Match Group Inc (MTCH) 2025 Q3 法說會逐字稿

Good day and welcome to the Match Group's third-quarter 2025 earnings call.

(Operator Instructions) Please note, this event is being recorded.

I would now like to turn the conference over to Tanny Shelburne, SVP of Investor Relations. Please go ahead.

Thank you, operator. Good afternoon, everyone.

Today's call will be led by CEO, Spencer Rascoff; and CFO, Steven Bailey. They'll make a few brief remarks, and then, we'll open it up to questions.

Before we start, I need to remind everyone that during this call, we may discuss our outlook and future performance. These forward-looking statements may be preceded by words such as we expect, we believe, we anticipate, or similar statements. These statements are subject to risks and uncertainties. Our actual results could differ materially from the views expressed today. Some of these risks have been set forth in our earnings release and our periodic reports with the SEC.

Also, during this call, we will discuss certain non-GAAP financial measures. Reconciliations to the most directly comparable GAAP financial measures are provided in the published materials on our IR website. These non-GAAP measures are not intended to be substitutes for our GAAP results.

With that, I'd like to turn the call over to Spencer.

Good afternoon, everyone. Thank you for joining us.

Since joining Match Group in February, my focus has been clear: confront challenges directly, move with urgency, and rebuild the company around product, excellence, and long-term growth. The work on our three-part turnaround is well underway and focused on Reset, Revitalize, and Resurgence.

We've successfully completed the Reset phase, instilling the culture of speed, accountability, and outcomes. This shift has come to life across our products, teams, and users. That progress is reflected in this quarter's results. We delivered on our revenue expectations and exceeded our adjusted EBITDA goals, excluding a legal settlement.

At Tinder and Hinge, momentum continues to build as we make progress in our Revitalization phase. We're starting to see green shoots and believe continued progress will come from delivering experiences that solve user pain points, deepen engagement, and improve user outcomes.

We believe our business model thrives when user outcomes improve: better outcomes driven by higher quality experiences, better matches, and more meaningful connections build confidence in our product and drive new users through positive word of mouth.

User success builds trust in the category and in Match Group's apps. By getting the user experience right, we will further deliver real success stories, which we use in marketing to amplify growth by driving new user acquisition and reactivations.

Our marketing strategy, especially at Tinder and Hinge, is focused on fueling category consideration, bringing in new and lapsed users through product-led storytelling that reflects real experiences happening across our brands.

We estimate there are roughly 250 million actively dating singles worldwide not currently on dating apps. Re-engaging the 30 million lapsed users and attracting the 220 million potential first-time entrants expands our user base, building a healthier, more efficient growth engine that compounds over time, and we are investing to capture this large addressable market.

Hinge continues to prove that with the right product experience and brand positioning, we can win with Gen Z and drive real growth at scale. Soon, we believe Tinder will too.

We'll walk through three proof points today. First, our product progress, where our obsession with outcomes is showing up across our brands, especially at Tinder and Hinge. Second, the essential work we're doing to strengthen trust and authenticity across the ecosystem. And third, the financial discipline and operational rigor that are now showing up in how we execute.

Starting with product, across Match Group, our brands share one goal: delivering better user outcomes. I want to highlight the progress at our two flagship brands, Tinder and Hinge; and how each is building affinity with users in different segments.

At Tinder, our focus this year has been to accelerate innovation, to rebuild trust, and to ship great products so we can reintroduce Tinder in 2026 to our core audience of Gen Z. Our new mission statement, Tinder is the most fun way to spark something new with someone new, captures the energy and the sense of possibilities we want every user to feel. Guided by new personas, prototypical user archetypes that reflect real people and their motivations, we're creating experiences that feel more personal and more aligned with what users want.

We've clarified what Tinder stands for and who we're building it for and that focus is already paying off. Users are seeing and feeling the difference through updates that are reshaping the Tinder experience in the following ways:

First, we're building a product and design-led culture. Our new liquid glass refresh planned on iOS this quarter will make the app more modern, fluid, and visually appealing, further bringing our mission to life every time you open the app.

Second, Chemistry is redefining how people connect. Powered by AI, this interactive matching feature, now known as Chemistry, is a major pillar of Tinder's upcoming 2026 product experience. It gets to know users through interactive questions, and with permission, learns from their camera roll to better understand their interests and personality. Using deep learning, chemistry Combats swipe fatigue by surfacing a few highly relevant profiles each day, driving more compatible matches and engaging conversations. Chemistry is now live in New Zealand and Australia, with plans to expand to additional countries in the coming months.

Third, Modes are powering a new social energy on Tinder. Our new Modes navigation gives users more choice in how they use Tinder, from meeting new people with a friend to connecting with their college community. Since launching Modes in September, Double Date adoption is up 30% in the US, while College Mode is gaining traction with 1 in 4 eligible students using it and over 8% engaging daily, as of October. Modes makes the fun part of our mission real, giving new ways to spark something together and redefining Tinder as a fun, social, and low-pressure way to meet new people. We're also seeing this momentum reflected in our marketing. The Double Date Island campaign across Europe drove the highest brand consideration lift of the year, boosted downloads, and particularly resonated with Gen Z. It proved that when we connect product innovation with authentic social-first storytelling, we can reignite excitement and bring new energy back to Tinder.

