Match Group Q1 2025 Earnings Call Transcript

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Provided by Quartr
May 8, 2025
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Operator

Good day, and welcome to the Match Group First Quarter twenty twenty five Earnings Conference Call. All participants will be in a listen only mode. After today's presentation, there will be an opportunity to ask questions. Please note this event is being recorded. Would now like to turn the conference over to Ms.

Operator

Tani Shelburne, Senior Vice President of Investor Relations. Please go ahead, ma'am.

Tanny Shelburne
Tanny Shelburne
SVP - Investor Relations at Match Group

Thank you, operator, and good morning, everyone. Today's call will be led by CEO, Spencer Raskoff and CFO, Stephen Bailey. They'll make a few brief remarks and then we'll open it up for questions. Before we start, I need to remind everyone that during this call we may discuss our outlook and future performance. These forward looking statements may be preceded by words such as we expect, we believe, we anticipate, or similar statements.

Tanny Shelburne
Tanny Shelburne
SVP - Investor Relations at Match Group

These statements are subject to risks and uncertainties and our actual results could differ materially from the views expressed today. Some of these risks have been set forth in our earnings release and our periodic reports with the SEC. Also during this call, we will discuss certain non GAAP financial measures. Reconciliations to the most directly comparable GAAP financial measures are provided in the published materials on our IR website. These non GAAP measures are not intended to be a substitute for our GAAP results.

Tanny Shelburne
Tanny Shelburne
SVP - Investor Relations at Match Group

With that, I'd like to turn the call over to Spencer.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

Thanks, Tandy. Good morning, everyone. This is my first full quarter earnings call as CEO, and I want to start by saying how proud I am to be here and how energized I am by the opportunity ahead. We're a company with a powerful mission to spark meaningful connections. Our job is to deliver on that mission with urgency, excellence, and a consumer first mindset by building products that reflect how people want to connect today.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

Over the last three months, I have visited many of our offices around the world, spoken with hundreds of employees, and gathered insights from thousands of users across our apps. Each conversation with a Match Group team member has reinforced how deeply our people believe in this mission. That mission orientation, combined with our product innovation and platform scale, puts us in a strong position to act decisively as we chart the future of personal connection. One of my priorities is evolving Match Group from a collection of independently managed brands into a unified product led organization that prioritizes innovation and user outcomes and operates as one company, not four divisions, to gain the full benefits of our scale and multi brand portfolio. Today, we announced a reorganization centralizing key functions, including select technology and data services, customer care and content moderation, media buying, and international go to market functions, while still allowing each brand to maintain their independence and product roadmaps.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

We've also taken some hard but appropriate steps today to sharpen our focus, including a planned 13% reduction of our workforce, as well as closing a number of open roles and further tightening operating expenses. These actions position us to achieve more than $100,000,000 in annualized savings, including approximately $45,000,000 of in year savings in 2025. But more importantly, these changes make us more nimble, more focused, and better aligned, enabling faster decision making, reducing management layers, including around one in five managers overall, so individuals can have greater impact, and accelerating our ability to ship products and features that deliver meaningful user outcomes. These savings will enable us to deliver the margin goals we outlined at our December Investor Day, while also providing the ability to invest in ways that we believe will return us to growth. I want to acknowledge the extraordinary contributions from and give thanks to those who will be leaving the company as a result of these decisions.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

Their hard work helped strengthen our position and make future success more possible. We're acting with urgency, making bold long term decisions and relentlessly prioritizing user outcomes. The best tech companies operate in product first builder mode, and this next chapter at Match Group is about getting back to that. Fewer layers, faster execution, and a culture focused on creating value through innovation. This is a big change and the company is responding positively to this culture shift.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

We are already operating with greater clarity, discipline, and speed. In fact, our solid financial and operating performance to start the year reflects the focus and resilience of our teams. In Q1, both Match Group total revenue and adjusted operating income came in above the high end of our guidance, driven by business performance that was in line with expectations, favorable foreign exchange trends, and ongoing rigorous cost management. Turning now to Tinder, our biggest brand and the number one most downloaded dating app worldwide. We are making tangible progress on our product roadmap and starting to see green shoots.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

Our priorities at Tinder are to rebuild trust on the platform through a cleaner ecosystem, to deliver better user outcomes, and to re energize the user experience, all of which are foundational to driving long term engagement and sustainable growth. While our Hinge brand leads the category for those looking for a serious relationship or what we call intentioned dating, Tinder is the leading app for younger users looking for lighter, lower pressure connections. To meet the needs of this Gen Z audience, age 18 to 27, we're focused on building features that feel more fun and more spontaneous. Our effort is on reducing friction in how people engage with one another and evolving the experience to reflect a broader definition of connection. We're already seeing traction with this approach.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

Let me give you a few examples of how this is already showing up in Tinder. We recently launched our double date feature in several European markets, allowing users to team up with a friend and match with other pairs. It's resonating with our younger audience. Nearly 90% of DoubleDate profiles are from users 29, and women using DoubleDate are three times as likely to swipe right on a pair than on an individual. The feature isn't just driving engagement, it's also growing our audience, with nearly 12% of invited users in these markets representing new registrations or reactivations.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

We plan to launch in several additional European, Asian and Latin American markets soon as we seek to create more fun opportunities for Connection. The U. S. Launch is planned for later this year. In addition, we launched the Game Game on iOS in numerous markets worldwide.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

This voice based experience was out for only the month of April, and it let users practice flirting with an artificial intelligence date to learn to break the ice through humor, storytelling, and playful interaction. Approximately three quarters of a million Tinder users played it last month, demonstrating its ability to tackle one of the most common challenges we hear. Just starting a conversation can feel intimidating. In addition to demonstrating our leading edge use case of AI, the game game drove significant viral awareness and reconsideration of Tinder and gave us deep insights into how our users interact with voice AI, which will inform future product development. And while we have been utilizing AI and machine learning for years in our core matching algorithm and in trust and safety efforts, we are bringing AI deeper into our product experience.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

