine months ended September 30, 2021

(In thousands, except per share amounts)

(Unaudited)


	Limited Partners'			Class A Common Stock						Class B Common Stock					Additional Paid-in			Treasury Stock						Accumulated		Accumulated Other Comprehensive			Total Bumble Inc. Owners'/ Shareholders'			Noncontrolling			Total Shareholders’ / Owners'
	Equity			Shares			Amount			Shares			Amount		Capital			Shares			Amount			Deficit		Income			Equity			Interests			Equity
Balance as of December 31, 2020	$	1,903,121			—		$	—			100		$	—	$	—			—		$	—		$	695	$	176,244		$	2,080,060		$	806		$	2,080,866
Acquisition of noncontrolling interests		806			—			—			—			—		—			—			—			—		—			806			(806	)		—
Net earnings prior to Reorganization Transactions		370,635			—			—			—			—		—			—			—			—		—			370,635			—			370,635
Stock-based compensation expense		11,587			—			—			—			—		—			—			—			—		—			11,587			—			11,587
Effect of the Reorganization Transactions (as adjusted)		(2,286,149	)		82,642,374			826			—			—		1,075,019			—			—			—		(95,882	)		(1,306,186	)		1,306,186			—
Retirement of Class B common stock		—			—			—			(80	)		—		—			—			—			—		—			—			—			—
Issuance of Class A common stock sold in the initial public offering, net of offering costs		—			57,500,000			575			—			—		2,236,787			—			—			—		—			2,237,362			121,009			2,358,371
Purchase of Class A Common Stock in the initial public offering		—			—			—			—			—		—			24,798,848			(1,018,365	)		—		—			(1,018,365	)		—			(1,018,365	)
Purchase of Common Units from Pre-IPO Common Unitholders in the initial public offering		—			—			—			—			—		(609,489	)		—			—			—		—			(609,489	)		(363,800	)		(973,289	)
Vested Incentive Units		—			—			—			—			—		(6,385	)		—			—			—		—			(6,385	)		6,385			—
Issuance of Founder loan common units		—			—			—			—			—		(29,034	)		—			—			—		—			(29,034	)		29,034			—
Equity plan modification from liability to equity settled due to Reorganization		—			—			—			—			—		22,107			—			—			—		—			22,107			—			22,107
Tax Receivable Agreement from Reorganization Transactions		—			—			—			—			—		(387,669	)		—			—			—		—			(387,669	)		—			(387,669	)
Stock-based compensation expense		—			—			—			—			—		79,573			—			—			—		—			79,573			—			79,573
Retirement of treasury stock and restored to authorized but unissued		—			(24,798,848	)		(248	)		—			—		(1,018,117	)		(24,798,848	)		1,018,365			—		—			—			—			—
Cancellation of restricted shares		—			(145,416	)		(1	)		—			—		(2,154	)		—			—			—		—			(2,155	)		2,155			—


Exercise of stock options		—	12,668		—	—		—		734		—		—		—			—			734			(189	)		545
Restricted stock units issued, net of shares withheld for taxes		—	230,389		2	—		—		(4,953	)	—		—		—			—			(4,951	)		(3,444	)		(8,395	)
Exchange of Common Units for Class A common stock		—	13,800,413		138	—		—		206,592		—		—		—			—			206,730			(206,730	)		—
Net loss subsequent to Reorganization Transactions		—	—		—	—		—		—		—		—		(48,378	)		—			(48,378	)		(26,603	)		(74,981	)
Other comprehensive loss, net of tax		—	—		—	—		—		—		—		—		—			(5,156	)		(5,156	)		(2,148	)		(7,304	)
Balance as of September 30, 2021	$	—	129,241,580	$	1,292	20	$	—	$	1,563,011		—	$	—	$	(47,683	)	$	75,206		$	1,591,826		$	861,855		$	2,453,681

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Bumble Inc.

Condensed Consolidated Statements of Cash Flows

(In thousands)

(Unaudited)



	Nine Months Ended September 30, 2022			Nine Months Ended September 30, 2021
Cash flows from operating activities:
Net earnings (loss)	$	45,122		$	295,654
Adjustments to reconcile net earnings (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization		73,835			80,882
Impairment loss		4,388			—
Loss on extinguishment of long term debt		—			3,398
Changes in fair value of interest rate swaps		(18,404	)		(2,789	)
Changes in fair value of contingent earn-out liability		(46,399	)		77,659
Changes in fair value of investments in equity securities		(38	)		—
Non-cash lease expense		3,479			4,247
Deferred income tax		(6,501	)		(443,096	)
Stock-based compensation expense		77,179			99,502
Net foreign exchange difference		(14,413	)		(2,257	)
Other, net		(1,140	)		3,727
Changes in assets and liabilities:
Accounts receivable		(5,176	)		(4,954	)
Other current assets		20,261			(5,284	)
Accounts payable		(9,841	)		(13,124	)
Deferred revenue		4,679			7,773
Legal liabilities		(7,130	)		(45,631	)
Accrued expenses and other current liabilities		(38,088	)		(35,721	)
Other, net		(44	)		271
Net cash provided by (used in) operating activities		81,769			20,257
Cash flows from investing activities:
Capital expenditures		(11,311	)		(9,388	)
Acquisition of business, net of cash acquired		(69,720	)		—
Other, net		—			31
Net cash provided by (used in) investing activities		(81,031	)		(9,357	)
Cash flows from financing activities:
Proceeds from issuance of Class A common stock sold in initial public offering, net of offering costs		—			2,358,371
Payments to purchase and retire common stock		—			(1,018,365	)
Purchase of Common Units from Pre-IPO Common Unitholders in the initial public offering		—			(973,289	)
Withholding tax paid on behalf of employees on stock-based awards		(7,352	)		(9,338	)
Proceeds from exercise of options		—			545
Repayment of term loan		(4,313	)		(205,000	)
Net cash provided by (used in) financing activities		(11,665	)		152,924
Effects of exchange rate changes on cash and cash equivalents		13,641			(535	)
Net increase (decrease) in cash and cash equivalents		2,714			163,289
Cash and cash equivalents, beginning of the period		369,175			128,286
Cash and cash equivalents and restricted cash, end of the period		371,889			291,575
Less restricted cash		6,784			—
Cash and cash equivalents, end of the period	$	365,105		$	291,575

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Bumble Inc.

Notes to Unaudited Condensed Consolidated Financial Statements

Note 1 - Organization and Basis of Presentation

Company Overview

Bumble Inc.’s main operations are providing online dating and social networking platforms through subscription and in-app purchases of dating products servicing North America, Europe and various other countries around the world. Bumble Inc. provides these services through websites and applications that it owns and operates.

Bumble Inc. (the "Company" or "Bumble") was incorporated as a Delaware corporation on October 5, 2020 for the purpose of facilitating an initial public offering (“IPO”) and other related transactions in order to operate the business of Buzz Holdings L.P. (“Bumble Holdings”) and its subsidiaries.

Prior to the IPO and the Reorganization Transactions, Bumble Holdings L.P. ("Bumble Holdings"), a Delaware limited partnership, was formed primarily as a vehicle to finance the acquisition (the “Sponsor Acquisition”) of a majority stake in Worldwide Vision Limited (the “Predecessor”) by a group of investment funds managed by Blackstone Inc. (“Blackstone” or our "Sponsor"). As Bumble Holdings did not have any previous operations, Worldwide Vision Limited, a Bermuda exempted limited company, is viewed as the predecessor to Bumble Holdings and its consolidated subsidiaries. Accordingly, these consolidated financial statements include certain historical consolidated financial and other data for Worldwide Vision Limited for periods prior to the completion of the business combination.

On February 16, 2021, the Company completed its IPO of 57.5 million shares of Class A common stock at an offering price of $43 per share and received net proceeds of $2,361.2 million after deducting underwriting discounts and commissions. The Company used the proceeds from the issuance of 48.5 million shares ($1,991.6 million) to redeem shares of Class A common stock and purchase limited partnership interests of Bumble Holdings ("Common Units") from entities affiliated with our Sponsor, at a price per share / Common Unit equal to the IPO price, net of underwriting discounts and commissions.

In connection with the IPO, the organizational structure was converted to an umbrella partnership-C-Corporation with Bumble Inc. becoming the general partner of Bumble Holdings. The Reorganization Transactions were accounted for as a transaction between entities under common control. As a result, the financial statements for periods subsequent to the Sponsor Acquisition and prior to the IPO and the Reorganization Transactions have been adjusted to combine the previously separate entities for presentation purposes. As the general partner, Bumble Inc. operates and controls all of the business and affairs, and through Bumble Holdings and its subsidiaries, conducts the business. Bumble Inc. consolidates Bumble Holdings in its consolidated financial statements and reports a noncontrolling interest related to the Common Units held by the pre-IPO common unitholders and the incentive units held by the continuing incentive unitholders in the consolidated financial statements.

Assuming the exchange of all outstanding Common Units for shares of Class A common stock on a one-for-one basis under the exchange agreement entered into by holders of Common Units, there would be 188,379,019 shares of Class A common stock outstanding (which does not reflect any shares of Class A common stock issuable in exchange for as-converted Incentive Units or upon settlement of certain other interests) as of September 30, 2022.

All references to the “Company”, “we”, “our” or “us” in this report are to Bumble Inc.

Secondary Offering

On September 15, 2021, the Company completed a secondary offering of 20.7 million shares of Class A common stock on behalf of certain selling stockholders affiliated with Blackstone (the "Selling Stockholders") at a price of $54.00 per share. This transaction resulted in the issuance of 9.2 million shares of Class A common stock for the period ending September 30, 2021.

Bumble did not sell any shares of Class A common stock in the offering and did not receive any of the proceeds from the sale. Bumble paid the costs associated with the sale of shares by the Selling Stockholders, net of the underwriting discounts.

Basis of Presentation and Consolidation

The unaudited condensed consolidated financial statements that accompany these notes include the financial statements of the Company, all entities that are wholly-owned by the Company and all entities in which the Company has a controlling financial interest. Intercompany transactions and balances have been eliminated. The unaudited condensed consolidated financial statements

have been prepared in conformity with U.S. GAAP, consistent in all material respects with those applied in the Company's 2021 Form 10-K, with the exception of the correction of certain errors as discussed below. These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated statements and notes thereto included in the 2021 Form 10-K.

A noncontrolling interest in a consolidated subsidiary represents the portion of the equity (net assets) in a subsidiary not attributable, directly or indirectly, to the Company. Noncontrolling interests are presented as a separate component of equity in the consolidated balance sheets and the presentation of net income is modified to present earnings and other comprehensive income attributed to controlling and noncontrolling interests. The Company’s noncontrolling interest represents substantive profit-sharing arrangements and profit and losses are attributable to controlling and noncontrolling interests using a hypothetical liquidation at book value method.

Revision of Previously Issued Financial Statements

In connection with the preparation of our consolidated financial statements, we identified certain immaterial prior period adjustments related to the recognition and presentation of debt issuance costs and refunds from third-party aggregators in previously issued financial statements. In addition, we recorded certain other previously identified adjustments that were deemed immaterial to the periods presented.

In accordance with SAB No. 99, “Materiality,” and SAB No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements,” we evaluated the errors and determined that the related impacts were not material to our financial statements for any prior annual or interim periods, but that correcting the cumulative impact of the errors would be significant to our results of operations for the three and nine months ended September 30, 2022. Accordingly, we have revised previously reported financial information for such immaterial errors. A summary of revisions to certain previously reported financial information presented herein for comparative purposes is included in Note 3, Revisions of Previously Issued Financial Statements.

Note 2 - Summary of Selected Significant Accounting Policies

Included below are selected significant accounting policies including those that were added or modified during the nine months ended September 30, 2022 as a result of new transactions entered into or the adoption of new accounting policies. Refer to Note 2, Summary of Selected Significant Accounting Policies, within the annual consolidated financial statements in our 2021 Form 10-K for the full list of our significant accounting policies.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make certain judgments, estimates and assumptions that affect the reported amounts of assets and liabilities, revenues and expenses. The Company’s significant estimates relate to income taxes, the fair value and useful lives of assets acquired and liabilities assumed in business combinations, the recoverability of long-lived assets and goodwill, potential obligations associated with legal contingencies, the fair value of contingent consideration, and the fair value of derivatives and stock-based compensation.

These estimates are based on management’s best estimates and judgment. Actual results may differ from these estimates. Estimates, judgments and assumptions are continuously evaluated and are based on management’s experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Uncertainty about these assumptions, judgments and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future periods.

Cash, Cash Equivalents and Restricted Cash

Cash and cash equivalents include cash in banks, cash on hand, cash in electronic money accounts and overnight deposits.

As of September 30, 2022, the Company has classified the cash held in Russia as restricted cash due to the sanctions imposed by the Russia-Ukraine Conflict, which is included in “Other noncurrent assets” within the accompanying condensed consolidated balance sheets.

Impairment of Long-lived Assets

Long-lived assets, which consist of property and equipment and right-of-use assets, are reviewed for impairment whenever events or circumstances indicate that the carrying value of an asset may not be recoverable. The carrying value of a long-lived asset is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset. If the carrying value is deemed not to be recoverable, an impairment loss is recorded equal to the amount by which the carrying value of the long-lived asset exceeds its fair value. The remaining estimated useful lives of property and equipment and right-of-use assets are routinely reviewed and, if the estimate is revised, the remaining unamortized balance is amortized or depreciated over the revised estimated useful life.

During the nine months ended September 30, 2022, the Company determined that a right-of-use asset associated with its decision to discontinue its operations in Russia was fully impaired and recognized an impairment charge of $4.4 million in “General and administrative expense” within the accompanying condensed consolidated statement of operations. See Note 9, Restructuring, for additional information on impairment.

Revenue Recognition

The Company recognizes revenue from services in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers (“ASC 606”). Under ASC 606, the Company recognizes revenue when or as the Company’s performance obligations are satisfied by transferring control of the promised services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those services.

Revenue is primarily derived in the form of recurring subscriptions and in-app purchases. Subscription revenue is presented net of taxes, refunds and credit card chargebacks. This revenue is initially deferred and is recognized using the straight-line method over the term of the applicable subscription period. Revenue from lifetime subscriptions is deferred over the average estimated expected period of the subscriber relationship, which is currently estimated to be twelve months. Revenue from the purchase of in-app features is recognized based on usage. Unused in-app purchase fees expire and are recognized as revenue after six months. The Company also earns revenue from online advertising and partnerships. Online advertising revenue is recognized when an advertisement is displayed. Revenue from partnerships is recognized according to the contractual terms of the partnership.

As permitted under the practical expedient available under ASU No. 2014-09, Revenue from Contracts with Customers, the Company does not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less, and (ii) contracts for which the Company recognizes revenue at the amount which it has the right to invoice for services performed.

During the three and nine months ended September 30, 2022 and 2021, there were no customers representing greater than 10% of total revenue.

For the periods presented, revenue across apps was as follows (in thousands):


	Three Months Ended September 30, 2022		(As Revised) Three Months Ended September 30, 2021		Nine Months Ended September 30, 2022		(As Revised) Nine Months Ended September 30, 2021
Bumble App	$	180,641	$	141,216	$	503,482	$	379,176
Badoo App and Other		51,998		57,931		158,393		174,689
Total Revenue	$	232,639	$	199,147	$	661,875	$	553,865

Deferred Revenue

Deferred revenue consists of advance payments that are received or are contractually due in advance of the Company's performance. The Company’s deferred revenue is reported on a contract by contract basis at the end of each reporting period. The Company classifies deferred revenue as current when the term of the applicable subscription period or expected completion of the performance obligation is one year or less. The deferred revenue balance is $44.9 million and $39.6 million as of September 30, 2022 and December 31, 2021, respectively, all of which is classified as a current liability. During the three months ended September 30, 2022 and 2021, the Company recognized revenue of $2.5 million and $2.0 million, that was included in the deferred revenue balance at the beginning of each respective period. During the nine months ended September 30, 2022 and 2021, the Company recognized revenue of $39.1 million and $29.9 million, that was included in the deferred revenue balance at the beginning of each respective period.

Business Combination

The Company accounts for business combinations using the acquisition method of accounting. The purchase price is allocated to the assets acquired and liabilities assumed, including identifiable intangible assets, based on their fair values at the date of acquisition, with the exception of contract assets and contract liabilities from contracts with customers. On January 1, 2022, the Company adopted ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, under which the Company recognizes and measures revenue contract assets and contract liabilities (including deferred revenue) acquired in a business combination on the acquisition date as if the revenue contracts were originated by the Company in accordance with ASC 606, Revenue from Contracts with Customers. The adoption of ASU 2021-08 did not have a material impact to the Company's consolidated financial position, results of operations and cash flows. Any excess of the amount paid over the fair values of the identifiable net assets acquired is allocated to goodwill. These fair value determinations require judgment and involve the use of significant estimates and assumptions, including assumptions with respect to future cash inflows and outflows, discount rates, asset lives and market multiples, among other items.

Transaction costs associated with business combinations are expensed as incurred.

Fair Value Measurements

The Company follows ASC Topic 820, Fair Value Measurement, for financial assets and liabilities measured on a recurring basis. The Company uses the fair value hierarchy to categorize the financial instruments measured at fair value based on the available inputs to the valuation and the degree to which they are observable or not observable in the market.

The three levels of the fair value hierarchy are as follows:


	•	Level 1 - Quoted prices in active markets for identical assets or liabilities.


	•	Level 2 - Assets and liabilities valued based on observable market data for similar instruments, such as quoted prices for similar assets or liabilities.


	•	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.

Restructuring Charges

Restructuring charges, associated with office closure or exiting a market, consist primarily of severance, relocation, right-of-use asset impairment and other related costs. The Company evaluates the nature of these costs to determine if they relate to ongoing benefit arrangements which are accounted for under ASC 712, Compensation - Nonretirement Postemployment Benefits, or one-time benefit arrangements which are accounted for under ASC 420, Exit or Disposal Cost Obligations. The Company records a liability for ongoing employee termination benefits when it is probable that an employee is entitled to them and the amount of the benefits can be reasonably estimated. One-time employee termination costs are recognized when management has communicated the termination plan to employees, unless future service is required, in which case the costs are recognized ratably over the future service period. All other related costs are recognized when incurred. See Note 9, Restructuring, for additional information.

Restructuring charges are recognized as an operating expense within the condensed consolidated statements of operations and are classified based on each employee’s respective function.

Earnings (Loss) per Share / Unit

Basic earnings (loss) per share / unit is computed by dividing net earnings (loss) attributable to the Company by the weighted average number of common shares / units outstanding during the period. Diluted earnings (loss) per share / unit is computed by dividing net earnings (loss) attributable to the Company by the weighted-average share / units outstanding during the period after adjusting for the impact of securities that would have a dilutive effect on earnings (loss) per share / unit.

See Note 14, Earnings (Loss) per Share / Unit, for additional information on dilutive securities.

Stock-Based Compensation

The Company issues stock-based awards to employees that are generally in the form of stock options, restricted shares, incentive units, or restricted stock units (“RSUs”). Compensation cost for equity awards is measured at their grant-date fair value, and in the case of restricted shares and RSUs is estimated based on the fair value of the Company’s underlying common stock. The grant date fair value of stock options is estimated using the Black-Scholes option pricing model, which requires management to make

assumptions with respect to the fair value of the Company’s common stock on the grant date, including the expected term of the award, the expected volatility of the Company’s stock calculated based on a period of time generally commensurate with the expected term of the award, risk-free interest rates and expected dividend yields of the Company’s stock. For time-vesting awards, compensation cost is recognized over the requisite service period, which is generally the vesting period, using the graded attribution method. For performance-based stock awards, compensation expense is recognized over the requisite service period on a straight-line basis when achievement is probable. At the IPO date, the Company concluded that our public offering represented a qualifying liquidity event that would cause the performance conditions to be probable of occurring.

For periods prior to the Company’s IPO, the grant date fair value of stock-based compensation awards and the underlying equity were determined on each grant date using a Monte Carlo model. As the Company's equity was not publicly traded, there was no history of market prices for the Company's equity. Thus, estimating grant date fair value required the Company to make assumptions, including the value of the Company's equity, expected time to liquidity, and expected volatility.

See Note 15, Stock-based Compensation, for additional information on the Company’s stock-based compensation plans and awards.

Recently Issued Pronouncements Not Yet Adopted

In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU” 2020-04) Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting and then subsequent amendments, which provide optional guidance and exceptions for applying GAAP to contract modifications and hedging relationships, subject to meeting certain criteria, that reference London Interbank Offered Rate ("LIBOR") or another reference rate expected to be discontinued. The amendments are effective prospectively at any point through December 31, 2022. The Company continues to implement its transition plan toward cessation of LIBOR and the modification of its loans and other financial instruments with attributes that are either directly or indirectly influenced by LIBOR. The Company expects to utilize the LIBOR transition relief allowed under ASU 2020-04, as applicable, and does not expect such adoption to have a material impact on its accounting and disclosures.