Fourth, evaluating profiles is becoming more meaningful and holistic. We've started testing several new features resonating with Gen Z by giving users more information to evaluate and connect with potential matches. Bio information now appears on the first photo card. Prompts content is integrated into the photo carousel. These improvements let users learn more about a potential match before deciding to swipe right. We've also started testing features like contextual likes and open messaging. We fully rolled out prompts on photos to let users share why they swiped right, making interactions more intentional and authentic.

Finally, app performance is a major focus and a key driver of user experience. On Android, Tinder start-up times are now 38% faster and crash rates are reduced by more than 32%. On iOS, app stability is up more than 57%. We're also removing long running tests and unused features to make the app leaner. As we bring load times closer to 1 second on iOS and Android, Tinder already feels faster and smoother. Our app performance work on iOS and Android is in service of the fun part of our mission because no one enjoys a slow, buggy app.

You can feel the energy across Tinder. During our Hack Week last week, teams brought incredible innovation and creativity, building some of the most exciting products and prototypes we've seen in years. The company feels electric.

Meanwhile, Hinge continues to be one of the best and most undiscovered stories in consumer tech, powered by a clear mission, a motivated team, a leading product experience, and sustained momentum. Hinge’s “Designed-To-Be-Deleted” philosophy drives a focus on user outcomes, specifically helping people go out on great dates, our North Star. This clarity of purpose has resulted in category-leading growth in both users and revenue.

Hinge is leading the way on AI innovation in dating, with category-first AI features that drive better connections and more real-world outcomes. This quarter brought both wins and learnings. Conversation Starters, which offers personalized prompts for first messages, was a clear win, driving approximately 10% more likes with comments and stronger engagement overall during the test, particularly with women. Updates to our recommendation system improved matching quality through rigorous testing and provided valuable insights that are already refining our approach. Warm Intros, designed to surface compatibility queues, didn't resonate and we won't move forward with it. While understanding compatibility remains a key focus, Hinge continues to prioritize user outcomes over simply launching new tools, reflecting our principled approach to innovation.

As we look ahead to the next few quarters, Hinge has an exciting slate of category-first features that showcase our leadership in product innovation and user experience. First Impressions help daters lead with personality. This new feature introduces prompts about photos, giving users more ways to express who they are and add depth to their profiles. A similar experience in the Standouts section earlier this year was well received. We're eager to see how users respond, as we continue making Hinge more personal and expressive.

Preferences will also become more meaningful at Hinge. Reimagined Preferences will take a new look at how daters express what they're looking for, capturing compatibility with greater nuance and intentionality. This update addresses key user pain points, helping people share what truly matters and find better matches faster.

These are just a few of the ways that Hinge continues to drive innovation in service of user outcomes.

The next pillar of our strategy is centered on deepening trust in the category. Turning now to trust and authenticity and the ways in which it strengthens the foundation of our ecosystem. In dating apps, everything depends on the integrity of the ecosystem. No matter how many new features we launch, people use our apps to meet other new people. That only works when they feel safe, respected, and confident in being themselves. Building and maintaining that trust is core to our long-term success, which is why we're doubling down on trust and safety across our platforms.

Nowhere is that more evident than at Tinder, where we're integrating safety directly into the product experience like never before. The centerpiece of this effort is Face Check, our new facial verification feature that helps confirm users are real and match their profile photos. It's now required for all new users in California, Colombia, Canada, India, Australia, and Southeast Asia. We'll roll out to additional US states and countries in the coming months.

Face Check sets a new standard for authenticity. Using only a short video selfie, it helps confirm a user is real and matches their profile photos. We built this technology with care, ensuring it delivers meaningful improvements to trust and safety, while keeping the user experience seamless.

Early results are strong and reinforce our confidence in the long-term benefits to the broader ecosystem. We have seen a 60% reduction in user views of profiles later identified as bad actors and a 40% decrease in reports of bad actor activity. Our ongoing optimization efforts have resulted in only low-single digits impact to monthly active users and revenue in test markets, which lessens over time. Early Net Promoter Score results show a clear and sustained improvement in user trust and satisfaction in test markets, with scores up roughly 10 points for men and 5 points for women in key markets where Face Check has launched. This is just the beginning. We plan to expand Face Check across the portfolio, with testing on Hinge beginning in the next few months.

We're also expanding safety beyond verification into everyday user interactions. Tinder and Hinge have introduced new, fairer enforcement tools to educate users and promote better behavior through faster and more consistent moderation. This approach calibrates responses based on severity, helping create a safer and more respectful community. We are also enhancing our Are You Sure? feature, which prompts users to pause before sending potentially offensive or disengaging messages, with large language models to make it smarter and more effective at encouraging better conversations in real time.

Originally developed Tinder and later enhanced by Hinge, this LLM-powered version improves accuracy and tone. Now, Tinder is incorporating those learnings back into its own experience, a great example of how our portfolio of brands innovate together, share insights, and make each other stronger.

Within Hinge, these principles come together through our product design and user experience. Beyond moderation, Hinge continues to refine the onboarding experience to build confidence and trust early in the user journey. Recent updates include clear guidance during setup, refreshed community guidelines at Help Center, and the introduction of an AI-powered chatbot that quickly answers commonly asked questions. Together, these updates reinforce Hinge's position as a dating app grounded in authenticity and safety, where people can show up as their true selves and for meaningful relationships.