We're testing a new AI enabled discovery experience in New Zealand that marks a major leap in utilizing AI in a new way to improve dating outcomes. With permission of our users, it takes in more attributes such as insights gleaned from their phone's camera roll and responses to dynamic questions about what they're seeking to generate a curated personalized daily match. Early signs are promising and we see this as a clear example of how AI and product innovation can drive more relevant, higher quality connections and reflects our commitment to reimagining the experience beyond the swipe feature. Each of these features is a clear example of how we're reshaping the experience to better serve our target audiences. We are listening, learning and building with their needs in mind.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

We are encouraged by our progress to date and I look forward to sharing more as we move forward. Finally, we continue to invest in our industry leading trust and safety initiatives to ensure that Tinder and other Match Group apps are the safest way to meet new people. We've been testing several new features aimed at validating the authenticity of users. In tests of these features, we've seen a more than 15% reduction in bad actor reports. Last week, we announced another cutting edge innovation aimed at ensuring user authenticity, our collaboration as the first dating or consumer social company to integrate with World ID.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

We'll start with Tinder in Japan and then plan to roll out to other geographies and brands. Our broad scale, global reach, multi brand portfolio and our ability to invest more in trust and safety than anyone in our category is an advantage that also improves user outcomes. At Hinge, user momentum remains strong and we're seeing continued great product traction. Since launching globally in late March, our new AI powered recommendation algorithm has driven a greater than 15% increase in matches and contact exchanges, demonstrating the ability of our investment in AI to significantly improve user outcomes. We're also continuing to enhance in app coaching, including by providing prompt feedback, an AI powered feature that suggests improvements to profile prompts in real time in the onboarding flow to increase its impact and its exposure.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

We're planning to test warm introductions in the coming months, which will highlight shared interests to improve Match quality. With continued innovation, strong brand resonance and global expansion underway, we are confident Hinge is well positioned to continue its leadership in the intentioned dating category. Turning to international expansion. One of Match Group's core strengths is our ability to build and acquire compelling consumer apps. Our strategy has been consistent.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

First, we establish product market fit, then we monetize, and finally, we scale globally with a proven go to market playbook. In 2025, we're leaning into this playbook with a number of global expansion efforts across the portfolio. For example, Hinge is on track to launch in Brazil and Mexico in the second half of this year as it seeks to serve intention daters in new markets. The League is planning to launch in The Middle East and India to meet the demand for premium experiences in these regions. Azar is continuing its U.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

S. And Western Europe expansion and Pairs recently launched in South Korea. These moves highlight our focus on further unlocking growth by extending our reach, and we're confident that by executing our playbook across our brands and new markets, we are well positioned to create long term value for both users and for our company. Let me close with this. We are in the early days of a transformation.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

Small, focused teams across the company are fueling a wave of innovation. From college focused concepts out of our New York office, to a group meetup experience built by our Korea team, to offline event experimentation in Japan, to changes to the core of the Tinder app. And by leveraging AI, staying relentlessly user first, and moving with speed, we have a real opportunity to reignite and redefine the future of human connection. The impact of deep learning is already reshaping our matching algorithms across the entire company, powering more personalized, more relevant and more effective experiences for our users, and this is just the beginning. The management team and I believe in our mission.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

I believe in our team, and I believe we will execute to drive growth and ultimately shareholder value over time. Along those lines, following our last earnings call, just four days into my role, I personally purchased $2,000,000 of Match Group stock at an average price of $34 per share. One quarter later today, my conviction in our mission, our strategy and our team has only strengthened. Given my confidence in our company, I plan to purchase an additional $1,000,000 of stock soon after our trading window opens. Now I'll hand it over to Steve to walk through the financials.

Steven Bailey
Steven Bailey
CFO at Match Group

Thank you, Spencer. Hello, everyone. Thank you for joining the call this morning. We're pleased with our start to the year and with our Q1 financial results. As Spencer mentioned, both Match Group total revenue and AOI exceeded the high end of our guidance range in the quarter, driven by business performance that was in line with our expectations, favorable FX trends and ongoing cost discipline.

Steven Bailey
Steven Bailey
CFO at Match Group

In Q1, Match Group's total revenue was $831,000,000 down 3% year over year, down 1% year over year FX neutral. FX headwinds were $5,000,000 less than we anticipated at the time of our last earnings call. Excluding the exit of our live streaming businesses, total revenue was down 2% year over year, up 1% year over year FXM. RPP grew 1% to $19.07 while payers declined 5% year over year to 14,200,000.0 Indirect revenue was a record quarter, up 31% year over year, driven by an increase in spend from our top advertisers. Tinder direct revenue in Q1 was $447,000,000 down 7% year over year, down 4% FXN.

Steven Bailey
Steven Bailey
CFO at Match Group

Tinder Payers declined 6% year over year to $9,100,000 and RPP declined 1% year over year to $16.38 Year over year payer declines were impacted by user trends, which are still declining year over year, but at a stable rate. Tinder's monthly active users declined 9% year over year in Q1. Operating income in the quarter was 193,000,000 down eight percent year over year, representing an OI margin of 42%. AOI in the quarter was $228,000,000 down 5% year over year, representing an AOI margin of 49%. Hinge continued its strong momentum in Q1 with direct revenue of $152,000,000 up 23% year over year, up 24% FXM.

Steven Bailey
Steven Bailey
CFO at Match Group

Hinge's strong download performance continued across both core English speaking and Western European markets. Hinge maintained its number one ranking across 10 countries and the number two ranking in its Western European markets overall in the quarter. Payers grew 19% year over year to 1,700,000, driven by strong user growth. RPP grew 3% to $29.9 driven largely by subscription price optimizations across several core markets. OI was $29,000,000 in the quarter, up 55% year over year, representing an OI margin of 19%.

Steven Bailey
Steven Bailey
CFO at Match Group

AOI was $43,000,000 up 47% year over year, representing an AOI margin of 28%. E and E's direct revenue was $149,000,000 down 12 year over year, down 11% OpEx on, driven by Evergreen brands decline of 15% year over year, partially offset by a 3% year over year increase at emerging brands. Ex Live, E and E direct revenue was down 8% year over year, down 7% year over year FXN. E and E is executing on its consolidation plans and is on track to migrate Plenty of Fish and Meetic, its final two brands later this year. Payers declined 16% year over year to 2,400,000.0 while RPP rose 5% year over year to $20.76 In Q1, E and E delivered OI of $7,000,000 down 61% year over year, representing an OI margin of 4%.