Note 3 - Revisions of Previously-Issued Financial Statements

In preparing the condensed consolidated financial statements as of and for the three and nine months ended September 30, 2022, the Company identified certain errors in its previously issued financial statements related to the recognition and presentation of debt issuance costs and refunds from third-party aggregators. Accordingly, during 2022, 2021 and 2020, certain immaterial errors existed.

The Company assessed the materiality of the misstatements both quantitatively and qualitatively and determined the correction of these errors to be immaterial to all prior consolidated financial statements taken as a whole and, therefore, amending previously filed reports to correct the errors was not required. However, the Company concluded that the cumulative effect of correcting the errors in the quarter ended September 30, 2022 would materially misstate the Company’s unaudited condensed consolidated financial statements for the three and nine months ended September 30, 2022. Accordingly, the Company has made the necessary adjustments to correct the prior periods financial statements as summarized below. In addition, the amounts labeled “Adjustment” also include certain other previously identified adjustments that were not recorded, as such errors were deemed immaterial to the periods presented. The Company will also revise such information in future filings to reflect the correction of the errors. The remainder of the notes to the Company's consolidated financial statements have been updated and revised, as applicable, to reflect the impacts of the adjustments described above.

The following tables summarize the revisions of previously-issued financial statements (in thousands):


Unaudited Condensed Consolidated Balance Sheets	June 30, 2022									June 30, 2021
	As Previously Reported			Adjustment			As Revised			As Previously Reported			Adjustment			As Revised
Deferred tax assets, net	$	22,365		$	1,100		$	23,465		$	15,175		$	—		$	15,175
Other noncurrent assets		22,860			581			23,441			3,913			806			4,719
Total assets		3,767,819			1,681			3,769,500			3,754,630			806			3,755,436
Deferred revenue		44,470			(355	)		44,115			37,329			(355	)		36,974
Current portion of long-term debt, net		2,588			3,162			5,750			2,588			3,162			5,750
Total current liabilities		211,859			2,807			214,666			170,689			2,807			173,496
Long-term debt, net		619,057			2,183			621,240			621,645			3,562			625,207
Payable to related parties pursuant to a tax receivable agreement		388,980			—			388,980			356,755			4,829			361,584
Total liabilities		1,251,305			4,990			1,256,295			1,267,122			11,198			1,278,320
Additional paid-in capital		1,621,917			1,645			1,623,562			1,339,583			92,542			1,432,125
Accumulated deficit		(40,853	)		(6,511	)		(47,364	)		(35,928	)		(4,422	)		(40,350	)
Accumulated other comprehensive income		73,667			(1,663	)		72,004			175,198			(97,626	)		77,572
Total Bumble Inc. shareholders’ / Buzz Holdings L.P. owners’ equity		1,656,027			(6,529	)		1,649,498			1,480,051			(9,506	)		1,470,545
Noncontrolling interests		860,487			3,220			863,707			1,007,457			(886	)		1,006,571
Total shareholders’ / owners’ equity		2,516,514			(3,309	)		2,513,205			2,487,508			(10,392	)		2,477,116
Total liabilities and shareholders’ / owners’ equity		3,767,819			1,681			3,769,500			3,754,630			806			3,755,436


Unaudited Condensed Consolidated Statements of Operations and Unaudited Condensed Consolidated Statements of Comprehensive Operations	Three Months Ended June 30, 2022									Three Months Ended June 30, 2021									Six Months Ended June 30, 2022									Six Months Ended June 30, 2021
	As Previously Reported			Adjustment			As Revised			As Previously Reported			Adjustment			As Revised			As Previously Reported			Adjustment			As Revised			As Previously Reported			Adjustment			As Revised
Revenue	$	220,454		$	(1,248	)	$	219,206		$	186,217		$	(802	)	$	185,415		$	431,653		$	(2,417	)	$	429,236		$	356,930		$	(2,212	)	$	354,718
Cost of revenue		62,757			(1,248	)		61,509			50,797			(802	)		49,995			119,538			(2,417	)		117,121			98,544			(2,212	)		96,332
Total operating costs and expenses		223,222			(1,248	)		221,974			195,715			(802	)		194,913			415,402			(2,417	)		412,985			478,824			(2,212	)		476,612
Interest income (expense)		(6,281	)		292			(5,989	)		(5,921	)		293			(5,628	)		(12,164	)		584			(11,580	)		(13,650	)		465			(13,185	)
Other income (expense), net		4,954			—			4,954			4,731			—			4,731			18,184			—			18,184			11,722			(8,006	)		3,716
Income (loss) before income taxes		(4,095	)		292			(3,803	)		(10,688	)		293			(10,395	)		22,271			584			22,855			(123,822	)		(7,541	)		(131,363	)
Income tax benefit (provision)		(2,328	)		1,100			(1,228	)		(459	)		—			(459	)		(4,756	)		618			(4,138	)		436,117			1,285			437,402
Net earnings (loss)		(6,423	)		1,392			(5,031	)		(11,147	)		293			(10,854	)		17,515			1,202			18,717			312,295			(6,256	)		306,039
Net earnings (loss) attributable to noncontrolling interests		(2,031	)		440			(1,591	)		(4,064	)		1,381			(2,683	)		5,512			444			5,956			(22,412	)		(1,139	)		(23,551	)
Net earnings (loss) attributable to Bumble Inc. shareholders / Buzz Holdings L.P. owners		(4,392	)		952			(3,440	)		(7,083	)		(1,088	)		(8,171	)		12,003			758			12,761			334,707			(5,117	)		329,590
Change in foreign currency translation adjustment		(8,973	)		—			(8,973	)		(5,467	)		—			(5,467	)		(10,178	)		—			(10,178	)		(9,034	)		4,608			(4,426	)
Total other comprehensive income (loss), net of tax		(8,973	)		—			(8,973	)		(5,467	)		—			(5,467	)		(10,178	)		—			(10,178	)		(9,034	)		4,608			(4,426	)
Comprehensive income (loss)		(15,396	)		1,392			(14,004	)		(16,614	)		293			(16,321	)		7,337			1,202			8,539			303,261			(1,648	)		301,613
Comprehensive income (loss) attributable to noncontrolling interests		(4,866	)		212			(4,654	)		(6,057	)		1,334			(4,723	)		2,296			81			2,377			(25,792	)		605			(25,187	)
Comprehensive income (loss) attributable to Bumble Inc. shareholders / Buzz Holdings L.P. owners		(10,530	)		1,180			(9,350	)		(10,557	)		(1,041	)		(11,598	)		5,041			1,121			6,162			329,053			(2,253	)		326,800
Net earnings (loss) per share / unit attributable to Bumble Inc. shareholders / Buzz Holdings L.P. owners
Basic earnings (loss) per share / unit		(0.03	)		—			(0.03	)		(0.06	)		—			(0.06	)		0.09			0.01			0.10			1.67			(0.04	)		1.63
Diluted earnings (loss) per share / unit		(0.03	)		—			(0.03	)		(0.06	)		—			(0.06	)		0.09			0.01			0.10			1.62			(0.03	)		1.59


Unaudited Condensed Consolidated Statements of Cash Flows	Six Months Ended June 30, 2022									Six Months Ended June 30, 2021
	As Previously Reported			Adjustment			As Revised			As Previously Reported			Adjustment			As Revised
Cash flows from operating activities:
Net Earnings	$	17,515		$	1,202		$	18,717		$	312,295		$	(6,256	)	$	306,039
Loss on extinguishment of long term debt		—			—			—			—			3,398			3,398
Deferred income tax		(3,275	)		(618	)		(3,893	)		(441,841	)		(1,285	)		(443,126	)
Net foreign exchange difference		(5,535	)		—			(5,535	)		(7,421	)		4,608			(2,813	)
Other, net		689			(584	)		105			3,875			(465	)		3,410
Accrued expenses and other current liabilities		(37,407	)		—			(37,407	)		(29,092	)		(2,534	)		(31,626	)
Net cash provided by (used in) operating activities		44,767			—			44,767			(31,439	)		(2,534	)		(33,973	)
Cash flows from financing activities:
Repayment of term loan		(2,875	)		—			(2,875	)		(206,096	)		2,534			(203,562	)
Net cash provided by (used in) financing activities		(9,069	)		—			(9,069	)		160,621			2,534			163,155


Unaudited Condensed Consolidated Balance Sheets	March 31, 2022									March 31, 2021
	As Previously Reported			Adjustment			As Revised			As Previously Reported			Adjustment			As Revised
Other noncurrent assets	$	20,142		$	638		$	20,780		$	4,267		$	863		$	5,130
Total assets		3,795,402			638			3,796,040			3,770,114			863			3,770,977
Deferred revenue		40,679			(355	)		40,324			33,370			(355	)		33,015
Accrued expenses and other current liabilities		114,129			—			114,129			142,652			2,533			145,185
Current portion of long-term debt, net		2,588			3,162			5,750			9,996			(2,121	)		7,875
Total current liabilities		166,232			2,807			169,039			201,065			57			201,122
Long-term debt, net		619,704			2,532			622,236			619,542			6,662			626,204
Payable to related parties pursuant to a tax receivable agreement		388,980			—			388,980			356,755			4,829			361,584
Total liabilities		1,286,257			5,339			1,291,596			1,295,908			11,548			1,307,456
Additional paid-in capital		1,598,567			1,645			1,600,212			2,259,381			93,934			2,353,315
Accumulated deficit		(36,461	)		(7,463	)		(43,924	)		(28,845	)		(3,334	)		(32,179	)
Accumulated other comprehensive income		79,805			(1,892	)		77,913			178,672			(97,673	)		80,999
Total Bumble Inc. shareholders’ / Buzz Holdings L.P. owners’ equity		1,643,207			(7,710	)		1,635,497			1,392,244			(7,073	)		1,385,171
Noncontrolling interests		865,938			3,009			868,947			1,081,962			(3,612	)		1,078,350
Total shareholders’ / owners’ equity		2,509,145			(4,701	)		2,504,444			2,474,206			(10,685	)		2,463,521
Total liabilities and shareholders’ / owners’ equity		3,795,402			638			3,796,040			3,770,114			863			3,770,977


Unaudited Condensed Consolidated Statements of Operations and Unaudited Condensed Consolidated Statements of Comprehensive Operations	Three Months Ended March 31, 2022									Three Months Ended March 31, 2021
	As Previously Reported			Adjustment			As Revised			As Previously Reported			Adjustment			As Revised
Revenue	$	211,199		$	(1,169	)	$	210,030		$	170,713		$	(1,410	)	$	169,303
Cost of revenue		56,781			(1,169	)		55,612			47,747			(1,410	)		46,337
Total operating costs and expenses		192,180			(1,169	)		191,011			283,109			(1,410	)		281,699
Interest income (expense)		(5,883	)		292			(5,591	)		(7,729	)		172			(7,557	)
Other income (expense), net		13,230			—			13,230			6,991			(8,006	)		(1,015	)
Income (loss) before income taxes		26,366			292			26,658			(113,134	)		(7,834	)		(120,968	)
Income tax benefit (provision)		(2,428	)		(482	)		(2,910	)		436,576			1,285			437,861
Net earnings (loss)		23,938			(190	)		23,748			323,442			(6,549	)		316,893
Net earnings (loss) attributable to noncontrolling interests		7,543			4			7,547			(18,348	)		(2,520	)		(20,868	)
Net earnings (loss) attributable to Bumble Inc. shareholders / Buzz Holdings L.P. owners		16,395			(194	)		16,201			341,790			(4,029	)		337,761
Change in foreign currency translation adjustment		(1,205	)		—			(1,205	)		(3,567	)		4,608			1,041
Total other comprehensive income (loss), net of tax		(1,205	)		—			(1,205	)		(3,567	)		4,608			1,041
Comprehensive income (loss)		22,733			(190	)		22,543			319,875			(1,941	)		317,934
Comprehensive income (loss) attributable to noncontrolling interests		7,162			(131	)		7,031			(19,735	)		(729	)		(20,464	)
Comprehensive income (loss) attributable to Bumble Inc. shareholders / Buzz Holdings L.P. owners		15,571			(59	)		15,512			339,610			(1,212	)		338,398
Net earnings (loss) per share / unit attributable to Bumble Inc. shareholders / Buzz Holdings L.P. owners
Basic earnings (loss) per share / unit		0.13			—			0.13			1.74			(0.04	)		1.70
Diluted earnings (loss) per share / unit		0.13			(0.01	)		0.12			1.69			(0.04	)		1.65


Unaudited Condensed Consolidated Statements of Cash Flows	Three Months Ended March 31, 2022									Three Months Ended March 31, 2021
	As Previously Reported			Adjustment			As Revised			As Previously Reported			Adjustment			As Revised
Cash flows from operating activities:
Net Earnings	$	23,938		$	(190	)	$	23,748		$	323,442		$	(6,549	)	$	316,893
Loss on extinguishment of long term debt		—			—			—			—			3,398			3,398
Deferred income tax		(2,961	)		482			(2,479	)		(441,682	)		(1,285	)		(442,967	)
Net foreign exchange difference		(5,705	)		—			(5,705	)		(2,307	)		4,608			2,301
Other, net		8,365			(292	)		8,073			2,787			(172	)		2,615
Net cash provided by (used in) operating activities		19,358			—			19,358			(45,582	)		—			(45,582	)


Unaudited Consolidated Balance Sheets	December 31, 2021									December 31, 2020
	As Previously Reported			Adjustment			As Revised			As Previously Reported		Adjustment			As Revised
Goodwill	$	1,540,112		$	—		$	1,540,112		$	1,540,915	$	(803	)	$	1,540,112
Deferred tax assets, net		19,090			482			19,572			—		104			104
Other noncurrent assets		9,319			694			10,013			3,319		919			4,238
Total assets		3,775,820			1,176			3,776,996			3,637,268		220			3,637,488
Deferred revenue		39,924			(355	)		39,569			31,269		(355	)		30,914
Current portion of long-term debt, net		2,588			3,162			5,750			5,338		3,162			8,500
Total current liabilities		173,163			2,807			175,970			241,334		2,807			244,141
Long-term debt, net		620,351			2,880			623,231			820,876		742			821,618
Deferred tax liabilities, net		—			—			—			428,087		586			428,673
Total liabilities		1,301,540			5,687			1,307,227			1,552,487		4,135			1,556,622
Additional paid-in capital		1,586,781			1,645			1,588,426			—		—			—
Accumulated deficit		(52,856	)		(7,269	)		(60,125	)		—		695			695
Accumulated other comprehensive income		80,629			(2,026	)		78,603			180,852		(4,608	)		176,244
Total Bumble Inc. shareholders’ / Buzz Holdings L.P. owners’ equity		1,615,846			(7,650	)		1,608,196			2,083,973		(3,913	)		2,080,060
Noncontrolling interests		858,434			3,139			861,573			808		(2	)		806
Total shareholders’ / owners’ equity		2,474,280			(4,511	)		2,469,769			2,084,781		(3,915	)		2,080,866
Total liabilities and shareholders’ / owners’ equity		3,775,820			1,176			3,776,996			3,637,268		220			3,637,488


Unaudited Consolidated Statements of Operations and Unaudited Consolidated Statements of Comprehensive Operations	Year Ended December 31, 2021									Period from January 29, through December 31, 2020
	As Previously Reported			Adjustment			As Revised			As Previously Reported			Adjustment			As Revised
Revenue	$	765,660		$	(4,750	)	$	760,910		$	542,192		$	(2,646	)	$	539,546
Cost of revenue		209,921			(4,750	)		205,171			146,629			(3,001	)		143,628
General and administrative expense		265,738			—			265,738			178,615			3,192			181,807
Total operating costs and expenses		900,343			(4,750	)		895,593			616,593			191			616,784
Operating earnings (loss)		(134,683	)		—			(134,683	)		(74,401	)		(2,837	)		(77,238	)
Interest income (expense)		(25,609	)		1,035			(24,574	)		(22,134	)		207			(21,927	)
Other income (expense), net		11,166			(8,006	)		3,160			(5,525	)		4,608			(917	)
Income (loss) before income taxes		(149,126	)		(6,971	)		(156,097	)		(102,060	)		1,978			(100,082	)
Income tax benefit (provision)		436,071			1,766			437,837			(8,126	)		(1,285	)		(9,411	)
Net earnings (loss)		286,945			(5,205	)		281,740			(110,186	)		693			(109,493	)
Net earnings (loss) attributable to noncontrolling interests		(30,834	)		2,759			(28,075	)		808			(2	)		806
Net earnings (loss) attributable to Bumble Inc. shareholders / Buzz Holdings L.P. owners		317,779			(7,964	)		309,815			(110,994	)		695			(110,299	)
Change in foreign currency translation adjustment		(7,319	)		4,609			(2,710	)		180,852			(4,608	)		176,244
Total other comprehensive income (loss), net of tax		(7,319	)		4,609			(2,710	)		180,852			(4,608	)		176,244
Comprehensive income (loss)		279,626			(596	)		279,030			70,666			(3,915	)		66,751
Comprehensive income (loss) attributable to noncontrolling interests		(33,673	)		4,647			(29,026	)		808			(2	)		806
Comprehensive income (loss) attributable to Bumble Inc. shareholders / Buzz Holdings L.P. owners		313,299			(5,243	)		308,056			69,858			(3,913	)		65,945
Net earnings (loss) per share / unit attributable to Bumble Inc. shareholders / Buzz Holdings L.P. owners
Basic earnings (loss) per share / unit		1.52			(0.02	)		1.50			(0.05	)		0.01			(0.04	)
Diluted earnings (loss) per share / unit		1.48			(0.03	)		1.45			(0.05	)		0.01			(0.04	)


Unaudited Consolidated Statements of Cash Flows	Year Ended December 31, 2021									Period from January 29, through December 31, 2020
	As Previously Reported			Adjustment			As Revised			As Previously Reported			Adjustment			As Revised
Cash flows from operating activities:
Net Earnings	$	286,945		$	(5,205	)	$	281,740		$	(110,186	)	$	693		$	(109,493	)
Loss on extinguishment of long term debt		—			3,398			3,398			—			—			—
Deferred income tax		(446,629	)		(1,766	)		(448,395	)		(789	)		1,285			496
Net foreign exchange difference		4,084			4,608			8,692			6,945			(4,608	)		2,337
Other, net		6,093			(1,035	)		5,058			3,604			(207	)		3,397
Deferred revenue		8,654			—			8,654			22,169			(355	)		21,814
Net cash provided by (used in) operating activities		104,837			—			104,837			56,261			(3,192	)		53,069
Cash flows from financing activities:
Debt issuance costs		—			—			—			(21,105	)		3,192			(17,913	)
Net cash provided by (used in) financing activities		151,486			—			151,486			2,866,236			3,192			2,869,428


Unaudited Condensed Consolidated Balance Sheets	September 30, 2021
	As Previously Reported			Adjustment			As Revised
Other noncurrent assets	$	4,238		$	750		$	4,988
Total assets		3,749,209			750			3,749,959
Deferred revenue		39,042			(355	)		38,687
Current portion of long-term debt, net		2,588			3,162			5,750
Total current liabilities		157,926			2,807			160,733
Long-term debt, net		620,998			3,220			624,218
Payable to related parties pursuant to a tax receivable agreement		381,152			4,829			385,981
Total liabilities		1,285,422			10,856			1,296,278
Additional paid-in capital		1,470,451			92,560			1,563,011
Accumulated deficit		(42,813	)		(4,870	)		(47,683	)
Accumulated other comprehensive income		173,229			(98,023	)		75,206
Total Bumble Inc. shareholders’ / Buzz Holdings L.P. owners’ equity		1,602,159			(10,333	)		1,591,826
Noncontrolling interests		861,628			227			861,855
Total shareholders’ / owners’ equity		2,463,787			(10,106	)		2,453,681
Total liabilities and shareholders’ / owners’ equity		3,749,209			750			3,749,959


