Match Group at Citi’s 2025 Conference: Strategic Shift and AI Focus

On Wednesday, 03 September 2025, Match Group (NASDAQ:MTCH) participated in Citi’s 2025 Global Technology, Media and Telecommunications Conference. The discussion, led by CFO Steven Bailey, highlighted the company’s strategic pivot towards long-term user growth and engagement, with a focus on product innovation and artificial intelligence (AI). While the company is optimistic about capturing a larger market share, challenges such as high IP fees remain.

Key Takeaways

• Match Group is shifting its focus from short-term monetization to long-term user growth.
• The company aims to capture more of the 250 million global active daters not using dating apps.
• AI is a central part of the strategy to enhance user experience and safety.
• In-app payments could save Match Group $65 million or more next year.
• Hinge is on track to reach $1 billion in revenue by 2027.

Financial Results

• Match Group spends $700 million annually on IP fees to Apple and Google.
• Potential savings from in-app payments could exceed $65 million next year.
• Hinge aims for $1 billion in revenue by 2027.
• A reduction in force of about 13% has been implemented to streamline operations.

Operational Updates

• Tinder Turnaround:

- Product-led strategy with a new management team.

- Focus on user outcomes rather than immediate monetization.

- $50 million in savings reinvested into the business, with a third allocated to Tinder product innovation.

- Increased product release frequency to weekly.

• Hinge Growth:

- Key drivers include user growth, geographic expansion, and pricing optimization.

- Expanding into Mexico and Brazil.

- Continued focus on AI-driven product innovation to stay competitive.

• AI Implementation:

- Interactive matching and prompt feedback features introduced.

- AI used for trust, safety, and internal efficiencies.

- Testing 30 different AI tools across the company.

Future Outlook

• The company is halfway through its three-year turnaround plan.
• Focus on driving user growth and improving retention.
• Plans to restart the word-of-mouth flywheel to enhance brand perception.

Q&A Highlights

• Tinder Marketing Strategy:

- Rebuilding brand perception to broaden Tinder’s image beyond casual hookups.

- Continuous brand marketing and product-specific campaigns.

• Competition between Hinge and Tinder:

- Users typically use an average of four apps in the dating category.

- Both Tinder and Hinge have distinct brand positioning, allowing room for both to succeed.

• In-App Payments Opportunity:

- Significant potential due to high IP fees.

- Hinge has started testing in-app payments, showing promising results.

Readers are encouraged to refer to the full transcript for a detailed discussion.

Full transcript - Citi’s 2025 Global Technology, Media and Telecommunications Conference:

Igor Runeian, Analyst, Citi: Good conference. Good. Alright. Looks like we’re live. Alright.

People still rolling in. Thanks thanks everyone for joining. Igor Runeian from the Citi and Internet team. Pleased to have Match Group CFO, Steven Bailey. Thanks so much for being here with us today.

We’ll take some q and a towards the end. Mike’s go around if if anyone has any questions. Just quickly before we start, I’m going to read Match’s safe harbor disclosures. During this presentation and during the Q and A session, 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.

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 periodic reports filed with the SEC. Alright. Steve, you’ve been CFO for almost a year. There’s been a lot of changes at Match, including Spencer coming in as CEO and and also leading Tinder.

Just would love to hear kind of at the highest level how the culture has changed with Spencer and board, how that company might be operating differently, and what what that means for for Match.

Steven Bailey, CFO, Match Group: Yeah. I’ve been CFO for almost a year now, like you said, but I’ve been with the company for thirteen years, so a long time. And I’ll have to say and I’ve been through a a handful of CEOs, and I will say that this is the biggest culture shift that I’ve seen, under Spencer in all my time at Match Group. So it’s very exciting. I think, you know, he brings a lot of, experience more than anything.

I think that’s what’s unique. He’s been a public company c CEO before with Zillow Group. He’s sort of been there, done that. He comes in with a set of principles. He can make decisions very, very, you know, fast and rapid just based on his experience.

And it’s and he’s done a great job shifting the culture. So it’s really, you know, just some of the things we’ve done in short order as we did the reduction in force of about 13% of the company, which, you know, was was not easy to do, but I think effective. We cut out a lot of the management layer, which you hear a lot of companies talking about right now, which just leads to, you know, more autonomy, but also accountability. And I think it’s allowed us to move faster. So we we cut about 20% of managers at Tinder, for example, and that’s freed up the company to go a lot faster, which is great to see.