Steven Bailey
Steven Bailey
CFO at Match Group

AOI of $29,000,000 was down 25% year over year, partially due to the timing of marketing spend for an AOI margin of 19%. Match Group Asia delivered direct revenue of $64,000,000 down 11% year over year, down 7% FXM. Ex Live direct revenue was down 2% year over year, up 3% FXM in Q1. Azar direct revenue was down 1% year over year, up 5% year over year FXM as it continued executing on its European and U. S.

Steven Bailey
Steven Bailey
CFO at Match Group

Expansion efforts. Hairs Direct revenue was down 3% year over year, flat year over year FXM driven by ongoing stability in the Japanese market. Across Match Group Asia, payers increased 5% year over year to $1,000,000 while RPP declined 15% year over year to $21.23 partially due to FX impacts. OI was $3,000,000 in the quarter, representing an OI margin of five percent and AOI was $19,000,000 up 43% year over year, representing an AOI margin of 30%. OI and AOI benefited from a tax reserve release in the quarter.

Steven Bailey
Steven Bailey
CFO at Match Group

Moving to profitability, in Q1, total company OI was $173,000,000 down 7% year over year, representing a margin of 21% and AOI was $275,000,000 down 2% year over year, representing a margin of 33%. Looking at costs, including stock based compensation expense, total expenses were down 2% year over year in Q1. Cost of revenue decreased 8% year over year and represented 29% of total revenue, down one point year over year, driven by lower IP fees and reduced variable expenses from the shutdown of our live streaming services mid last year. Selling and marketing costs decreased $8,000,000 or 5% year over year due to lower marketing spend at Tinder and Match Group Asia and was flat as a percent of total revenue at 19%. General and administrative costs increased 5% year over year, up one point year over year as a percent of total revenue to 13% driven primarily by severance and other employee compensation related expenses.

Steven Bailey
Steven Bailey
CFO at Match Group

Product development costs grew 4% year over year as a result of higher SBC expense, primarily at Tinder and Hinge, and were up one point as a percent of total revenue to 15%. Depreciation and amortization increased by $1,000,000 year over year to $32,000,000 Turning to the balance sheet. Our gross leverage was 2.8 times and net leverage was 2.4 times at the end of Q1. We ended the quarter with four fourteen million dollars of cash, cash equivalents and short term investments on hand. In Q1, we repurchased $6,100,000 of our shares at an average price of $32 per share on a trade date basis for a total of $195,000,000 and paid $48,000,000 in dividends, deploying over 135% of our free cash flow for capital return to shareholders.

Steven Bailey
Steven Bailey
CFO at Match Group

We maintain our commitment to return 100% of free cash flow to shareholders through share buybacks and the dividend. In late January, we repaid the $425,000,000 outstanding balance on our term loan with cash on hand. Now turning to guidance. We expect Q2 total revenue for Match Group of $850,000,000 to $860,000,000 down 2% to flat year over year. This range assumes a one point year over year tailwind for FX and a one point year over year headwind for the exit of Acuna and other of our live streaming businesses.

Steven Bailey
Steven Bailey
CFO at Match Group

FX and ex Live, we expect total revenue to be down 2% to down 1% year over year. We expect Match Group AOI of $295,000,000 to $300,000,000 in Q2, representing a year over year decline of 3% and AOI margin of approximately 35% at the midpoints of the ranges. We expect costs associated with restructuring of our operations to be $17,000,000 in the quarter. Excluding these restructuring costs, we expect AOI to increase year over year by 3% and AOI margins to be approximately 37% at the midpoint of the ranges. Our full year 2025 Match Group total revenue guidance of 3,375,000,000.000 to $3,500,000,000 remains unchanged.

Steven Bailey
Steven Bailey
CFO at Match Group

Our full year results could be impacted by macroeconomic conditions or changes in FX rates, both of which remain volatile and difficult to predict. Our business is not directly subject to tariffs and because a significant portion of our revenue is derived from subscriptions, which tend to be stickier than impulse purchases like a la carte, our business has historically been relatively resilient to macroeconomic impacts. We've seen some impacts to ALC revenue in the past, especially at our brands with younger users or those with less discretionary income, and we've started to see some impacts to ALC revenue at Tinder in recent weeks, which we are monitoring closely. We are prepared to take pricing, merchandising or other actions to minimize the impact to our financial performance should these trends persist. The recent decline in the dollar relative to other major currencies helped our Q1 results and we expect FX to be a tailwind to year over year total revenue growth in Q2, helping to offset any consumer spending related headwinds.

Steven Bailey
Steven Bailey
CFO at Match Group

We expect Match Group AOI to be within the previously disclosed full year guidance range of $1,232,000,000 to $1,278,000,000 on an as reported basis, and roughly in the middle of the range when excluding approximately $25,000,000 in costs associated with the restructuring of our operations. We expect to achieve our full year AOI margin target of 36.5%, excluding these restructuring costs. We now expect SPC expense in 2025 of $280,000,000 to $290,000,000 meaningfully lower than the range we provided at our last earnings call due to restructuring of our operations and our continued focus on managing headcount and SBC expense. As Spencer outlined, we've taken meaningful steps to become a flatter, more efficient, product first organization. We expect these changes to help us achieve our margin goals, excluding costs associated with the restructuring of our operations and better position the company to weather any macro headwinds.

Steven Bailey
Steven Bailey
CFO at Match Group

We expect them to also greatly improve product execution and accelerate innovation, which in turn should lead to improved growth and shareholder value over time. Now let's open it up to Q and A.

Operator

Thank you. We will now begin the question and answer session. And the first question will come from Nathan Feather with Morgan Stanley. Please go ahead.

Nathan Feather
Nathan Feather
Equity Research Associate at Morgan Stanley

Hey, everyone.