Unaudited Condensed Consolidated Statements of Operations and Unaudited Condensed Consolidated Statements of Comprehensive Operations	Three Months Ended September 30, 2021									Nine Months Ended September 30, 2021
	As Previously Reported			Adjustment			As Revised			As Previously Reported			Adjustment			As Revised
Revenue	$	200,509		$	(1,362	)	$	199,147		$	557,439		$	(3,574	)	$	553,865
Cost of revenue		56,627			(1,362	)		55,265			155,171			(3,574	)		151,597
Total operating costs and expenses		208,711			(1,362	)		207,349			687,535			(3,574	)		683,961
Interest income (expense)		(5,962	)		286			(5,676	)		(19,612	)		751			(18,861	)
Other income (expense), net		3,773			—			3,773			15,495			(8,006	)		7,489
Income (loss) before income taxes		(10,391	)		286			(10,105	)		(134,213	)		(7,255	)		(141,468	)
Income tax benefit (provision)		(280	)		—			(280	)		435,837			1,285			437,122
Net earnings (loss)		(10,671	)		286			(10,385	)		301,624			(5,970	)		295,654
Net earnings (loss) attributable to noncontrolling interests		(3,786	)		734			(3,052	)		(26,198	)		(405	)		(26,603	)
Net earnings (loss) attributable to Bumble Inc. shareholders / Buzz Holdings L.P. owners		(6,885	)		(448	)		(7,333	)		327,822			(5,565	)		322,257
Change in foreign currency translation adjustment		(2,878	)		—			(2,878	)		(11,912	)		4,608			(7,304	)
Total other comprehensive income (loss), net of tax		(2,878	)		—			(2,878	)		(11,912	)		4,608			(7,304	)
Comprehensive income (loss)		(13,549	)		286			(13,263	)		289,712			(1,362	)		288,350
Comprehensive income (loss) attributable to noncontrolling interests		(4,695	)		1,131			(3,564	)		(30,487	)		1,736			(28,751	)
Comprehensive income (loss) attributable to Bumble Inc. shareholders / Buzz Holdings L.P. owners		(8,854	)		(845	)		(9,699	)		320,199			(3,098	)		317,101
Net earnings (loss) per share / unit attributable to Bumble Inc. shareholders / Buzz Holdings L.P. owners
Basic earnings (loss) per share / unit		(0.06	)		—			(0.06	)		1.60			(0.03	)		1.57
Diluted earnings (loss) per share / unit		(0.06	)		—			(0.06	)		1.56			(0.03	)		1.53


Unaudited Condensed Consolidated Statements of Cash Flows	Nine Months Ended September 30, 2021
	As Previously Reported			Adjustment			As Revised
Cash flows from operating activities:
Net Earnings	$	301,624		$	(5,970	)	$	295,654
Loss on extinguishment of long term debt		—			3,398			3,398
Deferred income tax		(441,811	)		(1,285	)		(443,096	)
Net foreign exchange difference		(6,865	)		4,608			(2,257	)
Other, net		4,478			(751	)		3,727
Accrued expenses and other current liabilities		(42,525	)		6,804			(35,721	)
Net cash provided by (used in) operating activities		13,453			6,804			20,257
Cash flows from financing activities:
Repayment of term loan		(207,534	)		2,534			(205,000	)
Withholding tax paid on behalf of employees on stock-based awards		—			(9,338	)		(9,338	)
Net cash provided by (used in) financing activities		159,728			(6,804	)		152,924

Note 4 - Income Taxes

The Company is subject to U.S. federal and state income taxes and files consolidated income tax returns for U.S. federal and certain state jurisdictions with respect to its allocable share of any net taxable income of Buzz Holdings L.P. For the three and nine months ended September 30, 2022, our effective tax rates are 5.8% and 11.3%, respectively, which differ from the U.S. federal statutory tax rate of 21% primarily due to the geographical distribution of our earnings, income attributable to non-controlling interests, nondeductible stock-based compensation, and a valuation allowance recorded against certain deferred tax assets arising in the current year.

Our effective tax rate for the nine months ended September 30, 2021 was 309.0% which includes the discrete impact of the Company’s restructuring activities that occurred on January 1, 2021. Deferred tax liabilities of $448.2 million recorded at Maltese and UK entities related to relevant intangible property were written off in the first quarter of 2021, offset by $6.7 million of deferred tax assets recorded in Malta for related tax basis in transferred intangible property resulting in a net income tax benefit of $441.5 million during the period. In addition, the tax benefit for the three and nine months ended September 30, 2021 reflects the impact of our assessment that we will not be able to record the benefit of certain current year deferred tax assets for which a valuation allowance is recorded.

Note 5 - Payable to Related Parties Pursuant to a Tax Receivable Agreement

We estimate the amount of existing tax basis with respect to which our pre-IPO owners will be entitled to receive payments under the tax receivable agreement (assuming all Pre-IPO Common Unitholders exchanged their Common Units for shares of Class A common stock on the date of the IPO, and assuming all vested Incentive Units were converted to Common Units and immediately exchanged for shares of Class A common stock at the IPO price of $43.00 per share of Class A common stock) is approximately $2,603 million which includes the Company's allocable share of existing tax basis acquired in the IPO, which we have determined to be approximately $1,728 million. In determining the Company's allocable share of existing tax basis acquired in the IPO, we have given retrospective effect to certain exchanges of Common Units for Class A shares that occurred after the IPO that were contemplated to have occurred pursuant to the Blocker Restructuring. The payments under the tax receivable agreement are not conditioned upon continued ownership of the Company by the pre-IPO owners.

We have determined that it is more likely than not that we will be unable to realize tax benefits related to certain basis adjustments and acquired net operating losses that were received in connection with the Reorganization Transactions and our IPO. As a result of this determination, we have not recorded the benefit of these deferred tax assets as of September 30, 2022. The realizability of the deferred tax assets is evaluated based on all positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax planning strategies and recent results of operations. We will assess the realizability of the deferred tax assets at each reporting period, and a change in our estimate of our liability associated with the tax receivable agreement may result as additional information becomes available, including results of operations in future periods. At the time of the Sponsor Acquisition, the assets and liabilities of Bumble Holdings were adjusted to fair value on the closing date of the business combination for both financial reporting and income tax purposes. As a result of the IPO transaction, we inherited certain tax benefits associated with this stepped-up basis (“Common Basis”) created when certain pre-IPO owners acquired their interests in Bumble Holdings in the Sponsor Acquisition. This Common Basis entitles us to the depreciation and amortization deductions previously allocable to the pre-IPO owners. Based on current projections, we anticipate having sufficient taxable income to be able to realize the benefit of this Common Basis and have recorded a tax receivable agreement liability of $389.0 million related to these benefits as of September 30, 2022. To the extent that we determine that we are able to realize the tax benefits associated with the basis adjustments and net operating losses, we would record an additional liability of $281.0 million for a total liability of $670.0 million. If, in the future, we are not able to utilize the Common Basis, we would record a reduction in the tax receivable agreement liability to related parties that would result in a benefit recorded within our consolidated statement of operations.

Note 6 - Business Combination

The Company entered into a definitive agreement to purchase all of the outstanding shares of Flashgap SAS (“Flashgap”), pursuant to a Share Purchase Agreement dated January 31, 2022 (“Purchase Agreement”), by and among Bumble, Flashgap, and the company’s

selling shareholders, for a purchase price of approximately $75.4 million. Flashgap (popularly known as Fruitz), is a fast growing dating app with a Gen Z focus, which is a growing segment of online dating consumers. Fruitz complements our existing Bumble and Badoo apps and will allow the Company to expand our product offerings to a dynamic Gen Z market. The acquisition of Fruitz was accounted for using the acquisition method of accounting which required that the assets acquired and liabilities assumed be recognized at their estimated fair values as of the acquisition date (based on Level 3 measurements). As detailed below, the Company entered into a contingent earn-out arrangement that was determined to be part of the purchase consideration. See Note 11, Fair Value Measurements for further discussion.

The following tables summarize the purchase consideration and the preliminary purchase price allocation to estimated fair values of the identifiable assets acquired and liabilities assumed (in thousands):


Cash consideration	$	72,275
Fair value of contingent earn-out liability		3,100
Total purchase price	$	75,375


Purchase price allocation	$	75,375
Less fair value of net assets acquired:
Cash and cash equivalents		2,555
Accounts receivable		799
Other current assets		57
Property and equipment		17
Intangible assets		42,930
Deferred revenue		(650	)
Accounts payable		(1,045	)
Deferred tax liabilities		(10,819	)
Net assets acquired		33,844
Goodwill	$	41,531

Goodwill, which is not expected to be tax deductible, is primarily attributable to assembled workforce, expected synergies and other factors. During the three months ended June 30, 2022, the Company adjusted the purchase price allocation for tax related matters in the amount of $0.4 million. The Company did not adjust the purchase price allocation during the three months ended September 30, 2022.

The fair values of the identifiable intangible assets acquired at the date of acquisition are as follows (in thousands):


	Acquisition Date Fair Value		Weighted- Average Useful Life (Years)
Brand	$	38,000		15
Developed technology		4,100		4
User base		830		4
Total identifiable intangible assets acquired	$	42,930

The fair values of the acquired brand and developed technology were determined using a relief from royalty methodology. The fair value of the user base was determined using an excess earnings methodology. The valuations of intangible assets incorporates significant unobservable inputs and require significant judgment and estimates, including the amount and timing of future cash flows.

For the three and nine months ended September 30, 2022, the Company has recognized transaction costs related to the acquisition of $0.0 million and $1.1 million, respectively. These costs are recorded in “General and administrative expense” in the condensed consolidated statements of operations.

Note 7 - Property and Equipment, net

A summary of the Company’s property and equipment, net is as follows (in thousands):


	September 30, 2022			December 31, 2021
Computer equipment	$	22,553		$	21,675
Leasehold improvements		6,275			7,288
Furniture and fixtures		761			904
Total property and equipment, gross	$	29,589		$	29,867
Accumulated depreciation		(16,616	)		(15,240	)
Total property and equipment, net	$	12,973		$	14,627

Depreciation expense related to property and equipment, net for the three months ended September 30, 2022 and 2021 was $2.1 million and $2.3 million, respectively, and for the nine months ended September 30, 2022 and 2021 was $6.5 million and $7.0 million, respectively.

Note 8 - Goodwill and Intangible Assets, net

Goodwill

The changes in the carrying amount of goodwill for the periods presented is as follows (in thousands):


Balance as of December 31, 2021	$	1,540,112
Fruitz acquisition		41,531
Foreign currency translation adjustment		(5,377	)
Balance as of September 30, 2022	$	1,576,266

Intangible Assets, net

A summary of the Company’s intangible assets, net is as follows (in thousands):


	September 30, 2022
	Gross Carrying Amount		Accumulated Amortization			Impairment losses			Net Carrying Amount		Weighted- Average Remaining Useful Life (Years)
Bumble and Badoo brands	$	1,511,269	$	—		$	—		$	1,511,269	Indefinite
Fruitz brand		33,074		(1,470	)		—			31,604		14.3
Developed technology		248,381		(131,161	)		—			117,220		2.4
User base		113,417		(112,815	)		—			602		—
White label contracts		33,384		(6,953	)		(26,431	)		—		—
Other		15,645		(2,564	)		—			13,081		4.4
Total intangible assets, net	$	1,955,170	$	(254,963	)	$	(26,431	)	$	1,673,776


	December 31, 2021
	Gross Carrying Amount		Accumulated Amortization			Impairment losses			Net Carrying Amount		Weighted- Average Remaining Useful Life (Years)
Bumble and Badoo brands	$	1,511,269	$	—		$	—		$	1,511,269	Indefinite
Developed technology		244,813		(93,845	)		—			150,968		3.1
User base		112,695		(86,399	)		—			26,296		0.6
White label contracts		33,384		(6,953	)		(26,431	)		—		—
Other		9,106		(841	)		—			8,265		5.3
Total intangible assets, net	$	1,911,267	$	(188,038	)	$	(26,431	)	$	1,696,798

Amortization expense related to intangible assets, net for the three months ended September 30, 2022 and 2021 was $17.7 million and $24.8 million, respectively, and for the nine months ended September 30, 2022 and 2021 was $67.3 million and $74.0 million, respectively.

As of September 30, 2022, amortization of intangible assets with definite lives is estimated to be as follows (in thousands):


Remainder of 2022	$	13,845
2023		55,378
2024		54,844
2025		8,553
2026 and thereafter		26,355
Total	$	158,975

Note 9 - Restructuring

On March 8, 2022, the Company announced that it adopted a restructuring plan to discontinue its existing operations in Russia and remove its apps from the Apple App Store and Google Play Store in Russia and Belarus. The Company plans to substantially exit its Russian operations by the end of 2022. In connection with the restructuring plan, approximately 120 employees were impacted. The Company expects to incur restructuring charges totaling approximately $7.0 million to $10.0 million, consisting primarily of right-of-use asset impairment, severance benefits, relocation and other related costs during the twelve months ended December 31, 2022.

The following table presents the total restructuring charges by function (in thousands):


	Three Months Ended September 30, 2022			Nine Months Ended September 30, 2022
Cost of revenue	$	(14	)	$	125
Selling and marketing		—			34
General and administrative		789			6,561
Product development		(163	)		1,053
Total	$	612		$	7,773

During the nine months ended September 30, 2022, the Company determined that the Moscow office was fully impaired and recorded an impairment charge of $4.4 million, which was included in “General and administrative” expense in the accompanying condensed consolidated statements of operations. Including the impairment charge, the Company incurred restructuring charges of $0.6 million and $7.8 million during the three and nine months ended September 30, 2022, respectively. The remaining amounts were primarily related to employee severance and relocation costs.

The following table summarizes the restructuring related liabilities (in thousands):


	Employee Related Benefits			Other			Total
Balance as of December 31, 2021	$	—		$	—		$	—
Restructuring charges		3,222			163			3,385
Cash payments		(2,588	)		(163	)		(2,751	)
Balance as of September 30, 2022	$	634		$	—		$	634

On October 28, 2022, the Company entered into a lease termination agreement for its Moscow office (“Lease Termination Agreement”). The Lease Termination Agreement provides that the Lease Agreement, dated as of December 28, 2011, will terminate effective October 31, 2022. As consideration for Landlord’s agreement to enter into the Lease Termination Agreement, the Company was required to pay approximately $1.8 million.

Note 10 - Other Financial Data

Consolidated Balance Sheets Information

Other current assets are comprised of the following balances (in thousands):


	September 30, 2022		December 31, 2021
Capitalized aggregator fees	$	10,451	$	8,183
Prepayments		14,189		10,989
Income tax receivable		284		30,563
Other receivables		5,460		3,016
Total other current assets	$	30,384	$	52,751

Accrued expenses and other current liabilities are comprised of the following balances (in thousands):


	September 30, 2022		December 31, 2021
Legal liabilities	$	1,340	$	8,767
Accrued expenses		53,889		39,849
Lease liabilities		5,037		3,898
Income tax payable		4,344		42,317
Other payables		13,867		16,651
Total accrued expenses and other current liabilities	$	78,477	$	111,482

Other non-current liabilities are comprised of the following balances (in thousands):


	September 30, 2022		December 31, 2021
Lease liabilities	$	18,516	$	21,711
Contingent earn-out liability		53,010		96,600
Other liabilities		762		935
Total other liabilities	$	72,288	$	119,246

Note 11 - Fair Value Measurements

The following tables present the Company’s financial instruments that are measured at fair value on a recurring basis (in thousands):


	September 30, 2022
	Level 1		Level 2		Level 3		Total Fair Value Measurements
Assets:
Cash and cash equivalents	$	365,105	$	—	$	—	$	365,105
Derivative asset		—		23,411		—		23,411
Investments in equity securities		—		—		2,647		2,647
	$	365,105	$	23,411	$	2,647	$	391,163
Liabilities:
Contingent earn-out liability	$	—	$	—	$	53,010	$	53,010
	$	—	$	—	$	53,010	$	53,010


	December 31, 2021
	Level 1		Level 2		Level 3		Total Fair Value Measurements
Assets:
Cash and cash equivalents	$	369,175	$	—	$	—	$	369,175
Derivative asset		—		5,008		—		5,008
Investments in equity securities		—		—		2,610		2,610
	$	369,175	$	5,008	$	2,610	$	376,793
Liabilities:
Contingent earn-out liability	$	—	$	—	$	96,600	$	96,600
	$	—	$	—	$	96,600	$	96,600

There were no transfers between levels between September 30, 2022 and December 31, 2021.

The carrying value of accounts receivable, accounts payable, income tax payable, accrued expenses and other payables approximate their fair values due to the short-term maturities of these instruments.

The Company’s contingent earn-out liability is measured at fair value on a recurring basis using significant unobservable inputs (Level 3) and totaled $53.0 million and $96.6 million as of September 30, 2022 and December 31, 2021, respectively. Contingent earn-out liability is included in “Other liabilities” in the accompanying condensed consolidated balance sheets.

As of September 30, 2022, there is a contingent consideration arrangement, consisting of an earn-out payment to former shareholders of Worldwide Vision Limited of up to $150 million. The Company determined the fair value of the contingent earn-out liability by using a probability-weighted analysis to determine the amount of the liability, and applying a discount rate that captures the risks associated with the duration of the obligation. The number of scenarios in the probability-weighted analyses vary; generally, more scenarios are prepared for longer duration and more complex arrangements. As of September 30, 2022 and December 31, 2021, the fair value of the contingent earn-out liability reflects a risk-free rate of 4.1% and 0.5%, respectively.

In addition, as of September 30, 2022, there is a contingent consideration arrangement, consisting of an earn-out payment of up to $10 million in connection with the acquisition of Fruitz in January 2022. The Company determined the fair value of the contingent earn-out liability using a probability-weighted analysis and applied a discount rate that captures the risks associated with the obligation that is long-term in nature. As of September 30, 2022, the fair value of the contingent earn-out liability reflects a risk-free rate of 4.1%.

The Company classified contingent earn-out arrangements as liabilities at the time of the acquisition, as they will be settled in cash, and remeasures the fair values of the contingent earn-out liabilities each reporting period thereafter until settled. The fair value of the contingent earn-out liabilities are sensitive to changes in the forecasts of earnings and/or the relevant operating metrics and changes in discount rates. Changes in fair values of contingent earn-out liabilities are recognized in “General and administrative expense” in the accompanying condensed consolidated statements of operations. The change in fair value of the contingent earn-out liability was $(27.0) million and $5.2 million for the three months ended September 30, 2022 and 2021, respectively, and $(46.4) million and $77.7 million for the nine months ended September 30, 2022 and 2021, respectively.

Note 12 - Debt

Total debt is comprised of the following (in thousands):


	September 30, 2022		(As Revised) December 31, 2021
Term Loan due January 29, 2027	$	634,250	$	638,562
Less: unamortized debt issuance costs		8,261		9,581
Less: current portion of debt, net		5,750		5,750
Total long-term debt, net	$	620,239	$	623,231

Credit Agreements

On January 29, 2020, the Company and the wholly-owned subsidiaries, Buzz Bidco LLC, Buzz Merger Sub Limited, and Buzz Finco LLC (collectively, the “Borrowers”) entered into a credit agreement (the “Original Credit Agreement”). The Original Credit Agreement permitted the Company to borrow up to $625.0 million through a seven-year $575.0 million term loan (“Original Term Loan”), as well as a five-year revolving credit facility of $50.0 million and $25.0 million available through letters of credit. In connection with the Original Credit Agreement, the Company incurred and paid debt issuance costs of $16.3 million during the year ended December 31, 2020.

On October 19, 2020, the Company amended the Original Credit Agreement and entered into the First Amendment to the Credit Agreement (the “Amended Credit Agreement”), which provides for incremental borrowing of an aggregate principal amount of $275.0 million (the “Additional Term Loan”, collectively with the Original Term Loan, the “Term Loans”). The terms of the Amended Credit Agreement were unchanged from the Original Credit Agreement, and the sole purpose of the Amendment was to increase the principal available to the Company. In connection with the Amended Credit Agreement, the Company incurred and paid debt issuance costs of $4.8 million during the year ended December 31, 2020, of which approximately $1.6 million was capitalized as debt issuance costs.

On March 31, 2021, the Company used proceeds from the IPO to repay outstanding indebtedness on the Incremental Term Loan Facility in an aggregate principal amount of $200.0 million, which has prepaid our obligated principal repayments until maturity on the Incremental Term Loan and, as a result, has reduced our contractual obligations. In connection with the repayment, the Company recognized a $3.4 million loss on extinguishment of long-term debt.

Based on the calculation of the applicable consolidated total leverage ratio, the applicable margin for borrowings under the revolving credit facility is between 1.00% to 1.50% with respect to base rate borrowings and between 2.00% and 2.50% with respect to LIBOR rate borrowings. The interest rates in effect for the Original Term Loan and the Additional Term Loan as of September 30, 2022 were 5.27% and 5.77%, respectively. The Term Loans will mature on January 29, 2027 and principal amounts outstanding under the revolving credit facility will be due and payable in full at maturity on January 29, 2025. As of September 30, 2022, and at all times during the period, the Company was in compliance with the financial debt covenants.

