Match Group Stock Takes a Tumble Amid Earnings Reports
Contributed by: kellyseal on Tuesday, December 10 2024 @ 10:00 pm
Last modified on Tuesday, December 10 2024 @ 10:12 pm
The share price of Match Group Inc. dropped after a disappointing third quarter earnings report, signaling that consumer interest in paying for dating app subscriptions continues to wane.
According to Business Insider, Match Group shares dropped more than 18 percent after the company reported that paying users on its most popular app Tinder fell 4 percent in the third quarter from the same time period last year, to $9.9 million. The revenue decline for Tinder has been continuous the past few quarters, and Match Group says it expects this slowdown to continue in the fourth quarter.
Hinge continues to be the star of Match Group’s offerings, growing 36 percent year-over-year, though its userbase is still a fraction of Tinder’s.
Business Insider[*1] noted that Bumble saw a 10 percent growth in paying users, up to $2.9 million in the third quarter compared to the same time period last year. Despite this good news, average spending per user dropped 10 percent, and overall revenue for the company was relatively flat.
Bumble’s shares are also down 45 percent year-to-date, compared to Match Group shares which are down 16 percent year-to-date, according to Business Insider.
Dating app fatigue is a big concern in the industry as more singles are turning to other platforms like LinkedIn and Instagram, where they don’t have to pay to engage with people. Match Group and Bumble have put many desirable features behind a paywall, such as messaging and Super Likes, leaving daters no choice but to pay to play.
Many younger daters are also looking to meet people in-person through speed dating events, running clubs or in more organic ways as they grow tired of swiping on apps. This could be problematic for the $5 billion industry.
Forbes surveyed dating app users earlier this year and found that a whopping 78 percent of respondents across all age groups sometimes felt “emotionally, mentally, or physically exhausted” by using dating apps.
Dating app companies (including Match and Bumble) have been looking beyond dating to capture more interest and increase engagement among users. Bumble recently bought community app Geneva, where people can join specific topics of interest (like book clubs) and chat with each other. And CEO Lidiane Jones said in the company’s most recent earnings call that the company "plans to reimagine Bumble App to enable the next generation of online-to-real-world connections."
The waning interest in dating apps like Tinder has not deterred new apps from launching, and singles seem to be interested in those that offer alternatives to swiping. Recently, dating app Pique set up a temporary “Love Wall” in New York where people could leave their information on a piece of paper along with a polaroid and wait for someone to reach out.