Nathan Feather
Nathan Feather
Equity Research Associate at Morgan Stanley

Thanks for the question. I'm interested to hear given the cost reduction actions you just announced. Can you help us think through how you're balancing investment and efficiencies to maximize productivity and product velocity? Thank you.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

Yes.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

Thank you for

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

the question. So what we announced today were fairly deep cuts, dollars 45,000,000 of in year savings, 100,000,000 of annualized savings, primarily from labor. And now we turn our attention to OpEx where we think we can find even more savings. That on top of those numbers, it's about a 15% reduction in stock based compensation expense, which is about $45,000,000 a year of annualized SBC. The cuts today really had two goals.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

The first was to create a more nimble organization to break down silos, to create more of a unified match group, and a number of the organizational changes associated with the cuts speak to that. And the second goal was to cut deeply enough that we could feel confident in hitting the Investor Day targets and also reinvest for growth. So the nature of your question was about the reinvestment. So to provide a little more clarity there, we're basically taking these savings and turning around and investing them in international expansion, both in terms of product development as well as customer acquisition for a variety of brands, including Tinder, Hinge, The League, Pairs, Azar and others. We're also investing in the gay male segment through product and customer acquisition.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

And third, we're continuing to invest in Tinder product as well. So I'd say these to summarize these cuts, they make us increasingly confident in our Investor Day targets. They allow us to leave full year guidance unchanged and they also allow us to reinvest for growth. Operator, next question please.

Operator

Your next question will come from Cory Carpenter with JPMorgan. Please go ahead.

Cory Carpenter
Cory Carpenter
Internet Equity Research at JP Morgan

Thank you and good morning. Spencer, you certainly enacted a lot of change in your first few months. Hoping you could talk about your priorities for the company and how you may do things differently while still standing behind the Investor Day targets you just mentioned.

Cory Carpenter
Cory Carpenter
Internet Equity Research at JP Morgan

Thank you.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

Thanks, Cory. Yes, it's been a busy first couple first one hundred days or so. So firstly, I'd say I've been incredibly impressed with the quality of the team here and their mission focus and their desire to innovate. I'm also increasingly confident in our ability to improve user and consumer and even media perception of the category. I think this category is fixable.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

I feel like we've made a lot of progress in the first hundred days reducing red tape and reducing process and changing a culture away from analysis paralysis and creating a renewed sense of urgency, breaking down barriers and really driving culture shift at the company, including a prioritization of our users. In terms of my priorities, my first priority is operating as one match group so that each of our brands from Meetic to Pairs to Azar to our Affinity brands to, of course, Tinder and Hinge, so each of our brands can benefit from the combined scale of Match Group. That is new news. This company was not acting like one company. It was acting like many different individual apps, many of which are subscale.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

And Match Group brings enormous scale and technology and other benefits to the table. And so my number one priority is making sure that we reap the benefits of one match group. My second priority is growing Tinder audience. And we took a huge step forward today with the changes that we're making, which we'll probably talk more about here later in Q and A. But changes in org structure, speed, product strategy, product positioning, a lot is changing at Tinder.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

Number three, my third priority is to help Hinge continue its growth in the intentional dating category. Hinge is doing amazing and making sure that Hinge continues to benefit from Match Group overall, so Hinge can continue to achieve its mission. That's a key priority for me. And then finally, and sort of overarching all of these other more tactical priorities, where I spend much of my time and attention and focus is on employee engagement and company culture, creating urgency, driving innovation, creating accountability. I view that my greatest use of my time is to make the more than 2,000 people that work here better.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

So I'm driving a high degree of urgency. I'm operating in founder mode. I am locked in, and we're off to a really good start so far. Operator, next question please.

Operator

The next question will come from Wigel Arounian with Citi. Please go ahead.

Ygal Arounian
Ygal Arounian
Director - Internet Equity Research at Citi

Hey, good morning guys. Just on the cost cuts and reinvestment first. So in with the cost cuts here on the $100,000,000 annual run rate and kind of using that to feel more confident in hitting Investor Day margin targets while reinvesting. So what's changed exactly since December when you set these targets? Is it the feeling that you need more product investment to get to better growth?

Ygal Arounian
Ygal Arounian
Director - Internet Equity Research at Citi

Just trying to understand that dynamic. And then maybe we can talk a little bit about the Tinder product stuff and that broader definition of connection. Spencer, in the letter and in your remarks, you talked a little bit about some of the products today that are trying to achieve that. And maybe just expanding a little bit on how that roadmap product roadmap might change to achieve this a little bit better over the coming years? Thanks.

Steven Bailey
Steven Bailey
CFO at Match Group

Yes. Why don't I take the thanks for the question Yigal. Why don't I take the first part? The Investor Day targets from a margin perspective haven't changed where we said we would improve margins by 50 basis or 100 basis points per year over the next few years. What has changed is we've accelerated some of those cost reduction plans.

Steven Bailey
Steven Bailey
CFO at Match Group

We weren't counting on restructuring to achieve our twenty twenty five margin targets. We've accelerated those plans. We've done it with urgency and that's allowed us to stick with our commitment of 36.5 margins excluding one time costs for 2025, which was the target we laid out in February, while enabling us to invest in areas that we think are necessary to drive the revenue growth we're expecting to achieve over the next couple of years. So that's the way I would think about margin targets and reinvestment.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

Yes. So basically, I came in here and said, why do something in 2027 that we could do in 2020 And we lit a fire under the team here and we pulled forward a lot of organizational changes, cost reductions, reorganization, reshaping and restructuring of how the company operates. And that pulled forward savings, which now we're reinvesting. Regarding Tinder, today's changes, they right sized the team. So we are reducing 18% of the Tinder org.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

We're removing 24% of managers at Tinder, and that creates a much more nimble, more accountable team. From a leadership standpoint, we're also taking the ASL, the Art and Science Lab team, which was a standalone innovation function, and we are putting those folks directly into the Tinder org. And that brings a new burst of energy, innovation, technical excellence, product excellence into Tinder, which is going to be terrific. Just focusing on product velocity for a moment. By many measures, such as code commits or experiments that we have in flight, we're operating at about twice the pace as we were just a couple of quarters ago.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

And we've had two great quarters of really good product momentum. I mentioned in the prepared remarks the early success of Double Dating and the daily curated AI drop. We have an exciting college roadmap as well. So I feel a high degree of confidence in the Tinder roadmap. There is definitely a high degree of urgency, I can assure you.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

These turnarounds take time, though. This is a product led turnaround. And we've seen other companies like Snap or Pinterest or even Uber build innovative products that take time in order for their ecosystem to absorb them. Product driven turnarounds are difficult, but they are possible to do at scale. And today, we took a big step forward in terms of moving that ball down the field.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

Operator, next question please.

