Tinder to kill virtual currency, metaverse plans amid Match Group profit loss; Tinder loses its CEO – TechCrunch

Dating giant Match Group announced a series of changes to its Tinder management team along with announcing disappointing second-quarter earnings on Tuesday. Notably, Tinder CEO Rinat Nyborg will be leaving the company after less than a year in the top position. Match Group is also killing off Tinder’s plans to adopt new technology, such as virtual currencies and metaverse-based dating.

In a shareholder letter, Match Group CEO Bernard Kim expressed frustration with Tinder’s current performance, noting that the popular dating app has been unable to achieve its typical monetization success over the past few quarters and has failed to meet the company’s original revenue growth forecast for the latter half of 2022.

Kim commented Tinder’s problems on the “disappointing implementation of many improvements and new product initiatives,” but added that Tinder product implementation and speed could still be improved.

Along with Nyborg’s departure, Tinder will have a reorganized management team that will also include:

  • Faye Yusotalono, former Chief Strategy Officer of Match Group, as COO of Tinder
  • Mark Van Reswick, Chief Product Officer at Tinder. Reswick is a seasoned gaming CEO who joined the company in June.
  • Melissa Hubley, former chief marketing officer of OkCupid, as Chief Marketing Officer for Tinder
  • Tom Jack, CTO of Tinder. A veteran of the Match group for 11 years, he has served as Tinder’s Chief Technology Officer for the past five years.
  • Counsellor Amarnath Thumper. The current CEO of Match Group Americas and a 15-year veteran of Match Group will advise the Tinder management team on its product and growth roadmap.

Kim said he will oversee the team while Tinder looks for a permanent CEO.

Reading between the lines, there was also a hint that the younger generation of users may have lost their appetite for dating apps like Tinder – a cultural shift that can only be attributed to the ongoing pandemic effects. The letter notes that people have bypassed the COVID lockdowns and re-entered a “more normal lifestyle,” but their desire to try online dating apps for the first time has not returned to pre-pandemic levels.

Instead, Match Group reports that its highest engagement now comes from existing users.

As part of the revamp of Tinder, her “dating” ambitions have been drastically curtailed. The company had been planning to leverage its Hyperconnect acquisition to create a new form of online dating in a virtual environment, but those ideas are on hold as Match Group now has to tackle broader issues.

“…Given the uncertainty about the final lines of metaverse and what will or will not work, as well as the more challenging operating environment, I have instructed the Hyperconnect team to iterate but not invest heavily in the metaverse at this time,” Kim wrote. “We will continue to carefully evaluate this space, and will consider moving forward at the appropriate time when we have more clarity on the overall opportunity and feel we have a service qualified to succeed.”

There was also virtual currency on the chopping block, which the Match Group was experimenting with as Tinder Coins. (While Match Group stopped short of announcing blockchain integration for coins, the role of virtual currency in its broader metaverse plans suggests that cryptocurrency could be part of a long-term roadmap.)

“After seeing mixed results from testing Tinder coins, we decided to step back and re-examine this initiative so you can more effectively contribute to Tinder revenue,” Kim said. “We also intend to do more thinking about virtual goods to ensure they can be a real driver for Tinder’s next growth step and help us unleash powerful untapped users on the platform,” he added.

The company says it still plans to develop features to make Tinder more attractive to women, including a subscription-based package that will provide “curated recommendations” as well as features designed to engage friends in introductions. Across other products, it will also look for new features, such as live video streaming, to increase adoption.

Overall, Match reported revenue of $795 million in the second quarter of 2022, an increase of 12% year over year, but below Wall Street’s average estimate of $804.22 million. It also posted a loss of $31.86 million, or 11 cents a share, versus 46 cents in the last year’s quarter. Analysts had expected earnings of 57 cents per share. Match said it had an operating loss of $10 million, impacted by a $217 million writedown of intangible assets related to a lower financial outlook for Hyperconnect’s Azar and Hakuna apps.

The number of Paying Match Group users increased 10% year over year to 16.4 million. Tinder’s direct revenue grew 13% from previous quarters, driven by 14% growth to reach 10.9 million users.

Image credits: Match group

Estimates for the next quarter weren’t good either, with Match Group forecasting steady third-quarter growth to $790 million to $800 million in revenue, below estimates of $883 million. Tinder revenue growth is expected to be in the “single digits average”.

Shares fell more than 20% in trading after closing on the news.

Updated on 8/2/22 6:00 PM ET to clarify that Tinder has not officially announced blockchain integration for Tinder’s virtual currency.

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