Match Group has forecast third-quarter revenue of between US$910 million and US$920 million, above analyst expectations of US$889.8 million.

It expects adjusted operating income of US$330 million to US$335 million, slightly below Wall Street’s US$336 million estimate.

The company reported second-quarter revenue of US$863.7 million, with direct revenue from Tinder and Hinge exceeding projections.

However, total paying users fell to 14.1 million.

The US-based dating app operator, which owns Tinder and Hinge, will invest US$50 million in product development and advertising in the second half of 2025. This will increase ad expenses for both apps by 17% year over year.

Match recently cut over 20% of its managers and reorganized leadership, including hiring a new CTO at Tinder.

The company also lowered its full-year adjusted operating income margin target to 35.4% due to restructuring costs and a US$14 million settlement with the US Federal Trade Commission.

🔗 Source: Bloomberg

🧠 Food for thought

1️⃣ Activist investors drove Match’s strategic pivot after sustained performance decline

Match’s $50 million investment represents a direct response to mounting pressure from three activist investors who targeted the company throughout 2024 and into 2025.

Starboard Value, holding a 6.5% stake, specifically pushed for cost cuts and product innovation to address declining operating margins that fell from 25% to 21% 1.

The company also settled with Anson Funds by adding a new board director and shifting to annual elections for all directors, avoiding a costly proxy fight 2.

This activist campaign succeeded because Match’s financial performance had deteriorated significantly, with revenue declining for over a year and share prices dropping substantially from previous peaks.

The timing of CEO Spencer Rascoff’s appointment and the subsequent $50 million commitment demonstrates how activist pressure can force rapid strategic changes, particularly when companies face both user decline and margin compression.

2️⃣ Dating apps face fundamental retention challenges that investment alone may not solve