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LOVLQ OTCM· Spark Networks SE
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LOVLQ OTCM· Spark Networks SE
Earnings report Q2 2023

LOVLQ Reports Decline in Revenue for Q2 2023

Segments of revenue

LOVLQ's revenue for the three months ended June 30, 2023, was $41.2 million, representing a decrease of $6.8 million or 14.2% compared to the same period in 2022. For the six months ended June 30, 2023, revenue was $82.5 million, reflecting a decline of $15.4 million or 15.7% compared to the same period in 2022.

Strengths

Despite the decline in revenue, LOVLQ demonstrated strengths in managing its cost of revenue. The company successfully reduced its cost of revenue, exclusive of depreciation and amortization, by $13.6 million or 37.3% for the three months ended June 30, 2023, and by $20.5 million or 29.1% for the six months ended June 30, 2023, compared to the same periods in 2022. This reduction was primarily attributed to a decrease in marketing spend. The management's decision to engage Lamark Media Group contributed to this cost-saving initiative.

Challenges

The main weakness for LOVLQ in the latest quarter was the decrease in the number of average paying subscribers, which declined by 20.0% for the three months ended June 30, 2023, and by 18.8% for the six months ended June 30, 2023, compared to the same periods in 2022. This decline in subscribers directly impacted the company's revenue, leading to the overall decrease.

Noteworthy

During the quarter ended June 30, 2023, LOVLQ revised its business metrics, resulting in changes to the prior period metrics disclosed for the three and six months ended June 30, 2022. The company updated its definition of registrations and conducted a review of its business intelligence systems, leading to adjustments in the count of historical average paying subscribers.

Summary

LOVLQ experienced a decline in revenue for Q2 2023, primarily driven by a decrease in the number of average paying subscribers. However, the company demonstrated strengths in managing its cost of revenue by reducing marketing spend. The revision of business metrics and adjustments in subscriber counts indicate the company's commitment to accurate reporting. LOVLQ should focus on strategies to attract and retain paying subscribers to improve its revenue performance in future quarters.

Source documents

Form 10-Q/A  filed on Aug 23, 2023
59 pages scanned

Reference data

Company financials Q2 revenue 41.2M
Analyst estimates Q2 EPS missed by NaN%
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