Bumble, a once-powerful force in the realm of online dating, now finds itself at a crossroads.
The company has just released its Q4 2023 results, and the numbers are not looking favorable. With a staggering $32 million net loss and $273.6 million in revenue, Bumble has fallen short of Wall Street’s expectations. As a result, the company’s stock took a nosedive of approximately 10% during after-hours trading.
In an effort to turn things around, Bumble’s CEO Lidiane Jones has announced that 37% of the company’s workforce, equating to roughly 350 employees, will be let go. Additionally, Bumble plans to launch a complete overhaul of its app, with a focus on reigniting growth. Jones disclosed that the immediate product roadmap includes advancements in AI technology and enhanced safety features, as well as new features aimed toward younger demographics.
“We believe that these measures will strengthen our fundamental capabilities and allow us to continue providing our users with unique and compelling experiences, fostering healthy and equitable relationships,” Jones stated during a conference call about the recent earnings. “While many of our users currently enjoy the popular ‘swiping and searching’ method of online dating, we also recognize the need for a more organic and natural approach to connecting with others.”
But Bumble’s struggles are multidimensional, as its main competitor, Match Group, has mounted an aggressive marketing campaign targeting Gen Z users, with its popular dating apps like Tinder, Hinge, and Match.
According to Jones, Bumble’s growth in paying users has been slowing down since late 2021. Furthermore, several of the updates and enhancements made to Bumble’s app in the last 18 months have not resonated with its user base.
Bumble has also faced internal organizational challenges since founder Whitney Wolfe Herd stepped down as CEO last November, moving into the role of executive chair. Jones, who was brought on as CEO from Slack in January, has since appointed four new executives to Bumble’s C-suite just within the last week.
Bumble isn’t the only dating app experiencing sluggish growth. Industry-wide, apps like Match Group’s have seen a decline in revenue, as users are less inclined to pay for premium add-ons. According to a study conducted by Pew Research in 2023, only 22% of users under 30, the most coveted demographic, have paid for dating apps, while 41% of users over 30 have done the same.
To combat this downward trend, many dating platforms have made strategic changes. Tinder has shifted its focus toward fostering long-term relationships, a top priority for Gen Z users who have shown a decreased interest in casual dating and hookups. Concurrently, Hinge and others have embraced the move to in-person meetings, launching initiatives to sponsor singles events.
