Anuradha Subramanian: Yes. And in terms of your question about EBITDA, I think, for Q1, I would say the majority of y performance that you saw was really us being very disciplined on both marketing spend as well as in headcount. On the marketing side, we’ve been compensate of viewing all our campaigns, looking at all these little data returns in every market and trimming budgets based on that. We obviously, based on the topline numbers that you see, we haven’t seen any loss of efficiency. So, all of this is just us getting better and better in getting the returns that we want. We would definitely like to see if we can spend some of the marketing dollars that we saved in Q1 and Q2. And that’s why we haven’t increased full year guidance for EBITDA yet, but it’s definitely something that we’ll continue to look at on an ongoing basis, but we feel very confident in being able to get to the — at least 100 basis points of margin expansion that we are guiding to for the full year.
And in terms of headcount, I’ll also mention that over the last few years, we’ve had an ongoing cadence of continuously reviewing different parts of our organization in terms of how much we are funding each of those groups. We’ve been pretty judicious over the last few years in terms of how much we’ve grown through the pandemic and in the last couple of years. So this isn’t something that, we’re just doing for the first time this year. This is definitely something that we’ve always been very good at doing internally. And I think I mentioned this the last time as well; our teams have been told that the bar for incremental head count is very high. And certain critical areas are definitely being funded. Areas like, obviously, Whitney talked a lot about AI, so augmenting our engineering teams to make sure that we have the right skill set around some of the things that we want to build and develop.
We are definitely looking at funding, but otherwise, like I said, the bar for how you’re thinking about incremental headcount is pretty high. And again, this is something that, we are going to continue to keep a very close eye on because we want to make sure that we’re investing in the right things to maximize our top line.
Shweta Khajuria: Okay. Thank you, Tariq. Thank you, Anu.
Operator: Your next call comes from Lauren Schenk.
Lauren Schenk: Great, thank you. Two, if I can. I think relative to what we know you’re running through end of February and an AK that you put out, it seems like March accelerated really nicely. Is there anything from a specific product feature, geography, monetization that drove that acceleration or just sort of broad-based improvement? And then secondly, just on the EBITDA margin guide for the second quarter, a little bit, I think, below where the street was expecting, is that just a shift of marketing from 1Q to 2Q? Anything else to call out there? Thanks.
Anu Subramanian: Yes, I think I’ll maybe start with the second question first. Nothing, specific to call out on 2Q. I think we’ve said before, our first half tends to be just seasonally, a higher quarter in terms of marketing spend. Now, this in Q1 as well, and eventually we were able to spend less and still achieve the top end efficiency that we wanted. We are earmarking certain funds for certain campaigns in Q2. But again, like I said, I think our goal would definitely be to try and maximize efficiency wherever we can. It doesn’t change the trajectory that we have for the full year. It’s just purely a function of timing of how some of our campaigns are landing. And I think in terms of the pair cadence for Q1, I think it’s important to remember that the net ad number has a lot of things that can impact that.
So, it’s not always easy to sort of just draw a correlation between the months. If you look at the year-over-year sort of growth rate, January was slightly lighter than you would have normally expected, but Feb and March did very well. It was in line with how we had planned our product cadence. It was in line with how we had planned our product cadence. It was in line with what we were planning for in terms of top of the funnel user growth as well. And also the payer optimization work that we had planned for the quarter. So this was definitely something that we were expecting. And obviously, when we guided to the numbers, we were very confident that that’s the number that we would end up in. And we came in slightly higher than that. So nothing specific to call out other than, what had been sort of planned from a user growth and product perspective.
Lauren Schenk: Okay, great. Thank you so much.
Operator: Your next call comes from Benjamin Black.
Ishant Goel: Hi, thank you for taking our question. This is Ishant Goel on for Ben. It would be great to hear your thoughts on the recent developments within App Store fee. And do you sense that App Store fee really could be a 2024 event? Thank you.
Tariq Shaukat: Hey, sure. So, we are certainly paying a lot of close attention to this, and both what Apple and Google are doing. And as we’ve said, as we talked about before, we are pleased to be in the user choice billing program at Google as just one example of the efforts that we’re taking. I would say at the moment, we are quite positive on the impact on users. We do have increasing evidence as these different programs are rolled out that users do want choice in how they are able to pay for our services. And as we offer them more forms of payment, you see people opting for those other forms of payment. And that generally speaking is a good thing. So we’re very positive on the user experience side and on the — the payer side, if you will, on that front.
In terms of the fees themselves, I would say it’s not a clear picture at the moment. We’re not anticipating, frankly, any major apps for relief this year. And next year, I think, this is all hard to say. The net effect of some of the changes being proposed by Apple and Google could actually be to raise the fees that you have to pay as opposed to lowering the fees. So I think it’s a very murky picture and there’s a lot of detail that needs to be worked through by all the different platforms.
