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Match Group is repositioning Upward as a service for "modern courtship" rather than casual dating. The move aims to capture a segment of younger users who say they are dating with the specific goal of getting married. While Tinder remains the company's largest brand, Match has seen success by building a portfolio of apps for specific niches. This relaunch is an attempt to better compete for users who are becoming frustrated with the swipe-heavy nature of general dating apps and are looking for more intentional platforms.
Source: PRNewsWire
Match Group's finance chief shared details on a plan to fix Tinder's slowing growth by focusing on how the app feels rather than how much money it can make right now. The strategy includes a brand refresh and a new feature for in-person events, aimed at winning over younger users who have grown tired of traditional swiping.
This is a pivot for the company, which has recently struggled to keep users paying for subscriptions. By spending on the user experience today, management is betting they can build a more loyal audience that will eventually pay off, even if it means slower profit growth in the short term.
Match Group reported quarterly earnings of 70 cents per share, which was better than the 65 cents analysts expected. However, revenue of 850 million dollars slightly missed targets as Tinder, the company's largest app, saw its revenue fall 1 percent. While Tinder is struggling to grow, Hinge remains a bright spot, with revenue jumping 22 percent as it expands further into Europe.
The stock fell about 7 percent because the company's outlook for the next quarter was lower than what Wall Street anticipated. Management is working on a turnaround for Tinder to improve how many people use the app every day, but those efforts have not yet translated into higher sales. For now, the business is relying on Hinge's momentum and disciplined spending to protect its bottom line while it tries to fix its biggest moneymaker.
See the full quarter, and how our tracked metrics did
Source: 8-K filing
Third-party data suggests that Tinder is seeing a slow improvement in new user sign-ups and a smaller drop in monthly active users. While these are positive signals for the app's health, the business still faces structural challenges in getting more users to pay for premium features. We view this as a sign that the company's product changes are starting to work, but the path back to consistent growth remains long.
Source: Proactive Investors
Management has a history of clearing the bar they set, though the results have been choppy. They have beaten expectations in five of the last eight quarters.
| Expectation | |
|---|---|
| EPS | $1.05 |
| Revenue | $892M |
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