And, you know, he’s also done a couple other things that I think were smart, which is really focus the company on outcomes as our sort of guiding principle, and and a little bit away from short term monetization, which we’ve always been so good at, but maybe to a little bit to a fault. So he’s pointed the company in the right direction. And then, you know, we’ve taken pretty decisive action on the cost cutting side, which has freed us up to reinvest in some of these growth initiatives we think are important drivers of, future success. So I’ve been, you know, very impressed so far. We’ve taken real he’s taken decisive action, and, you know, I really think we’re moving in the right direction.

Igor Runeian, Analyst, Citi: K. Great. Yeah. I think it’s you’re notable in some of the way the speed of change you’re seeing and some of the aspects. And and we’ll we’ll we’ll dig into that a a little bit more.

But so but maybe just to start at at the macro level on the dating app ecosystem because that still continues to get a lot of attention from from investors and, you know, what how saturated the the market is or what the opportunity is from here. You know, one of the things that we’re seeing in the space and with Tinder also is just around trust and safety, some kind of, like, shrinking to get bigger and navigating the the overall user ecosystem. What what’s your view on where the dating app ecosystem is today and the the the role that Match can play to get to kinda get it back into a healthier place? And, you know, do you think we need to expand beyond dating? Is it AI that kind of, moves the needle?

Just just kind of like state of the union on that, and then we’ll dig into Match a little bit more.

Steven Bailey, CFO, Match Group: You know, I’m I’m a numbers guy. So when I think about the opportunity, I just I look at the TAM numbers, and the opportunity is pretty clear. Basically, what it says is is that category adoption is around 30% in developed countries. So that means 30% of singles are using a dating app, not just a mass group app, but any dating app, which is still pretty low. And in developing countries, regions like Asia, for example, it’s even lower.

It’s it’s 7%. And so that shows you that, there’s real opportunity there. And then if you peel back down even further and you look at active daters because, of course, some singles aren’t actively dating, that’s a harder, you know, group to go after. But if you look at those actively dating right now, there’s about 250,000,000 of them across the globe that aren’t using dating apps to help. And so that’s pretty big relative to our MAU.

I think the last time we gave a number was 82,000,000, and that’s a lot of that. There’s there’s duplication there. Right? Because we’ve got users using multiple apps. So if you look at it from a unique perspective, it’s it’s lower than the 82.

And so the two fifty is a big opportunity. And so what we’re really focused on is, you know, how can we capture that group? And, you know, I think it really comes down to, you know, product innovation. Maybe we rested on our laurels a bit with Tinder. It really hasn’t, changed all that much in the last decade.

Consumer wants and tastes and needs have, particularly with Gen z, and so it’s up to us to get the Tinder products back on track. And I think we’ve started to do that with features like double date, and we’ve got a great product road map, laid out for the rest of the year to help address, you know, Gen z user pain points in particular. And the last thing I’ll say, which gives me a lot of confidence is, you know, AI is a tool. Right? And and if you look if you look back over the history of our industry, we’ve been here before.

We’ve seen plateauing of the category. I mean, that was the case, you know, over in the February, 02/2011, 02/2012. And then, you know, we had a a new technology called, you know, the the smartphone and that Tinder took advantage of. They they came up with a totally new rethought product experience you you would have not imagined, you know, even five years earlier when, you know, you had the match.coms of the world on a desktop computer. Right?

This is a it’s a new form factor, new technology. Tinder came in, took advantage of it, totally rethought the product experience, and it blew the category open. I mean, particularly with young people. You know, I think we’ve kind of been waiting for what’s the next technology breakthrough that allows us to rethink how our products work. AI is clearly that for not only us, but a lot of industries.

And I think it’s given products, the product teams the tool they need to really rethink how these products work. So I think AI, you know, the cultural reset we talked about under Spencer, you know, the sense of urgency and the fact that we’re the biggest player in the space with the resources needed to make these investments, you know, puts us in a good position for success.