Ishant Goel: Thank you very much.
Tariq Shaukat: Thank you.
Operator: Your next question comes from Justin Patterson.
Justin Patterson: Great, thank you. Good afternoon. Whitney, I was hoping you could touch a little bit more on just marketing toward Gen Z. It seems like something that, many companies have been struggling with. So I would love to hear a little bit more about how you’re positioning that potential new product to really attract that demographic more. And perhaps as a follow-up to that, I would love to hear you just elaborate a little bit more about the testing features within Bumble. I know some companies just optimize for revenue growth. I’d be curious to hear about how you’re thinking about just the broader user experience within there and making sure that you’re not sacrificing the health of the product in order to drive revenue growth? Thank you.
Whitney Herd : Yes. Hi, thanks so much for the question. So to start with Gen Z, I think it’s important to note that a significant driver of our success in these recent quarters has been the steady growth that we’re seeing in our Gen Z user base. And that’s particularly in the US. And so as you can imagine, this is very exciting as we are successfully acquiring this user base of the future. And I mentioned that Bumble app also led other dating apps in terms of MTF scores among US Gen Z and Q4. So that’s another proof point that our appeal to this very important market is — it’s really resonating. And we have recently begun to build products designed to engage our Gen Z users. So the fact that we’re performing so well with this generation without really optimizing the platform yet for them is a positive.
I’ll talk about that in a second. I just want to take a second and double click on our unique understanding of the college audience and how this is not new. This is something we have been so focused on since I started the company in 2014. So we have this scaled program with what we call Honey Ambassadors and because we have consistently and constantly evolved that and stayed current with that, where we don’t age with them necessarily. We’re always bringing in the freshmen and the sophomores and the juniors and the seniors along with us. We really invested in this audience and we can really relate to them in a number of ways, so not only from the product side, which will be consisting of things like virtual gifts and optimizing speed dating for them and really leaning into that Gen Z women’s experience and the deeper focus of this audience-specific content messaging, but we’re really good at marketing to them.
So, we have this unique hook in with the influential college students. This is something, competitors can’t go and just acquire this is something we’ve built over the years it’s a deep ingrained network effect and so that is really paying off for us, because of those roots that we’ve planted over the years. And then one thing I’d like to touch on is this low tier offering that is going to be paired with, kind of the college bundle that we’ve talked about, which we’re pleased that those results with those initiatives to date. But, a big priority for this college age group is to really test a range of different features that target this particular audience. As I said earlier, that’s a virtual gift, and this could be even new experiences that are very social ways to engage.
This could be stickers, photo effects, or other ways to express themselves. So that is in its very early stages of testing, and we do not expect to have any material contributions of this in 2023, but we’re very excited about the prospect for this given that growing and robust user base. Before I hand it to Tariq, I just want to double click on user joy. So this is something we are obsessed with. I want to reinforce that while we are really good at delivering our numbers and staying really incredibly efficient know, incredibly efficient. We operate for the long-term. This is a long-term committed business and without customer joy and satisfaction, that’s impossible. And so that is always front and center at every product roadmap, at every strategy meeting.
And this is absolutely mission critical with Gen Z and particularly women. So I think you see that through our results. And so, I just want to reinforce that while we’re great at pricing and optimizing revenue, it’s never at the expense of customer joy, safety, satisfaction. With that, if Tariq would like to add anything, I’ll take it to him.
Tariq Shaukat : The only thing I would build on top of what Whitney said is, as we look at our experimentation plan as we talk about what we’re solving for, of course, at the end of the day, we look at revenue, payers, efficiencies, things like that. But those are all output metrics, right? And those are not actually what our teams sulfur per se. What they solve for are the input metrics, and the input metrics get back to what Whitney is talking about. We know that if we are able to better match you and better get you matches on the platform, you’re more likely to be retained on the platform until you find the person that you want to be with and then you leave. And we know that you’re more willing to pay if we are helping to generate high relevance for you and that we’re able to do that in a safe and respectful way.
And so our teams from an experimentation standpoint are really looking at that customer journey at the dynamics of the ecosystem. And we kind of know that when we are able to make that ecosystem really work well, it leads to more paying users, more revenue, more EBITDA for us. So that’s essentially the philosophy the teams work with.
Justin Patterson: Great. Thank you both.
Tariq Shaukat : Thanks, Justin.
Operator: Your next question comes from John Blackledge.
John Blackledge : Great. Thanks. Two questions First, could you provide some more color on Compliments, the kind of the usage of the feature, and how it’s driving monetization and payer conversion? And then second area on AI and machine learning, is the AI that you use kind of across the safety and the recommendation engines, etcetera, all from kind of internally developed capabilities in-house. And then kind of going forward, would you expect to partner with any of these emerging gen AI companies to drive improvements, kind of either in the apps and/or to drive efficiencies across the business and marketing, software coding, etcetera. Thank you.