Let's now turn to our financial and operational rigor and how it translates into results.

The same discipline driving product innovation is also reflected in how we execute, day to day. We are operating with sharper focus and accountability across the company; hitting deadlines; shipping Match Group-wide features, such as alternative payments, faster; and acting like a more nimble and decisive company. These improvements are creating operational momentum and financial optionality, as we plan for 2026.

You can see this strategy in action through Project Aurora, our large-scale test in Australia that brings together many of Tinder's biggest advancements into a faster, safer, and more personal experience. As part of this work, we're overhauling the recommendations engine to better align with user outcomes, improving both match quality and overall satisfaction.

We're being thoughtful with our tests, prioritizing user trust, outcomes, and long-term impact over quick wins. We may see some short-term revenue and adjusted EBITDA impact from these tests, which we've included in our guidance, as we trade short-term monetization for a better user experience and improved user outcomes. These tests will help us refine our strategy and further validate that improved user outcomes will drive more sustainable user and revenue growth over the long term, which, in turn, will drive increased shareholder value. We'll share more of these results next quarter.

At Hinge, momentum continues to build, as the product delivers meaningful outcomes for users. Revenue, adjusted EBITDA, and user growth remain strong, supported by continued innovation and disciplined execution.

Hinge's international expansion remains on track, with the successful Mexico launch in September and with Brazil planned for Q4. The team is actively working on plans for new expansion markets in 2026, as well.

Hinge launched alternative payments testing ahead of schedule in Q3, with strong early results. We plan to fully roll out alternative payments across our major apps, including Tinder and Hinge, in the US in Q4. Strong initial performance at Hinge and ongoing optimizations at Tinder and E&E have increased adoption of web payments. We now expect to generate approximately $14 million of savings in Q4 2025 and approximately $90 million in 2026. We have seen some impact to gross revenue in some of our tests at Tinder and Hinge, which we're continuing to optimize for.

We're also seeing early success from our recent acquisition of HER, which expands our reach among queer women and gender-diverse communities. The team has already delivered strong results, with algorithmic improvements and monetization optimizations driving over 20% revenue increase in test markets. This success highlights the opportunity to scale high-potential brands across our portfolio and deepen our presence in key segments of the dating market.

That same disciplined approach to growth is reflected in how we manage the business. Our financial discipline earlier this year generated approximately $100 million of annualized savings, allowing us to reinvest approximately $50 million across the portfolio to test user-first features, strengthening marketing and expanding our international footprint.

The early results from our Q3 investments are instilling confidence in our strategy. We're executing well against our Q4 plans. The learnings from these investments and the ongoing benefits of the cost savings efforts will help inform how we prioritize and deploy capital in 2026. Together, these steps are setting the foundation for the next phase of the turnaround and the resurgence that we expect to take hold in 2026 and 2027.

We're entering this next chapter with real progress and a clear path forward.

At Tinder, our new measure of success, Sparks, tracks six-way conversations; meaning, at least six total messages exchanged between two users. This has become one of the clearest indicators that a genuine connection is forming. While the total number of Sparks is lower year over year due to a smaller monthly active user base, Sparks coverage or the proportion of users in the ecosystem having these deeper conversations continues to improve and is up year over year. This shows that more users are having better experiences on the platform, an early but encouraging sign that our focus on improving product quality and user outcomes is taking hold.

Match Group holds a unique position in solving one of the most important challenges of our time: helping people connect in a world that increasingly feels disconnected. Our focus is on fostering genuine human connection, while ensuring technology strengthens relationships and is the social fabric that brings people together.

With that, I'll turn it over to Steve to walk through more on the financials.

Thanks, Spencer.

We're pleased with our Q3 results, as Match Group total revenue was in line with expectations for the quarter and adjusted EBITDA meaningfully exceeded our expectations, excluding a $61 million charge to settle the Candelore v. Tinder, Inc., case on a class-wide basis. Candelore is a 10-year-old case involving Tinder's former age-based pricing. The parties are preparing a long-form agreement reflecting the settlement terms and we'll then seek approval of the settlement by the court.

In Q3, Match Group's total revenue was $914 million, up 2% year over year, up 1% year over year on a foreign exchange-neutral basis. FX was $4 million, better than expected at the time of our last earnings call. Payers declined 5% year over year to 14.5 million, while RPP increased 7% year over year to $20.58. Indirect revenue of $18 million was up 8% year over year, driven primarily by strength in our Third-Party Advertising business.

Moving to total company profitability, in Q3, Match Group's adjusted EBITDA was $301 million, down 12% year over year, representing an adjusted EBITDA margin of 33%. Excluding the $61 million settlement charge and $2 million of restructuring costs included in the $25 million of restructuring costs announced in May, adjusted EBITDA would have been $364 million, up 6% year over year, representing adjusted EBITDA margin of 40%.

Tinder direct revenue in Q3 was $491 million, down 3% year over year and down 4% year-over-year FXN. Q3 direct revenue includes an approximately $3 million negative impact from user experience testing in the quarter. Payers declined 7% year over year to 9.3 million and RPP increased 5% year over year to $17.66. Adjusted EBITDA in the quarter was $204 million, down 23% year over year, representing an adjusted EBITDA margin of 40%. Excluding the legal settlement charge, adjusted EBITDA would have been $264 million, representing an adjusted EBITDA margin of 52%.

