Why the Tinybeans (ASX:TNY) share price is soaring 13% higher today

The Tinybeans Group Limited (ASX: TNY) share price is soaring higher today following the company’s release of a positive trading update.

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Tinybeans Group Ltd (ASX: TNY) shares are soaring higher today following the company’s release of a positive trading update. At the time of writing, the Tinybeans share price is up 13.1% to $1.38. In earlier trade, Tinybeans shares reached as high as $1.43 before retracing slightly.

What’s driving the Tinybeans share price higher?

Investors are today driving the Tinybeans share prive higher after the company updated the market with a forecast record performance for the second quarter of FY21.

According to the release, Tinybeans advised it saw strong trading conditions in October and November, with December remaining favourable.

Revenue for the end of the second quarter is projected to be around $3 million. This represents a 146% increase on FY20’s second quarter revenue and a 24% rise above the prior quarter.

The company said premium revenue will reach $280,000, which will reflect a 10% gain on the second quarter of FY20. Total paid subscriptions are expected to reach 23,000.

Reaching over 4.6 million people, monthly active users are forecast to rise a massive 260% over the prior corresponding period, and 15% on the FY21 first quarter result.

Complimenting the robust result, Tinybeans highlighted its advertising wins from both new and existing customers. These include contracts from major retailers Walmart Inc (NYSE: WMT) and Apple Inc (NASDAQ: AAPL).

Further strengthening the company’s balance sheet, Tinybeans anticipates receiving $3 million in cash receipts for the second quarter. This represents a 40% lift on the previous period. The company estimates its cash balance will be around $4.2 million at the end of the quarter, which includes a cash burn of $400,000.

What did the CEO say?

Tinybeans CEO Mr Eddie Geller was excited to deliver the strong results. He said:

After a successful Q1-FY21, we are absolutely thrilled to have such a strong follow up by delivering another record quarter.

Metrics are up across all key business drivers. From monthly active users, to revenues to cash. The Company is forging ahead in executing the strategy to build the number one digital parenting platform and drive multiple complementary revenue streams.

This is a testament to the team and the value proposition to parents and brands. This has set us up for an even better 2021 given the exciting product roadmap ahead.

About the Tinybeans share price

The Tinybeans share price has been climbing higher since the middle of August. Shareholders who bought the company’s share at that time would now be sitting on gains of around 80% over just a few months.

Tinybeans shares reached a 52-week high of $2.90 in January and a 52-week low of 51 cents in March.

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Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and recommends Apple. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of Tinybeans Group Ltd. The Motley Fool Australia has recommended Apple and Tinybeans Group Ltd. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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