Tinder owner Match Group reported solid first-quarter results Tuesday, but everyone seemed to be focused on Facebook and its intentions to join the dating market.
“Near-term unclarity around FB’s pending dating feature will likely cloud the impressive quarter,” Jefferies analyst Brent Thill wrote in a note.
Match Group, which also owns dating apps OKCupid and PlentyOfFish, suffered a huge blow to its stock valuation, with shares tumbling more than 20% last Tuesday, after Facebook announced it would add dating features to its platform. But Match’s management isn’t worried about Facebook stealing market share.
Match’s management defended its position against the potential threat of Facebook, and reassured investors that the social-media giant won’t cut into its customer base. Match Group CEO Mindy Ginsberg said on the company’s conference call Wednesday that Facebook won’t directly compete with Match’s dating apps just as bars, churches, and other ways that singles find partners don’t take away from business. She also noted that dating is not a category where one-size-fits-all and that on average, people use three dating products at any given time.
“Research office says that the vast majority of singles would not want to use Facebook for dating primarily due to concerns with data and personal privacy,” Ginsberg said. “More importantly, they don’t want to be contacted by strangers on a social network meant for connections with friends and family.”
Ginsberg noted that Tinder, which is the company’s strongest growth engine, introduced SMS sign-up on its app last year, allowing users to opt out of signing up through Facebook. Within two months, new users signing up through Facebook dropped from 100% to just 25%. Users said they preferred not to mix dating with their network of family and friends.
“It is possible that Facebook can convince some of the resistors to try dating through technology and therefore they may be able to help break some of the stigma and further expand the category,” Ginsberg said. “Given our large product portfolio we think that we could benefit from this.”
Match Group reported adjusted earnings of $0.26 per share, beating the $0.24 that Wall Street analysts surveyed by ̆Bloomberg were expecting. Revenue came in at $407.4 million, ahead of the $386.15 million consensus.
Match Group is up more than 8% this year.