As the loans are issued with a floating rate of interest, the Company believes that the fair value of the obligations is approximated by the principal amount of the loans as of September 30, 2022. The carrying value of the Term Loans includes the outstanding principal amount, less unamortized debt issuance costs. Therefore, the Company assumes the carrying value of the debt, before any transaction costs, would closely approximate the fair value of the loan obligation with the assumptions above.

Future maturities of long-term debt as of September 30, 2022, were as follows (in thousands):


Remainder of 2022	$	1,437
2023		5,750
2024		5,750
2025		5,750
2026 and thereafter		615,563
Total	$	634,250

Note 13 - Shareholders' Equity

Equity Structure Prior to Initial Public Offering and Reorganization

Limited Partner’s Interest

On January 29, 2020, Bumble Holdings, and the wholly owned indirect subsidiary, Buzz Merger Sub Limited, executed the Merger Agreement with Worldwide Vision Limited whereby Bumble Holdings agreed to purchase all of the outstanding equity interest of Worldwide Vision Limited. In conjunction with the Sponsor Acquisition, the equity that was in existence in the Predecessor periods was settled and no longer outstanding subsequent to January 29, 2020.

Prior to the IPO, Limited Partners' Interest was inclusive of Capital Contribution from the Parent, Additional Paid-in Capital, and Retained Earnings. The capital structure of Bumble Holdings consisted of two different classes of limited partnership interests, Class A and Class B units. Class A units were issued and held by Blackstone, an affiliate of Accel Partners LP., our Founder, and certain members of senior management in exchange for capital contributions (“Class A Units”). Class B units were issued to senior management, select members of the Company's board of directors (the “Board”) and select employees of Bumble Holdings and represent profit interests of Bumble Holdings which vest subject to certain service and performance conditions.

As of December 31, 2020, there were 2,453,784,599 units of Class A and 153,273,895 units of Class B outstanding.

Noncontrolling Interests

Prior to the IPO, the Company’s noncontrolling interests represented a reserve for minority interests’ share of accumulated profits and losses of Huggle App (UK) Limited and Lumen App Limited and pre-Sponsor Acquisition, Bumble Holding Limited and its subsidiaries.

Initial Public Offering

On February 16, 2021, the Company completed its IPO of 57.5 million shares of Class A common stock at an offering price of $43 per share. The Company received net proceeds of $2,361.2 million after deducting underwriting discounts and commissions. The Company used the proceeds from the issuance of 48.5 million shares ($1,991.6 million) in the IPO to redeem shares of Class A common stock and purchase Common Units from entities affiliated with our Sponsor, at a price per share / Common Unit equal to the IPO price, net of underwriting discounts and commissions. The Company used a portion of the proceeds from the issuance of 9.0 million shares ($369.6 million) in the IPO to repay $200.0 million of outstanding indebtedness.

Secondary Offering

On September 15, 2021, the Company completed a secondary offering of 20.7 million shares of Class A common stock on behalf of certain selling stockholders affiliated with Blackstone Inc. (the "Selling Stockholders") at a price of $54.00 per share. This transaction resulted in the issuance of 9.2 million shares of Class A common stock for the period ended September 30, 2021.

Reorganization

Prior to the IPO, on February 10, 2021 the limited partnership agreement of Bumble Holdings was amended and restated, resulting in the following:

•

Bumble Inc. became the general partner of Bumble Holdings with 100% of the voting power and control of the management of Bumble Holdings.

•

All outstanding Class A Units were either (1) reclassified into a new class of limited partnership interest referred to as “Common Units”, or (2) directly or indirectly exchanged for vested shares of Class A common stock of Bumble Inc.

•

All outstanding Class B Units were either (1) reclassified into a new class of limited partnership interest referred to as “Incentive Units”, or (2) directly or indirectly exchanged for vested shares of Class A common stock of Bumble Inc. (in the case of vested Class B Units) and restricted shares of Class A common stock of Bumble Inc. (in the case of unvested Class B Units).

•

Recognition of a noncontrolling interest due to the Pre-IPO Common Unitholders retaining an economic interest in Bumble Holdings related to Common Units not exchanged for vested shares of Class A common stock.

As part of the Reorganization Transactions, the Blocker Companies entered into certain restructuring transactions that resulted in the Pre-IPO Shareholders acquiring newly issued shares of Class A common stock in exchange for their ownership interests in the Blocker Companies and the Company acquiring an equal number of outstanding Common Units.

Additionally, Bumble Inc. and the holders of all Common Units entered into an exchange agreement in which the holders of the Common Units will have the right on a quarterly basis to exchange their Common Units for shares of Class A common stock of the Company on a one-for-one basis, subject to customary conversion rate adjustments for stock splits, stock dividends and reclassifications.

Subsequent to the Reorganization Transactions, our Sponsor effected certain exchanges of Common Units for Class A shares that were contemplated to have occurred pursuant to the Blocker Restructuring, with the net change to the capital structure being 4,455,510 Common Units in Bumble Holdings being exchanged on April 1, 2021, on a one-for-one basis, for Class A common stock in the Company. We gave retrospective effect to these transactions when estimating our tax receivable agreement liability, see Note 4, Income Taxes.

Amendment and Restatement of Certificate of Incorporation

The Company’s amended and restated certificate of incorporation has three classes of ownership interests: 6,000,000,000 shares of Class A common stock, par value $0.01 per share, 1,000,000 shares of Class B common stock, par value $0.01 per share, and 600,000,000 shares of preferred stock, par value $0.01 per share.

Class A Common Stock

Shares of Class A common stock have both voting and economic rights. Holders of Class A common stock are entitled to one vote for each share of Class A common stock held. Notwithstanding the foregoing, unless they elect otherwise, our Founder and affiliates of Blackstone (collectively, the “Principal Stockholders”) are entitled to outsized voting rights. Until the High Vote Termination Date (as defined below), each share of Class A common stock held by a Principal Stockholder is entitled to ten votes. “High Vote Termination Date” means the earlier to occur of (i) seven years from the closing of this offering and (ii) the date the parties to the stockholders agreement cease to own in the aggregate 7.5% of the outstanding shares of Class A common stock, assuming exchange of all Common Units. Shares of Class A common stock are entitled to dividends and pro rata distribution of remaining available assets upon liquidation. Shares of Class A common stock do not have preemptive, subscription, redemption or conversion rights.

As of September 30, 2022 and December 31, 2021, there were 129,645,692 and 129,212,949 shares of Class A common stock outstanding, respectively.

Class B Common Stock

Shares of Class B common stock have voting but no economic rights. Holders of Class B common stock generally are entitled, without regard to the number of shares of Class B common stock held by such holder, to one vote for each Common Unit of Bumble Holdings held by such holder. Notwithstanding the foregoing, unless they elect otherwise, each Principal Stockholder that holds Class B common stock is entitled to outsized voting rights. Until the High Vote Termination Date, each Principal Stockholder that holds Class B common stock is entitled, without regard to the number of shares of Class B common stock held by such Principal Stockholder, to a number of votes equal to 10 times the aggregate number of Common Units of Bumble Holdings held by such Principal Stockholder. Shares of Class B common stock do not have any right to receive dividends or distribution upon liquidation.

As of September 30, 2022 and December 31, 2021, there were 20 shares of Class B common stock outstanding.

Preferred Stock

The Company is authorized to issue, without the approval of its stockholders, one or more series of preferred stock. The Board may determine, with respect to any series of preferred stock, the powers (including voting powers), preferences and relative, participating, optional or other special rights.

As of September 30, 2022 and December 31, 2021, no preferred stock had been issued.

Treasury Stock

During the three months ended March 31, 2021, the Company used a portion of the proceeds from the issuance of 48.5 million shares in the IPO to redeem shares of Class A common stock from the pre-IPO owners. Repurchases of the Company's common stock are included in treasury stock at the cost of shares repurchased.

During the nine months ended September 30, 2021, the Company retired and restored the treasury stock to the status of authorized, but unissued, shares of Class A Common Stock.

Noncontrolling Interests

The Company’s noncontrolling interests represent a reserve related to the Common Units held by the pre-IPO Common Unitholders and the Common Units to which continuing incentive unitholders would be entitled to following exchange of their Vested Incentive Units.

Note 14 - Earnings (Loss) per Share / Unit

The Company computes earnings per share (“EPS”) of Class A common stock using the two-class method required for participating securities. The Company considers unvested restricted shares and vested RSUs to be participating securities because holders are entitled to be credited with dividend equivalent payments, upon the payment by the Company of dividends on shares of Common Stock.

Undistributed earnings allocated to participating securities are subtracted from net earnings (loss) attributable to Bumble Inc. in determining net earnings (loss) attributable to common stockholders. Basic EPS is computed by dividing net earnings (loss) attributable to common stockholders / unitholders by the weighted-average number of shares of our Class A Common Stock / Units outstanding.

For the calculation of diluted EPS, net earnings (loss) attributable to common stockholders / unitholders for basic EPS is adjusted by the effect of dilutive securities.

Diluted EPS attributable to common stockholders / unitholders is computed by dividing the resulting net earnings (loss) attributable to common stockholders / unitholders by the weighted-average number of common shares / units outstanding, adjusted to give effect to dilutive elements including restricted shares, RSUs, and options to the extent these are dilutive.

The following table sets forth a reconciliation of the numerators used to compute the Company's basic and diluted earnings (loss) per share / unit (in thousands):


	Three Months Ended September 30, 2022		(As Revised) Three Months Ended September 30, 2021			Nine Months Ended September 30, 2022		(As Revised) Nine Months Ended September 30, 2021
Numerator:
Net earnings (loss)	$	26,405	$	(10,385	)	$	45,122	$	295,654
Net earnings (loss) attributable to noncontrolling interests		8,342		(3,052	)		14,298		(26,603	)
Net earnings (loss) attributable to Bumble Inc. shareholders / Buzz Holdings L.P. owners	$	18,063	$	(7,333	)	$	30,824	$	322,257

The following table sets forth the computation of the Company's basic and diluted earnings (loss) per share / unit (in thousands, except share / unit amounts, and per share / unit amounts, unaudited):


	Three Months Ended September 30, 2022		(As Revised) Three Months Ended September 30, 2021			Nine Months Ended September 30, 2022		(As Revised) Nine Months Ended September 30, 2021
Basic earnings (loss) per share / unit attributable to common stockholders / unitholders
Numerator
Allocation of net earnings (loss) attributable to Bumble Inc. shareholders / Buzz Holdings L.P. owners	$	18,042	$	(6,711	)	$	30,855	$	187,381
Less: net earnings (loss) attributable to participating securities		18		—			33		517
Net earnings (loss) attributable to common stockholders / unitholders	$	18,024	$	(6,711	)	$	30,822	$	186,864
Denominator
Weighted average number of shares of Class A common stock / units outstanding		129,464,491		121,234,122			129,366,351		118,860,555
Basic earnings (loss) per share / unit attributable to common stockholders / unitholders	$	0.14	$	(0.06	)	$	0.24	$	1.57

Diluted earnings (loss) per share / unit attributable to common stockholders / unitholders
Numerator
Allocation of net earnings (loss) attributable to Bumble Inc. shareholders / Buzz Holdings L.P. owners	$	17,628	$	(6,711	)	$	30,362	$	182,620
Increase in net earnings (loss) attributable to common shareholders upon conversion of potentially dilutive Common Units		8,777		—			14,760		113,034
Less: net earnings (loss) attributable to participating securities		18		—			33		504
Net earnings (loss) attributable to common stockholders / unitholders	$	26,387	$	(6,711	)	$	45,089	$	295,150
Denominator
Number of shares / units used in basic computation		129,464,491		121,234,122			129,366,351		118,860,555
Add: weighted-average effect of dilutive securities
Restricted shares		—		—			—		—
RSUs		1,597,664		—			988,602		1,056,484
Options		—		—			—		7,425
Common Units to Convert to Class A Common Stock		62,924,260		—			61,968,587		72,672,843
Weighted average shares of Class A common stock / units outstanding used to calculate diluted earnings (loss) per share / unit		193,986,415		121,234,122			192,323,540		192,597,307
Diluted earnings (loss) per share / unit attributable to common stockholders / unitholders	$	0.14	$	(0.06	)	$	0.23	$	1.53

The following table sets forth potentially dilutive securities that were excluded from the diluted earnings (loss) per share computation because the effect would be anti-dilutive, or issuance of such shares is contingent upon the satisfaction of certain conditions which were not satisfied by the end of the periods:


	Three Months Ended September 30, 2022		Three Months Ended September 30, 2021		Nine Months Ended September 30, 2022		Nine Months Ended September 30, 2021
Time-vesting awards:
Options		2,698,372		1,869,375		2,698,372		1,916,881
Restricted shares		—		121,187		—		—
RSUs		92,173		2,566,865		481,978		6,330
Incentive units		266,723		5,260,645		344,648		121,372
Total time-vesting awards		3,057,268		9,818,072		3,524,998		2,044,583

Exit-vesting awards:
Options		164,362		222,424		164,362		222,424
Restricted shares		—		97,387		—		—
RSUs		208,007		1,248,057		208,007		1,248,057
Incentive units		300,732		4,324,868		372,819		4,324,868
Total exit-vesting awards		673,101		5,892,736		745,188		5,795,349
Total		3,730,369		15,710,808		4,270,186		7,839,932

Note 15 - Stock-based Compensation

Total stock-based compensation cost, net of forfeitures, was as follows:



(In thousands)	Three Months Ended September 30, 2022		Three Months Ended September 30, 2021		Nine Months Ended September 30, 2022		Nine Months Ended September 30, 2021
Cost of revenue	$	807	$	808	$	2,726	$	3,019
Selling and marketing expense		3,779		2,545		4,547		10,186
General and administrative expense		23,080		11,287		45,627		49,155
Product development expense		9,509		9,123		24,279		37,142
Total stock-based compensation expense	$	37,175	$	23,763	$	77,179	$	99,502

Plans

Prior to the IPO, Bumble Holdings had three active plans under which awards had been granted to various employees of the Company, including key management personnel, based on their management grade.

In connection with the Sponsor Acquisition, Bumble Holdings and Buzz Management Aggregator L.P., an interest holder in Bumble Holdings, adopted two new incentive plans for the employees’ performance and retention purposes, namely the Employee Incentive Plan (“Non-U.S. Plan”) and the Equity Incentive Plan (“U.S. Plan”). The participants of the Non-U.S. Plan and U.S. Plan are selected employees of the Company and the subsidiaries. Bumble Holdings and Buzz Management Aggregator L.P. also adopted one incentive plan for Whitney Wolfe Herd (the “Founder Plan”). Awards granted under the Founder Plan and U.S. Plan were in the form of Class B Units in Bumble Holdings and Class B Units in Buzz Management Aggregator L.P, respectively (collectively, the “Class B Units”). Under the Non-U.S. Plan, participants have received phantom awards of Class B Units in Buzz Management Aggregator L.P. (the “Phantom Class B Units”) that are settled in cash equal to the notional value of the Buzz Management Aggregator Class B Units at the settlement date.

The Class B Units under the Founder Plan and U.S. Plan and the Phantom Class B Units under the Non-U.S. Plan comprise:

●

Time-Vesting Class B Units and Time-Vesting Phantom Class B Units (60% of the Class B Units and Phantom Class B Units granted) that generally vest over a five-year service period and for which expense is recognized under a graded expense attribution model; and

●

Exit-Vesting Class B Units and Exit-Vesting Phantom Class B Units (40% of the Class B Units and Phantom Class B Units granted). Vesting for these awards is based on a liquidity event in which affiliates of Blackstone receive cash proceeds in respect of its Class A units in the Company prior to the termination of the participant. Further, the portion of the Exit-Vesting Class B Units and Exit-Vesting Phantom Class B Units that vest is based on certain Multiple on Invested Capital (“MOIC”) and Internal Rate of Return (“IRR”) hurdles associated with a liquidity event. The MOIC and IRR

hurdles impact the fair value of the awards. As the vesting of these units is contingent upon a specified liquidity event, no expense was required to be recorded prior to the occurrence of a liquidity event.

Time-Vesting Class B Units and Exit-Vesting Class B Units

Expense for the Time-Vesting Class B Units and Exit-Vesting Class B Units was based on the grant date fair value of the Class B Units. The grant date fair value was measured using a Monte Carlo model, which incorporates various assumptions noted in the following table. Use of a valuation model requires management to make certain assumptions with respect to selected model inputs. Expected volatility was calculated based on the observed equity volatility for comparable companies. The expected time to liquidity event was based on management’s estimate of time to an expected liquidity event. The dividend yield was based on the Company’s expected dividend rate. The risk-free interest rate was based on U.S. Treasury zero-coupon issues. Forfeitures were accounted for as they occurred.

The weighted-average assumptions the Company used in the Monte Carlo model for 2020 are as follows:


Dividend yield	—
Expected volatility	58	%
Risk-free interest rate	0.86	%
Expected time to liquidity event (years)	4.7

Post-IPO Award Reclassification

In connection with the Company’s IPO, awards under the Founder Plan, U.S. Plan, and Non-U.S. Plan were reclassified as follows:

●

The Time-Vesting and Exit-Vesting Class B Units in Bumble Holdings under the Founder Plan and granted to senior management under the U.S. Plan were reclassified to vested Incentive Units (in the case of Vested Class B Units) and unvested Incentive Units (in the case of unvested Class B Units) in Bumble Holdings.

●

The Time-Vesting and Exit-Vesting Class B Units in Bumble Holdings (other than those granted to senior management) were reclassified to Class A common stock (in the case of vested Class B Units) and restricted shares of Class A common stock (in the case of unvested Class B Units) in the Company.

●

In each of the above reclassifications, the Post-IPO awards retained the same terms and conditions (including applicable vesting requirements). Each Post-IPO award was converted to reflect the $43.00 share price contemplated in the Company’s IPO while retaining the same economic value in the Company.

At the IPO date, the Company concluded that our public offering represented a qualifying liquidity event that would cause the Exit-Vesting awards’ performance conditions to be probable. As such, the Company has begun to recognize stock-based compensation expense in relation to the Exit-Vesting awards.

On July 15, 2022, the Exit-Vesting awards granted to 386 participants were modified to also provide for time-based vesting in 36 equal installments, with the first installment vesting on August 29, 2022 and subsequent installments vesting on each of the next 35 monthly anniversaries of August 29, 2022, subject to the award holder's continued employment through each applicable vesting date and subject to other terms and conditions of the award. Incremental expense associated with the modification of the Exit-Vesting awards was $35.8 million, which is expected to be recognized over a period of 3.0 years. If the performance conditions are met prior to their respective time-vesting schedules, vesting of these Exit-Vesting awards and the associated stock-based compensation will be accelerated pursuant to the terms of the award agreements.

Incremental expense for the modified Exit-Vesting awards was based on the modification date fair value of modified Exit-Vesting Awards. The modification date fair value was measured using a Monte Carlo model, which incorporates various assumptions noted in the following table. Use of a valuation model requires management to make certain assumptions with respect to selected model inputs. Expected volatility was calculated based on the observed equity volatility for comparable companies. The expected time to liquidity event was based on management’s estimate of time to an expected liquidity event. The dividend yield was based on the Company’s expected dividend rate. The risk-free interest rate was based on U.S. Treasury zero-coupon issues. Forfeitures are accounted for as they occur.

The weighted-average assumptions the Company used in the Monte Carlo model for the modified Exit-Vesting awards are as follows:


Dividend yield		—
Expected volatility		60	%
Risk-free interest rate	2.1% to 3.1%
Expected time to liquidity event (years)		1.0

Compensation cost related to the Exit-Vesting awards for the three months ended September 30, 2022 and 2021 was $16.0 million and $3.6 million, respectively, and $19.5 million and $22.7 million, respectively, for the nine months ended September 30, 2022 and 2021.

2021 Omnibus Plan

In connection with the IPO, the Company adopted the 2021 Omnibus Plan, which became effective on the date immediately prior to the effective date of the IPO. The 2021 Omnibus Plan provides the Company with flexibility to use various equity-based incentive awards as compensation tools to motivate and retain the Company’s workforce. The Company has initially reserved 30,000,000 shares of our common stock for the issuance of awards under the 2021 Omnibus Plan.

The fair value of Time-Vesting awards granted or modified at the time of the IPO was determined using the Black-Scholes option pricing model with the following assumptions:


Volatility	55%-60%
Expected Life	0.5 - 7.4 years
Risk-free rate	0.1%-0.8%
Fair value per unit	$43.00
Dividend yield		0.0	%
Discount for lack of marketability(1)	15% - 25%

The fair value of Exit-Vesting awards granted or modified at the time of the IPO was determined using a Monte Carlo simulation approach in an option pricing framework, where the common stock price of the Company was evolved using a Geometric Brownian Motion over a period from the Valuation Date to the date of Management's expected exit date - a date at which MOIC and IRR realized by the Sponsor can be calculated ("Sponsor Exit"), with the following assumptions:


Volatility		55	%
Expected Life	1.8 years
Risk-free rate		0.1	%
Fair value per unit	$43.00
Dividend yield		0.0	%
Discount for lack of marketability(1)		15	%

(1) Discount for lack of marketability for Time-Vesting awards and Exit-Vesting awards is only applicable for Incentive Units granted in Bumble Holdings at the time of the IPO.