Hinge continued its strong momentum in Q3, with direct revenue of $185 million, up 27% year over year and up 26% year-over-year FXN. Payers increased 17% year over year to 1.9 million. RPP increased 9% to $32.87. Adjusted EBITDA was $63 million, up 22% year over year, representing an adjusted EBITDA margin of 34%.

E&E direct revenue in Q3 was $152 million, down 4% year over year and down 5% year-over-year FXN. Payers decreased 13% year over year to 2.3 million, while RPP increased 10% year over year to $22.22. Adjusted EBITDA was $47 million, up 14% year over year, representing an adjusted EBITDA margin of 30%.

Match Group Asia delivered direct revenue in Q3 of $69 million, down 4% year over year on both an as-reported and FXN basis. Excluding the exit of our Live Streaming businesses, Match Group Asia direct revenue in Q3 was flat year over year on both an as-reported and an FXN basis. Azar direct revenue was flat year over year and up 2% year-over-year FXN. Azar direct revenue was negatively impacted by an estimated $3 million, after Azar was blocked in Turkey by Turkish regulators in late August. We're pursuing all available legal remedies and working with Turkish regulators to get Azar unblocked. However, it is unclear at this time when that may happen. Pairs direct revenue was down 1% year over year and down 2% year-over-year FXN. Across Match Group Asia, payers increased 6% year over year to 1.1 million, while RPP declined 10% year over year to $20.73, partially due to the exit of Hakuna mid-last year. Adjusted EBITDA was $15 million, down 14% year over year, representing an adjusted EBITDA margin of 22%.

Looking at costs, including stock-based compensation expense, total expenses were up 1% year over year in Q3. Cost of revenue decreased 2% year over year and represented 27% of total revenue, down 1 point year over year, driven by reduced variable expenses from the shutdown of our Live Streaming services mid last year, lower web services costs, and lower employee compensation expense from our restructuring efforts.

Selling and marketing costs increased $12 million or 8% year over year and represented 19% of total revenue, up 1 point year over year, primarily due to increased marketing spend at Tinder, Hinge, and Match Group Asia, partially offset by lower employee compensation expense from our restructuring efforts.

General and administrative costs increased 42% year over year, up 5 points year over year as a percentage of total revenue to 16%, driven primarily by the legal settlement charge, partially offset by lower employee compensation expense from our restructuring efforts.

Product development costs increased 1% year over year and were flat year over year as a percentage of total revenue at 11%.

Depreciation and amortization decreased by $44 million year over year to $24 million due to impairments of intangible assets at E&E and Match Group Asia in the prior year quarter and lower internally developed capitalized software costs, primarily at Tinder and Match Group Asia.

Turning to the balance sheet, our trailing 12-month gross leverage was 3.4 times and net leverage was 2.5 times at the end of Q3. We ended the quarter with $1.1 billion of cash, cash equivalents, and short-term investments on hand.

In August, we issued $700 million of 6.125% senior notes due 2033. The proceeds from these notes will be used to repay all of the exchangeable senior notes coming due in 2026 on or before maturity and for general corporate purposes. In September, we repurchased $76 million of the 2026 exchangeable senior notes at a discount to par.

Year to date through Q3, we delivered operating cash flow of $758 million and free cash flow of $716 million. We repurchased 17.4 million shares at an average price of $32 per share on a trade-date basis for a total of $550 million and paid $141 million in dividends, deploying nearly 100% of free cash flow for capital return to shareholders.

In October, we repurchased an additional 3 million shares of our common stock for $100 million on a trade-date basis and at an average price of $33 per share. As of October 31, 2025, we reduced diluted shares outstanding by 8% year over year.

We maintain our commitment to target returning 100% of free cash flow to shareholders through buybacks and the dividend.

Now, turning to guidance, we expect Q4 total revenue for Match Group of $865 million to $875 million, up 1% to 2% year over year. This range assumes a nearly 2.5 points year-over-year tailwind from FX. FXN, we expect total revenue to be down 1% to 2% year over year. We expect Match Group adjusted EBITDA of $350 million to $355 million in Q4, representing a year-over-year increase of 9% and an adjusted EBITDA margin of 41% at the midpoints of the ranges.

Q4 total revenue guidance reflects continued strong performance at Hinge and Tinder performance that is in line with the expectations we had at our last earnings in August, including an expected $14 million negative impact to Tinder direct revenue from user experience testing. It also reflects weaker-than-expected performance at E&E and assumes the continuation of Azar's block in Turkey.

E&E saw weaker trends in Q3, which we are working quickly to address. We no longer expect Emerging Brands direct revenue growth to offset Evergreen Brands's declines in 2025. We expect an estimated $9 million negative impact of Match Group Asia direct revenue from Azar's block in Turkey. We expect indirect revenue to be approximately $15 million in the quarter.

Our Q4 adjusted EBITDA guidance includes $4 million of restructuring-related costs included in the $25 million of restructuring-related costs announced in May and an $8 million positive impact from an expected sale of one of our two office buildings in LA that was not fully utilized.

We are increasing our 2025 full-year free cash flow guidance to $1.11 billion to $1.14 billion, which assumes the Candelore settlement will not be paid until Q1 2026. We now expect our 2025 full-year tax rate to be in the high-teens.

