Match (NASDAQ:MTCH) stock fell as much as 10% in pre-market trading today after the dating app company reported better-than-expected first-quarter results but announced that its CEO would step down. Additionally, the company’s Q2 guidance came in below analysts’ average outlook.
In a phenomenon that often causes stocks to be “more volatile,” investors tend to become nervous after companies unexpectedly announce that a new CEO will be taking the helm. That’s because Wall Street wonders whether the new boss will be positive or negative for the firm’s financial results.
After market close yesterday, Match announced first-quarter earnings per share of 74 cents, versus analysts’ average outlook of 66 cents. The company reported revenue of $799 million, slightly above the mean estimate.
However, Match provided Q2 revenue guidance of $800 million to $810 million, well below analysts’ average estimate of $835.7 million.
What Is Going on With MTCH Stock?
Also yesterday, the company announced that its CEO, Shar Dubey, would resign, effective May 31. Dubey will be replaced by Bernard Kim, who has been the president of video game maker Zynga (NASDAQ:ZNGA) for more than five years. After May 31, Dubey will remain on Match’s board and serve as an advisor to the company regarding “product strategy.” Dubey became the CEO of Match in March 2020.
Match noted that Kim was “instrumental in Zynga’s explosive growth and was pivotal in the company’s expansion to new markets.”
In a statement, Dubey said, “I feel privileged that I am able to step down from a day-to-day operating role and have the time and headspace to focus on what is hopefully the ‘give back’ chapter of my life. As a Director and an advisor, I will have the flexibility to stay close to aspects of the business I love – product and strategy.”
So far this year, MTCH stock has tumbled 43%
On the date of publication, Larry Ramer did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.