Igor Runeian, Analyst, Citi: Okay. Well, come back to AI, but I I I like that comparison to mobile and how mobile changed the dating ecosystem

Steven Bailey, CFO, Match Group: that was I mean, arguably, AI could be a lot bigger than a smartphone.

Igor Runeian, Analyst, Citi: Yeah. So so that’s an interesting point. We’ll come back to AI. Just one one quick follow-up on the the Gen z point. Just to dig in a little bit deeper.

So it it does it sounds like that that kind of not keeping pace with the evolving changes within the the younger audiences was part of the challenge that the space is seen and that but that’s also the opportunity right now. Is that is that a fair fair way I I

Steven Bailey, CFO, Match Group: that’s right. Like, the the the thing you have to understand is that we know what the problems are. Right? We’ve got mill you know, tens of millions of users that we can survey that we can ask, you know, what’s working, what’s not. We do we spend a lot of money.

We have a lot of worries resources around, real deep product product research. And and we we survey the single population quarterly and understand trends and sentiment. And so, you know, we we know what they want. You know, they want they’re they’re they’re worried about authenticity. They’re worried that that that we hear about dating app fatigue.

We hear about, you know, outcomes. We want these products to work better. And so, it’s on us to build the product that they’re looking for.

Igor Runeian, Analyst, Citi: Okay. Great. So let’s start talking about the product, and we’ll start with Tinder, obviously. So the turnaround’s still in earlier days. You’ve you’ve kind of accelerated the product velocity there, but we’re still rolling out some of those things, and it’s still it it’s still early.

You know, maybe just talk about the product and the drivers and your expectations to get Tinder back to a better to a better spot. Like, what what what are the things that get you there? And, I don’t to be frank, I guess, like, we’ve been through this maybe a few times with Tinder over the past few years on this path to getting to a healthier spot. What what’s different this time about about the approach?

Steven Bailey, CFO, Match Group: Yeah. I would say, look. This is a product led turnaround. Right? And and, you know, what you need to find success in a product led turnaround, in my mind, is a few things.

One, you need a great team. So, you know, you can’t do it without super really strong product talent. I think we now have that at Tinder. We’ve brought in great talent that were part of the s an ASL group, which was a central group within the organization. We now embedded them directly in Tinder.

They’re our the best product people we have. I feel really good about that. You also need to have a product engineering organization that, fully enables the product talent to go execute with autonomy and speed. And I and, you know, we’ve reorganized the Tinder product engine engineering org into autonomous pods. That was part of the changes we’ve recently made.

So I think we’ve got the org structure needed too. So that’s one is the team and and the org structure. Two, is is ideation, like, good ideas. Right? And so I you know, what I’ve seen is, you know, the way good ideas come about are really, really strong product to the team combined with that deep research that we have.

So research insights combined with product talent leads to great ideas. And we’re seeing that, I think, with product features like double date and and interactive matching. So the ideas are there. There’s no lack of ideas. And then third is velocity because you you gotta go fast.

Right? Because not all these features are gonna work. Some are gonna work. Some are not gonna work. Even if the research is saying one thing, it may not resonate when you roll it out.

So you gotta you gotta go fast. You gotta iterate. You gotta be quick you know, you gotta fail fast. If it’s not working, get rid of it, move on. And so velocity becomes an important part of the part of the recipe.

And I think you’ve we’ve really seen an increase in velocity lately. We’ve gone from releasing every two weeks of Tinder to releasing every one week. Things like that help, you know, increase the probability of success in a led turnaround. So those, I think, are the is the recipe for success. I I know we’ve been at this for a while.

It’s taking longer than I would like to. So why is it different now? I think the main reason why it’s different now is the is the management team, I think. It’s a new management team, particularly under Spencer, which we talked a little bit about. And this focus on you know, he shifted the focus from monetization to outcomes.

And that’s a it’s a it’s a bold shift to make. And, also, you know, what we’ve done so it’s management and strategy. And the strategy component is freeing up the product teams to iterate, giving them the breathing room to maybe take a little bit of a short term monetization hit for a long term user growth or revenue gain. And that’s what we’ve done, I think, in a smart way by taking this $50,000,000 of savings and plowing it back in the business, and about a third of that’s going towards this Tinder product innovation, just giving the product team some more room to to really iterate on concepts that I think will work over the long term. Okay.