Now let's open it up to Q&A.

(Operator Instructions)

Cory Carpenter, J.P. Morgan.

Spencer, you mentioned in your prepared remarks that the early reinvestments are giving you confidence in your strategy. Could you expand a bit on the green shoots you're seeing across the broader company and then, also at Tinder, specifically?

Yeah. Thanks, Cory. Let me start with Tinder and ,then if we want to expand from there, we will.

At Tinder, we now have a clear mission statement, which we understand, so we know why we're building what we're building. We have clear consumer personas so we know who we're building them for. And, now, we have a clear metric, six-way conversations or what we call Sparks, so that we know how to measure whether we're driving good user outcomes.

Sparks, we think, are a good measure of product efficacy. Globally, they're down in the low single-digit range year over year but they're improving and close to flat. It's actually quite a bit better than MAU, which has stabilized in the 9%, 10% high-single-digit year-over-year range.

As I said just a moment ago, Sparks coverage is actually up year over year but it's up the most among US Gen Z.

So all this by way of saying the product is working better today to help spark something new with someone new than it was a year ago. That's encouraging.

There are a couple of reasons why the product has improved efficacy.

The first is, a lot of our recommendations tests are bearing fruit. So at any point in time, we have dozens, sometimes hundreds of different recommendation algorithms in the market.

We ended up finding one of them that actually improves women’s matches by 4% and improves Sparks and improves retention with no revenue trade-off, which is really uncommon. Usually, when we have recommendation improvements that improve user outcomes, it comes at some revenue hit. In this case, it did not. So we've rolled this out, globally.

Our work is not done on recs. We are always continuing to improve them. But I'm encouraged by where we're headed.

The second -- so moving from recs is number one. Number two, I'll turn to Double Date.

Double Date continues to resonate really well with our target users. As I think I mentioned just a moment ago, adoption for Double Date is up quite a bit. The stat -- I don't think I shared yet -- is that about 17% of US users age 18 to 22 now have a Double Date pair. That's a big deal. If you think about that, think about a Gen Z, 18- to 22-year-old American user of Tinder, almost 1 in 5 of them are now using Tinder with a friend to swipe on pairs of people. So that's changing perception of what Tinder is and how they use it. That's critical for us to drive reconsideration and, ultimately, MAU growth.

Finally, I will just hit on a basket of features at Tinder, which, in the aggregate, help people assess the whole person, rather than just quickly assessing the attractiveness of the photo. These are features like contextual likes, which Hinge pioneered; features like putting biographical information on the first photo. The good news here is those types of features have improved user outcomes like Sparks without impacting revenue. We were prepared to accept the small revenue hit for these types of features but many of them actually just improved user outcomes and have not impacted revenue.

Let me pause there. I'm happy to elaborate on the roadmap and where it's going but that brings you pretty current with what we've shipped on Tinder over the last couple of months and the early positive results that we're seeing on user outcomes.

Nathan Feather, Morgan Stanley.

Really encouraging to see the faster product velocity at Tinder. Any particular sense if that's also accelerating the curve as you think of user outcomes and underlying metrics?

Connected to that, as you start prioritizing user outcomes, you mentioned a negative Tinder revenue headwind in 4Q, to what extent should we expect that to continue into next year as you continue to make these product improvements?

Thanks, Nathan.

It's probably a little too early for us to know the answer to your question about 2026. What we're in the midst of right now is evaluating all these tests in key markets, including in Australia, where we're throwing the kitchen sink, in terms of user outcomes and marketing efficiencies, in order to see what it takes to turn around user outcomes and audience in a couple of key markets so that we can decide how we want to run the company in 2026, with respect to profitability.

What Steve, I think, highlighted in his prepared remarks were a potential $14-ish million impact on Tinder revenue, which is baked into guidance for Q4. This comes from features like different recommendation algorithms that we're testing, still, to try to improve user outcomes even further; rolling out new Modes -- of course, today, we have College Mode and Double Date mode but there are several more modes on the way -- those might come at small cost of revenue; building out open messaging and giving more free user outcomes, like letting users see a couple free-see of who likes you pairs; and redesigning certain aspects of Tinder, building out Chemistry into the main card stack and rolling that out into more geographies, rolling Face Check out across the whole United States by end of year, which I don't think I mentioned that in the prepared remarks but now we're targeting face check through the whole US by end of year and globally, with the possible exception of the EU and the UK by spring.

All of this is taking us towards a product event in spring 2026 for the media, for influencers, for investors -- hopefully, we'll see many of you there -- where we'll show the world what we've been building at Tinder over the last -- by that point, it will be around six months-or-so; and also, what's coming.

That's a real catalyzing event, which has the Tinder team rallying with urgency around building as much as products as we can to improve user outcomes by that spring 2026 event.

Jason Helfstein, Oppenheimer.

Just, maybe, follow up a little bit. You did elaborate in the letter that you plan to unlock $40 million of payment savings. Is the idea that, like, if you do decide to lean in more into these clean-up initiatives or however you want to describe them, that $90 million could help potentially offset that revenue headwind next year?

Like, to that point on Project Aurora and, like, if you did go fully roll this out, like, should investors assume --like, how dramatically would you be willing to let, like, revenue come down of end up with, like, the right place, from a user experience standpoint?

Why don't I take the first part of that question?

