Good day, everyone. My name is Catherine and I will be your conference operator today. At this time, I would like to welcome you to the Grindr third quarter 2026 earnings call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, and if you have joined via the webinar, please use the raise hand icon, which can be found at the bottom of your webinar application. At this time, I would like to turn the call over to Tolu Adeofe, Head of Investor Relations.

Thank you, moderator. Hello and welcome to the Grindr earnings call for the third quarter 2026. Today's call will be led by Grindr's CEO, George Arison, and CFO, John North, who will make a few brief remarks. George will then be joined by Alda Chan, VP of Finance, for the Q&A session. Please note, Grindr released its shareholder letter this afternoon, and this is available on the SEC's website and Grindr's investor page at investors.grinder.com. Before we begin, I will remind everyone that during this call, we may discuss our outlook, future performance, and future prospects. You should not rely on forward-looking statements as predictions of future events. These forward-looking statements are subject to risks and uncertainties, and our actual results could differ materially from the views expressed today. Some of the risks that could cause our actual results to differ from views expressed in our forward-looking statements have been set forth in our earnings release and our periodic reports filed with the SEC, including our annual report on Form 10-K for the year ended December 31, 2025, or any subsequently filed quarterly reports. During today's call, we will also present both GAAP and non-GAAP financial measures. Additional disclosures regarding non-GAAP measures, including a reconciliation of these non-GAAP financial measures to their most closely comparable GAAP financial measure, are included in the earnings release we issued today, which has been posted on the investor relations page of Grindr's website and in Grindr's filings with the SEC. With that, I'll turn it over to George.

Thanks, Tolu, and hello, everyone. We delivered in our excellent quarter. Revenue grew 22% to $141 million, with $62 million in adjusted EBITDA and a 44% adjusted EBITDA margin. We are again raising our 2026 guidance to at least $560 million in revenue and $236 million in adjusted EBITDA. Three things I want to focus on today. First, we are delivering on the strategy we laid out at our 2024 investor day. We said we would turn Grindr into the global neighborhood, which would ultimately be a platform of profitable businesses that reinforce one another, starting with a better free app and premium products worth paying more for. Since we've rebuilt the app and chat infrastructure introduced right now in AI-powered recommendations and recently launched maps, monthly active users have grown 13% since 2024, and users now spend almost 70 minutes a day on Grindr on average. The updated 2026 outlook already puts us within the adjusted EBITDA dollar range we previously set at Invest Today for 2027, and our revenue at roughly 93% of our 2027 Invest Today target, all a year early. This fantastic progress reflects our team's ability to simultaneously over-deliver for our users and our shareholders by creating tremendous value within our core product. Second, Edge is launching this month. Early access for our new AI-powered premium tier begins November 10, with global launch on November 17. We are launching Edge at an introductory price of $120 a month. With a premium experience and deliberately limited membership, we have room for substantially higher pricing over time. With nearly 400,000 users registering for early access within 72 hours of us announcing the ability for users to express an interest, we received another strong data point of Edge being very well set up to be a strong driver of core app revenue growth in 2027 and beyond. Third, we have completed our acquisition of PurposeNet Inc., the parent company of the Freddie brand. The premiumization underway and the core business well ahead of our investor day plan, we're in prime position to do more. HIV prevention is directly tied to men meeting through Grindr. Making PrEP easier to access is a natural next step of our evolution. The acquisition brings a profitable business, an experienced clinical team, nationwide coverage, and pharmacy operations that would take at least two years to build ourselves. We know Grindr can accelerate Freddie's growth. Through September, almost a quarter of Freddie's US patients came through Grindr ads that any advertiser could buy. Woodwork showed us that native placements built into the app convert almost two and a half times as well as standard ads. We validated the effectiveness of native placements for PrEP during diligence and now starting to use them for Freddie. We expect approximately 12,000 U.S. patients at the end of the year. Based on our tests, we believe current native placements and new ones we're building can alone take us to 50,000 over the medium term. At more than $4,800 in revenue per patient per year, 50,000 U.S. patients receiving telehealth and pharmacy services for a full year would generate approximately $240 million in annual revenue. At adjusted EBITDA margins of 40% or higher in the medium term, that is nearly $100 million in annual adjusted EBITDA. Getting there will take time, including spreading infrastructure costs across more patients, filling more prescriptions through FETI's affiliated pharmacies, and growing the U.S. share of revenue where we expect higher margins than in Canada. Our ambitions go much further. We estimate that bringing 200,000 U.S. gay men onto PrEP for the first time could prevent nearly 4,000 HIV infections annually. When you think of the opportunity from this point of view, the magnitude of what we are taking on becomes much clearer. Beyond native placements, we plan to offer Freddie patients premium grinder services and other integrations, such as an in-app badge with a verified date of your last negative HIV test result, or a PrEP prescription obtained for Freddie, information shared only with user consent. These, we believe, will play a vital role in getting a lot more men who have not tried PrEP before to start the medication. Premium features help users find connections, while verified badges build competence and profile health information. Both can bring more men into taking care of their health while improving their Grindr experience. In summary, our priorities for 2027 are threefold. One, integrate Freddie and expanding clinical and affiliated pharmacy capacity to grow U.S. patients. Two, rapidly scaling edge revenue while developing AI products and future premium offerings like VIP. And three, improving free grinder to remain the app of choice for gay men. At our next Investor Day in June 2027, we will share our vision and financial goals through 2030. Our team's execution over the last four years gives us the confidence to aim much higher. Thank you to our team and our shareholders. Now over to John.