Operator

Your next question will come from Swayta Kajuria with Wolfe Research. Please go ahead.

Shweta Khajuria
Managing Director at Wolfe Research LLC

Thank you for taking my questions. Let me try two please. One is on App Store changes and impact potential impact. Are you making any changes across your apps to allow for alternative routes? And if so, have you tested them?

Shweta Khajuria
Managing Director at Wolfe Research LLC

What are you seeing? Any update on that would be great. Thank you. And then the second question is, you mentioned if macro gets worse, you have some thoughts on maybe potential pricing changes or other changes that you could do you could make. Could you please provide some color on that?

Shweta Khajuria
Managing Director at Wolfe Research LLC

Thanks a lot.

Steven Bailey
Steven Bailey
CFO at Match Group

Yes. Thanks for the question. Why don't I take this one? For the question. Appreciate it.

Steven Bailey
Steven Bailey
CFO at Match Group

So on IEP, yes, we're encouraged by the court's decision in the Apple versus Epic case which allows link outs to web purchases without incurring IP fees. I think it's a win for consumer choice and a win for developers. When we saw the news last week, the teams quickly sprang into action. Most of our brands in The U. S.

Steven Bailey
Steven Bailey
CFO at Match Group

Have submitted app releases at this point. We're testing a number of things including discounted offers on web, CRM and push campaigns, web payment options on rate cards, and we'll share those learnings across the portfolio which is a unique strength of ours. Apple did file an emergency motion yesterday, on parts of this ruling including commissions. So we're going to have to see how that plays out. They are currently still approving app submissions.

Steven Bailey
Steven Bailey
CFO at Match Group

So we're going have to see how the appeals process plays out and whether these policy changes, are put permanent. But for now, we are acting with urgency and have submitted app releases across most of our apps. The way I would think about opportunity sizing is this, about 45% of our revenue is in The U. S, Two thirds of that is in Apple's App Store for which we pay Apple about a 27% commission on average. So if we were to shift just 10% of App Store purchases to web, that would save us approximately $25,000,000 in fees assuming same conversion rates and before any discounting.

Steven Bailey
Steven Bailey
CFO at Match Group

So it could be very meaningful for us. And again, we're going to have to see how this thing plays out. We haven't included any of it in our guidance, but I think it does offer some meaningful potential upside. On the second part of your question on macro, let me just remind everybody, we talked about a little bit about this in the prepared remarks. Our business is relatively recession resilient historically, not entirely recession proof though.

Steven Bailey
Steven Bailey
CFO at Match Group

Subscription revenue tends to hold up quite well, which is the vast majority of our revenue as most of you know, but we have seen some impacts to ALC revenue in the past at brands with younger users or those with less discretionary income like Tinder for example. And so over the past few weeks, we've just started to see some early signs of weakening Tinder ALC trends among younger users in particular. So it's still early. We're watching it closely. We're prepared to take pricing, merchandising or other actions to limit its impact.

Steven Bailey
Steven Bailey
CFO at Match Group

And if some of you might recall, we did a similar we took a similar tact a couple of years back when we faced some sort of consumer weakness and we're able to do things like reduce the bundle size of a la carte offerings like Boost, effectively offer lower incoming price points that are more palatable to consumers that are feeling a pinch in their pocketbook. I'd also say that the restructuring efforts we announced today does position us to weather potential macro headwinds. So I think we're in fairly good shape. The last thing I would say is, we're not seeing any of these macro headwinds across the subscription revenue base at Tinder or at any of our other brands thus far including Hinge where we haven't seen any of it either. Thanks for the question.

Shweta Khajuria
Managing Director at Wolfe Research LLC

Thank you. That was very helpful.

Operator

The next question will come from John Blackledge with Cowen. Please go ahead.

John Blackledge
John Blackledge
Senior Equity Research Analyst at Cowen

Great. Thanks. Two questions. First on Tinder, any way to think about Tinder's paying user trajectory as we work through the year? And then second question, Spencer, you mentioned a little bit earlier addressing potential OpEx savings after this restructuring announced today.

John Blackledge
John Blackledge
Senior Equity Research Analyst at Cowen

Just curious if you could expand a little bit there. Thank you.

Steven Bailey
Steven Bailey
CFO at Match Group

Yes. Thanks for the question. On payers, as you know, it's not a metric we're specifically focused on. We're focused on improving user trends, MAU trends, which will in turn lead to improved revenue trends. So that's really the focus of the management team and of Tinder specifically.

Steven Bailey
Steven Bailey
CFO at Match Group

But what I would say is, we don't expect let me start with MAU trends. MAU trends continue to decline. They declined about 9% in Q1, which is a similar rate of decline that we've seen in the past handful of quarters. So, still declining but at a stable rate. That is leading to payer declines of course, which are also continuing to decline at a relatively stable rate as well.

Steven Bailey
Steven Bailey
CFO at Match Group

And so, what we're focused on doing is turning around improving those MAU trends through product innovation that will lead ultimately to payer improvement and revenue. I wouldn't expect payer trends to grow this year. I'd expect those trends to continue to decline, but likely at a stable rate like we're seeing with MAU until some of the product innovation work bears fruit.

Operator

OpEx.

Steven Bailey
Steven Bailey
CFO at Match Group

On OpEx, yes, as Spencer mentioned, the focus of the last three months was on reorganizing the company, then reaping not only headcount savings, but reorganizing the company to be leaner, faster and better set up for success. We have now shifted our focus to OpEx where we think there are a number of opportunities. We talked about IP fees as well just a few minutes ago. And so we're looking across the entire cost base for ways to do things better, smarter and faster. And so I think you'll see some of those savings come through not necessarily in 2025, but as we head into 2026.