So I just

Igor Runeian, Analyst, Citi: wanna tie that together just to be clear. So the on on the accelerating velocity on the product side, double date, interactive matching, and maybe we can dig into the product a little bit more. But does that mean that in the near term, those products aren’t me being monetized directly? They’re meant to drive MAUs on top of funnel and then think about monetization. I think that’s probably way to think about it?

Steven Bailey, CFO, Match Group: I think that’s the right exactly the right way to think about it. The focus is on driving user growth. Really, the focus is on driving outcomes right now that will then lead to user growth, and that will then lead to revenue. I will say that I do think AI in itself will lead to monetization opportunities down the road, but it’s it’s definitely a second step

Igor Runeian, Analyst, Citi: Okay.

Steven Bailey, CFO, Match Group: Just by introducing new form factors. If interact if interactive matching really works, gets you in matches, gets you on dates faster and easier and better, you know, those are there will be ways to monetize it, but it’s not a focus today.

Igor Runeian, Analyst, Citi: Okay. Alright. So you’ve hit on interactive matching. You’ve hit on double dating. Anything from from double dating in particular early on that you’re seeing that’s getting you excited?

And as we think about product, and and you guys always say it’s not one product or it’s not even two products. Right? It’s the it’s the cadence of things. So is it, what what should investors be looking for on the product road map? Is it still a lot of things to come that are gonna push push you forward, or is it some of the things that have been launched so far?

Like, what’s what’s the most like, the what are the things to be the most excited about,

Steven Bailey, CFO, Match Group: I guess? Yeah. I’ll take the first part of your question is around double date. There, I I do I am I am excited about how it’s resonating with Gen Z because we talked about it takes good ideation, right, to create product features that consumers want users want. And I think we are seeing that with DoubleDate.

You know, we the adoption’s been good. I think the stats, like, 90% of users on DoubleDate or Gen z is a fantastic stop. That means we’re hitting the mark. We’re building features that this audio our target audience wants. And the fact that it’s working, better, particularly for women, it’s leading to more matches than, and and more rights, you know, more rights swipes by women in this, feature set than on the normal card stock.

Effectively, it’s giving women better recommendations that are leading to more matches, meaning means it’s working better, which goes to that outcome point. So I think this feature is hitting the mark. It’s it’s doing the things we want. It’s resonating with our target audience. It’s solving outcomes.

It’s solving dating fatigue. And so the is we didn’t we know one is not gonna be enough. We need to do more of those Right. Which is sort of the second part of your question. And so I think if we keep up this pace, yeah, we’re we’re on the right path.

I feel really good about the second half road map. They all play a role. What we’ve said all along is that it’s not one product feature. It’s a laddering of features that really change the Tinder experience overall. And I think we’re, you know, still a little bit in the early days of that, but on the right track.

I think if I look across the list, what am I most excited about? I think interactive matching is a is a very exciting feature on Tinder. You know, it’s really the first true AI, user facing feature that we’re gonna roll out. It’s gonna feel really new, unique, different. It’s already rolled out in New Zealand, so we’re looking to roll it out further.

The other thing, I’m excited about on the Tinder product road map is more back end, which is algos. I mean, it’s not as sort of sexy as the user facing stuff, but at the end of the day, you know, we’re here to get provide you with the best recommendations possible. Right? That’s core to the the the the product experience. And I think there’s a lot we can do on the recommendation engine at Tinder.

It’s on the road map. I think if you just look at Hinge, Hinge has is a step ahead. They rolled out AI driven algos. It’s led to a 15% increase in matches, which is huge for our business. If we could see a result like that on Tinder, it would it would it would really help.

And then, you know, the other bucket I would just say is trust and safety, which is something that will stay at the forefront, of our product, strategy and, you know, something we’ll continue to invest in. And, you know, face, face check is an interesting feature. Improved bot detection, will always help. And so I think staying, focused on trust and safety both improve the product experience and to to tackle some of these these category perception challenges, those are the things I’m most excited about.

Igor Runeian, Analyst, Citi: And trust and safety has just become an ongoing like, it’s an ongoing effort.

Steven Bailey, CFO, Match Group: Yeah. It’s not there’s no there’s no end to this, unfortunately, for anybody.

Igor Runeian, Analyst, Citi: Right.