Here's the way I think about the $90 million. The $90 million gives us clear flexibility, right, and optionality. As Spencer just said, the $14 million Q4 impact from Tinder user outcome testing is an estimate, right? These are tests. So it's probably premature to speculate on whether we'll need the $90 million to offset the revenue declines or whether there will be revenue declines at all until we see how these tests play out.

And so the plan is to continue testing throughout the rest of the quarter; to go through our annual planning process, like we always do; and then, we'll give clear guidance on 2026 in a lot more detail on our investment strategy and the outcome of these tests and all the learnings we've gathered at that time.

That's the plan.

Ben Black, Deutsche Bank.

This is Kunal, on for Ben. A couple on Hinge.

Right from the beginning, Hinge was designed to be deleted or meant to be deleted. Has the engagement profile of the users changed since the beginning?

And then, you talked about how Hinge is expanding into Mexico and Brazil in the coming months. How does that change the addressable market?

Yeah. Thanks, Kunal. Good questions.

Yeah. Hinge is really meant to be the last dating app that you'll ever use and Tinder is meant to be the first dating app that you'll ever use. So that positioning is clear in terms of how we think about marketing the two apps and in terms of the product roadmap and focus of the teams at Hinge and Tinder.

That positioning for Hinge hasn't changed since Match Group purchased it. It's been very consistent. I think that consistency is one of the reasons for Hinge's continued success.

Hinge just launched in Mexico a couple of weeks ago. It's off to a faster start in Mexico than when Hinge launched in Europe several years ago. So that's extremely encouraging. Brazil will launch in the next few weeks.

When you look at Hinge's success in the markets that it's in or even this recent fast start in Mexico, it gives me a lot of optimism that the total addressable market for Hinge is massive. That this customer segmentation or psychographic segmentation between Tinder opening a world of possibilities at the fun spontaneous side of dating and Hinge being for more serious and intentional daters, that duality should be true, globally.

It's hard for me to imagine there would be a country where there wouldn't be an opportunity for an intentional dating app like Hinge to be a category leader in that segment.

As we go through the annual planning process that Steve mentioned over the next couple of weeks, we'll be thinking through which markets to expand Hinge to in 2026. We already have integrated certain areas of our go-to-market, such as Asia, where Match Group now provides shared services for all of our brands as we expand to new markets in Asia.

That allows us to even more efficiently and effectively and intelligently expand to new markets in a coordinated manner. So that's the type of thing that only our multi-brand scaled portfolio, as the category leader, can provide and I think should be an even greater tailwind as Hinge launches into new markets in 2026.

Eric Sheridan, Goldman Sachs.

I think, based on the early learnings in Australia, how do you think about the philosophically going to market with a wider array of offerings and changes to Tinder all at once, relative to looking out towards next year and thinking about being more strategic and directed in the way certain enhancements go global, either by country-by country or by geo? Just curious how you think about that.

Yeah. It's a good question, Eric.

The interesting thing about this category, which can easily be forgotten by people that aren't in it day to day, is that the company and the brands build products and then, we market them. But, ultimately, we're in the service of introducing strangers to strangers. And so the success of the products really rely on the quality and behavior of those in our community.

One of the reasons that we're doing Project Aurora is to try to not just improve the actual feature set but increase the marketing focus on trust and safety there, turn that whole market around with vigor in the aggregate. Because the ecosystem hangs together in these products in a way that e-commerce really doesn't have that experience.

So in terms of how we roll this out, these types of changes in 2026, I do want to be clear that we're not standing still. For example, the recs algorithm that I mentioned that's in Australia, we've also rolled that out in other markets. Face Check, which we've rolled out in Australia, we've also rolled out in a handful of other markets.

So we're certainly not waiting for a clean read from a single market. But it is helpful for us as we decide what the answer is to, I think it was Jason's question, about 2026 and profitability for next year. We will benefit from having greater insight into how the product investments and the marketing hang together to improve the whole ecosystem. That will help us articulate what the plan is for 2026.

Ygal Arounian, Citi.

Spencer, you mentioned MAU is stabilizing in is down 9%, 10% range. So you think about the initiatives you're rolling out all the way from the single stuff in certain markets -- the whole kitchen sink, like you said -- in Project Aurora, how do you think about the timeline for -- you're seeing some of these KPIs and green shoots, like what's the timeline to when you think MAUs can start to turn around and start to move in the other direction?

And then, on the in-app payment, the upside to the savings that you're seeing now versus what you called out last quarter, can you talk about what's driving that? What you've seen that's driving more savings?

Yeah. I'll take the first question.

A number of the product initiatives that we've been doing to improve user outcomes actually have the effect of hurting monthly active users. For example, Face Check hurt monthly active users by a little bit, at least initially, by a couple of percentage points.

The recommendation algorithm also can have the effect of hurting male monthly active users. It improves female retention, the female experience, but that can have the effect of pulling female attention away from certain male users and then, we sometimes lose their visits. That's okay.

So the fact that is MAU hanging in there in the high-single digit year over year, even while we're improving user outcomes, is a good sign; just as the fact that we're able to improve user outcomes at minimal impact to revenue, with a couple of the examples I cited, that's also a good sign.

I'll let you talk to IAP.

I can take the IAP, sure. Yeah. we've made a lot of progress over the last few months on alternative payments. You're right, the expected savings in 2026 has gone up quite a bit.