The fair value of Time-Vesting Options granted during the nine months ended September 30, 2022 was determined using the Black-Scholes option pricing model with the following assumptions:


Volatility	60%-70%
Expected Life	7.0 years
Risk-free rate	1.74% - 2.95%
Fair value per unit	$15.36 - $17.66
Dividend yield		0.0	%

Incentive Units in Bumble Holdings:

The following table summarizes information around Incentive Units in Bumble Holdings. These include grants of Class B Units that were reclassified into Incentive Units as described above, as well as Incentive Units issued to new recipients. The Incentive Units received as a result of the reclassification of Class B Units retain the vesting attributes (including original service period vesting start date) of the Class B Units. The Company did not recognize any incremental fair value due to the reclassification of awards as the fair value per award was the same immediately prior to and after the Reclassification. The newly granted Incentive Units contain the same vesting attributes as Incentive Units granted as a result of the Reclassification.



	Time-Vesting Incentive Units					Exit-Vesting Incentive Units
	Number of Awards			Weighted- Average Participation Threshold		Number of Awards			Weighted- Average Participation Threshold
Unvested as of December 31, 2021		5,170,731		$	14.22		4,324,868		$	13.81
Granted		—			—		—			—
Vested		(1,223,569	)		13.30		(240,255	)		13.81
Forfeited		—			—		—			—
Unvested as of September 30, 2022		3,947,162		$	14.46		4,084,613		$	13.81

As of September 30, 2022, total unrecognized compensation cost related to the Time-Vesting Incentive Units is $12.5 million, which is expected to be recognized over a weighted-average period of 2.6 years. Total unrecognized compensation cost related to the Exit-Vesting Incentive Units is $30.2 million, which is expected to be recognized over a weighted average period of 2.8 years.

Restricted Shares of Class A Common Stock in Bumble Inc.:

The following table summarizes information around restricted shares in the Company. The restricted shares granted as a result of the reclassification of Class B Units retain the vesting attributes (including original service period vesting start date) of the Class B Units. The Company did not recognize any incremental fair value due to the reclassification of awards as the fair value per award was the same immediately prior to and after the Reclassification.



	Time-Vesting Restricted Shares of Class A Common Stock					Exit-Vesting Restricted Shares of Class A Common Stock
	Number of Awards			Weighted- Average Grant-Date Fair Value		Number of Awards			Weighted- Average Grant-Date Fair Value
Unvested as of December 31, 2021		98,717		$	7.26		82,211		$	15.41
Granted		—			—		—			—
Vested		(24,518	)		7.23		(3,641	)		17.48
Forfeited		(13,824	)		7.25		(15,164	)		6.31
Unvested as of September 30, 2022		60,375		$	7.27		63,406		$	17.46

As of September 30, 2022, total unrecognized compensation cost related to the Time-Vesting restricted shares is $0.2 million, which is expected to be recognized over a weighted-average period of 2.4 years. Total unrecognized compensation cost related to the Exit-Vesting restricted shares is $0.8 million, which is expected to be recognized over a weighted average period of 2.8 years.

RSUs in Bumble Inc.:

The following table summarizes information around RSUs in the Company. These include grants of Phantom Class B Units that were reclassified into RSUs in conjunction with the IPO, as well as Promised RSUs issued to new recipients. The RSUs granted as a result of the reclassification of Phantom Class B Units retain the vesting attributes (including original service period vesting start date) of the Phantom Class B Units. As the Phantom Class B Units were legally settled in cash and the RSUs will be settled with equity, this represents a liability-to-equity modification. The Company reclassified any outstanding liabilities to equity and recognized expense in accordance with the appropriate pattern using the modification date fair value.

Time-Vesting RSUs that were granted as a result of the Reclassification generally vest in equal annual installments over a five year period, whereas Time-Vesting RSUs that were granted at the time of the Company’s IPO generally vest in equal annual installments over a four year period. Time-Vesting RSUs that have been granted since the Company’s IPO generally vest 25% on the first anniversary of the date of grant, or other vesting commencement date, and the remaining 75% of the award vests in equal installments on each monthly anniversary thereafter such that the award will be fully vested on the fourth anniversary of the date of grant, or other vesting commencement date. Exit-Vesting RSUs that were granted as a result of the Reclassification contain similar vesting requirements to the previously Exit-Vesting Phantom Class B Units.



	Time-Vesting RSUs					Exit-Vesting RSUs
	Number of Awards			Weighted- Average Grant-Date Fair Value		Number of Awards			Weighted- Average Grant-Date Fair Value
Unvested as of December 31, 2021		2,803,943		$	45.36		1,217,151		$	38.13
Granted		3,062,478			27.49		—			—
Vested		(626,424	)		45.90		(49,752	)		40.26
Forfeited		(783,351	)		39.06		(324,398	)		32.29
Unvested as of September 30, 2022		4,456,646		$	34.11		843,001		$	40.25

As of September 30, 2022, total unrecognized compensation cost related to the Time-Vesting RSUs is $80.9 million, which is expected to be recognized over a weighted-average period of 3.1 years. Total unrecognized compensation cost related to the Exit-Vesting RSUs is $17.9 million, which is expected to be recognized over a weighted average period of 2.8 years.

Options

Under the 2021 Omnibus Plan, the Company has granted certain stock options with the underlying equity being shares of the Company’s Class A common stock. These stock options are inclusive of both Time-Vesting stock options and Exit-Vesting stock options. Time-Vesting stock options either vest over a four or a five year period, and weighted-average remaining contractual term has been specified in the table below. Exit-Vesting stock options vest upon satisfaction of a performance condition under which Blackstone and its affiliates receive cash proceeds in respect of certain MOIC and IRR hurdles, subject to the recipient’s continued employment at the time of satisfaction. At the IPO date, the Company concluded that our public offering represented a qualifying liquidity event that would cause the Exit-Vesting options’ performance conditions to be probable of occurring.

The following table summarizes the Company’s option activity as it relates to Time-Vesting stock options as of September 30, 2022:


	September 30, 2022
	Number of Options			Weighted- Average Exercise Price Per Share		Weighted- Average Grant Date Fair Value Per Share
Outstanding as of December 31, 2021		2,038,016		$	43.76	$	22.96
Granted		1,198,321			27.06		17.17
Exercised		—			—		—
Forfeited and expired		(537,965	)		38.49		20.78
Outstanding as of September 30, 2022		2,698,372		$	37.40	$	20.88
Exercisable as of September 30, 2022		398,254		$	43.00	$	22.22

The following table summarizes the Company’s option activity as it relates to Exit-Vesting stock options as of September 30, 2022:


	September 30, 2022
	Number of Options			Weighted- Average Exercise Price Per Share		Weighted- Average Grant Date Fair Value Per Share
Outstanding as of December 31, 2021		222,424		$	43.00	$	19.58
Granted		—			—		—
Exercised		—			—		—
Forfeited		(58,062	)		43.00		22.18
Outstanding as of September 30, 2022		164,362		$	43.00	$	18.66
Exercisable as of September 30, 2022		9,125		$	43.00	$	18.69

Total unrecognized compensation cost related to the Time-Vesting options is $23.9 million, which is expected to be recognized over a weighted-average period of 2.9 years. Total unrecognized compensation cost related to the Exit-Vesting options is $1.2 million, which is expected to be recognized over a weighted-average period of 2.8 years.

Options have a maximum contractual term of 10 years. The aggregate intrinsic value – assuming all options are expected to vest – and weighted average remaining contractual terms of Time-Vesting and Exit-Vesting options outstanding and options exercisable were as follows as of September 30, 2022.


Aggregate intrinsic value
Time-Vesting options outstanding		—
Time Vesting options exercisable		—
Exit-Vesting options outstanding		—
Exit-Vesting options exercisable		—
Weighted-average remaining contractual term (in years)
Time-Vesting options outstanding		8.8
Time Vesting options exercisable		8.1
Exit-Vesting options outstanding		8.4
Exit-Vesting options exercisable	8.4

The market price as of September 30, 2022 exceeded the weighted average exercise price, and as such, resulted in the aggregate intrinsic value to be negative for all of the Company’s stock options (referred to as “out-of-the money”).

Note 16 - Related Party Transactions

In the ordinary course of operations, the Company enters into transactions with related parties, as discussed below.



Related Party relationship	Type of Transaction	Financial Statement Line	Three Months Ended September 30, 2022		Three Months Ended September 30, 2021		Nine Months Ended September 30, 2022		Nine Months Ended September 30, 2021
Other	Marketing costs	Selling and marketing expense	$	836	$	996	$	2,362	$	2,447
Other	Moderator costs	Cost of revenue		566		—		1,120		—
Other	Advertising revenue	Revenue		143		—		400		—
Company owned by a Director	Loans repaid by Whitney Wolfe Herd	Limited Partners’ interest		—		95,465		—		95,465



Related Party relationship	Type of Transaction	Financial Statement Line	September 30, 2022		December 31, 2021
Parent Company of the Predecessor	Loan granted - current	Payable to related parties pursuant to a tax receivable agreement	$	388,980	$	388,780

Founder Loan

On January 29, 2020, the Company recognized a $119.0 million loan to an entity controlled by the Founder, which was recorded as a reduction of “Limited Partners’ interest” in the consolidated balance sheets. In connection with the dividends paid, the Company’s Founder repaid $25.6 million of the loan (the "Founder Loan"), which was recorded as an increase to Limited Partners’ Interest. As of December 31, 2020, $93.4 million remained outstanding.

On January 14, 2021, our Founder settled the outstanding balance of the loan plus accrued interest for a total of $95.5 million when Bumble Holdings distributed the loan in redemption of 63,643,425 Class A units held by Beehive Holdings III, LP with a hypothetical fair value equal to $95.5 million (such Class A units, the “Loan Settlement Units”). Since the value of the Loan Settlement Units redeemed by Bumble Holdings, determined using the volume-weighted average price of the Class A Common Stock on Nasdaq during the regular trading session as reported by Bloomberg L.P. for the 30-day period beginning on February 16, 2021 (the “Applicable VWAP”) exceeded the implied value of the Loan Settlement Units on the settlement date for purposes of repaying the loan, Bumble Holdings delivered to Beehive Holdings III, LP 3,252,056 Common Units which are exchangeable for shares of Class A common stock having a value based on the Applicable VWAP equal to such excess amount. The settlement of the Founder loan was recorded as an equity transaction with no net impact to the accompanying condensed consolidated balance sheet.

Underwriting of IPO

Blackstone Securities Partners L.P., an affiliate of Blackstone, underwrote 4.1 million of the 57.5 million shares of Class A common stock offered to the market in the IPO, with underwriting discounts and commissions of $1.935 per share paid by the Company.

Redemption of Class A Common Stock and Purchase Common Units in Connection with the IPO

The Company used the proceeds from the issuance of 48.5 million shares ($1,991.6 million) in the IPO to redeem shares of Class A common stock and purchase Common Units from our Sponsor, at a price per share / Common Unit equal to the IPO price, net of underwriting discounts and commissions.

Payable to related parties pursuant to a tax receivable agreement

Concurrent with the completion of the IPO, the Company entered into a tax receivable agreement with pre-IPO owners including our Founder, our Sponsor, an affiliate of Accel Partners LP and management and other equity holders (see Note 5).

Other

The Company recognizes advertising revenues and incurs marketing expenses from Liftoff Mobile Inc. ("Liftoff"), a company in which Blackstone affiliated funds hold a controlling interest. The Company uses TaskUs Inc. ("TaskUs"), a company in which Blackstone affiliated funds holds more than 20% of ownership interest, for moderator services.

Note 17 - Segment and Geographic Information

The Company operates as a single operating segment. The Company’s chief operating decision maker is the CEO, who reviews financial information presented on a consolidated basis, accompanied by disaggregated information about the Company’s revenue, for purposes of making operating decisions, assessing financial performance and allocating resources.

Revenue by major geographic region is based upon the location of the customers who receive the Company’s services. The information below summarizes revenue by geographic area, based on customer location (in thousands):



	Three Months Ended September 30, 2022		(As Revised) Three Months Ended September 30, 2021		Nine Months Ended September 30, 2022		(As Revised) Nine Months Ended September 30, 2021
North America(1)	$	141,808	$	117,007	$	400,177	$	318,885
Rest of the world		90,831		82,140		261,698		234,980
Total	$	232,639	$	199,147	$	661,875	$	553,865

(1) North America revenue includes revenue from the United States and Canada.

The United States is the only country with revenues of 10% or more of the Company’s total revenue for the three and nine months ended September 30, 2022 and 2021.

The information below summarizes property and equipment, net by geographic area (in thousands):


	September 30, 2022		December 31, 2021
United Kingdom	$	5,422	$	6,035
United States		3,305		3,183
Czech Republic		1,632		3,234
Rest of the world		2,614		2,175
Total	$	12,973	$	14,627

United Kingdom, United States and Czech Republic are the only countries with property and equipment of 10% or more of the Company’s total property and equipment, net at September 30, 2022 and December 31, 2021.

Note 18 - Commitments and Contingencies

The Company has entered into indemnification agreements with the Company’s officers and directors for certain events or occurrences. The Company maintains a directors and officers insurance policy to provide coverage in the event of a claim against an officer or director. Historically, the Company has not been obligated to make any payments for indemnification obligations, and no liabilities have been recorded for these obligations as of September 30, 2022.

The Company is involved in certain lawsuits, claims and proceedings that arise from time to time. The Company records a liability for these when it is believed to be probable that the Company has incurred a loss and the amount can be reasonably estimated. The Company regularly evaluates current information to determine whether it should adjust a recorded liability or record a new one. If the Company determines that there is a reasonable possibility that a loss may be incurred and the loss or range of loss can be estimated, the possible loss is disclosed in the accompanying notes to the condensed consolidated financial statements to the extent material.

Litigation

In late 2021 and early 2022, four putative class action lawsuits were filed against the Company in Illinois alleging that certain features of the Badoo or Bumble apps violate the Illinois Biometric Privacy Act (“BIPA”). These lawsuits allege that the apps used facial geometry scans in violation of BIPA’s authorization, consent, and data retention policy provisions. A fifth putative class action was also filed against the Company in late 2021 in California alleging that Bumble app users’ information was collected, used, and disseminated in violation of California’s consumer protection and privacy laws. Plaintiffs in these lawsuits seek statutory damages, compensatory damages, attorneys’ fees, injunctive relief, and (in the California action) punitive damages. These cases are still in early stages and at this time the Company cannot reasonably estimate a range of potential liability, if any, which may arise therefrom.

In January 2022, a purported class action complaint was filed in the United States District Court for the Southern District of New York naming, among others, the Company, our Chief Executive Officer, our Chief Financial Officer, our board of directors and Blackstone, as defendants. The class action complaint asserts claims under the U.S. federal securities laws, purportedly brought on behalf of a class of purchasers of shares of Class A common stock in in Bumble’s secondary public stock offering which took place in September 2021 (the “SPO”), that the SPO Registration Statement and prospectus contained false and misleading statements or omissions by failing to disclose certain information concerning Bumble and Badoo app paying users and related trends and issues with the Badoo app payment platform, and that as a result of the foregoing, Bumble’s business metrics and financial prospects were not as strong as represented in the SPO Registration Statement and prospectus. The class action complaint seeks unspecified damages and an award of costs and expenses, including reasonable attorneys’ fees, as well as equitable relief. The Company believes that the allegations contained in the complaint are without merit and intends to defend the complaint vigorously.

Three shareholder derivative complaints have been filed in the United States District Court for the Southern District of New York and United States District Court for the District of Delaware against the Company and certain directors and officers. The Glover-Mott shareholder derivative complaint, filed in April 2022, alleges a breach of fiduciary duty against management and our board of directors based on the same allegations and events described in the class action complaint. The complaint seeks unspecified damages, an award of costs and disbursements, including reasonable attorneys’ fees, and that the Company be directed to take action to reform its corporate governance and internal procedures. The William B. Federman Irrevocable Trust shareholder derivative complaint, filed in May 2022, alleges violations of Section 14(a) of the Exchange Act, breach of fiduciary duty, aiding and abetting breach of duty and gross mismanagement based on misstatements or omissions in the Company’s April 2022 Proxy Statement concerning alleged deficiencies in the Company’s risk management and internal controls which allegedly led to disclosure deficiencies in the SPO documents. The complaint seeks a declaration that the individual defendants breached their fiduciary duties, aided and abetted breach of fiduciary duty, were unjustly enriched, grossly mismanaged the Company and violated the federal securities laws; an order that the individual defendants are jointly and severally liable for all damages; an order requiring the individual defendants to remit their

salaries and compensation to the Company for the period of breach; unspecified equitable and injunctive relief; and costs and disbursements, including reasonable attorneys’, consultants’ and experts’ fees. The Dana Messana shareholder derivative complaint, filed in September 2022, alleges violation of Section 10(b) of the Exchange Act, breach of fiduciary duty against management and the Board, aiding and abetting breach of fiduciary duty, unjust enrichment, and waste of corporate assets based on the same allegations and events described in the SPO class action complaint. The complaint seeks unspecified damages; an order that the individual defendants are jointly and severally liable for all damages; an order for imposition of a constructive trust on any profits and unjust enrichments received by the individual defendants through unlawful conduct; and an award of costs and disbursements, including reasonable attorneys’, accountants’, and experts’ fees. The Company has also received an inquiry from the SEC relating to the disclosures at issue in the SPO class action complaint. The Company cannot predict at this point the length of time that these matters will be ongoing, their outcome or the liability, if any, which may arise therefrom.

From time to time, the Company is subject to patent litigations asserted by non-practicing entities.

As of September 30, 2022 and December 31, 2021, the Company determined that provisions of $1.3 million and $8.8 million, respectively, reflect our best estimate of any probable future obligation, including legal costs incurred to date and expected to be incurred up to completion, for the Company’s litigations. During the three and nine months ended September 30, 2022, the Company paid $0.1 million and $7.6 million to settle litigation matters. Legal expenses are included within “General and administrative” expense in the accompanying condensed consolidated statements of operations.

Purchase Commitments

In September 2022, the Company entered into an agreement for third-party cloud services. The Company is committed to pay a minimum of $7.1 million over the period of 18 months. If at the end of the 18 months, or upon early termination, the Company has not reached the $7.1 million in spend, they will be required to pay for the difference between the sum of fees already incurred and the minimum commitment.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

You should read the following discussion and analysis of the financial condition and results of operations of Bumble Inc. in conjunction with our unaudited condensed consolidated financial statements and related notes included elsewhere in Part I, “Item 1 – Financial Statements (Unaudited)”. This discussion contains forward-looking statements that involve risks and uncertainties about our business and operations. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to these differences include, without limitation, those discussed in this Management’s Discussion and Analysis of Financial Condition and Results of Operations and those identified under “Special Note Regarding Forward-Looking Statements” and Part I, “Item 1A—Risk Factors" in our 2021 Form 10-K.

Overview

We provide online dating and social networking platforms through subscription and in-app purchases of dating products servicing North America, Europe and various other countries around the world. Bumble operates three apps, Bumble, Badoo and Fruitz. Our apps monetize via a freemium model, where the use of the service is free and a subset of the users pay for subscriptions or in-app purchases to access premium features. We launched Bumble app in 2014 to address antiquated gender norms and a lack of kindness and accountability on the internet. By placing women at the center – where women make the first move – we are building a platform that is designed to be safe and empowering for women, and in turn, provide a better environment for everyone. Badoo app, launched in 2006, was one of the pioneers of web and mobile free-to-use dating products. In January 2022, we acquired Fruitz, a fast-growing dating app with a Gen Z focus, which is a growing segment of online dating consumers. Fruitz encourages open and honest communication of dating intentions through playful fruit metaphors. Our consolidated results for the three and nine months ended September 30, 2022 included the operating results of Fruitz from January 31, 2022. Revenues from Fruitz were included in Badoo App and Other Revenue but excluded from our key operating metrics. For additional information, see Note 6, Business Combination, to our unaudited condensed consolidated financial statements included in Part I, “Item 1 – Financial Statements (Unaudited)” of this Quarterly Report on Form 10-Q.