Steven Bailey, CFO, Match Group: But I do think AI, you know, interestingly enough, it can really help in this area too. And we’re in the early days of that, but the teams are iterating on how we can use AI behind the scenes to improve trust and safety on our apps.

Igor Runeian, Analyst, Citi: Got it. Okay. So I’m trying to put you to a specific timeline or, you know, trying to say here, okay. This is when we get back to growth, but, ultimately, that’s what investors are looking for.

Steven Bailey, CFO, Match Group: Those people just put me on the spot. Well But I appreciate you being nice.

Igor Runeian, Analyst, Citi: If you want me to. But so let let let’s just think about that kind of right? So we’re working on all these things. Ultimately, you wanna get back to you you’re talking about being a little bit more balanced with monetization. So whether it’s payer growth or or MAU growth, is there a time line that you think about?

Are there KPIs that investors should be looking for? I know you talked a little bit about, at at earnings and some of the improvements that you’ve seen in the top of the funnel. Like, how do we see this start to play out, as you get back to that?

Steven Bailey, CFO, Match Group: Yeah. Look. I think we were pretty clear about the timeline. We’ve laid out a three part turnaround. Phase three, this resurgence phase, is, you know, ’26 and ’27.

And that that lines with our investor day narrative too where we went into great detail on what this turnaround looks like and how long it’ll take. So I think that’s still sort of the timeline we’re under. It does take time, but I I feel like we’re on the right path. And, I’m sorry. Tell me the second part of your question one more time.

Igor Runeian, Analyst, Citi: The path to get there and the KPIs.

Steven Bailey, CFO, Match Group: Oh, the KPIs. Yeah. So the KPIs, you know, we we did go into it a little bit on earnings. The way I think about it is, you know, like most businesses, there’s a funnel. Right?

And, really, what we’re focused on right now is the actually, bottom of the funnel, which is all around outcomes, which is getting you into matches and into real IRL connections. And so we do have while we can’t, track with great clarity what you’re doing off the app in real life, you know, we have proxies for the outcomes. Four way conversations, for example, back and forth, four way times is a good indicator that, you know, things are getting serious. There’s a good probability you’re gonna go meet that person in some form or fashion in real life. Or, you know, first contacts.

You know, if you if, you know, we can read signals that you’re exchanging contacts, you know, Instagram handle, cell phone number, that tells us, okay. That’s a proxy for you meeting that person in real life. That’s really what we’re focused our product features around today. What that means is the app is working better. That goes back to this sort of driving outcomes as the guiding principle of the company today, particularly at Tinder.

And so if we can improve those lower funnel metrics, basically, what that does is it improves retention, meaning you’re you’re more likely to come back and use the app or stay on the app and use it until you find someone. And it improves word-of-mouth, which is so critical for our business. You know, Tinder is a word-of-mouth business. It’s you know, it has a 50% margin because it’s not relying on marketing to drive users. It’s relying on word-of-mouth.

And so what we want is to restart that that word-of-mouth flywheel, which comes from better user experiences. So you go tell your friend, Tinder’s new. Tinder’s different. Give it another try. There’s millions of people that have used Tinder that are single that aren’t using it today because they didn’t like the old Tinder.

But if we can build that, if we can really evolve the product, get that word-of-mouth flywheel going, it will drive reconsideration. And then that leads to the top of funnel metrics we’ve been talking about, which is ultimately MAU. But starts with registrations and reactivations, ultimately leading to user growth and then revenue growth thereafter.

Igor Runeian, Analyst, Citi: Okay. Got it. So good segue. I want to get into marketing here, and it comments interesting on yes. Tinder’s always been word-of-mouth.

You’ve been supporting it with marketing, obviously, as well. And you guys always talk about how marketing and product have to go hand in hand. If you push on marketing before the product’s ready, it doesn’t really work. But you are pushing on marketing again here. And in that in that effort to change the brand perception around Tinder, do you think you’ve made the right amount of progress?

And kinda what’s the marketing strategy here going forward, particularly as we get back back to school and a busier season seasonality for you?

