Risk, returns & timeframes illustration
1 min read
November 7, 2022
by
Belinda Nash

Dating gets ugly 🤪

Sometimes the business of apps can get real ugly, and with reverse catfishing on the rise, dating apps are under the lens. As the pandemic redefined dating behaviour, it seems investors have fallen out of love with Bumble and Tinder parent, Match Group. Will investors ever swipe right again?
Risk, returns & timeframes illustration
1 min read
November 7, 2022
by
Belinda Nash

Dating gets ugly 🤪

Sometimes the business of apps can get real ugly, and with reverse catfishing on the rise, dating apps are under the lens. As the pandemic redefined dating behaviour, it seems investors have fallen out of love with Bumble and Tinder parent, Match Group. Will investors ever swipe right again?
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It’s been an ugly week at Elon Musk’s ‘town square’, but Twitter’s not the only app getting ugly. Reverse catfishing’s been popping up on dating apps like a nervous breakout… or a bedroom selfie on BeReal. And dating apps themselves might be hoping people superswipe to get to know their personality, too. Since January this year, both Bumble (BMBL), and Tinder and Hinge owner, Match Group (MTCH), have drifted apart from shareholders, falling 32% and nearly 68% respectively. 💔

Following third quarter earnings, however, Match may be hoping to swap the dog box for long walks on the beach. 🏖️ The 20-year-old online dating pioneer with 16.5 million paying users, beat analysts’ revenue earnings estimates by 2.1% for the quarter, seeing shares jump 13% then settle back down to pre-earnings’ value. But it’s not all roses for Tinder. 🥀 Statista research released mid-year showed US singles may be switching to female-founded Bumble, which overtook Tinder as the most popular paid dating app in early 2022. And investors are still ghosting. Why? Analyst data suggests it could be Match’s profit margins dropping from 21% last year to 3.4% that’s spooking shareholders.

Also hoping to play cupid with investors is last year's IPO fresh face, Bumble. 🏹 While falling 40% from their loved-up July high, and 69% from their St Valentine’s high in 2021, some analysts expect their earnings per share (EPS) to increase 91.67% in the next year. But despite bumbling product delays and declining margins, Bumble still appears to be ‘squeezing more revenue’ from users than Match, which increased 13% in their second quarter.

Chinese-owned Grindr may also be swiping for their partner in crime. 🔍 US national security may yet be wedded to concerns about Grindr selling location-based data, but after the LGBTIQ+-friendly app merged with a SPAC this year, it appears they’re preparing to go public. Could things get reeeally ugly?

Belinda Nash
Finance writer
Linkedin

We’re not financial advisors and Hatch news is for your information only. However dazzling our writing, none of it is a recommendation to invest in any of the companies or funds mentioned. If you want support before making any investment decisions, consider seeking financial advice from a licensed provider. We’ve done our best to ensure all information is current when we pushed ‘publish’ on this article. And of course, with investing, your money isn’t guaranteed to grow and there’s always a risk you might lose money.

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