Thanks, George. We had an excellent third quarter. Revenue grew 22% year over year to $141 million and adjusted EBITDA was $62 million, representing a 44% margin. Performance was driven by sustained momentum in core app revenue as well as solid ads execution. App-based revenue grew 22% year-over-year to $118 million, supported by steady demand across our extra and unlimited tiers, and strong consumables performance. Average paying users grew 11% to $1.4 million, and ARPU was up 10% to $27.15. Advertising revenue grew 23% to $24 million, driven by continued strength in direct advertising alongside programmatic growth. As a reminder, we still expect advertising revenue to land in the mid to high teens as a percentage of total revenue for full year 2026, Before normalizing back to our near historical 15% range. Reported GAAP net loss was $7 million. This was driven by a one-time $33 million settlement charge related to historical UK litigation over data practices prior to 2020, well before the current ownership and management team took over. along with $3 million in transaction costs for Freddie. Excluding litigation and transaction costs, net income was $21 million. Operating expenses, excluding cost of revenue, were $103 million on a reported basis or $67 million excluding litigation and transaction costs compared to $42 million in Q3 of last year. Operating income, excluding litigation and transaction costs, was $40 million or 28% of revenue. Adjusted EBITDA grew 13% year-over-year to $62 million, or a 44% margin. Q3 of last year came in at a 47% margin, benefiting from higher capitalized product development expenses. Our underlying profitability remains very healthy, giving us plenty of capacity to invest in our core app and edge while maintaining strong margins. Talking about share repurchases, through our structured buyback programs, we completed the repurchase of approximately 13 million shares for $180 million, at an average price of $13.83 before excise tax during the nine months ended September 30th, 2026. As part of the Freddie transaction, we funded 60 million of the consideration in equity, which represents about 4 million grinder shares. Even with those shares factored in, our buyback activity delivered a net share reduction of roughly 9 million shares, or about 5% of our pre-buyback shares outstanding, and roughly 19% of our pre-buyback free float. Note also that the shares issued for Freddie have resale restrictions, so they won't immediately enter the freely tradable flow. Now for our guidance. With our strong Q3 results and continued momentum across the core business, we are raising our full year 2026 outlook. We now expect full year 2026 revenue of at least $560 million, up from our previous outlook of approximately $540 million, and adjusted EBITDA of at least $236 million, up from approximately $232 million. This outlook includes negligible contribution from Freddie in the fourth quarter following the close. We are also providing our initial 2027 outlook to help you model the addition of Edge and Freddie. For 2027, we expect total revenue of at least $705 million, representing approximately 26% in implied top-line growth based on our 2026 guidance, and adjusted EBITDA of at least $275 million, which implies an adjusted EBITDA margin of at least 39%. This fits right within our 39% to 42% investor day margin framework, even as we make upfront operational investments to scale Freddie's clinical and pharmacy infrastructure in the U.S. While scaling those operations will have a modest impact on consolidated margin percentage next year, we expect Freddie to be accretive to consolidated EBITDA dollars. At scale, we expect Freddie to deliver adjusted EBITDA margins of at least 40% comparable to the core business. We will provide a full multi-year update at our investor day in June of 2027. Overall, we are very pleased with the underlying business and are well positioned to fund our highest priority growth initiatives while continuing to deliver strong financial results. And with that, operator, please open the call to questions.