Steven Bailey, CFO, Match Group: Yeah. I do think marketing helps. And, you know, we probably didn’t spend enough money on marketing historically on Tinder, which is part of the reason, you know, what ultimately that did was it let the the consumer tell the Tinder story rather than us tell the Tinder story. And and and the brand perception got away from us a little bit. So the idea behind the marketing is to build back up the brand perception and to explain to people that Tinder is not for hookups.

It’s for possibilities, all sorts of possibilities. And I think the marketing has helped in that regard. We do track, brand perception metrics. They are ticking up. It takes time to move them, but they’re ticking up in the right direction.

So I think that investments are worth it. You know, I always say, you know, marketing supports product, but it cannot replace product. Right. And so I do think, it should become more effective going forward because while the marketing has helped, the product still really hasn’t evolved the way it needed to be until more recently. I’ve and and I think as we roll out more features like double date, for example, we’ll sort of the strategy going forward is always on brand marketing.

We’ve got another iteration of it starts with the swipe out now in q three. Q three is a a seasonally strong, to your point, season for us, really q one and q three are. So we’ve got great campaigns across Tinder and Hinge. And, you know, so we’ll do the always on brand marketing at Tinder combined with, you know, product specific marketing to drive specific features like double date, which I think, you know, will combine as the product evolves, the marketing becomes more effective. And, again, that gets that flywheel going.

That’s what we’re really looking for. Okay. And then, you know, Hinge also has a great campaign out, right now in q three to take advantage of the high season two, and, you know, marketing continues to resonate well there. There, you’ve got sort of a marketing message and a product that’s resonating together, and you see how powerful it is. User growth has been phenomenal.

We’re looking to, you know, mimic that at Tinder.

Igor Runeian, Analyst, Citi: K. Great. So let let I wanna move on to Henge also given the strength and the growing importance of it, I think, for for you guys as it gets bigger. You know? So it it it has been growing well.

It’s it’s accelerating in the second half. It’s on track to that billion dollar revenue target that you’ve laid out for for 2027. You hit on some of the things that that are working there and Hinge being one step ahead. But, you know, as we see that acceleration here, like, what what are the the key growth drivers for for Hinge? What what continues to keep it strong as it scales, which, you know, something that other apps have kind of had a hard time at

Steven Bailey, CFO, Match Group: Yeah. I mean, it’s pretty fantastic to see an app at this scale, reaccelerate growth, which is what we’re seeing over the rest of the year. That doesn’t happen that often to your point. And, you know, I will tell you, I’m more confident today that they’ll get to the billion dollars than I was even back in December at Investor Day, just because they continue to execute so well. And I think it’s it’s it’s, it’s really a few things.

You know? One, it’s it’s user growth driven, which is sustainable, and users are growing in all in all markets. You know, in The US, in every market they’re in, expansion markets, core markets, you we’re we see user growth, which is fantastic. That leads to sustainable revenue growth. The other thing that gives me confidence is geographic expansion, but there’s still a long runway there.

They’re in Europe, still pretty small. If you look at it relative to, like, Tinder versus their US footprint, Europe accounts for 10% of of Hinge’s revenue. So it’s still a long way to go there, and they haven’t even entered, you know, regions like Asia, for example. They’re about to, move into Mexico and Brazil. It’s the next two countries.

That’s all on track. So there’s a long runway for for geographic expansion. And then monetization is another thing. There there’s still pretty early days in the monetization road map. Part of this reacceleration is because they’d all you know, what they did was is they, optimized the pricing across various geographies, in q two.

It was just, you know, similar price in every market. Everybody knew that wasn’t the right strategy. It was just low on the list of prioritization. They got to it. They optimized.

Some priced up, some priced down, drove a lot you know, it’s it’s driving phenomenal revenue growth. And so I think because it’s a it’s sort of a all those three things are working with room to go, I feel pretty confident in their the sustainability. And then last point I’ll make is, you know, they’ve they’ve and why I think they’re they’ve been the smartest, and we’ve sort of learned from Tinder a bit here, is that they’ve continued to keep even though they’re doing all those things well, their their their main focus is still on product innovation and to stay one step ahead of the competition, through, you know, AI innovations, like prompt feedback or some of the other features they’re rolling out, over the coming quarters. So they’ve been really smart about that. So as long as the execution stays where it’s been over the last few years, I’m very confident in the billion dollars.

