The Meet Group Inc. (NASDAQ: MEET) beat earnings expectations for the fourth quarter of 2019 while revenues came in line with forecasts. The stock was up 1% in premarket hours on Wednesday.
Total revenue of $57.6 million was up 10% from the same period last year and in line with analysts’ estimates of $57.6 million. The topline benefited from a double-digit increase in total user pay revenue.
On a GAAP basis, net income was $4.9 million, or $0.07 per share, compared to $4.3 million, or $0.06 per share in the prior-year quarter. Adjusted net income amounted to $12.4 million, or $0.17 per share, surpassing estimates of $0.16 per share.
Adjusted EBITDA was $13.3 million, compared to $10.6 million in the prior year quarter. At the end of the year, the company had $27.2 million in cash and cash equivalents.
During the quarter, the company saw a 47% year-over-year increase in user pay revenue from video amounting to $22.2 million. User pay revenue from subscription and other in-app products fell 7% to $14.9 million. Total user pay revenues grew 18% to $37.1 million, and comprised 64.6% of total revenues. Advertising revenue fell 3% to $20.3 million.
Last week, Meet Group announced an agreement that will allow it to be acquired by NuCom Group for approx. $500 million. NuCom Group is jointly owned by ProSiebenSat.1 and General Atlantic. The all-cash transaction, which amounts to $6.30 per share, is expected to close in the second half of 2020.
Meet Group, which provides interactive livestreaming solutions, believes this combination will help in building a strong and dynamic product portfolio. The deal will also allow the company to pursue new opportunities and drive growth by combining its video platform with ProSieben’s valued content.
Shares of Meet Group have gained 20% since the beginning of this year.
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