We will now move to our question and answer session. If you are viewing the webcast, you can submit a question via the ask a question tab on the top right hand side of your screen. If you have joined via the webinar, please use the raise hand icon, which can be found at the bottom of your webinar application. When you are called on, please unmute your line and ask your question. We will now pause a moment to assemble the queue. Our first question will come from Nathan Feather with Morgan Stanley. You may now unmute your audio and ask your question.

Hey, everyone. Thanks for the question. Appreciate the transparency into 27. Can you just help us unpack a little bit how we should think about the key revenue drivers here and any kind of sense of stack ranking between Edge, Freddie, and any other drivers?

Hi, Nathan. Good to talk to you, and thanks for the question. Let me start with strategic for 27, and then we can talk through the details to the extent that we can. We are thinking of three things that matter for next year. Number one, we want to get the acquisition integration right and set Freddie up for tremendous growth in the years to come because we think the potential is massive. We want to drive adoption for Edge to be quite high. We are really happy with how things are going so far, getting ready for the launch, but obviously it's a really big launch for us. If you think about Edge from a long-term perspective, it's a $100 to $150 million opportunity on the and a conservative side of estimates over many years. And so we want to get that right. And number three, we really want to invest in the free user experience given how far ahead of the three-year plan we are having come in at 93% of the three-year plan for 27 this year and EBITDA range already being in the So when you think about from that perspective, there are now three big revenue drivers inside Grindr with Freddie. No. 1 is the core app and the subscription business, plus the add-ons. No. 2 is the ad business, and No. 3 is Freddie. With the core business, the biggest driver is going to be Edge, and we expect that to do very, very well. Obviously, we don't break out that as a revenue number, but our expectations are that it's going to perform very strongly, and if I had to break it out, probably we will achieve somewhere between A quarter and a third of what we want to achieve over the long term with Edge in the first year. And we feel really confident about that. With the ads business, we're going to have a year that is going to be more moderate than what you've seen in the last few years. We obviously have said this before, but ads should moderate back to being in that 15, 16 percent of the total revenue range, which I think we've repeatedly said throughout this year, rather than the kind of 18, 19% that it is today. Some of the reasons why ads has done so well is because we actually have been able to achieve a lot of the growth that we had expected for ads in 27 earlier, thanks to Teams overperformance. But we have a lot of other investments that we want to make for ads and next year will be a year that we do it. Another reason why ads will moderate is because we're losing approximately $10 million of telehealth Thank you for joining us. and we're going to spend the year really investing into new ad formats and into some of our longer term investments to make the direct business grow faster over the long term. I think medium term, long term, I still believe that there is a significant amount of growth in ads beyond where we are now. We were at 30 million four years ago. We are nearly 100 now. And I think that there is a path to double or 2.5x that. And then with Freddie, the way we kind of think of Freddie for this coming year is to really focus on integrating the business. It's going to be a big step for us. We've never done that. before as a business. It's our first acquisition and I think it's really critical to get it right and really focus on expanding our in-house pharmacy capacity and moving as many U.S. patients as possible from third-party pharmacists to our own pharmacies. And the reason that matters is because that is the key driver to making the unit economics remarkably better. Obviously, Freddie is already profitable, but for every patient that you have on your pharmacy rather than third-party pharmacy, and they stay on with you for a full year, that's about $2,400 of more revenue a year versus if you're using a third-party pharmacy. And so while we wouldn't expect every patient to be on the Friday pharmacies, we want to move as many as we can to that. And then once we are in a place where we think our pharmacy operations are fully built out and have the capacity for a lot more, that would be the right time for us to start driving a lot more traffic into the Friday experience and getting a lot more new patients. So the patient volume will increase in 2027, but it will be more moderate at pace. But then in 28 and beyond, we would expect the patient volume to grow at a faster pace because, again, we would want to be growing in a very profitable way at maximum unit economics per patient that we can be achieving.