Quarter ended September 30, 2022 Consolidated Results

For the three months ended September 30, 2022 and 2021, we generated:

•

Total Revenue of $232.6 million and $199.1 million, respectively;

•

Bumble App Revenue of $180.6 million and $141.2 million, respectively;

•

Badoo App and Other Revenue of $52.0 million and $57.9 million, respectively;

•

Net earnings (loss) of $26.4 million and $(10.4) million, respectively, representing net earnings (loss) margins of 11.4%, and (5.2)%, respectively; and

•

Adjusted EBITDA of $61.8 million and $54.5 million, respectively, representing Adjusted EBITDA margins of 26.6% and 27.4%, respectively.

Year-to-Date September 30, 2022 Consolidated Results

For the nine months ended September 30, 2022 and 2021, we generated:

•

Total Revenue of $661.9 million and $553.9 million, respectively;

•

Bumble App Revenue of $503.5 million and $379.2 million, respectively;

•

Badoo App and Other Revenue of $158.4 million and $174.7 million, respectively;

•

Net earnings of $45.1 million and $295.7 million, respectively, representing net earnings margins of 6.8%, and 53.4% respectively;

•

Adjusted EBITDA of $166.4 million and $152.4 million, respectively, representing Adjusted EBITDA margins of 25.1% and 27.5%, respectively.

•

Net cash provided by operating activities of $81.8 million and $20.3 million, respectively, and operating cash flow conversion of 181.2% and 6.9%, respectively; and

•

Free cash flow of $70.5 million and $10.9 million, respectively, representing free cash flow conversion of 42.3% and 7.1%, respectively.

For a reconciliation of Adjusted EBITDA, Adjusted EBITDA margin, free cash flow and free cash flow conversion, which are all non-GAAP measures, to the most directly comparable GAAP financial measures, information about why we consider Adjusted EBITDA, Adjusted EBITDA margin, free cash flow and free cash flow conversion useful and a discussion of the material risks and limitations of these measures, please see “—Non-GAAP Financial Measures.”

Key Operating and Financial Metrics

We regularly review a number of metrics, including the following key operating and financial metrics, to evaluate our business, measure our performance, identify trends in our business, prepare financial projections and make strategic decisions. We believe these non-GAAP and operational measures are useful in evaluating our performance, in addition to our financial results prepared in accordance with GAAP. See “—Non-GAAP Financial Measures” for additional information on non-GAAP financial measures and a reconciliation to the most comparable GAAP measures.

The following metrics were calculated excluding paying users and revenue generated from Fruitz:


(In thousands, except ARPPU)	Three Months Ended September 30, 2022		(As Revised) Three Months Ended September 30, 2021		Nine Months Ended September 30, 2022		(As Revised) Nine Months Ended September 30, 2021
Key Operating Metrics
Bumble App Paying Users		2,088.1		1,532.6		1,929.3		1,452.8
Badoo App and Other Paying Users		1,202.2		1,333.4		1,176.8		1,412.7
Total Paying Users		3,290.3		2,866.0		3,106.1		2,865.5
Bumble App Average Revenue per Paying User	$	28.84	$	30.71	$	29.00	$	29.00
Badoo App and Other Average Revenue per Paying User	$	12.75	$	13.73	$	13.26	$	13.08
Total Average Revenue per Paying User	$	22.96	$	22.81	$	23.03	$	21.15



(In thousands, except per share / unit data and percentages)	Three Months Ended September 30, 2022		(As Revised) Three Months Ended September 30, 2021			Nine Months Ended September 30, 2022		(As Revised) Nine Months Ended September 30, 2021
Condensed Consolidated Statements of Operations Data:
Revenue	$	232,639	$	199,147		$	661,875	$	553,865
Net earnings (loss)		26,405		(10,385	)		45,122		295,654
Net earnings (loss) attributable to Bumble Inc. shareholders / Buzz Holdings L.P. owners		18,063		(7,333	)		30,824		322,257
Net earnings (loss) per unit attributable to Bumble Inc. shareholders / Buzz Holdings L.P. owners
Basic earnings (loss) per share / unit	$	0.14	$	(0.06	)	$	0.24	$	1.57
Diluted earnings (loss) per share / unit	$	0.14	$	(0.06	)	$	0.23	$	1.53

(In thousands)						September 30, 2022		December 31, 2021
Condensed Consolidated Balance Sheets Data:
Total assets						$	3,792,838	$	3,776,996
Cash and cash equivalents							365,105		369,175
Long-term debt, net including current maturities							625,989		628,981

Profitability and Liquidity

We use net earnings (loss) and net cash provided by (used in) operating activities to assess our profitability and liquidity, respectively. In addition to net earnings (loss) and net cash provided by (used in) operating activities, we also use the following measures:

•

Adjusted EBITDA. We define Adjusted EBITDA as net earnings (loss) excluding income tax (benefit) provision, interest (income) expense, depreciation and amortization, stock-based compensation expense, employer costs related to stock-based compensation, foreign exchange (gain) loss, changes in fair value of contingent earn-out liability, interest rate swaps and investments in equity securities, transaction and other costs, litigation costs net of insurance reimbursements

that arise outside of the ordinary course of business and tax receivable agreement liability remeasurement benefit. Adjusted EBITDA margin represents Adjusted EBITDA as a percentage of revenue.

•

Free cash flow. We define free cash flow as net cash provided by (used in) operating activities less capital expenditures. Free cash flow conversion represents free cash flow as a percentage of Adjusted EBITDA.

Adjusted EBITDA, Adjusted EBITDA margin, free cash flow and free cash flow conversion are key measures we use to assess our financial performance and are also used for internal planning and forecasting purposes. We believe Adjusted EBITDA, Adjusted EBITDA margin, free cash flow and free cash flow conversion are helpful to investors, analysts and other interested parties because they can assist in providing a more consistent and comparable overview of our operations across our historical financial periods. In addition, these measures are frequently used by analysts, investors and other interested parties to evaluate and assess performance.

See “—Non-GAAP Financial Measures” for additional information and a reconciliation of net earnings (loss) to Adjusted EBITDA and Adjusted EBITDA margin and net cash provided by (used in) operating activities to free cash flow.

Impact of Russia-Ukraine Conflict

The ongoing conflict between Russia and Ukraine has increased global economic and political uncertainty. On March 8, 2022, we announced that we will discontinue our operations in Russia and remove all of our apps from the Apple App Store and Google Play Store in Russia and Belarus. Our decision to discontinue our operations in Russia and remove all of our apps from the Apple App Store and Google Play Store in Russia and Belarus has led to reduced revenues and Paying Users from these countries and increased costs. For further information regarding revenues and Paying Users see the “Results of Operations―Comparison of the Three and Nine Months Ended September 30, 2022 and 2021―Revenue” section further below. For further information regarding the cost related to our discontinuation of operations in Russia see Note 9, Restructuring, to our unaudited condensed consolidated financial statements included in Part I, “Item 1 – Financial Statements (Unaudited)” of this Quarterly Report on Form 10-Q.

As of September 30, 2022, the net assets of our subsidiary in Russia comprised 0.1% of total net assets. For the three and nine months ended September 30, 2022, revenues from Russia, Belarus and Ukraine combined were approximately 0.5% and 0.9%, respectively, of our total revenues. Operating costs related to our Russian operations were approximately 0.3% and 1.6% of our total operating costs for the three and nine months ended September 30, 2022.

For additional information, see “Risk Factors—Risks Related to Our Brand, Products and Operations―Our operations may be adversely affected by ongoing developments in Russia, Ukraine and surrounding countries, including due to the impact of our decision to discontinue our operations in Russia and remove our apps from the Apple App Store and Google Play Store in Russia and Belarus” in Part I, Item 1A. of our 2021 Form 10-K.

Impact of COVID-19

Since early 2020, COVID-19 has impacted market and economic conditions globally, resulting in the implementation of significant governmental measures, including lockdowns, closures, quarantines, and travel bans intended to control the spread of the virus, as well as changes in consumer behavior as some individuals have become reluctant to engage in social activities with people outside their households. While many jurisdictions have relaxed restrictions, others have remained in place with some areas continuing to experience renewed outbreaks and surges in infection rates despite more widespread availability of vaccines. Future prevention and mitigation measures, as well as the potential for some of these measures to be reinstituted in the event of subsequent waves or the emergence of new variants of the virus, have had and are likely to continue to have an adverse impact on global economic conditions and consumer confidence and spending in many parts of the world for some time. Such macroeconomic conditions have adversely affected and may continue to adversely affect demand, and/or users’ ability to pay, for our products and services, particularly in the geographic and demographic markets in which Badoo app operates. Given the continued uncertainty around the duration and severity of the impact on market conditions and the business environment, the impact of the COVID-19 pandemic on our business, financial condition and results of operations going forward remains uncertain for the foreseeable future.

For additional information, see “Risk Factors—General Risk Factors—Our business and results of operations may be materially adversely affected by the ongoing COVID-19 outbreak or other similar outbreaks” and “Risk Factors—General Risk Factors—An economic downturn or economic uncertainty may adversely affect consumer discretionary spending and demand for our products and services” in Part I, Item 1A. of our 2021 Form 10-K.

Macroeconomic Conditions

The prevailing global economic climate, Russia-Ukraine conflict and other macroeconomic conditions, including but not limited to slower growth or economic recession, changes to fiscal and monetary policy and exchange rate fluctuations have adversely affected and may continue to adversely impact our business as consumers face greater pressure on disposable income. The increase in interest rates by the Federal Reserve and overall market conditions have led to significant strengthening of the U.S. dollar against other global currencies in 2022. A strong U.S. dollar has impacted and may continue to impact our revenue and earnings through the remainder of 2022 and extending into 2023. We continuously monitor the direct and indirect impacts of these circumstances on our business and financial results.

For additional information, see “Risk Factors—General Risk Factors—An economic downturn or economic uncertainty may adversely affect consumer discretionary spending and demand for our products and services” in Part I, Item 1A. of our 2021 Form 10-K.

Factors Affecting the Comparability of Our Results of Operations

As a result of a number of factors, our historical results of operations may not be comparable from period to period or going forward. Set forth below is a brief discussion of the key factors impacting the comparability of our results of operations.

Initial Public Offering and Offering Transactions

On February 10, 2021, our registration statement on Form S-1 relating to our initial public offering (“IPO”) was declared effective by the U.S. Securities and Exchange Commission, and our Class A common stock began trading on the NASDAQ on February 11, 2021. Our IPO closed on February 16, 2021.

Bumble Inc. issued and sold 57.5 million shares of its Class A common stock in the IPO, including 7.5 million shares sold pursuant to the exercise in full by the underwriters of their option to purchase additional shares. Bumble Inc. used the proceeds (net of underwriting discounts) from the issuance of 9 million shares ($369.6 million) to acquire an equivalent number of newly-issued Common Units from Buzz Holdings L.P, which Buzz Holdings L.P. used to repay outstanding indebtedness under our Term Loan Facility totaling approximately $200.0 million in aggregate principal amount and approximately $148.3 million for general corporate purposes, and to bear all of the expenses of the IPO. Bumble Inc. used the proceeds (net of underwriting discounts) from the issuance of 48.5 million shares ($1,991.6 million) to purchase or redeem an equivalent aggregate number of shares of Class A common stock and Common Units from our pre-IPO owners. We refer to the foregoing transactions as the “Offering Transactions”.

Secondary Offering

On September 15, 2021, the Company completed a secondary offering of 20.7 million shares of Class A common stock on behalf of certain selling stockholders affiliated with Blackstone Inc. (the "Selling Stockholders") at a price of $54.00 per share. This transaction resulted in the issuance of 9.2 million Class A shares for the period ending September 30, 2021.

Reorganization Transactions

Prior to the completion of the IPO, we undertook certain reorganization transactions (the “Reorganization Transactions”) such that Bumble Inc. is now a holding company, and its sole material asset is a controlling equity interest in Bumble Holdings. As the general partner of Bumble Holdings, Bumble Inc. now operates and controls all of the business and affairs of Bumble Holdings, has the obligation to absorb losses and receive benefits from Bumble Holdings and, through Bumble Holdings and its subsidiaries, conducts our business. The Reorganization Transactions were accounted for as a reorganization of entities under common control. As a result, the consolidated financial statements of Bumble Inc. will recognize the assets and liabilities received in the Reorganization Transactions at their historical carrying amounts, as reflected in the historical financial statements of Bumble Holdings, the accounting predecessor. Bumble Inc. will consolidate Bumble Holdings on its consolidated financial statements and record a non-controlling interest, related to the Common Units and the Incentive Units held by our pre-IPO owners, on its consolidated balance sheet and statement of operations.

Bumble Inc. is a corporation for U.S. federal and state income tax purposes. Bumble Inc.’s accounting predecessor, Bumble Holdings is and has been since the Sponsor Acquisition, treated as a flow-through entity for U.S. federal income tax purposes, and as such, has generally not been subject to U.S. federal income tax at the entity level. Accordingly, the historical results of operations and other financial information set forth in this Quarterly Report do not include any material provisions for U.S. federal income tax for the period prior to our IPO. Following our IPO, Bumble Inc. pays U.S. federal and state income taxes as a corporation on its share of Bumble Holdings’ taxable income.

In addition, in connection with the Reorganization Transactions and our IPO, we entered into the tax receivable agreement as described under “―Tax Receivable Agreement.”

Tax Receivable Agreement

In connection with the Reorganization Transactions and our IPO, we entered into a tax receivable agreement with certain of our pre-IPO owners that provides for the payment by the Company to such pre-IPO owners of 85% of the benefits that the Company realizes, or is deemed to realize, as a result of the Company’s allocable share of existing tax basis acquired in our IPO, increases in our share of existing tax basis and adjustments to the tax basis of the assets of Bumble Holdings as a result of sales or exchanges of Common Units (including Common Units issued upon conversion of vested Incentive Units), and our utilization of certain tax attributes of the Blocker Companies (including the Blocker Companies’ allocable share of existing tax basis) and certain other tax benefits related to entering into the tax receivable agreement.

We estimate the amount of existing tax basis with respect to which our pre-IPO owners will be entitled to receive payments under the tax receivable agreement (assuming all Pre-IPO Common Unitholders exchanged their Common Units for shares of Class A common stock on the date of the IPO, and assuming all vested Incentive Units were converted to Common Units and immediately exchanged for shares of Class A common stock at the IPO prices of $43.00 per share of Class A common stock) is approximately $2,603 million, which includes the Company’s allocable share of existing tax basis acquired in the IPO, which we have determined to be approximately $1,728 million. In determining the Company’s allocable share of existing tax basis acquired in the IPO, we have given retrospective effect to certain exchanges of Common Units for Class A shares that occurred after the IPO that were contemplated to have occurred pursuant to the Blocker Restructuring. The payments under the tax receivable agreement are not conditioned upon continued ownership of the Company by the pre-IPO owners.

We have determined that it is more likely than not that we will be unable to realize certain tax benefits that were received in connection with the Reorganization Transactions and our IPO. As a result of this determination, we have not recorded the benefit of these deferred tax assets as of September 30, 2022. The Company is entitled to certain depreciation and amortization deductions as a result of its allocable share of existing tax basis acquired in the IPO and increases in its allocable share of existing basis and adjustments to the tax basis of the assets of Bumble Holdings as a result of sales or exchanges in connection with the IPO. There is significant existing tax basis in the assets of Bumble Holdings as a result of the Sponsor Acquisition. Based on current projections, we anticipate having sufficient taxable income to be able to realize these tax benefits and have recorded a liability of $389.0 million associated with the tax receivable agreement related to these benefits. The ability of the deferred tax assets to be realized is evaluated based on all positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax planning strategies and recent results of operations. We will assess the ability of the deferred tax assets to be realized at each reporting period, and a change in our estimate of our liability associated with the tax receivable agreement may result as additional information becomes available, including results of operations in future periods. During the three months ended September 30, 2022, our tax receivable agreement liability did not materially change.

Employee Equity Plans

In connection with the Reorganization Transactions and our IPO, we undertook a number of modifications to existing employee equity plans such that awards under the Founder Plan, U.S. Plan, and Non-U.S. Plan were reclassified as follows:

•

The Time-Vesting and Exit-Vesting Class B Units in Bumble Holdings under the Founder Plan and granted to Senior Management under the U.S. Plan were reclassified to vested Incentive Units (in the case of Vested Class B Units) and unvested Incentive Units (in the case of unvested Class B Units) in Bumble Holdings.

•

The Time-Vesting and Exit-Vesting Phantom Class B Units in Bumble Holdings were reclassified into vested RSUs (in the case of vested Class B Phantom Units) and unvested RSUs (in the case of unvested Class B Phantom Units) in Bumble Inc. As the modification resulted in a change from liability-settled to equity-settled, the RSUs were fair valued at the date of the IPO.

In all cases of respective reclassifications, the Post-IPO awards retained the same terms and conditions (including applicable vesting requirements). Each Post-IPO award was converted to reflect the $43.00 share price contemplated in the Company’s IPO while retaining the same economic value in the Company.

In connection with the IPO, we adopted the 2021 Omnibus Incentive Plan (the "2021 Omnibus Plan), which became effective on the date immediately prior to the effective date of the IPO. Under the 2021 Omnibus Plan, we granted equity awards as follows:

•

Stock options with the underlying equity being shares of the Company’s Class A common stock. These stock options are inclusive of both Time-Vesting stock options and Exit-Vesting stock options.

•

Time-Vesting Restricted Stock Units with the underlying equity being shares of the Company’s Class A common stock.

•

Shares of Class A common stock issuable in exchange for an equivalent number of Common Units in Bumble Holdings to be received upon the conversion of vested Time-Vesting and Exit-Vesting Incentive Units in Bumble Holdings.

At the IPO date, we concluded that our public offering represented a qualifying liquidity event that would cause the Exit-Vesting awards’ performance conditions to be probable. As such, we started to recognize stock-based compensation expense for the Exit-Vesting awards. On July 15, 2022, the Exit-Vesting awards, with vesting based on certain performance conditions, were modified to also provide for time-based vesting in 36 equal installments and we began to recognize incremental stock-based compensation associated with the modification of these awards. Compensation cost related to the modified Exit-Vesting awards for the three months ended September 30, 2022 and 2021 was $16.0 million and $3.6 million, respectively, and $19.5 million and $22.7 million, respectively, for the nine months ended September 30, 2022 and 2021.

For additional information, see Note 15, Stock-based Compensation, to our unaudited condensed consolidated financial statements included in Part I, “Item 1 – Financial Statements (Unaudited)” of this Quarterly Report on Form 10-Q.

Components of Results of Operations

Our business is organized into a single reportable segment.

Revenue

We monetize the Bumble, Badoo and Fruitz apps via a freemium model where the use of our service is free and a subset of our users pay for subscriptions or in-app purchases to access premium features. Subscription revenue is presented net of taxes, refunds and credit card chargebacks. This revenue is initially deferred and is recognized using the straight-line method over the term of the applicable subscription period. Revenue from lifetime subscriptions is deferred over the average estimated expected period of the subscriber relationship, which is currently estimated to be twelve months. Revenue from the purchase of in-app features is recognized based on usage.

We also earn revenue from online advertising and partnerships, which are not a significant part of our business. Online advertising revenue is recognized when an advertisement is displayed. Revenue from partnerships is recognized according to the contractual terms of the partnership.

Cost of revenue

Cost of revenue consists primarily of in-app purchase fees due on payments processed through the Apple App Store and Google Play Store. Purchases on Android outside of the United States and United Kingdom, mobile web and desktop have additional payment methods, such as credit card or via telecom providers. These purchases incur fees which vary depending on payment method. Purchase fees are deferred and expensed over the same period as revenue.

Cost of revenue also includes data center expenses such as rent, power and bandwidth for running servers, employee compensation (including stock-based compensation) and, other employee related costs and restructuring charges. Expenses relating to customer care functions such as customer service, moderators and other auxiliary costs associated with providing services to customers such as fraud prevention are also included within cost of revenue.

Selling and marketing expense

Selling and marketing expense consists primarily of brand marketing, digital and social media spend, field marketing, restructuring charges, compensation expense (including stock-based compensation) and other employee-related costs for personnel engaged in sales and marketing functions.

General and administrative expense

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. General and administrative expense also consists of transaction costs, impairment of right-of-use assets, changes in fair value of contingent earn-out liability, expenses associated with facilities, information technology, external professional services, legal costs, settlement of legal claims, restructuring charges and other administrative expenses.

Product development expense

Product development expense consists primarily of compensation (including stock-based compensation) and other employee-related costs for personnel engaged in the design, development, testing and enhancement of product offerings and related technology, as well as restructuring charges.

Depreciation and amortization expense

Depreciation and amortization expense is primarily related to computer equipment, leasehold improvements, furniture and fixtures, developed technology, user base, white label contracts, trademarks and other definite-lived intangible assets.

