Bumble, a once powerful force in online dating, is facing a reckoning.
The company posted weak Q4 2023 results today, showing a net loss of $32 million and revenue of $273.6 million. While higher than the same period a year ago, earnings came in below expectations and combined with a disappointing Q1 2024 forecast, sending Bumble stock down ~10% in after-hours trading.
Bumble takes drastic measures to stop the bleeding.
CEO Lidiane Jones announced that 37% of Bumble’s workforce, or about 350 employees, will be laid off and that Bumble will begin an overhaul of the app with the goal of revitalizing growth. The near-term product roadmap will focus on artificial intelligence and enhanced security measures, Jones said, as well as features designed to appeal to younger audiences.
“We believe these actions will strengthen our core capabilities and allow us to continue to deliver new and engaging user experiences that create healthy and fair relationships,” Jones said during today’s earnings call. “We have a lot of users today who love the paradigm of online dating — scanning, discovering and searching — but there’s also a set of users who want more flexibility to be able to experience and discover people in a more organic and natural way. “
Bumble is facing challenges on multiple fronts as its main rival, Match Group, which owns Tinder, Hinge and Match among other dating apps, is going after Gen Z users with aggressive marketing tactics.
Bumble’s payer growth has been slowing since late 2021. And many of the features introduced to Bumble’s apps over the past 18 months haven’t resonated with the user base, Jones said during the call.
Bumble has also had to deal with internal organizational changes after founder Whitney Wolfe Herd stepped down as CEO last November and moved into the role of executive chairman. Jones, who joined from Slack in January, has appointed four new C-suite executives to Bumble in the last week alone.
Slower growth isn’t just Bumble. Dating apps in general — including Match Group — have seen revenue decline from users reluctant to shell out cash for premium add-ons. According to a 2023 Pew survey studywhile 41% of users aged 30 and over have paid for dating apps, just 22% of users under 30 – the demographic seen as the most desirable – have done the same.
Platforms have tried to combat the decline in a number of ways. Tinder is rotating to focus on long-term relationships – a top priority for Gen Z, polls show less interested in casual relationships and socializing. Hinge among others, meanwhile, is embracing the move to IRL meetings by launching one capital and promotions for solo event sponsors.