Yeah, that's very helpful. Just a few follow-ups on that last bit. How should we think about the main gating factors to expanding the in-house pharmacy? And then any way to think about the timeline there? And then you noted that once that happens, you can accelerate patient growth a little more. How are you thinking about how Freddie shows up in the app near term until you have more of those in-house pharmacy targets achieved?

Yeah, so all the investments that are necessary for Freddie are already assumed in the guidance that we're giving today. And I do want to highlight the fact that even with a pretty significant investment plan, we're still going to, you know, at the minimum, we're saying that we're going to deliver what's implied 39% margin, and that's within the We have a very high margin business coming in next year, which is going to be Edge, and that's going to allow us to also do a significant amount of investments for Freddie while having the margin that we had committed to in the past when we had never envisioned doing something like Freddie at the time. We need to add another at least one more pharmacy in the U.S. And there's We want to be able to get in a situation where we have the ability to do just mail order from a pharmacy location as well and there's just a bunch of I think it's also important to highlight on that piece, you know, Freddie is an operational business. That is very different than what Grindr is used to today. I, for better or for worse, have run an operational business before, one with far worse margins than Freddie has. And so I kind of understand the challenges of an operational business from that point of view. And and so on. People matter in that business a ton. And yes, you can have operations and process and structure to ensure that quality experience across the board of people so delivered. And so it's both the pharmacies themselves, but also the people in the pharmacies, meaning the pharmacists, the tax and ensuring that we are delivering as good of a customer experience as possible is going to be a big focus for next year. As far as how the Freddie product is going to show up in the app. So to start with, we had built a bunch of different native placements for woodwork that we are now using for Freddie. About a little over half of those placements are already being utilized for Freddie and over time we will switch all of them. to be available for Freddie. These are in effect advertisements, but they're very natively built into the product and make a lot more sense to the user. We also have a health center, which you can access in the app as well. And there, Freddie is not going to take a leading position because it's going to be messaged around, hey, get PrEP, and you can get PrEP directly from there. Today, you still get sent out to the Friday website to go through the process of getting PrEP prescriptions there, but we want to actually integrate that fully into the GrindRap so you don't have to leave the app at all and can do it all within our experience. And we also are working on creating a bunch of new placements. For example, adding a placement for an ED medication on a person's profile probably didn't make sense. It wouldn't feel very native. But on the Grindr profile, each individual user is able to say, I am on PrEP. Well, in that space, having a placement that allows a person who is looking at your profile to also click on a button and get PrEP is a very native thing. It makes a ton of sense. And so we're going to Build new placements like that across the app to have more places where we're educating people on both. You should be on prep and here's prep available directly through the grinder experience. That's all going to be kind of coming not in too distant future in 2027. There are a few pieces beyond that that we want to do that's going to take a little bit longer. We want to be able to have verified badges on a person's profile if they have done a HIV test with Freddie and or if they have received a Freddie prescription as well. And we believe giving people the option to choose to show that information on the app. Obviously, it's going to be all with user consent. We'll make their profiles a lot more interesting to people. You know, a very large number of people on Grindr already say whether they are HIV positive or negative on the profile, but that's self-reported. Now, think about that, whether it's actually verified. We know that they had a test on this date, and these were the test results. Again, that would only be done with user consent, but showing that information on the profile will make the profile be a lot more relevant to people and a lot more trustworthy to the other users that are seeing it. That's an added benefit to the user. It's also an added benefit to also promoting the fact that any other user can have a similar type of profile if they go through an HIV test process with Freddy. So that is going to be something that's going to take a little bit longer to build out because there is a lot of data integrity management that needs to happen between the Grindr side and the Freddy side. And we're starting to work on that, but we'll need a little bit more time. And then the last thing that we're envisioning is giving Freddy Patience, access to Grindr premium products and features as part of their Freddie prescription or as part of their visit with a doctor. So if you have a visit with a Freddie doctor, then you also can get Grindr premium access at the same time. That's something that also will take time to build out and integrate. There is a lot of and a lot of data management to do in that regard as well. But that is something that we're envisioning also. The way to think about this is if you do a survey of Granta users, making sure that they're managing properly for HIV risk is among the most important things that people care about. I believe that vast majority of users are going to be very comfortable and very supportive of us utilizing as much of the app as we can to educate more people to be on PrEP and to get people to be compliant with staying on their PrEP medications. Because this is something that matters both to the individual who is on PrEP and for that person's health, but also for the PrEP of all the other men that are on Grindr looking to connect. And so that is actually why the two businesses make so much sense together. And we certainly are going to be using the Grinder app in a very powerful way to both educate people beyond PrEP and, hey, here's a direct access to PrEP in a very simple way within the app that you're using for an hour a day. Very helpful. Thank you.