Igor Runeian, Analyst, Citi: Got it. So even though things have been working well, there’s still kind of a strong product pipeline for Hinge as well coming up? Absolutely. Okay. One follow-up on the because we get this question a lot also.

Is is it do you think Hinge’s success comes at the detriment of Tinder? And are are they competitors? Are they complementary? Is it different audiences? Can both be successful at the same time?

Steven Bailey, CFO, Match Group: I absolutely think both can be successful at the same time. I this is a multi app usage business. Our users are on four apps the category on average. You know, we want as many of those as possible within our portfolio. And I think, you know, we’re they’re they’re a unique product and brand positioning.

And so there’s definitely room for both Tinder and Hinge to succeed. You know, is is Hinge having some impact on Tinder indirectly? Yes. I mean, I think it’s having an impact on all the players in the space. You know, apps like Bumble too.

Yeah. But, you know, that’s because, you know, it’s it’s created a product that resonates with a certain subsegment of Gen z and of of of today’s daters that are looking for more high intent high intent dating app experience. And so I think, actually, that’s a positive. It shows that if you get the product right, you know, you their user growth will come. And I think that’s it’s on us to get Tinder up to Hinge’s level, but in its own unique way and with its own unique sort of brand positioning and product experience.

And if we can do that, then there’s no reason why we can’t see growth at both of those hubs.

Igor Runeian, Analyst, Citi: Okay. Alright. We we’ve hit on Gen AI kind of throughout the conversation, but just to dig a little bit deeper on it. And, you know, I guess, a, is Gen z more receptive to Gen AI as a assistant in in dating? And how are you more broadly building GenAI into your overall products?

I know we talked about a few of the products that are coming out that are GenAI based, but, you know, what what’s the overall GenAI strategy for for you guys?

Steven Bailey, CFO, Match Group: Yeah. It’s core to our strategy at both Tinder and Hinge, and I I do think GenZ is receptive to it if done in an authentic way. One of those three sort of core principles I talked about with was authenticity. So I think it’s it’s very important for us to do to use this technology in the right way, in an authentic way. And, really, where we you know, sort of the themes we’re using it in are a couple.

One is user facing features, like, interactive matching at Tinder, like prompt feedback at Hinge, like, they’re coming out with warm intros, for example, that are sort of in this coaching theme, helping users succeed, not replacing user content, not replacing not not creating inauthentic experiences, but really using this incredible technology to assist users, to to to find, you know, the success they want and deserve on the apps. So that’s how we’re using it, on the user facing side. And then there’s there’s there’s a whole another sort of area which is sort of more behind the scenes, which, which is really in two buckets. One is trust and safety. I think there’s a lot of applications there.

We’re pretty still we’re still pretty early on there in in both, you know, getting bad actors off the app and in the sort of customer experience space, which you see a lot of industries and companies doing. Yeah. Or sorry. Customer service space. And then also in recommendations.

I mean, at the end of the day, recommendations are core to what we do. Hinge has found a lot of success there with their AI driven recommendation experience. It’s increasing matches by 15%. We’re, they’re using what’s called a two tier model to do that. Tinder’s, starting to test similar approaches using AI, and I think there’s a lot of opportunity there too.

Igor Runeian, Analyst, Citi: Okay. What about internally in terms of, efficiencies, kind of up and down your cost base?

Steven Bailey, CFO, Match Group: Yeah. That’s another great application. It’s something that, Spencer believes very strongly, and I do too. We have a task force set up. We have a AI enablement team at the company now, that’s purely focused on how we can use this technology to improve our operations.

And so I think we’re testing 30 different AI tools right now across the company. We’ve got an escalated process for approvals to roll these features out. We have a new centralized scale tech and data team that’s really running this. I think what we’ve seen so far so we’re sort of doubling down in this area. I think what we’ve seen what I’ve seen so far is the most, benefit is really on the engineering side, in terms of code, reviewing code, and writing code, Cursor AI, for example.

Those types of tools is where we found the most success. But, again, I think customer care is a is a is a big opportunity, and we’re looking at it across really all departments.

Igor Runeian, Analyst, Citi: Okay. Great. Let’s stick with margins a little bit. And so one of the things you you talked about is, being able to reinvest and maintain the margin, the pre the previous margin guidance as you found some of those efficiencies. And talk about that balance.