Let me just give you a little bit more detail. Basically, back in August, Hinge had yet to start testing. We said it was going to start testing in September. That happened. We were extrapolating Tinder and E&E results and seeing about a 30% shift to web payments, of course, in the US. We extrapolated that out to about a 10 points increase in net revenue, which equates to about $65 million in savings in 2026.

Now, as of October, actually, Tinder, Hinge, and most of the E&E apps are now fully rolled out. So we've rolled these apps out faster than we originally planned, which is good. Hinge saw really strong results out the gate; better than E&E and Tinder, we're seeing. Since August, Tinder has also done a really great job, as has E&E, in continuing to optimize.

Now, with most of our apps, including Tinder and Hinge, rolled out 100% in the US and fully optimized, we're seeing a 40% to 60% shift to web, depending on the app, which translates into a 15 points increase in net revenue and $90 million of savings.

So the net of it is: Strong results at Hinge out the gate and continued optimization at Tinder and E&E has resulted in more of those payments going to web, which is resulting in more savings.

The other thing I'll just mention, I don't know if you caught this but Google, mid-last week, updated it's Play Store policy, allowing for web payments, as well, in the US without fees similar to the Apple situation. And so we plan to test there, too.

That's a smaller opportunity. We have less Android users in the US than we have Apple users. Also, the fee we pay Google for in-app purchases is more, like, 18% versus the 27% we pay Apple. So there's less savings to be had from shifting to web.

But if you pencil it out, our early estimate is about a $10 million to $15 million additional savings through Google on an annualized basis. So we're excited about that opportunity, too. We'll start testing and confirm those initial estimates.

John Blackledge, TD Cowen.

It's Logan Whalley, on for John.

Could you talk about any traction or the traction that you cited from recent marketing efforts; and then, how you approach the opportunity with lapsed daters versus those that have never used the app before?

And then, sticking to marketing on the cost side, maybe how you're thinking about marketing spend and the traditionally more expensive 4Q advertising season?

Yeah. I'll take the very last part of that first, which is we do go lighter on advertising in Q4. Our seasonal peak tends to be after Christmas. People make a New Year's resolution about starting to date anew and we benefit from that and we spend into it.

But between Thanksgiving and Christmas, the media market is more expensive. Because of e-commerce and other consumables, we tend to pull our marketing spend back.

In terms of overall marketing, we just completed Project Prism, which was Match Group's first-ever attempt to put marketing spend on an apples-to-apples basis across all of our brands to create a shared framework to assess the efficacy of marketing spend so that we'll have a point of view now about going into 2026.

If we were going to put $5 million or $10 million against brand X, what is the likely number of downloads that it would acquire? What's the user and gender mix? What's the user retention? What's the cost to generate a Spark or contact exchange or other KPIs that we track across our different brands?

We now have a rubric that puts all our brands on the same footing. This is something that we worked with an outside resource on, a marketing executive, a person that used to run marketing for me at Zillow Group. Before that, we worked together at Expedia Group. She has created shared marketing frameworks in several multi-brand Internet companies before.

That project has been really illuminating in order to inform our 2026 decisions.

So if you take all these different things together that we've mentioned, the Tinder user tests, the Tinder testing in Australia, a shared understanding of what marketing efficacy is across all of our brands, the IAP savings that Steve just talked about, now, you have a little window into what the next couple of weeks are going to be for us, as we go through business unit by business unit, creating our annual plans for 2026, rolling them up, discussing them with the Board, making final decisions about how we're going to operate the company by the end of the year and then, communicating it with all of you in early February at earnings.

But it's great to be going into that process with the work done on Project Prism so we understand marketing efficacy by brand; with the work still in flight on the Tinder front, in terms of the different testing that we've been doing but much more well informed than we were even a couple of weeks ago now that we have a lot of these features in flight and we're starting to see the impact on user outcomes, as well as revenue and expenses.

Shweta Khajuria, Wolfe Research.

Spencer, you mentioned you'll assess next year's growth and investment opportunities as you think about how your product and marketing is trending. My question is: What will you be looking at? Is it predominantly the inflection in top of the funnel that will give you more confidence in your product roadmap working and/or marketing initiatives working? If it is somewhat slower than expected, is it fair to assume you'll reinvest to the degree that it makes sense? How should we think about that as we think of next year?

Yeah. I'm solving for or maximizing against what I think will make the stock price higher three years from now. There are hundreds of puts-and-takes that go into that, from user outcomes to revenue to audience on Tinder, market expansion on Hinge. There are so many different variables that impact that.

But if there's a single North Star to try to explain how I'm bringing it all together and the way the leadership team is bringing it all together, that's the one.

I think the big question marks going into 2026, of course, are going to be what level of profitability do we choose to run Tinder at? To date, Match Group has chosen to run Tinder at a much higher level of profitability than Hinge.

The two components of that are:

How much benefit users get. In other words, if we decide to give more value to users.

What type of cost of acquisition we choose to deploy against Tinder?

So those are some of the key questions that we'll face going into planning. Now, you understand how I'm making the decision is what do I think the stock price will be a couple of years from now.

Of course, the key component of the stock price are -- you know this better than anyone, stock prices at net present value is stream of future cash flows, ultimately, divided by the shares outstanding, which, of course, -- as Steve mentioned, we bought back 8% of our shares year over year, which is pretty extraordinary and is worth highlighting.

