Match plummets 20% as weak guidance, 'negative surprises' raise analysts concerns

young attractive man is looking for a couple in an online Dating app. Search for love on Internet. a man is looking for a guy. All screen graphics are made up


Match Group (NASDAQ:MTCH) shares plummeted more than 20% on Wednesday as investors fretted about the company’s weak outlook for the second-half of the year, prompting analysts to note the outlook for online dating may be worse than initially feared.

J.P. Morgan analyst Cory Carpenter, who has an overweight rating on Match Group (MTCH) shares, noted that the implied growth of 8% year-over-year for the second half is worrisome.

“There are a number of factors driving [Match’s] lower outlook, some of which we expected (FX, macro, Japan COVID resurgence), but also a number of unexpected headwinds including Tinder product execution challenges & new user acquisition remaining below pre-pandemic levels,” Carpenter wrote in a note to clients.

He added that the biggest “surprise” is the product reset for Tinder, with Tinder Coins and virtual goods being paused and the app’s CEO, Renate Nyborg, leaving.

Bumble (BMBL), which competes with Match (MTCH) in online dating, saw its shares fall in sympathy, declining more than 4% to $34.46 in premarket trading.

Jefferies analyst Brent Thill, who has a buy rating on Match (MTCH), noted that the weak guidance and additional changes to Tinder’s management were “negative surprises,” though there is the potential for Match (MTCH) and its new CEO, Bernard Kim, to be conservative.

“We believe new CEO Bernard Kim’s heightened focused on faster product innovation, an expedited Hinge [international] rollout and improving monetization at Tinder will be key catalysts for driving accelerating [revenue] growth in [2023],” Thill wrote in a note to clients.

RBC Capital Markets analyst Brad Erickson, who has an outperform rating on Match (MTCH), noted the second-quarter figures were “relatively in-line with expectations,” but the level of changes announced could ultimately wind up being “broad based” and negatively impact the company’s largest brand, Tinder.

Match Group (MTCH) is set to host a conference call at 8:30 a.m. ET to discuss the results.


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