Our next question will come from Erin Sheridan with Goldman Sachs. Please unmute your line and ask your question.

Thank you so much for taking the question. Maybe sort of a two-parter. With Edge, you've got the number around early access registrations. How are you thinking about registrations converting into users against wanting to strike a balance and there being a cap? On Edge more broadly. That's number one. And number two, you talked a little bit about a VIP tier, some future product iterations in the materials. How are we thinking about Edge as a jumping off point to more tiering and different levels of pricing elasticity for the business over the long term? Thanks so much.

Thanks, Eric, and great to talk to you. I think these are great questions, so I appreciate them. Let me start with the very last of what you said, which is pricing elasticity. We raised prices fairly markedly this year, about 20% across the board, and so virtually no churn in terms of users churning off the experience. Quite frankly, it was better than even we had expected or tested into it. And so I think that tells you that there is quite a bit of pricing elasticity power In the product. And, you know, I'm not saying we're going to raise prices again in the immediate term. That is totally not the plan. I think one of the reasons why that worked so well is because we had created a ton of value in the tiers over time. And then we raised prices so people were much more comfortable. I'm getting a lot more out of this tier. It's reasonable for it to be a little bit more expensive. And so We will focus on adding more value in the 2027 period and then revisit where the pricing should be on the current tiers beyond that. Now, with going to Edgepoint, we are really happy with the registrations that we have seen in the pre-registration period. This is, we told people, if you are interested in having early access, which is going to come on November 10th, Please register here. And so then people gave us their registration and information through that path. And demand was tremendous. We had estimated maybe we'd get about 100,000 people over a seven-day period. And instead, we got 400,000 registrations in a 72-hour window and more since. And so that was really awesome. When we think about How big edge can potentially be? We're really kind of circling around somewhere between one third of a percent to two thirds of a percent of our mile, meaning of 1% of our mile. If we achieve Two thirds of 1% of Mao at the current price that we are starting edge with, which is $120. That is a $150 million revenue opportunity, assuming that person stays with edge for a full year. So even kind of on that low end calculation with a lower end price that we are launching with. You're already building an amazing business that is extremely high margin as well. At this point, our view is that we're going to hard cap it at no more than 1% of our MAO for now. Now, obviously, long term, if we feel like there's room to increase that, we could, but that's going to be the approach that we take. We do not expect to be at two thirds of 1% in year one, right? That would be too much to achieve in one year. But if we could do something like, you know, 20 to 30% of that in the first year of it being live, we would be very happy with that outcome. And I would call that a complete home run as far as what we would like to see from Edge. We believe that we can do it based on the testing that we've done so far. And the reason we launched at the price that we did, even though we could have gone at a higher price and testing data support at a higher price, is because we wanted to have a lot of demand, get a lot of excitement for this, and then have pricing power in the future to either move to longer term plans like two months, three months at a time, or to move to a higher price point at a later date. With regards to VIP, I know this is something that we are working on and have been for a while. Edge is not the highest price point that we're envisioning for Grindr. This VIP product is something that we're envisioning beyond that. Now, that's going to be limited to and much smaller cohort of people. We're truly thinking like a VIP experience that is going to combine in-app features with off-app experiences. One of the things that struck me in user research and talking to people, I host dinners with what you would view as kind of long-term VIP customers of Grindr on a regular basis is people are really excited about the opportunity to have and a lot of in-person engagement with people like them that might not be in their normal business network, but have a lot of other similarities to them and their lifestyles. And that can be people going to events together. It can be that we host parties for them, et cetera. So there'll be a lot of off app experiences that we are envisioning for the VIP tier. As an example, in January, We are hosting a very select group of people for an event at Aspen Ski Week. It's going to be for a pretty small cohort of people, but it's kind of our experimentation of getting to these very high-end VIP events and activities. So our vision for a VIP product is going to have this offline component, and then it's going to have an online component inside the app where they're going to get Features similar to Edge, but even more powerful than what you have in Edge. And there will also be the group of people that will be getting a lot of our features first. And then, you know, once they've kind of fully permuted and used them a lot, then we might then be available for the Edge tier as well. We believe that between these two things, in-app features and off-app features, the price point for VIP can be far, far higher than what we are envisioning for Edge. Now, again, for a very small cohort of people, it is kind of what we are envisioning here. And I'm really excited about this product. It's something that, frankly, I've thought about for decades. A few years now, and it's really fun to now be in a place where you're actually getting it to market and start engaging users with it. There's not a big revenue assumption for VIP in 2027. Frankly, there's zero in the guidance that we're giving, but it is going to be something that we want to be in as good of a position for growth in 2028 as edges today for 2027. Great. Thank you.

