Dating Apps Have Hit a Wall. Can They Turn Things Around?

As online dating became as easy as swiping a finger across your phone screen, the companies who own apps like Tinder and Bumble became Wall Street darlings. But about a decade later, those platforms are now struggling to live up to expectations, and investors have grown frustrated and eager for something new.

Match Group and Bumble — which make up nearly the entire industry by market share — have lost more than $40 billion in market value since 2021. Even in an age when the apps are a staple on people’s smartphones, the two companies are laying off workers and reporting lackluster revenue growth.

Both companies have recently brought on leaders who have vowed to experiment with new features, hoping to capture the growth investors crave. But they face one critical obstacle: Not enough young people are willing to pay for subscriptions to dating apps — partly because younger daters are increasingly looking to platforms like Snapchat and TikTok to make connections — and it’s not clear what will change that.

Match Group and Bumble generate the bulk of their revenue — about $4.2 billion for both companies last year — by selling subscriptions, with smaller income streams from advertising. But they’re struggling to grow those sales. Match Group was able to keep revenues steady last year only by raising its prices.

As far as investors are concerned, the businesses need to convince more young users to pay.

“Wall Street loves subscription models because it gives them the comfort of recurring revenues,” said Youssef Squali, an analyst at Truist Securities.

By paying, users can unlock features like unlimited swipes and the ability to see who has swiped on them. But for many people, that’s not enough: Unlike other paid subscription services, like Spotify or Netflix, dating apps can’t guarantee that you’ll find what you’re looking for.