And over time, does that start to kind of bring you bring you back up on the margin side? Or are you, for the kind of foreseeable future, focused on reinvesting and maintaining kinda like the way you balanced it this year? Right. And we’re gonna come back to payments and right after this.

Steven Bailey, CFO, Match Group: Okay. Yeah. Look. I think, you know, the the fact the easiest way to expand margins is is to grow revenue faster Right. When you have a business like ours with high operating leverage.

So, you know, I think that’s you know, that that’s the fastest way to margin expansion. And so I think, you know, we’re making these reinvestments to ultimately generate long term profits. Right? We’re not doing it at the at the you know, just to drive to drive revenue growth for the sake of revenue growth. Right.

And so, the way I think about it is, look. We’ve we’ve been smart about it. We’ve freed up $50,000,000. It it it makes sense to reinvest it into growth. It makes sense to do these product tests on Tinder.

We’re going to see how they play out. We’re going to measure results. We’re going to see the returns we’re getting, not just in dollars, but in impact to users. And we’ll make an assessment in the fall about what 2026 looks like. I think, the good thing is we’ve we’ve given ourselves some room to some flexibility there, right, to hit the margin targets and reinvest for growth.

You know, we’re trying to kinda sorta do both, and and we’ve been effective so far. But, you know, we go through a long planning process in the fall, we’ll sort of figure out what 2026 looks like then.

Igor Runeian, Analyst, Citi: Okay. Great. So on on the in app payments, you know, that is the most tangible. It’s been we’ve been talking about this for years. Yeah.

And that’s fine. It’s finally tangible. You put a number on it. That’s $65,000,000 next year potentially

Steven Bailey, CFO, Match Group: Yeah.

Igor Runeian, Analyst, Citi: I think based on how things play out.

Steven Bailey, CFO, Match Group: Yeah.

Igor Runeian, Analyst, Citi: What what are you seeing so far? What is that op how do you see that opportunity next year? And, you know, is that another area where you can, you know, roll the savings into investment? Does it flow through? How should we think about that?

Steven Bailey, CFO, Match Group: No. It’s it’s a big opportunity. I think most of you probably know, but IP fees, both Apple and Google combined, are single largest cost. $700,000,000 a year we spend on on on fees. And so it’s it’s more than headcount.

It’s more than marketing. Like, when you think about that It’s

Igor Runeian, Analyst, Citi: kinda crazy.

Steven Bailey, CFO, Match Group: Pretty incredible. Right? So any change here is massive for our business, and we’re encouraged by the, what we’ve seen develop in in The US. So, yeah, 65,000,000 or more. You know, what what’s great to, you know, see is that Hinge was the one the only app that we hadn’t yet started testing.

We started yesterday, so we, met the mark there. It could be a big opportunity for that business as well. And so, again, I would say it gives us that flexibility in 2026. We haven’t made a decision yet. We invest or flow through, but it certainly helps with our ability to both increase margin and drive, growth initiatives across the business if we if we see that they’re resonating.

Igor Runeian, Analyst, Citi: Okay. One last quick one. Just a a lot of investors ask if the the Investor Day targets are still the right way to think about the

Steven Bailey, CFO, Match Group: business. Yes.

Igor Runeian, Analyst, Citi: The answer is yes.

Steven Bailey, CFO, Match Group: The the the short answer is yes. You know, the way I think about it is, you know, we laid out a three year plan. We’re halfway through that first year, and we’re on track. Right? So, on an as reported revenue perspective, we’re a little bit ahead of the game because of of of FX.

On a on a FX neutral basis, we’re we’re on track. We’re doing the things we’re we said we would do. We’ve got a long way to go. This is not a next quarter tenure, is back to growth thing, but we never said it was gonna be that. So, yes, the three year targets are on track.

I I think we’re ahead of the game on the margin side and, in line with expectation on the top of the line. And so I feel good about where we’re where we’re at

Igor Runeian, Analyst, Citi: and where we’re headed. Alright. Awesome. I had some more, but we’re out of time. So I’ll save them for for next year,

Steven Bailey, CFO, Match Group: I guess. Okay. Okay. That sounds good. Thanks, everyone,

Igor Runeian, Analyst, Citi: for joining. Thanks.

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