Our next question will come from Andrew Muroc with Raymond James. You may now unmute your line and ask your question.

Hi, thanks for taking my questions. So in the shareholder letter and in the script, you called out the three priorities of Grindr Health, Edge, and Grindr app. You've talked a bit before about how you like to have a given year's product development kind of prepared in advance and well in the pipe. So how do you feel about the state of the 2027 core roadmap at this point so that Health and Edge rollouts can maybe take up a little bit more focus?

Well, I think we've made a lot of great progress on the core product roadmap for 2027. I do want to say we're giving guidance a quarter early. And normally the way we do things is we put a bunch of stuff in testing in the kind of September, October timeline that are going to be revenue drivers for the next year. So we did that this year as well. A bunch of stuff went into testing in September, October, November. And the results on that are not yet available, right, because they're still in testing today. And so giving guidance a quarter early put us in a position where we don't have full visibility yet into the core app revenue drivers. Obviously, we have a visible into the really big one, which is Edge, but some of the other stuff is not yet available. We have a very good plan and we're really excited about that. Historically, if you look back, you know, the last six years, a really big portion of Grindr's engineering capacity was focused on either premium products and premium products where we would be making money or in Redoing the architectural components of the app that were causing users significant challenges, including rewriting the chat infrastructure, rewriting the back end completely, rewriting the front end nearly completely. All of that is now complete, and the data infrastructure is also built out inside the app and on our back end. The result of that is our crash rates are down massively. The bugs in the app are down Thank you so much. We'll be right back. You know, learning the last four years that we probably went to modernization of right now too fast. Right now it's captured a really fantastic user base. They're using it all the time, but we probably should have kept it freer for longer than we did because I think it would have made the product even better than it already has been. And so we want to be in a place where we are building a lot of things for the free user and getting them to use them for a long time. and through that ensuring that we protect the Grindr mode and protect Grindr as the app of choice for gay men in the U.S. and around the world. So hopefully that answers the question.

Yeah, very, very helpful. Thank you. And maybe one more, if I could. I mean, you've been one of the biggest proponents of AI usage, I think, in our coverage space and certainly one of the ones who has been put the most numbers around how it's helped engineer productivity and things like that. With some of the recent advances in AI tools, what are you seeing maybe over the last three to six months that have been some of the biggest unlocks for your internal teams using AI? and how do you think that that sets you up for twenty seven? Thank you.

