The Dating Game
From “Tinder Troubles” (May 2024): “Recent results at Match and Bumble lead me to believe my ‘maturation’ thesis may be flawed… On a few key factors - the strength and sustainability of Tinder’s position, financial expectations for Match as a whole, and my trust in this management team - I’ve grown less confident… For that reason, I’ve decided to sell [MTCH].”
Two notable development have taken place since May: first, Match attracted the attention of another activist investor, Jeff Smith of Starboard Value; and second, Bumble’s disappointing Q2 FY24 results led to another ~45% decline for the stock in the past 90 days (it is now down more than 90% from the 2021 highs). In my view, both events relate to the point made in “Tinder Troubles”: something is clearly amiss in the online dating industry. That is evident in the lowered financial targets for Bumble (app) and Tinder relative to prior guidance (at Tinder, management is now calling for ~3% YoY direct revenue growth in FY24, down from an original target of ~7% YoY growth).