Steven Bailey
Steven Bailey
CFO at Match Group

And again, either helps us achieve the margin expansion targets we set out over the next three years or gives us more room to reinvest in the business.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

Yes. Just one other thing to add. For example, just to kind of combine two threads here, the thread around operating like one match group and the thread around looking at OpEx savings. In the cost reductions that we announced today, we did not take down marketing spend at all. However, we are looking at unifying our marketing measurements across the company.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

We already unify our media buying for certain types of digital advertising, but we haven't unified marketing measurements. And we think there's a lot of opportunity as one match group to start looking at the efficacy of marketing spend cross brand at a central level, and that should drive savings and synergies as well. Operator, next question please.

Operator

The next question will come from Curtis Nagle with Bank of America. Please go ahead.

Curtis Nagle
Curtis Nagle
Director - Senior US SMID Cap Internet Analyst at Bank of America

Terrific. Yes. So just a couple of ones for me. Could you elaborate just on the surge in advertising in 1Q? I guess, was there something you specifically did?

Curtis Nagle
Curtis Nagle
Director - Senior US SMID Cap Internet Analyst at Bank of America

What drove it? And would you expect us to sustain for the year?

Steven Bailey
Steven Bailey
CFO at Match Group

Yes. Thanks for the question. We did have it was a record quarter for advertising which was fantastic to see. We saw really strong demand from advertisers around the Valentine's Day holiday which was great and we had a few large of our larger advertisers, spend quite a bit of money with us in the quarter. I would not expect it to continue.

Steven Bailey
Steven Bailey
CFO at Match Group

We're not changing our full year guidance for advertising revenue which is approximately flat year over year. So I would think of it as a really good quarter, we'll take it, but not a sustained change for the business. And then of course, we always have to keep in mind that the macro effect on advertisers too. So we'll have to see how the macro environment plays out over the rest of the year and what impact if any of that has on advertising revenue. Thanks for the question.

Operator

The next question will come from Ben Black with Deutsche Bank. Please go ahead.

Benjamin Black
Benjamin Black
Co-Head Internet Equity Research at Deutsche Bank

Great. Thanks for taking my question. So Spencer, you just dig in a little bit into what you're seeing in New Zealand for Tinder and AI discovery? Are match rates improving? Are you seeing a lift to sort of dating outcomes?

Benjamin Black
Benjamin Black
Co-Head Internet Equity Research at Deutsche Bank

And then I guess relatedly, you touched on this in the letter, in the prepared remarks, how are you finding the data that you need to power your AI efforts? And then secondly, your competitor Bumble last night spoke about pulling back on marketing, I mean, a particular performance spend. I'd be curious to hear how that potentially impacts you. Is this sort of a time to double down and pick up users? Or does it generally not necessarily have an impact on your business?

Benjamin Black
Benjamin Black
Co-Head Internet Equity Research at Deutsche Bank

Thank you.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

Yes. So what we are testing in New Zealand and coming soon to other countries is a daily drop. So a single bespoke AI driven match. And this is important for two reasons. Number one, the quality of the match is driven by AI because by the user inputting more information about themselves, answering questions and also sharing access to their camera roll, which is a window to your soul.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

And so the quality of the matches are better through that than our traditional, also AI driven algorithm. But more importantly, it's changing the perception of how users consider Tinder. And if you think about the double dating feature and this single daily drop in tandem, you start to understand how we're trying to change how people think about Tinder. For a decade, Tinder has been an infinite card stack where you swipe left or swipe right to assess the essentially attractiveness of the photo that you're looking at. And we are and that worked well ten years ago, when there was more of a hookup culture, when smartphones were new and when there was novelty around that type of feature set.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

But as millennials aged up and as Gen Z entered into our sweet spot, that product has less resonance and Tinder has less product market fit today than in the past. And we think that by adding new ways to use Tinder, including a daily drop and also a double dating feature and other features in our roadmap, we'll start to change user perception of Tinder. So I'm definitely encouraged by the specific data coming out of the daily AI drop, including around the quality of the matching. But more importantly, I'm excited about the ways that we can change brand perception of Tinder, which is the first step in arresting our MAU declines and returning to traffic and audience growth. Steve, I'll let you answer the question about, performance marketing.

Steven Bailey
Steven Bailey
CFO at Match Group

Sure. The way I would think about is this, performance marketing plays an important role in some of our brands, namely our E and E brands like Match.com. And there we take a very rigorous ROI driven approach. So if the ROIs aren't meeting our thresholds, we don't spend the dollars and that's been our approach for many years now and will continue to be our approach going forward. For our brands like Tinder and Hinge, performance marketing plays a very small part of the total marketing spend.

Steven Bailey
Steven Bailey
CFO at Match Group

And so we really don't have a situation where we're driving a lot of traffic through performance that we need to reassess. It's really brand marketing, at both Tinder and Hinge that's driving organic traffic and that's something we're going to continue to do, as long as it makes sense for us. Thanks for the question.

Benjamin Black
Benjamin Black
Co-Head Internet Equity Research at Deutsche Bank

Very helpful. Thank you.

Operator

The next question will come from Ken Goralski with Wells Fargo. Please go ahead.

Ken Gawrelski
Ken Gawrelski
Analyst at Wells Fargo

Thank you very much. Two for Spencer, if I may, please. First, Spencer, how would you assess the health of the overall online dating industry? If we're still seeing industry headwinds overall, how effective do you believe Match can be in driving improved momentum strictly through company specific product innovation, especially at your most scaled brands? And then a second follow-up for you, Spencer.