Interest income (expense)

Interest income (expense) consists of interest income received on related party loans receivables and interest expense incurred in connection with our long-term debt.

Other income (expense), net

Other income (expense), net consists of insurance reimbursement proceeds, impacts from foreign exchange transactions, tax receivable agreement liability remeasurement (benefit) expense, loss on debt extinguishment and fair value changes in derivatives and investments in equity securities.

Income tax benefit (provision)

Income tax benefit (provision) represents the income tax benefit or expense associated with our operations based on the tax laws of the jurisdictions in which we operate. These foreign jurisdictions have different statutory tax rates than the United States. Our effective tax rates will vary depending on the relative proportion of foreign to domestic income, changes in the valuation of our deferred tax assets and liabilities, and changes in tax laws.

Results of Operations

The following table sets forth our unaudited condensed consolidated statement of operations information for the periods presented:



(In thousands)	Three Months Ended September 30, 2022			(As Revised) Three Months Ended September 30, 2021			Nine Months Ended September 30, 2022			(As Revised) Nine Months Ended September 30, 2021
Revenue	$	232,639		$	199,147		$	661,875		$	553,865
Operating costs and expenses:
Cost of revenue		64,581			55,265			181,702			151,597
Selling and marketing expense		64,316			55,105			180,628			151,654
General and administrative expense		29,815			45,726			107,636			215,631
Product development expense		25,828			24,231			73,479			84,197
Depreciation and amortization expense		19,755			27,022			73,835			80,882
Total operating costs and expenses		204,295			207,349			617,280			683,961
Operating earnings (loss)		28,344			(8,202	)		44,595			(130,096	)
Interest income (expense)		(6,866	)		(5,676	)		(18,446	)		(18,861	)
Other income (expense), net		6,545			3,773			24,729			7,489
Income (loss) before income taxes		28,023			(10,105	)		50,878			(141,468	)
Income tax benefit (provision)		(1,618	)		(280	)		(5,756	)		437,122
Net earnings (loss)		26,405			(10,385	)		45,122			295,654
Net earnings (loss) attributable to noncontrolling interests		8,342			(3,052	)		14,298			(26,603	)
Net earnings (loss) attributable to Bumble Inc. shareholders / Buzz Holdings L.P. owners	$	18,063		$	(7,333	)	$	30,824		$	322,257

The following table sets forth our unaudited condensed consolidated statement of operations information as a percentage of revenue for the periods presented:



	Three Months Ended September 30, 2022			(As Revised) Three Months Ended September 30, 2021			Nine Months Ended September 30, 2022			(As Revised) Nine Months Ended September 30, 2021
Revenue		100.0	%		100.0	%		100.0	%		100.0	%
Operating costs and expenses:
Cost of revenue		27.8	%		27.8	%		27.5	%		27.4	%
Selling and marketing expense		27.6	%		27.7	%		27.3	%		27.4	%
General and administrative expense		12.8	%		23.0	%		16.3	%		38.9	%
Product development expense		11.1	%		12.2	%		11.1	%		15.2	%
Depreciation and amortization expense		8.5	%		13.6	%		11.2	%		14.6	%
Total operating costs and expenses		87.8	%		104.1	%		93.3	%		123.5	%
Operating earnings (loss)		12.2	%		(4.1	)%		6.7	%		(23.5	)%
Interest income (expense)		(3.0	)%		(2.9	)%		(2.8	)%		(3.4	)%
Other income (expense), net		2.8	%		1.9	%		3.7	%		1.4	%
Income (loss) before income taxes		12.0	%		(5.1	)%		7.7	%		(25.5	)%
Income tax benefit (provision)		(0.7	)%		(0.1	)%		(0.9	)%		78.9	%
Net earnings (loss)		11.4	%		(5.2	)%		6.8	%		53.4	%
Net earnings (loss) attributable to noncontrolling interests		3.6	%		(1.5	)%		2.2	%		(4.8	)%
Net earnings (loss) attributable to Bumble Inc. shareholders / Buzz Holdings L.P. owners		7.8	%		(3.7	)%		4.7	%		58.2	%

The following table sets forth the stock-based compensation expense, net of forfeitures, included in operating costs and expenses:



(In thousands)	Three Months Ended September 30, 2022		Three Months Ended September 30, 2021		Nine Months Ended September 30, 2022		Nine Months Ended September 30, 2021
Cost of revenue	$	807	$	808	$	2,726	$	3,019
Selling and marketing expense		3,779		2,545		4,547		10,186
General and administrative expense		23,080		11,287		45,627		49,155
Product development expense		9,509		9,123		24,279		37,142
Total stock-based compensation expense	$	37,175	$	23,763	$	77,179	$	99,502

Comparison of the Three and Nine Months Ended September 30, 2022 and 2021

Revenue



(In thousands)	Three Months Ended September 30, 2022		(As Revised) Three Months Ended September 30, 2021		Nine Months Ended September 30, 2022		(As Revised) Nine Months Ended September 30, 2021
Bumble App	$	180,641	$	141,216	$	503,482	$	379,176
Badoo App and Other		51,998		57,931		158,393		174,689
Total Revenue	$	232,639	$	199,147	$	661,875	$	553,865

Total Revenue for the three months ended September 30, 2022 increased by $33.5 million, or 16.8%, compared to the same period in 2021 primarily driven by growth in Total Paying Users and, to a lesser extent, a slight increase in Total Average Revenue per Paying User.

Bumble App Revenue for the three months ended September 30, 2022 increased by $39.4 million, or 27.9%, compared to the same period in 2021 driven by a 36.2% increase in Bumble App Paying Users to 2.1 million. The increase in Bumble App Revenue was due to higher re-engagement rates in core markets and international expansion partially offset by fluctuations in foreign currency exchange rates.

The decline of 6.1% in Bumble App Average Revenue per Paying Users was due to fluctuations in foreign currency exchange rates partially offset by pricing initiatives.

Badoo App and Other Revenue for the three months ended September 30, 2022, decreased by $5.9 million, or 10.2%, compared to the same period in 2021. This decrease was driven by a 9.8% decrease in Badoo App and Other Paying Users to 1.2 million due to the Company’s decision to remove all of its apps from the Apple App Store and Google Play Store in Russia and Belarus in March 2022 and the continued impact of COVID and macroeconomic conditions. We expect the impact of COVID and macroeconomic conditions to continue to have an adverse impact on Badoo App and Other Paying Users in the fourth quarter of 2022.

The decline of 7.1% in Badoo App and Other Average Revenue per Paying Users to $12.75 also contributed to the decrease in Badoo App and Other Revenue. The decrease in Badoo App and Other Average Revenue per Paying Users was due to the impact of the Ukraine conflict and fluctuations in foreign currency exchange rates partially offset by pricing optimization.

In addition, other revenue of $6.0 million for the three months ended September 30, 2022, increased by $3.0 million, or 99.2% compared to the same period in 2021, primarily due to Fruitz.

Total Revenue for the nine months ended September 30, 2022 increased by $108.0 million, or 19.5%, compared to the same period in 2021 primarily driven by growth in Total Paying Users and an increase in Total Average Revenue per Paying User.

Bumble App Revenue for the nine months ended September 30, 2022 increased by $124.3 million, or 32.8%, compared to the same period in 2021 driven by a 32.8% increase in Bumble App Paying Users to 1.9 million. The increase in Bumble App Revenue was due to higher re-engagement in core markets and international expansion partially offset by fluctuations in foreign currency exchange rates.

Badoo App and Other Revenue for the nine months ended September 30, 2022, decreased by $16.3 million, or 9.3%, compared to the same period in 2021. This decrease was driven by a 16.7% decrease in Badoo App and Other Paying Users to 1.2 million due to the Company’s decision to remove all of its apps from the Apple App Store and Google Play Store in Russia and Belarus in March 2022 and the continued impact of COVID and macroeconomic conditions. We expect the impact of COVID and macroeconomic conditions to continue to have an adverse impact on Badoo App and Other Paying Users in the fourth quarter of 2022.

The decline in Badoo App and Other Revenue for the nine months ended September 30, 2022 was partially offset by the increase of 1.4% in Badoo App and Other Average Revenue per Paying Users to $13.26.

In addition, other revenue of $18.0 million for the nine months ended September 30, 2022, increased by $9.6 million, or 113.7% compared to the same period in 2021, primarily due to Fruitz.

Cost of revenue



(In thousands, except percentages)	Three Months Ended September 30, 2022			(As Revised) Three Months Ended September 30, 2021			Nine Months Ended September 30, 2022			(As Revised) Nine Months Ended September 30, 2021
Cost of revenue	$	64,581		$	55,265		$	181,702		$	151,597
Percentage of revenue		27.8	%		27.8	%		27.5	%		27.4	%

Cost of revenue for the three months ended September 30, 2022 increased by $9.3 million, or 16.9%, as compared to the same period in 2021 driven primarily by growth in in-app purchase fees due to increasing revenue. As a percentage of revenue, cost of revenue was relatively flat, with an increase in fees due to the adoption of Google Play billing in many of our markets partially offset by the reduced Google Play service fees for subscriptions which has declined from 30% to 15%.

Cost of revenue for the nine months ended September 30, 2022 increased by $30.1 million, or 19.9%, as compared to the same period in 2021 driven by growth in in-app purchase fees due to increasing revenue. As a percentage of revenue, cost of revenue was relatively flat, with an increase in fees due to the adoption of Google Play billing in many of our markets partially offset by the reduced Google Play service fees for subscriptions which has declined from 30% to 15%.

We expect cost of revenue as a percentage of revenue to be negatively impacted by additional fees from the adoption of Google Play’s billing system by approximately 2% over the remainder of fiscal 2022.

Selling and marketing expense



(In thousands, except percentages)	Three Months Ended September 30, 2022			Three Months Ended September 30, 2021			Nine Months Ended September 30, 2022			Nine Months Ended September 30, 2021
Selling and marketing expense	$	64,316		$	55,105		$	180,628		$	151,654
Percentage of revenue		27.6	%		27.7	%		27.3	%		27.4	%

Selling and marketing expense for the three months ended September 30, 2022 increased by $9.2 million, or 16.7%, as compared to the same period in 2021. The change was primarily due to a $6.7 million increase in digital and social media marketing costs and a $2.2 million increase in personnel-related expenses.

Selling and marketing expense for the nine months ended September 30, 2022 increased by $29.0 million, or 19.1%, as compared to the same period in 2021. The change was primarily due to a $27.2 million increase in digital and social media marketing costs and a

$6.5 million increase in personnel-related expenses, partially offset by a $5.6 million decrease in stock-based compensation due to forfeitures.

General and administrative expense



(In thousands, except percentages)	Three Months Ended September 30, 2022			Three Months Ended September 30, 2021			Nine Months Ended September 30, 2022			Nine Months Ended September 30, 2021
General and administrative expense	$	29,815		$	45,726		$	107,636		$	215,631
Percentage of revenue		12.8	%		23.0	%		16.3	%		38.9	%

General and administrative expense for the three months ended September 30, 2022 decreased by $15.9 million, or 34.8%, as compared to the same period in 2021. The change is primarily driven by a decline of $32.2 million in the fair value of the contingent earn-out liabilities, partially offset by a $11.8 million increase in stock-based compensation primarily due to the incremental expense associated with the modification of Exit-Vesting awards with certain performance conditions to also provide for vesting with time-based service conditions, a $2.9 million increase in personnel-related expenses and a $0.8 million increase in professional fees.

General and administrative expense for the nine months ended September 30, 2022 decreased by $108.0 million, or 50.1%, as compared to the same period in 2021. The change is primarily driven by a decline of $124.1 million in the fair value of the contingent earn-out liabilities, a $6.6 million decrease in non-recurring transaction costs and professional service fees incurred in relation to the IPO in the three months ended March 2021 and a $3.5 million decrease in stock-based compensation due to forfeitures. These decreases were partially offset by a $15.1 million increase in personnel-related expenses, a $4.4 million right-of-use asset impairment loss related to our Moscow office, a $3.7 million increase in insurance expenses and a $3.3 million increase in other overhead expenses.

Product development expense



(In thousands, except percentages)	Three Months Ended September 30, 2022			Three Months Ended September 30, 2021			Nine Months Ended September 30, 2022			Nine Months Ended September 30, 2021
Product development expense	$	25,828		$	24,231		$	73,479		$	84,197
Percentage of revenue		11.1	%		12.2	%		11.1	%		15.2	%

Product development expense in the three months ended September 30, 2022 increased by $1.6 million, or 6.6%, as compared to the same period in 2021. The change is primarily driven by a $1.3 million increase in personnel-related expenses and a $0.4 million increase in stock-based compensation due to the incremental expense associated with the modification of Exit-Vesting awards with certain performance conditions to also provide for vesting with time-based service conditions.

Product development expense in the nine months ended September 30, 2022 decreased by $10.7 million, or 12.7%, as compared to the same period in 2021, primarily due to a $12.9 million decrease in stock-based compensation due to forfeitures partially offset by a $1.9 million increase in personnel-related expenses.

Depreciation and amortization expense



(In thousands, except percentages)	Three Months Ended September 30, 2022			Three Months Ended September 30, 2021			Nine Months Ended September 30, 2022			Nine Months Ended September 30, 2021
Depreciation and amortization expense	$	19,755		$	27,022		$	73,835		$	80,882
Percentage of revenue		8.5	%		13.6	%		11.2	%		14.6	%

Depreciation and amortization expense for the three months ended September 30, 2022 decreased by $7.3 million, or 26.9%, as compared to the same period in 2021. For the nine months ended September 30, 2022, depreciation and amortization expense decreased by $7.0 million, or 8.7%, as compared to the same period in 2021. The decreases in depreciation and amortization expense for the three-month and nine-month periods were primarily due to the full amortization of the legacy Badoo user base in July 2022 and

the impairment of certain white label contracts in 2021. These decreases were partially offset by increases in the amortization of intangibles acquired from the Fruitz acquisition in January 2022.

Interest income (expense)



(In thousands, except percentages)	Three Months Ended September 30, 2022			(As Revised) Three Months Ended September 30, 2021			Nine Months Ended September 30, 2022			(As Revised) Nine Months Ended September 30, 2021
Interest income (expense)	$	(6,866	)	$	(5,676	)	$	(18,446	)	$	(18,861	)
Percentage of revenue		(3.0	)%		(2.9	)%		(2.8	)%		(3.4	)%

Interest expense for the three months ended September 30, 2022 increased by $1.2 million, or 21.0%, compared to the same period in 2021 and was due to an increase in interest rates on our outstanding debt under the credit agreements.

Interest expense for the nine months ended September 30, 2022 decreased by $0.4 million, or 2.2%, compared to the same period in 2021 as we repaid $200.0 million of debt in March 2021 partially offset by an increase in interest rates on our outstanding debt under the credit agreements.

Other income (expense), net



(In thousands, except percentages)	Three Months Ended September 30, 2022			Three Months Ended September 30, 2021			Nine Months Ended September 30, 2022			(As Revised) Nine Months Ended September 30, 2021
Other income (expense), net	$	6,545		$	3,773		$	24,729		$	7,489
Percentage of revenue		2.8	%		1.9	%		3.7	%		1.4	%

Other income (expense), net in the three months ended September 30, 2022 increased by $2.8 million, or 73.5%, compared to the same period in 2021, primarily due to a $4.7 million increase in net gain on interest rate swaps, partially offset by a $1.7 million decline in the tax receivable agreement liability and a $0.4 million decrease in net foreign exchange gains.

Other income (expense), net in the nine months ended September 30, 2022 increased by $17.2 million, or 230.2%, compared to the same period in 2021, primarily due to a $15.6 million increase in net gain on interest rate swaps and a $3.4 million loss on extinguishment of long-term debt recognized when we repaid $200.0 million of debt in March 2021, partially offset by a $1.7 million decline in the tax receivable agreement liability and a $0.3 million decrease in fair value of investments in equity securities.

Income tax benefit (provision)



(In thousands, except percentages)	Three Months Ended September 30, 2022			Three Months Ended September 30, 2021			Nine Months Ended September 30, 2022			(As Revised) Nine Months Ended September 30, 2021
Income tax benefit (provision)	$	(1,618	)	$	(280	)	$	(5,756	)	$	437,122
Effective tax rate		5.8	%		(2.8	)%		11.3	%		309.0	%

Income tax provision was $(1.6) million for the three months ended September 30, 2022, compared to $(0.3) million for the same period in 2021. Income tax provision was $(5.8) million for the nine months ended September 30, 2022, compared to a benefit of $437.1 million for the same period in 2021. The tax benefit of $437.1 million recorded in the nine months ended September 30, 2021 includes a $441.5 million tax benefit related to the reversal of a net deferred tax liability, which was due to the restructuring of our international operations.

Non-GAAP Financial Measures

We report our financial results in accordance with GAAP, however, management believes that certain non-GAAP financial measures provide users of our financial information with useful supplemental information that enables a better comparison of our performance across periods. We believe Adjusted EBITDA provides visibility to the underlying continuing operating performance by excluding the impact of certain expenses, including income tax (benefit) provision, interest (income) expense, depreciation and amortization, stock-based compensation expenses, employer costs related to stock-based compensation, foreign exchange (gain) loss, changes in fair value of contingent earn-out liability, interest rate swaps and investments in equity securities, transaction and other costs, litigation costs net of insurance reimbursements that arise outside of the ordinary course of business, tax receivable agreement liability remeasurement (benefit) expense and impairment loss, as management does not believe these expenses are representative of our core earnings. We also provide Adjusted EBITDA margin, which is calculated as Adjusted EBITDA divided by revenue. In addition to Adjusted EBITDA and Adjusted EBITDA margin, we believe free cash flow and free cash flow conversion provide useful information regarding how cash provided by (used in) operating activities compares to the capital expenditures required to maintain and grow our business, and our available liquidity, after funding such capital expenditures, to service our debt, fund strategic initiatives and strengthen our balance sheet, as well as our ability to convert our earnings to cash. Additionally, we believe such metrics are widely used by investors, securities analysis, ratings agencies and other parties in evaluating liquidity and debt-service capabilities. We calculate free cash flow and free cash flow conversion using methodologies that we believe can provide useful supplemental information to help investors better understand underlying trends in our business.

Our non-GAAP financial measures may not be comparable to similarly titled measures used by other companies, have limitations as analytical tools and should not be considered in isolation, or as substitutes for analysis of our operating results as reported under GAAP. Additionally, we do not consider our non-GAAP financial measures as superior to, or a substitute for, the equivalent measures calculated and presented in accordance with GAAP. Some of the limitations are:

•

Adjusted EBITDA and Adjusted EBITDA margin exclude the recurring, non-cash expenses of depreciation and amortization of property and equipment and definite-lived intangible assets and, although these are non-cash expenses, the assets being depreciated and amortized may have to be replaced in the future;

•

Adjusted EBITDA and Adjusted EBITDA margin do not reflect changes in, or cash requirements for, our working capital needs;

•

Adjusted EBITDA and Adjusted EBITDA margin exclude stock-based compensation expense and employer costs related to stock-based compensation, which has been, and will continue to be for the foreseeable future, an important part of how we attract and retain our employees and a significant recurring expense in our business;

•

Adjusted EBITDA and Adjusted EBITDA margin do not reflect the interest (income) expense or the cash requirements to service interest or principal payments on our indebtedness, and free cash flow does not reflect the cash requirements to service principal payments on our indebtedness;

•

Adjusted EBITDA and Adjusted EBITDA margin do not reflect income tax (benefit) provision we are required to make; and

•

Free cash flow and free cash flow conversion do not represent our residual cash flow available for discretionary purposes and does not reflect our future contractual commitments.

Adjusted EBITDA is not a liquidity measure and should not be considered as discretionary cash available to us to reinvest in the growth of our business or to distribute to stockholders or as a measure of cash that will be available to us to meet our obligations.

To properly and prudently evaluate our business, we encourage you to review the financial statements included elsewhere in this report, and not rely on a single financial measure to evaluate our business. We also strongly urge you to review the reconciliation of net earnings (loss) to Adjusted EBITDA, the computation of Adjusted EBITDA margin as compared to net earnings (loss) margin which is net earnings (loss) as a percentage of revenue, the reconciliation of net cash provided by (used in) operating activities to free cash flow, and the computation of free cash flow conversion as compared to operating cash flow conversion, which is net cash provided by (used in) operating activities as a percentage of net earnings (loss) in each case set forth below.

We define Adjusted EBITDA as net earnings (loss) excluding income tax (benefit) provision, interest (income) expense, depreciation and amortization, stock-based compensation expense, employer costs related to stock-based compensation, foreign exchange (gain) loss, changes in fair value of contingent earn-out liability, interest rate swaps and investments in equity securities, transaction and other costs, litigation costs net of insurance reimbursements that arise outside of the ordinary course of business and tax receivable agreement liability remeasurement (benefit) expense. Adjusted EBITDA margin represents Adjusted EBITDA as a percentage of revenue.