Yeah, we are super happy, honestly, with the what the engineering team has been doing with with that, and we're continuing to see massive improvements in How much productivity they're gaining? The way I answer this question regularly now is when I joined Grindr about six or nine months into it, I met for a mentorship meeting with a retiring CEO of a very large tech company. And I told them what I'm envisioning for the next three, four years. And I'm like, I think I'll need somewhere between 150 and 200 engineers in 2026 to do all the things that I want us to do at the time. and he looked at me like, no, you won't. You'll be fine with about 60 to 70. And I'm like, what are you talking about? Even at 150 to 200 people, that's like a super lean team because revenue is going to grow so much. And he kept insisting like, no, you won't. And His rationale was it's because the things I'm seeing coming down the pike, having just been inside some of the AI labs and companies at the forefront of this that are not yet publicly known but will come in a year or two, the amount of product you're going to have from engineering is just going to be enormous. and so when you think about that conversation and think about it today, he was right and I was right. I actually would have needed a 100 to 250% team to do the stuff that we're doing and, you know, That makes sense. But we're able to do it with about 60 people on the product engineering side. So we have more engineers than 60, but product engineers are roughly 60. And it's because each engineer today is roughly 2.5 to 3x more productive than they were a year or 18 months ago. And that's pretty remarkable. Now, there are things to be cautious about or to manage for. Number one is bugs and kind of risks that the AI created code might cause. put into the product. And that's something that we are managing very thoughtfully and carefully. And it's very much top of mind for our engineering leadership. And I got an email about what we're going to be doing about it actually today from the team. And so that's, I think, really important. And the other big factor is security. The risks around Thank you for joining us. Where I think really big opportunities are, and I hope people are working on these outside of Grindr, is giving teams outside of engineering the tooling that they need to also be able to increase their productivity at a similar pace. One of the things we are finding at Grindr today is that engineers are so far ahead of everybody else that the rest of the organization cannot keep up with them at the pace that it needs to, especially on the product and the design side. And part of that is because the technology is not yet there. for product and for design to be able to use AI in the same way. But it's starting to be there more. We've recently introduced some new tools into the Grindr ecosystem for engineers. One in particular is called Devon. And with Devon, now we can be in a place where our designers are going to start using that and our PMs are going to start using that as well to actually produce code also. So we're pretty psyched about that as well.

Great. Thank you.

Our final question will come from Andrew Boone with Citizens JMP. You may now unmute your audio and ask your question.

Hey, thanks for taking the questions. This is Tim on for Andrew. I wanted to ask more about Freddie. Could you talk about what it takes to move patients from third-party pharmacies onto owned pharmacies? What does that process look like? And secondly, on the $4,800 per US patient figure, what does the split look like between pharmacy and reimbursement revenue and the telehealth and lab fee? Thank you.

Absolutely. Well, moving a patient to which pharmacy is actually quite simple from the operational point of view, meaning like we can decide where the prescription goes. What's important is having actual pharmacy capacity to do that. And that means having pharmacies in place, having those pharmacies be staffed in a proper way and having the We're still going to have a pharmacy in New York as well. And then we need to make sure that These pharmacies are able to do as much mail order as we need them to do in order to fill the needs of what the customers kind of have in terms of their location. So it's more of a, I guess, operational, like get it in place process versus, you know, picking whether you're sending somebody to a third party pharmacy or a or a Freddie affiliated pharmacy. With regards to the revenue split, I think you can assume roughly 50-50 between pharmacy and telehealth. I think maybe 60-40 would be the place that I would position you to. So 60 on the telehealth side and 40 on the pharmacy side.

This completes the allotted time for questions. I will now turn the call back over to George Arison for any closing remarks.

Well, thank you everybody for joining. I'm really excited for the quarter that we had and happy to be giving guidance a quarter early for what is going to be a really amazing year for Grindr in 2027.

Thank you for joining Grindr's third quarter 2026 earnings call. You may now disconnect.