May 5 (Reuters) - Match Group posted first-quarter revenue above estimates on Tuesday, driven by the solid performance of dating app Hinge and early signs that a turnaround at Tinder is gaining traction amid a broad push for AI-led transformation.
Shares of the company rose about 5% in extended trading.
Match, which owns Tinder, Hinge, OkCupid and Plenty of Fish, has been retooling its products around AI-powered features aimed at improving match quality and reducing "swipe fatigue," a sense of burnout
among users overwhelmed by endless profiles and underwhelming connections.
The company is also re-evaluating its hiring plans as it deepens its use of AI tools, expecting headcount growth to slow over the rest of the year.
“We are making a big push around AI enablement,” Chief Financial Officer Steven Bailey told Reuters.
“While AI has been part of the product roadmap for some time, we are now seeing significant internal benefits in operating efficiency. Our goal is to become an AI‑native company, and one way we are funding that is by slowing hiring.”
Match's first-quarter revenue came in at $864 million, above estimates of $854.9 million, according to data compiled by LSEG.
For the second quarter, the company sees revenue between $850 and $860 million, the midpoint of which is below analysts' estimates of $856.16 million. Tinder product testing and disruption at its Azar app in Asia is expected to result in a combined $30 million headwind.
Though revenue has been pressured by unexpected Azure‑related costs, the company was able to offset the impact on adjusted EBITDA through cost-cutting measures, including reallocating headcount and alternative payments, Bailey said.
Apart from AI-powered upgrades, the company has launched multiple new features on its Tinder app, including astrology and music, helping registrations rise by 1% after multiple years of decline.
Match's paying users for the quarter decreased 5% from a year earlier to 13.5 million, while Hinge payers increased 15% to 2 million.
The online dating industry has been grappling with slowing growth, declining paying subscribers and widespread user fatigue, particularly among younger users who have grown disillusioned with swipe-based dating models.
Competitors like Bumble have also leaned heavily on AI-driven features as they look to revive growth and reposition brands for younger audiences.
(Reporting by Kritika Lamba in Bengaluru; Editing by Jonathan Ananda)