We define free cash flow as net cash provided by (used in) operating activities less capital expenditures. Free cash flow conversion represents free cash flow as a percentage of Adjusted EBITDA. Operating cash flow conversion represents net cash provided by (used in) operating activities as a percentage of net earnings (loss).

The following table reconciles our non-GAAP financial measures to the most comparable GAAP financial measures for the periods presented:



(In thousands, except percentages)	Three Months Ended September 30, 2022			(As Revised) Three Months Ended September 30, 2021			Nine Months Ended September 30, 2022			(As Revised) Nine Months Ended September 30, 2021
Net earnings (loss)	$	26,405		$	(10,385	)	$	45,122		$	295,654
Add back:
Income tax (benefit) provision		1,618			280			5,756			(437,122	)
Interest (income) expense		6,866			5,676			18,446			18,861
Depreciation and amortization		19,755			27,022			73,835			80,882
Stock-based compensation expense		37,175			23,763			77,179			99,502
Employer costs related to stock-based compensation (1)		431			2,438			1,628			2,438
Litigation costs, net of insurance reimbursements (2)		249			2,019			4,089			3,794
Foreign exchange (gain) loss (3)		(1,551	)		(2,011	)		(6,050	)		(6,042	)
Changes in fair value of interest rate swaps(4)		(4,774	)		(46	)		(18,404	)		(2,789	)
Transaction and other costs(5)		2,705			2,208			6,869			21,630
Changes in fair value of contingent earn-out liability		(27,004	)		5,221			(46,399	)		77,659
Changes in fair value of investments in equity securities		(38	)		(14	)		(38	)		(333	)
Tax receivable agreement liability remeasurement benefit (6)		—			(1,687	)		—			(1,687	)
Impairment loss (7)		—			—			4,388			—
Adjusted EBITDA	$	61,837		$	54,484		$	166,421		$	152,447
Net earnings (loss) margin(8)		11.4	%		(5.2	)%		6.8	%		53.4	%
Adjusted EBITDA margin		26.6	%		27.4	%		25.1	%		27.5	%

Net cash provided by (used in) operating activities							$	81,769		$	20,257
Less:
Capital expenditures								(11,311	)		(9,388	)
Free cash flow							$	70,458		$	10,869
Operating cash flow conversion								181.2	%		6.9	%
Free cash flow conversion								42.3	%		7.1	%

(1)

Represents employer portion of Social Security and Medicare payroll taxes domestically, National Insurance contributions in the United Kingdom and comparable costs internationally related to the settlement of equity awards.

(2)

Represents certain litigation costs and insurance proceeds associated with pending litigations or settlements of litigation.

(3)

Represents foreign exchange (gain) loss due to foreign currency transactions.

(4)

Represents fair value gain on interest rate swaps.

(5)

Represents transaction costs related to acquisitions and our offerings (IPO, the Reorganization and the secondary offering) such as legal, accounting, advisory fees and other related costs. Amount for the nine months ended September 30, 2021 also includes a loss on debt extinguishment related to the repayment of $200.0 million under the Incremental Term Loan Facility. Amounts for 2022 also include employee-related restructuring costs directly associated with our decision to discontinue our operations in Russia including severance benefits, relocation and advisory fees.

(6)

Represents changes in tax receivable agreement liability due to tax rate changes and unrelated to exchanges of Common Units for Class A shares.

(7)

Represents impairment loss of a right-of-use asset related to our Moscow office.

(8)

Net earnings margin for the nine months ended September 30, 2021 includes a $441.5 million tax benefit related to the reversal of a deferred tax liability due to a restructuring of the Company’s international operations.

Liquidity and Capital Resources

Overview

The Company’s principal sources of liquidity are our cash and cash equivalents and cash generated from operations. Our primary uses of liquidity are operating expenses and capital expenditures. As of September 30, 2022, we had $365.1 million of cash and cash equivalents, a decrease of $4.1 million from December 31, 2021 primarily due to the acquisition of Fruitz and the classification of restricted cash for cash held in Russia.

In connection with our IPO, we used the proceeds (net of underwriting discounts) from the issuance of 9.0 million shares of Class A common stock ($369.6 million) in the IPO to purchase an equivalent number of newly issued Common Units from Bumble Holdings, which Bumble Holdings used to repay outstanding indebtedness under our Incremental Term Loan Facility totaling $200.0 million in aggregate principal amount and allocated $169.9 million to be used for general corporate purposes, to bear all of the expenses of the IPO and we expect that our future principal uses of cash will also include funding our debt obligations and paying income taxes and obligations under our tax receivable agreement. Based on current conditions, we believe that we have sufficient financial resources to fund our activities and execute our business plans during the next twelve months.

Cash Flow Information

The following table summarizes our unaudited condensed consolidated cash flow information for the periods presented:



(In thousands)	Nine Months Ended September 30, 2022			(As Revised) Nine Months Ended September 30, 2021
Net cash provided by (used in):
Operating activities	$	81,769		$	20,257
Investing activities		(81,031	)		(9,357	)
Financing activities		(11,665	)		152,924

Operating activities

Net cash provided by operating activities was $81.8 million for the nine months ended September 30, 2022, and $20.3 million for the nine months ended September 30, 2021. This includes adjustments to net earnings (loss) for the nine months ended September 30, 2022 and September 30, 2021 related to: deferred income tax of $(6.5) million and $(443.1) million, respectively; change in fair value of deferred contingent consideration of $(46.4) million and $77.7 million, respectively; stock-based compensation of $77.2 million and $99.5 million, respectively; and depreciation and amortization of $73.8 million and $80.9 million, respectively.

The changes in assets and liabilities for the nine months ended September 30, 2022 and 2021 consist primarily of: changes in legal liabilities of $(7.1) million and $(45.6) million, respectively; and changes in accounts receivables of $(5.2) million and $(5.0) million, respectively, driven by timing of cash receipts.

Investing activities

Net cash used in investing activities was $81.0 million and $9.4 million for the nine months ended September 30, 2022 and 2021, respectively. The change was primarily due to the acquisition of Fruitz (net of cash acquired) of $69.7 million in the nine months ended September 30, 2022. In addition, the Company had capital expenditures of $(11.3) million and $(9.4) million in the nine months ended September 30, 2022 and 2021, respectively.

Financing activities

Net cash provided by (used in) financing activities was $(11.7) million and $152.9 million in the nine months ended September 30, 2022 and 2021, respectively. In the nine months ended September 30, 2022, the Company used $(7.4) million for shares withheld to satisfy employee tax withholding requirements upon vesting of restricted stock units, and $(4.3) million to repay a portion of the outstanding indebtedness under our Original Term Loan. In the nine months ended September 30, 2021, the Company received net proceeds of $2,361.2 million after deducting underwriting discounts and commissions, of which $1,991.6 million was used to redeem shares of Class A common stock and purchase Common Units from our Sponsor, $(205.0) million was used to repay a portion of the outstanding indebtedness under our Incremental Term Loan Facility and $(9.3) million was used for shares withheld to satisfy employee tax withholding requirements upon vesting of restricted stock units.

Indebtedness

Senior Secured Credit Facilities

In connection with the Sponsor Acquisition, in January 2020, we entered into the Initial Term Loan Facility in an original aggregate principal amount of $575.0 million and the Revolving Credit Facility in an aggregate principal amount of up to $50.0 million. In connection with the Distribution Financing Transaction, in October 2020, we entered into the Incremental Term Loan Facility (the “Incremental Term Loan Facility”) in an original aggregate principal amount of $275.0 million. The Incremental Term Loan provides for additional senior secured term loans with substantially identical terms as the Initial Term Loan Facility (other than the applicable margin). A portion of the net proceeds from the initial public offering was used to repay $200.0 million aggregate principal amount of our outstanding indebtedness under our Term Loan Facility in the three months ended March 31, 2021. The borrower under the Senior Secured Credit Facilities is a wholly owned subsidiary of Bumble Holdings, Buzz Finco L.L.C. (the “Borrower”). The Senior Secured Credit Facilities contain affirmative and negative covenants and customary events of default.

Borrowings under the Senior Secured Credit Facilities bear interest at a rate equal to, at the Borrower’s option, either (i) LIBOR for the relevant interest period, adjusted for statutory reserve requirements (subject to a floor of 0.0% on the Initial Term Loan and 0.50% on the Incremental Term Loan), plus an applicable margin or (ii) a base rate equal to the highest of (a) the rate of interest in effect as last quoted by the Wall Street Journal as the “Prime Rate” in the United States, (b) the federal funds effective rate plus 0.50% and (c) adjusted LIBOR for an interest period of one month plus 1.00% (subject to a floor of 0.00% per annum), in each case, plus an applicable margin. The applicable margin for loans under the Revolving Credit Facility is subject to adjustment based upon the consolidated first lien net leverage ratio of the Borrower and its restricted subsidiaries and is subject to reduction after the consummation of our initial public offering.

In addition to paying interest on the outstanding principal under the Senior Secured Credit Facilities, the Borrower is required to pay a commitment fee of 0.50% per annum (which is subject to a decrease to 0.375% per annum based upon the consolidated first lien net leverage ratio of the Borrower and its restricted subsidiaries) to the lenders under the Revolving Credit Facility in respect of the unutilized commitments thereunder. The Borrower must also pay customary letter of credit fees and an annual administrative agency fee.

The Initial Term Loan Facility amortizes in equal quarterly installments in aggregate annual amounts equal to 1.00% of the principal amount of the Initial Term Loan Facility outstanding as of the date of the closing of the Initial Term Loan Facility, with the balance being payable at maturity on January 29, 2027. The Incremental Term Loan Facility amortizes in equal quarterly installments in aggregate annual amounts equal to 1.00% of the principal amount of the Incremental Term Loan Facility outstanding as of the date of the closing of the Incremental Term Loan Facility, with the balance being payable at maturity on January 29, 2027. Following the $200.0 million aggregate principal payment of amount of outstanding indebtedness during the three months ended March 31, 2021 quarterly installment payments on the Incremental Term Loan Facility are no longer required for the remaining term of the facility. Principal amounts outstanding under the Revolving Credit Facility are due and payable in full at maturity on January 29, 2025.

Tax Receivable Agreement

In connection with the IPO, in February 2021, we entered into a tax receivable agreement with certain of our pre-IPO owners that provides for the payment by the Company to such pre-IPO owners of 85% of the benefits that the Company realizes, or is deemed to realize, as a result of the Company’s allocable share of existing tax basis acquired in our initial public offering and other tax benefits related to entering into the tax receivable agreement.

We estimate the amount of existing tax basis with respect to which our pre-IPO owners will be entitled to receive payments under the tax receivable agreement (assuming all Pre-IPO Common Unitholders exchanged their Common Units for shares of Class A common stock on the date of the initial public offering, and assuming all vested Incentive Units were converted to Common Units and subsequently exchanged for shares of Class A common stock at the initial public offering price of $43.00 per share of Class A common stock) is approximately $2,603.7 million, which includes the Company’s allocable share of existing tax basis acquired in this IPO, which we have determined to be approximately $1,728.1 million. In determining the Company’s allocable share of existing tax basis acquired in the IPO, we have given retrospective effect to certain exchanges of Common Units for Class A shares that occurred following the IPO that were contemplated to have occurred pursuant to the Blocker Restructuring. The payments under the tax receivable agreement are not conditioned upon continued ownership of the Company by the pre-IPO owners.

Contractual Obligations and Contingencies

The following table summarizes our contractual obligations as of September 30, 2022:


	Payments due by period
(In thousands)	Less than 1 year		1 to 3 years		3 to 5 years		More than 5 years		Total
Long-term debt	$	5,750	$	11,500	$	617,000	$	—	$	634,250
Operating leases		5,561		8,444		8,804		4,521		27,330
Other		7,889		5,340		—		—		13,229
Total	$	19,200	$	25,284	$	625,804	$	4,521	$	674,809

The payments that we may be required to make under the tax receivable agreement to the pre-IPO owners may be significant and are not reflected in the contractual obligations table set forth above as they are dependent upon future taxable income. Assuming no material changes in the relevant tax law, and that we earn sufficient taxable income to realize all tax benefits that are subject to the tax receivable agreement, we expect future payments under the tax receivable agreement related to the Offering Transactions to aggregate to $660.3 million and to range over the next 15 years from approximately $10.9 million to $58.5 million per year and decline thereafter. In determining these estimated future payments, we have given retrospective effect to certain exchanges of Common Units for Class A shares that occurred after the IPO but were contemplated to have occurred pursuant to the Blocker Restructuring. The foregoing numbers are merely estimates, and the actual payments could differ materially. See “― Tax Receivable Agreement.”

In connection with the Sponsor Acquisition in January 2020, we entered into a contingent consideration arrangement, consisting of an earn-out payment to the former shareholders of Worldwide Vision Limited of up to $150 million. In addition, we entered into a contingent consideration arrangement for an earn-out payment of up to $10 million in connection with our January 2022 acquisition of Fruitz. The timing and amount of such payments, that we may be required to make, is not reflected in the contractual obligations table set forth above as the payment to the former shareholders of Worldwide Vision Limited is dependent upon the achievement of a specified return on invested capital by our Sponsor and our payment to Fruitz is dependent upon the achievement of certain net revenue targets. See Note 6, Business Combination, for additional information on the Fruitz acquisition.

In October 2022, the Company entered into a lease termination agreement for its Moscow office. The reduction in future lease payments is not reflected in the table above.

Critical Accounting Policies and Estimates

We have discussed the estimates and assumptions that we believe are critical because they involve a higher degree of judgment in their application and are based on information that is inherently uncertain in our Annual Report on Form 10-K for the year ended December 31, 2021. There have been no significant changes to these accounting policies and estimates for the nine months ended September 30, 2022, except as described below.

Related Party Transactions

For discussions of related party transactions, see Note 16, Related Party Transactions, to the condensed consolidated financial statements included in "Item 1 - Financial Statements (Unaudited)".

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Foreign Currency Exchange Risk

We conduct business in certain foreign markets, primarily in the United Kingdom and the European Union. For the three months ended September 30, 2022 and 2021, revenue outside of North America accounted for 39.0% and 41.2% of combined revenue, respectively. Revenue outside of North America accounted for 39.5% and 42.4% of combined revenue, respectively for the nine

months ended September 30, 2022 and 2021. Our primary exposure to foreign currency exchange risk is the underlying user’s functional currency other than the U.S. Dollar, primarily the British Pound and Euro. As foreign currency exchange rates change, translation of the statements of operations of our international businesses into U.S. dollars affects year-over-year comparability of operating results. The average Euro versus the U.S. Dollar exchange rate was 14.5% and 11.0% lower in the three and nine months ended September 30, 2022 compared to the three and nine months ended September 30, 2021, respectively. The average British Pound versus the U.S. Dollar exchange rate was 14.6% and 9.1% lower in the three and nine months ended September 30, 2022 compared to the three and nine months ended September 30, 2021, respectively. Historically, we have not hedged any foreign currency exposures. Our continued international expansion increases our exposure to exchange rate fluctuations and as a result such fluctuations have had and could continue to have a significant impact on our future results of operations.

Interest Rate Risk

At September 30, 2022, we had debt outstanding with a carrying value of $626.0 million. With consideration of the financial impact of our interest rate swaps, a hypothetical interest rate increase of 1% would have increased interest expense for the three and nine months ended September 30, 2022 by $0.7 million and $2.1 million, respectively, based upon the outstanding debt balances and interest rates in effect during those periods. See Note 12, Debt, within the unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report. Borrowings under our Senior Secured Credit Facilities bear interest at a variable market rate. In order to reduce the financial impact of increases in interest rates, the Company entered into two interest rate swaps for a total notional amount of $350 million on June 22, 2020. The effective date for the interest rate swaps is June 30, 2020 and final maturity date is June 30, 2024. The financial impact of the interest rate swaps is to fix the variable interest rate element on $350 million of the long-term debt at a rate of 0.4008%.

In July 2017, the UK’s Financial Conduct Authority, which regulates LIBOR, announced that it intends to phase out USD LIBOR for new loans by the end of 2021 and will stop publishing USD LIBOR after June 30, 2023. The expected discontinuation, reform or replacement of LIBOR may result in fluctuating interest rates, or higher interest rates, which could have a material adverse effect on our interest expense. Once one month LIBOR is phased out after June 30, 2023, the interest rates for our LIBOR-based loans will be indexed to a comparable or successor rate as provided for in our loan agreements.

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as of the end of the period covered by this Quarterly Report on Form 10-Q. Based on such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that as of September 30, 2022, our disclosure controls and procedures are effective to provide reasonable assurance that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission (“SEC”), and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

In conjunction with our review of the accounting for debt issuance costs during the quarter ended September 30, 2022, we identified misstatements in the recognition and presentation of certain debt issuance costs within prior periods, which indicated a material weakness existed within our internal controls for those prior periods. The Company implemented enhanced internal controls during fiscal year 2022, which identified and remediated the material weakness as of September 30, 2022. The misstatements in previously issued financial statements were corrected in this Quarterly Report on Form 10-Q as disclosed in Note 3 to the unaudited condensed consolidated interim financial statements for the period ended September 30, 2022.

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely basis.

This control deficiency did not result in a material misstatement of our prior period consolidated annual or interim financial statements. However, the control deficiency could have resulted in material misstatements to the annual or interim consolidated financial statements that would not have been prevented or detected. Accordingly, management has concluded that this control deficiency constitutes a material weakness in prior periods.

Changes in Internal Control over Financial Reporting

Other than the changes made to identify and remediate the prior period material weakness, there were no changes in our internal control over financial reporting during our most recent fiscal quarter that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II—OTHER INFORMATION

Item 1. Legal Proceedings.

We are subject to various legal proceedings, claims, and governmental inspections, audits or investigations arising out of our business which cover matters such as general commercial, governmental regulations, product liability, environmental, intellectual property, employment and other actions that are incidental to our business, including a number of trademark proceedings, both offensive and defensive, regarding the BUMBLE mark. Although the outcomes of these claims cannot be predicted with certainty, in the opinion of management, the ultimate resolution of these matters will not have a material adverse effect on our financial position or results of operations.

For additional information, see Note 18, Commitments and Contingencies, to our unaudited condensed consolidated financial statements included in Part I, “Item 1—Financial Statements (Unaudited)” of this Quarterly Report on Form 10-Q, which is incorporated herein by reference.

Item 1A. Risk Factors.

For a discussion of our risk factors, see Part I, “Item 1A—Risk Factors” of our 2021 Form 10-K. Refer also to the other information set forth in this Quarterly Report on Form 10-Q, including in the “Special Note Regarding Forward-Looking Statements,” and in Part I, “Item 2—Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and “Item 1—Financial Statements (Unaudited)”.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

None.

Item 6. Exhibits.

The following is a list of all exhibits filed or furnished as part of this report:


Exhibit Number		Description

2.1		Agreement and Plan of Merger, dated as of November 8, 2019, by and among Buzz Holdings L.P., Buzz Merger Sub Ltd, Worldwide Vision Limited and Buzz SR Limited, as the seller representative (incorporated by reference to Exhibit 2.1 to the Registrant’s Registration Statement on Form S-1 filed on January 15, 2021).
3.1		Amended and Restated Certificate of Incorporation of the Registrant (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on February 16, 2021).
3.2		Amended and Restated Bylaws of the Registrant (incorporated by reference to Exhibit 3.2 to the Registrant’s Current Report on Form 8-K filed on February 16, 2021).
10.1*		Amended and Restated Employment Agreement, dated September 23, 2022, by and between Bumble Trading LLC and Anuradha Subramanian.†
10.2*		Form of Vesting Adjustment Letter relating to Performance-Based Incentive Unit Awards.†
31.1*		Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*		Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1*		Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2*		Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS		Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document.
101.SCH		Inline XBRL Taxonomy Extension Schema Document
101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)


*	Filed herewith.
†	Management contract or compensatory plan or arrangement.

The agreements and other documents filed as exhibits to this report are not intended to provide factual information or other disclosure other than with respect to the terms of the agreements or other documents themselves, and you should not rely on them for that purpose. In particular, any representations and warranties made by us in these agreements or other documents were made solely within the specific context of the relevant agreement or document and may not describe the actual state of affairs as of the date they were made or at any other time.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	BUMBLE INC.

Date: November 16, 2022	By:	/s/ Whitney Wolfe Herd
		Whitney Wolfe Herd
		Chief Executive Officer

Date: November 16, 2022	By:	/s/ Anuradha B. Subramanian
		Anuradha B. Subramanian
		Chief Financial Officer