By Jaspreet Singh
(Reuters) – Tinder parent Match Group (NASDAQ:) on Tuesday expects second-quarter revenue below Wall Street estimates as people scale back spending on dating apps, weighing on user growth. Shares of the Dallas, Texas-based company fell more than 4% in aftermarket trading.
Match Group – which offers dating apps including Tinder, Hinge and OkCupid – is struggling with declining revenues due to weaker user discretionary spending in an uncertain economy.
The company also competes with smaller rival Bumble’s dating app of the same name.
“With the lowered expectations and reportedly mixed impact from product improvement initiatives implemented by the company’s new management team, investors will have to wait longer for more solid news on a turnaround at Tinder,” said M Science analyst Chandler Willison.
In the first quarter, global Tinder downloads fell 6% from a year earlier, the third consecutive quarter of declining downloads, according to market research firm Sensor Tower.
Total monthly active users (MAUs) for Tinder fell 21% globally in the reported quarter, according to Sensor Tower.
The company’s payers fell 6% to 14.9 million in the quarter ended March 31 from a year earlier.
“As Tinder matures as a company, Match will increasingly have to rely on its other properties for growth. While Hinge remains a bright spot, Match hopes its other segments can quickly turn the corner,” said Third Bridge analyst Jamie Lumley. .
It expects revenue for the second quarter ending in June to be between $850 million and $860 million, with the midpoint below the average analyst estimate of $882 million, according to LSEG data.
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The company now expects annual revenue growth at the lower end of the aforementioned 6% to 9% range.
First-quarter revenue grew 9% to $859.6 million, beating expectations of $855.5 million.
Match Group reported first-quarter earnings per share of 44 cents, compared with an estimate of 40 cents per share, according to LSEG data.
