Grindr NYSE: GRND reported second-quarter 2026 revenue growth of 33% year over year to $138 million and raised its full-year outlook, citing strength in subscription revenue, advertising and operating leverage from greater use of artificial intelligence in software development.
Adjusted EBITDA rose 27% from a year earlier to $58 million, representing a 42% margin, CFO John North said during the company’s earnings call. The company increased its full-year revenue outlook to approximately $540 million from $535 million previously, while raising expected adjusted EBITDA to about $232 million from $227 million.
Subscription and advertising revenue drive growth
App-based revenue increased 30% year over year to $113 million in the second quarter, supported by demand for Grindr’s XTRA and Unlimited subscription tiers as well as consumables. North said the performance reflected strong conversion, average revenue per user and retention in the company’s core app business.
Advertising revenue grew 44% to $25 million, aided by programmatic advertising and a large year-long direct brand campaign. The company continues to expect advertising to account for the mid- to high-teens percentage of total revenue for full-year 2026. However, North said advertising revenue as a share of total revenue is expected to normalize closer to the company’s historical 15% range in 2027 and beyond.
Management said it is maintaining a disciplined approach to third-party ad loads, seeking to protect the experience for free users. CEO George Arison said Grindr regularly tests advertising placement, conversion mechanisms and product changes, tracking effects on revenue, user feedback and engagement.
“Free users are the lifeblood of Grindr,” Arison said, adding that the company does not seek to convert as many users as possible into paying subscribers. Instead, it aims to retain a robust free offering while providing premium options to users seeking additional features.
AI adoption reshapes engineering operations
Arison said Grindr’s efforts to become an “AI-native” company have materially increased its engineering productivity. The company estimated that engineering output increased about 2.5 times between July 2025 and April 2026 while maintaining roughly the same team size.
The company initially calculated an output increase of 3.5 times based on production metrics, but reduced its stated estimate to 2.5 times as a more conservative measure, Arison said. He added that, before generative AI, producing comparable output could have required about 200 additional engineers and approximately $60 million in annual costs.
Grindr has used tools including Cursor and Claude Code, and Arison said the company had recently seen significant adoption of Devin. The company primarily uses tools from frontier-model providers for coding, though it has deployed open-source models elsewhere in its systems.
North said the higher productivity has allowed Grindr to moderate expected engineering hiring while continuing to invest in product development and growth initiatives. The company is still hiring and expanding its workforce, he said, but does not expect to add as many engineers as it had anticipated earlier in the year.
Management maintained that its longer-term adjusted EBITDA margin guidepost of 39% to 42% remains appropriate. The stronger full-year profitability outlook reflects second-quarter outperformance and productivity gains rather than a reduction in planned investments, North said.
Product roadmap includes Right Now and EDGE
Arison said Grindr is refining its Right Now feature, which is designed to help users communicate interest in more immediate or casual connections. The company has received feedback that the feature’s name and one-hour usage period can suggest that users must connect immediately, rather than within the next day or two.
Grindr plans product changes in response to that feedback. It has also introduced an option allowing users to post in Right Now without directly linking the post to their standard Grindr profile. Arison said the feature has gained meaningful traction over roughly the past year and a half.
The company is also preparing for a broader rollout of EDGE, its AI-enabled premium tier, later in the fall. Arison said EDGE requires more extensive marketing and product packaging than existing subscription tiers because its value proposition includes a broader set of tools and features rather than simply allowing users to see more profiles.
He said engagement with EDGE features has been high and retention among subscribers has exceeded the company’s expectations. Grindr has also seen some users who were not previously subscribers convert to EDGE, contrary to its initial expectation that the tier would primarily attract Unlimited users.
North identified EDGE as a significant part of the company’s 2027 growth story. Arison clarified that Grindr tested a price of CAD 500 for EDGE, not a $500 U.S. price point.
Marketing, share repurchases and outlook
Operating expenses excluding cost of revenue totaled $71 million, compared with $53 million a year earlier. North said part of the increase reflected one-time marketing costs associated with Grindr’s Madonna partnership, including a Times Square event that Arison said drew an estimated 50,000 people after a 30-minute notice through the app.
Management described the Madonna campaign as a brand-building initiative rather than a top-of-funnel user-acquisition effort. Arison said the company aims to build stronger positive associations with Grindr and improve its ability to attract direct advertisers.
During the quarter, Grindr made a $60 million upfront payment under another accelerated share repurchase program. Certain repurchase transactions remained in progress at quarter-end and were expected to settle in the third quarter. The company had approximately $300 million remaining under its $900 million repurchase authorization.
For the second half, North said revenue growth is expected to moderate as the company laps subscription pricing changes introduced late last year and faces more difficult comparisons against an accelerating second half of 2025. He said the higher 2026 outlook was primarily driven by first-half outperformance, including lower-than-expected churn and stronger-than-anticipated response to pricing changes.
About Grindr (NYSE:GRND)
Grindr, trading on the NYSE under the ticker symbol GRND, operates a global social networking and dating platform designed primarily for gay, bisexual, transgender and queer (GBTQ) individuals. The company’s core offering is a location-based mobile application that enables users to connect, chat and share content with others in their vicinity. Through its free tier and premium subscription services—known as Grindr XTRA and Grindr Unlimited—Grindr provides enhanced features such as ad-free browsing, advanced filters and unlimited profile views, catering to a broad spectrum of user needs.
Originally launched in 2009 by entrepreneur Joel Simkhai, Grindr was one of the first mobile apps to leverage geolocation technology for social networking.
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