Janice R. Andrews
The parent firm of well-known dating apps like Plenty of Fish, Tinder, Hinge, and OKCupid, Match Group Inc., has stated that it intends to cut 6% of its personnel worldwide. This move was made in reaction to Tinder, the company’s main app, seeing a continuous drop in user subscriptions.
Significant reorganization was required as a result of an 8% decline in the number of paying Tinder members, according to the firm. The closure of its live-streaming app, Hakuna, and the elimination of live-streaming functionality from many of its dating sites would be the main causes of the job layoffs.
Match Group has experienced a decline in Tinder users for a couple of quarters running. Tinder is still the most widely used dating app worldwide in spite of this. There is optimism for the firm because the recent decline in subscriptions was not as bad as some investors had thought. Match Group said in a letter to shareholders on Tuesday that the most recent decrease in subscribers was better than the 9% decline from the previous quarter.
Rival dating apps like Bumble, which saw an increase in its number of paying members in the most recent quarter, are putting more of a strain on Tinder. Russ Mould, investment director at AJ Bell, stated, “Match Group has been struggling with intense competition despite owning some of the most well-known brands in the dating market.” “A lack of innovation seems to be a key bugbear, and activists are putting pressure on the company to come up with new ideas to drive up user numbers.”
Given that Match Group’s stock price has dropped more than 60% from its top in 2021, some investors have pushed the business to improve performance and increase value for shareholders. Match Group stressed in its letter that Tinder’s “engaging and fun user experience,” especially the simplicity of swiping left or right on possible matches, had previously been the driving force behind the app’s rise. The business does see that consumer tastes had changed.
“Sentiment has shifted as users seek a lower-pressure experience with greater authenticity that more easily delivers desired connections,” the letter 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.”
Tinder has added new features, including letting friends and family play matchmaker and using artificial intelligence (AI) to assist users in choosing the best photos for their profiles, to cater to these shifting tastes. The goal of these advancements is to provide users a more engaging and genuine experience.
Mr. Mould pointed out that Match Group has a “glimmer of hope” because of Tinder’s slower fall in paying customers and the rise of Hinge. Paying users have increased significantly on Hinge, as evidenced by a 48% rise in sales over the same period in 2023. Conversely, within the same time frame, Tinder’s direct income increased by a mere 1%.
In after-hours trading on Tuesday, Match Group’s share price increased by about 10% following the release of its results, indicating cautious optimism among investors.
While navigating these obstacles, Match Group is concentrating on finding new methods to improve the dating experience across all of its platforms and adjusting to changing user preferences. The business may be able to regain its footing and provide more value to its consumers and shareholders with the impending innovations and adjustments.