Ken Gawrelski
Ken Gawrelski
Analyst at Wells Fargo

You spoke to the increased product velocity that you can see internally in terms of code base, etcetera. What are the external markers that you would point us to, to monitor your progress? Thanks.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

So let me I'll take the second part of the question first. I think the most there aren't enough external monitors for you. I guess MAU is the single best one. I wish there was a way for you to see user sentiment, which is a precursor to MAU. If MAU hypothetically was exactly the same, but the users inside of our ecosystem were more pleased and had higher resonance with the brand and the feature set, that's a leading indicator to MAU improvements just a couple months later.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

But obviously, you don't have that type of visibility. So I think the best external metric would be things related to audience. Regarding the category, the online data category is clearly challenged. The good news is that these challenges are of our own making. And I really believe that Tinder as the category leader sets the tone.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

And the category challenges have been due primarily to a lack of innovation and our failure to recognize and respond to changes in the younger demographic, especially Gen Z and what they want. We see the category splitting somewhat into the intentional dating category where Hinge is the clear category leader and the spontaneous serendipitous user use case where Tinder is the clear category leader. We need to improve the perception of category though, and the way to do that is number one, to improve trust and safety. That's foundational and we that's within our own control. And as we continue to make match group apps the safest way to meet new people, I think that will start improving category perception.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

Number two, we have to innovate. And to innovate, we have to prioritize users over short term revenue and profit. That has not been the way this company has operated historically, and that's been to our detriment. And one of the reasons that the category is ill is because of the way we have not prioritized user outcomes. We have to build lower pressure ways for Gen Z users to interact with each other, which is what they seek from us.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

And we have to be prepared to revisit first principles around the product. I already explained how the swipe of an infinite card stack is really only one of several ways that people can now use Tinder in certain markets. And over time, that will those other ways will continue to rise in prominence. When you look at other categories like ridesharing, it wasn't too long ago that ridesharing as a category was really challenged. And what happened there, like I mean, I remember just a couple of years ago, the idea of getting in the backseat of a stranger's car that seemed kind of crazy and there were trust and safety issues in the category.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

And a new CEO entered the category at the category leader and drove a culture of innovation, prioritized trust and safety, unlocked new TAM as they expanded into other adjacencies, both quality of cars as well as food delivery and other adjacencies, and really changed user perception of Uber, the category leader, which then changed perception of the entire category. And what did it? It started with culture at the company, and then that drove innovation, and that innovation drove better user outcomes, and that drove revenue profit and shareholder value. So that's the recipe that we're following here. And I think if we do a great job at Tinder and at Match Group, then we will start to change the perception of the category and also the investor attitude towards the category.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

Next question, please.

Operator

Your next question will come from Jason Helfstein with Oppenheimer. Please go ahead.

Jason Helfstein
MD & Head - Internet at Oppenheimer & Co. Inc.

Thanks for taking the question. So I just want to ask just dig a little more into the Tinder now down nine. I guess how much of that is still intentional, I. E, whether it's still getting bad actors off the platform or kind of there's traffic that is like your data shows like low conversion, and you're kind of either choosing to invest in other ways or maybe not invest money in certain ways. So just maybe dig a little into like how much of that, I guess, 9% down was intentional?

Jason Helfstein
MD & Head - Internet at Oppenheimer & Co. Inc.

And then just longer term, I mean, there's definitely been a discussion of should you be running the business more for kind of revenue and EBITDA kind of like Netflix is now and not disclosing kind of user and payer metrics? I mean, Spencer, just give us your thought, does disclosing all this data to us inhibit your ability to make the right long term decisions for the business? Thanks,

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

Jason. Great question. And you and I had this discussion at Zillow for many, many years around our number of paying advertisers, our number of real estate agent advertisers and whether that was a good metric to disclose. And of course, you know and other analysts on the call who cover both companies know that I always explained that that was not a great metric and I regretted that we disclosed it when we went public and then of course over time we sunsetted it. So to answer your specific question, your specific question was, does the fact that we disclose payers prevent us from making the right long term decisions?

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

The answer on that is no, because am making the right long term decisions around the product and the payer number is an output of that. And if that goes up, okay. If that goes down, okay. Like we're driving this business towards long term sustainable profitability, shareholder value creation, etcetera. And as Steve already answered, we don't run the business to short term decisions or even the payer count number.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

Would it be easier if we didn't disclose it? I don't know. It doesn't really affect decision making, so it doesn't bother me that much. Regarding the audience and whether some of the declines are due to bad actors and so it's desirable, I don't have a great answer to that. I would say some of the decline is intentional and desirable, but certainly not all

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

of it.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

And I'm working like mad and the team is working like mad to grow Tinder audience, the right kind of audience, of course. I mean, we could grow the wrong kind of audience quite quickly and we're not gonna do that. But I I guess the easiest way to describe it would be some of the decline is is due to intentional bad actor, but not most of it. So I look forward to the days when Tinder is flat and then up in terms of audience, and we've improved trust and safety at the same time. Operator, next question please.

Operator

The next question will come from Chris Kutarik with UBS. Please go ahead.

Chris Kuntarich
Chris Kuntarich
Internet Equity Research at UBS Group

Great. Thanks for taking the question. Maybe just going back to the trust and safety dynamics, any update to be sharing around mandatory face photos and how we should be thinking about a potential rollout in The U. S? And then just one quick follow-up.

Chris Kuntarich
Chris Kuntarich
Internet Equity Research at UBS Group

I think you had been assuming 2.5 points of FX tailwind in the full year guidance. I think it's one point of tailwind in 1Q. Any updates there? Thanks.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

So on the topic of trust and safety, just I want to reiterate how foundational this is. And this is work that never stops for us. We must make Match Group apps be the safest way to meet new people. And we devote enormous resources, that's manpower, technology, over hundreds of millions of dollars to driving trust and safety and improved user outcomes. The mandated liveness check that we're testing, which is basically a short face video and selfie in a couple markets, it takes time for the ecosystem to settle when we introduce new features, especially new trust and safety features, because we need time for the audience, the other folks that are using the apps in those geographies to recognize that there's a higher degree of safety there.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

And, it drives higher Net Promoter Score from our existing users. It drives better word-of-mouth. So because we're a two sided marketplace with local network effects, this isn't a simple AB test that you can just say, Oh, should the button be blue or red? This is something that the ecosystem has to digest. And also, on our end, we need time to mitigate any negative impacts of those tests, whether it be financial or otherwise.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

So I guess I would just say we are acting with care and consideration, but no lack of urgency on this issue. I don't have any specific updates on rolling that particular feature out more broadly, but we're working very hard on this and acting with urgency even though it's been live for a couple months now and we have not rolled it out further. Steve, FX question for you?