Youssef Squali, Truist.

Spencer, can you please talk about the state of the broader dating in the market in the US -- how it's performing -- given the the macro environment, competitive intensity? Any early read or impacts from Facebook Dating?

And then, Steve, just quickly, what does the Q4 revenue guide imply, in terms of payers's growth and RPP?

Yeah. We've always had competitors. I'm sure we'll always continue to have competitors, whether they be big tech companies or start-ups. I like our brands. I like the network effects that the brands provide.

Our biggest challenge, as a company, is growing category acceptance. I think there was a prior question, which I only answered partially, about bringing new people into the category. There are 250 million people, globally, that are single and dating in countries that we serve that are not on dating apps. 250 million.

Only $30 million of those have used dating apps and they're not currently using data apps. 220 million of them have never been in the category.

So to the extent that Meta and Facebook or any competitor educates people that they can use a dating app, they can use the power of technology to safely meet people and get up off the couch and go out on dates and form human connections, that benefits Match Group as the category leader, especially because this is a category with multi-app usage.

So we welcome any and all initiatives, whether they've come from Match Group, such as our Face Check initiative, which we think brings new people into the category as we improve trust and safety in the apps or others, such as Meta, to raise attention and awareness to the power of technology to drive human connections. That's what we're here for.

Steve, you can do the second one?

Yeah. Let me touch on macro first. The way I would describe it is we continue to see the same trend that we've seen earlier this year. We've talked about the last couple of calls, where it's some -- a little bit of weakness, not a lot but a little bit of weakness on ALC amongst younger users on Tinder. That trend hasn't gotten any worse but it also hasn't gotten any better either. So a little bit more of the same.

We're not seeing it on any other part of the Tinder business. We're not seeing it on the subscription revenue. We're also not seeing it across any of our other brands or at Hinge.

So we'll keep looking at it closely but that's what we're seeing today.

And then, on payers and RPP, we don't typically guide to pairs and RPP. Specifically, we're focused on revenue and user growth. But those metrics have been -- the trend of those metrics has been relatively stable, just like MAU trends have been relatively stable. I expect something similar in Q4.

Chris Kuntarich, UBS.

Maybe just one on Face Check. You mentioned it being fully rolled out in the US by the end of the year. I just want to clarify: Does that include existing users? If it doesn't, could you just give us a bit of an update on your thinking about rolling out to that cohort of users for Tinder?

And then, maybe just one follow-up. Any early read on the level of inefficient marketing spend that you've been able to identify with Project Prism?

Yeah. Face Check only applies to newly created accounts because that's the vector that bad actors use to attack us. So spam accounts from bad actors create brand-new accounts. Therefore, we can stop those with Face check. That's exactly what's happening. As I've mentioned, 60% reduction in interactions with spam accounts.

I don't remember if I mentioned -- I think I mentioned it vaguely but to give a little more detail on the perceived improvement in trust and safety from Face Check, we survey users and we say, do you believe the profiles that you see on Tinder are real? In Face Check markets, 5% to 10% more folks are saying, yes, they believe that the profiles they see on Tinder are real.

So it's not just improving safety and authenticity, it's actually improving perceived authenticity, which is so critical to driving category reconsideration.

Marketing. Yeah. What I would say there is, unsurprisingly, Hinge's marketing drives new registrants, new downloads, or SPARKS at a lower cost per than Tinder's does. That makes sense for a couple of reasons.

First of all, Hinge is a newer brand. Hinge's product is better at taking users and moving it down the funnel in that way. More of Tinder's spend is focused on brand marketing than direct response user acquisition. The reason for that is Tinder is trying to drive reconsideration and change user perception, whereas Hinge has a pristine user perception. And so, therefore, most of their spend can be focused on user acquisition.

User acquisition spend is always going to be more effective on paper than brand spend will be. So that's not surprising.

As we go into 2026 -- and we think about the marketing levels that we want to run the company at and the allocations between the brands -- we'll have to weigh that, of course. But, boy, it feels good to be going to that decision, actually having some levers to look at.

Previously, we were flying this plane without an altimeter. Now, we actually can see some metrics across different brands and start making informed decisions, based on that.

Robert Coolbrith, Evercore ISI.

This is Georgia, on for Rob. Thanks for the color on Sparks and MAUs.

Last quarter, you noted some encouraging movement at the top of the funnel. Can you provide an update on that, so far?

Yeah. Thanks for the question, Georgia.

Our Tinder monthly active users at the top of the funnel is basically down high-single digits, similar to where it's been for the last couple of months. It moves around a little bit, based on different tests that we're running. As I already mentioned, initiatives like Face Check and recommendations can improve user outcomes but can and, sometimes, do hurt mostly active users. But it basically stabilized in that range.

It's worth noting Tinder revenue is down 3% year over year this quarter. Last quarter, it was down 4%. So revenue also has stabilized. Obviously, we don't want it to stabilize down year over year. But it's nice to see that we're starting to see some stabilization for some of those metrics.

Of course, as I think I said last call, the first thing you have to do if you're trying to turn around the line that's slipping down is you've got to get that line to flat. So it's nice to see some of those lines starting to flatten.

Thank you very much. We look forward to talking to you next quarter.

Thanks, everyone. Have a great day.

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