Match Group (NASDAQ: MTCH) shares jumped more than 14% on Wednesday after the online dating company delivered upbeat guidance for the current quarter and highlighted promising results from its recent product innovations.
The Dallas-based firm, which owns Tinder, Hinge, and several other dating platforms, said it expects third-quarter revenue to come in between $910 million and $920 million — comfortably above the $890 million forecast from analysts polled by FactSet.
New CEO Spencer Rascoff, who joined in February, struck an optimistic tone during Tuesday’s earnings call, positioning the company as being at the start of a new chapter.
“We are operating like a company that is just getting started, and we believe the best chapters of the category and company are still ahead,” Rascoff said.
Targeting Gen Z and new market segments
Match has faced slowing user engagement across the online dating industry over the past year, prompting a push toward innovation and younger audiences.
Under Rascoff’s leadership, the company has introduced several new features to rejuvenate its user base.
These include an AI-powered discovery tool across multiple platforms and a double-date feature on Tinder, which Rascoff said is proving particularly popular with younger users, with 90% of participants under the age of 30.
The company also plans to launch features geared toward college students as part of its effort to win over Gen Z daters.
Looking ahead, Rascoff indicated that AI integration and international expansion will be central to the company’s strategy, particularly for Hinge.
He expects Hinge to see steady quarterly year-over-year growth starting in 2025, while Tinder will evolve into a “low-pressure, serendipitous experience designed for Gen Z.”
Activist pressure and strategic shifts
Match has also been navigating pressure from activist investors, notably Starboard Value, which has urged the company to cut costs, accelerate innovation, and improve profitability — or even explore going private.
Since taking the helm, Rascoff has overseen cost-cutting measures, including role reductions, while also committing $50 million in reinvestment for new product development.
This balance of operational discipline and product expansion aims to strengthen the company’s competitive positioning in a challenging market.
The company’s strategy appears to be resonating with investors, as evidenced by Wednesday’s double-digit share price gain. The shares pared some of the gains and were trading up 9% at press time.
Financial performance and outlook
For the second quarter, Match posted earnings of 49 cents per share, in line with analyst expectations.
Revenue reached $864 million, surpassing the $854 million estimate.
While growth has been modest, the stronger-than-expected revenue forecast for the current quarter signals renewed momentum.
Rascoff described the online dating sector as being on the verge of a “new era” marked by “renewed trust, strong demand, and long-term growth potential.”
If Match can deliver on its plans to enhance its platforms with AI, expand internationally, and capture the attention of younger demographics, the company may be able to sustain this positive market sentiment into 2025 and beyond.
With a clear strategic direction and early signs of product traction, Match Group’s turnaround efforts are beginning to take shape — and the market is taking notice.
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