Match Group, Tinder’s parent company, forecast third-quarter revenue below Wall Street estimates on Tuesday, the company anticipates lackluster discretionary spending on dating apps as its paying users decline
According to LSEG data, the company anticipates revenue in the third quarter to fall from $895 million to $905 million. The midpoint of this range is lower than the average estimate of $915.4 million among analysts.
The results were announced approximately two weeks after activist investor Starboard Value acquired a 6.6% stake in the dating app operator, advising it to consider a sale if it cannot revitalize its business.
Starboard is the third investor this year to advocate for changes at Match, which has encountered challenges in the form of a post-pandemic decline in growth and delays in releasing new features for critical applications like Tinder. Elliott Investment Management and Anson Funds Management were the first two investors to do so.
The company reported that Match’s total paying users decreased by 5% to 14.8 million in the second quarter. This marks the seventh consecutive quarter of decline.