Contributed by: kellyseal on Wednesday, September 04 2024 @ 08:07 pm
Last modified on Wednesday, September 04 2024 @ 08:21 pm
Dating app giant Match Group announced its plan to cut six percent of its workforce after numbers for the company’s second quarter fell short of expectations, according to BBC.
Match Group owns the popular dating app Tinder (which has seen a significant decline in downloads), along with Hinge, Plenty of Fish and OkCupid[*1] , among others. The company’s second quarter earnings report showed an 8 percent decline among the number of paying Tinder users according to multiple reports. Hinge still remains a bright spot with significant growth.
According to BBC[*2] , Match Group said job cuts would largely come from shutting down its live-streaming app Hakuna and removing live-streaming features from some of its dating apps. (Despite the popularity of livestreaming dating apps in China, it hasn’t really taken off in the rest of the world.)
The company has been in a slump the last several quarters, though Match Group was quick to point out that the second quarter dip was an “improvement” over a 9 percent dip in the first quarter.
Match Group activist investors have called for the company to make significant changes, noting a 60 percent drop in shareholder value since its peak in 2021.
Russ Mould, investment director at AJ Bell, told BBC: "A lack of innovation seems to be a key bugbear and activists are putting pressure on the company to come up with some new ideas to drive up user numbers."
The dating app industry itself is suffering, with Bumble losing 30 percent of its market share after an abysmal Q2 earnings report. Many dating apps are struggling to remain relevant as younger daters gravitate to in-person events and other ways of meeting people to date. There seems to be a general sense of fatigue with dating apps, according to Axios.
Match Group said in its letter to shareholders that while users originally liked Tinder for its fun and convenient interface, including the groundbreaking swiping feature, audience preferences have changed. "Sentiment has shifted as users seek a lower-pressure experience with greater authenticity that more easily delivers desired connections," the company said. "We expect Tinder to begin testing new lower pressure forms of discovery in the coming quarters, including more ways for users to use Tinder with friends."
Match Group has been leaning heavily on AI for developing new features, including added security and the ability for the app to choose the best photos for a profile. Match Group also recently formed a partnership with ChatGPT. To date, these enhancements have not made a significant difference with Tinder, but Hinge has continued to see exponential growth, which Match Group called its “glimmer of hope.”