Dating app Tinder is seeking to revitalize itself through artificial intelligence technology in response to a continuous decline in user engagement. The dating application, owned by Match Group, plans to launch a brand new AI discovery and matching feature in the next quarter to offer users a new way to connect, moving away from the traditional "swipe" mechanism.
Data shows that Tinder is facing significant challenges. In January of this year, its monthly active users dropped by approximately 8% year-over-year, with direct revenue reported at $476 million, falling short of the anticipated range of $480 million to $485 million. In response, Match Group's CFO Gary Swidler stated that the upcoming AI matching feature will complement the existing swipe mechanism rather than replace it, aiming to provide "more personalized and engaging matches."
To drive this transformation, Match Group has appointed Spencer Rascoff, co-founder of Zillow Group, as the new CEO. Rascoff is optimistic about AI in online dating, comparing this technological innovation to the shift from desktop to mobile a decade ago, believing that AI will bring a similarly significant change to the industry.
However, challenges remain daunting. Match Group anticipates a year-over-year revenue decline of 3% to 5% in the first quarter of 2025, estimating revenue to be around $820 million to $830 million. Young users' fatigue with online dating, concerns over safety and privacy, and issues related to user experience are critical challenges facing the platform.
This shift towards AI is a significant strategic move for Tinder, but whether it can successfully reverse the trend of user attrition remains to be seen in the market.