Steven Bailey
Steven Bailey
CFO at Match Group

Yes, sure. Let me take that one. You're right. FX trends have improved for our business pretty meaningfully as the U. S.

Steven Bailey
Steven Bailey
CFO at Match Group

Dollar has weakened against most major other currencies that helped our results in Q1 as we mentioned and has helped our results our expected results in Q2 as well more than offsetting any sort of macro related pressure. From the full year perspective, we use the forward curves. They're also predicting a much weaker dollar than what we expected back in February when we set our full year guidance. And so all else equal that would improve our full year as reported expectations. At the same time, given some of the early signs we're seeing at Tinder and all the uncertainty around the general macroeconomic environment, we're being cautious.

Steven Bailey
Steven Bailey
CFO at Match Group

And so that those two forces, have led us to leave our guidance unchanged for the full year, which would be it's being helped by, the declining dollar, but we want to stay cautious on potential macro impacts to the business, as we see how things unfold. Next question.

Operator

The next question will come from Youssef Squali with Truist. Please go ahead.

Robert Zeller
Robert Zeller
Equity Research Associate at Truist Securities

Hi. This is Robert Zeller on for Youssef Squali. Thanks for taking the question. I'm just curious what is a rollout in a new market typically look like in terms of additional costs in the first couple of years, user growth and then the ramp of revenues? Thanks.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

Yes. Hey, Robert, I'll take that. It depends on the brand. So but it's usually on the order of a couple million dollars of spend, depending upon how much customization is required and then how much COA we decide to apply to that market. So it's not it's not nothing, but it's also not incredibly significant.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

And it definitely depends on the complexity of the individual country. So Paris, for example, which is the number one dating app in Japan, just launched in Korea. There, we use the combined Match Group Asia go to market team to launch pairs from Japan into Korea. And so that's a team that already was marketing Tinder in Korea and then our other brands throughout Asia. So we have terrific synergies there.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

It's basically almost no incremental cost from a headcount standpoint in terms of go to market. There's a small incremental COA cost as we start to light up local network effects in the Korean market. And then there are the product development costs of payers to customize the product for Korea, but that's borne by the core business. And in that case, the incremental was very low. So it's a playbook that we followed now globally across more than 15 different brands.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

And it's a big focus of ours in 2025 and 2026 for the remaining geographies where we don't have coverage yet from our brands. Operator, next question please.

Operator

Our final question today will come from Dan Salmon with New Street Research. Please go ahead.

Dan Salmon
Lead Analyst at New Street Research

Great. Good morning, everyone. Maybe an appropriate one to wrap up the call with, but Spencer, obviously, changes at the Board level here recently with some changes in seeing excuse me, to see Kelly Campbell join, Alan Spoon exit, formally expanding the size of it. Would love to just hear your thoughts on how those changes help improve the broader strategy for the company over the long term. And then just any update you can give us on your dialogue with, I don't know if we call them activist investors or maybe publicly active investors.

Dan Salmon
Lead Analyst at New Street Research

Would just love to hear if there's anything you can add to that about where your dialogue sits? Is that largely with Stephen? Does that reach up to your level or even to the Board's? Any color would be great. Thanks.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

Sure. Thanks for the question. Yes, I'm incredibly excited about Daryl and Kelly joining the Board. They both bring incredible consumer expertise. Daryl is a founder of two category leading digital tech companies, has an incredible background of product engineering.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

He's a technologist as well as performance marketing and brand marketing. So he's a great addition. And Kelly also has an extraordinary marketing and product background from technology and consumer media. So they both bring great expertise onto our board. Alan was a fantastic director of the company, and I will miss his counsel, though I know how to reach him as well.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

And so I'm sad to see him leave and very grateful for what he contributed over the years. But Darryl and Kelly are going to be terrific directors as well. The in terms of our relationship with our shareholders, all is well. I'm engaging I personally am engaging actively with all key shareholders, including those that you referenced, and looking forward to continuing to learn from them and hear their perspectives on the business. And as I did for fifteen years as a public CEO before, I like engaging with shareholders.

Spencer Rascoff
Spencer Rascoff
CEO at Match Group

I like engaging with research analysts. I always learn from those conversations and I don't shy away from them. And so I look forward to continuing to engage with all shareholders, whether they be activists or not activists.

Dan Salmon
Lead Analyst at New Street Research

I think that with that, we'll wrap up the call. Thank you very much.

Dan Salmon
Lead Analyst at New Street Research

I look forward to speaking with you all again very shortly. Have a great day. Thanks.

Operator

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

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Key Takeaways

  • Reorganization and Cost Cuts: Match Group centralized technology, data services, customer care, media buying, and international go-to-market functions, reducing the workforce by 13% and management layers by 20% to achieve $100 million in annualized savings (including $45 million in 2025) and support margin goals.
  • Strong Q1 Financials: Total revenue of $831 million (down 1% FX neutral) and adjusted operating income margin of 49% beat guidance, driven by cost discipline, favorable FX trends, and record advertising revenue, while Hinge delivered 23% year-over-year revenue growth.
  • Tinder Product Innovation: To rebuild trust and re-energize the Gen Z user base, Tinder launched features like Double Date, the AI-powered Game Game, and an AI-driven daily match test in New Zealand, alongside integrating its Art & Science Lab into the core Tinder organization for faster execution.
  • Expanded Trust & Safety: Ongoing AI and authentication efforts—including a >15% reduction in bad actor reports, testing mandatory face liveness checks, and partnering with World ID—underscore the company’s commitment to making Match Group apps the safest way to meet new people.
  • Global Expansion Playbook: Match Group plans to roll out Hinge in Brazil and Mexico, The League in the Middle East and India, and further expand Azar and Pairs in key markets, leveraging its scaled multi-brand portfolio and proven go-to-market strategy to drive growth.
AI Generated. May Contain Errors.
Earnings Conference Call
Match Group Q1 2025
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