Bumble, once a powerhouse in the online dating industry, is facing liquidation.
The company today announced disappointing fourth quarter 2023 financial results showing a net loss of $32 million and revenue of $273.6 million. Although up from a year ago, earnings fell short of Wall Street expectations, and combined with disappointing first-quarter 2024 forecasts, Bumble's stock price fell as much as 10% in after-hours trading.
Bumble is taking drastic measures to stop the bleeding.
CEO Lydiaan Jones announced that Bumble will lay off 37% of its workforce, or about 350 people, and begin a complete overhaul of the app in an effort to restore growth. Jones said the near-term product roadmap focuses on AI and enhanced safety measures, as well as features designed to appeal to younger audiences.
“We believe these initiatives strengthen our fundamental capabilities and enable us to continue to deliver new and engaging user experiences that create healthy and equitable relationships,” Jones said on today's earnings call. ” “Today, there are many users who love the online dating paradigm – swipe and discover and search – but want more flexible features that allow them to experience and discover people in a more natural and natural way. There are also users.”
Bumble faces challenges on multiple fronts as its main rival Match Group, which owns Tinder, Hinge and Match among dating apps, targets Gen Z users with an increasingly aggressive marketing strategy. are doing.
Bumble payer growth has slowed since the second half of 2021. Jones also said during the call that many of the features introduced to Bumble's app over the past 18 months have not resonated with its user base.
Bumble also had to grapple with internal organizational changes after founder Whitney Wolfe Herd stepped down as CEO last November and transitioned into the role of chairman of the board. Jones, who joined from Slack in January, has appointed four new executives at Bumble in the last week alone.
Slowing growth isn't unique to Bumble. Dating apps in general, including Match Group, are seeing declining revenue as users are reluctant to shell out cash for premium add-ons. According to a 2023 Pew Research study, 41% of users over 30 have paid for a dating app, while only 22% of users under 30, the most desirable demographic, have paid for a dating app. Only % did the same thing.
Platforms have attempted to combat decline in a variety of ways. Tinder is pivoting to focus on long-term relationships, which is a top priority for Gen Z, who, according to polls, are less interested in casual hookups and hookups. Meanwhile, companies like Hinge have embraced the move to IRL meetups and are launching funds and promotions to sponsor singles events.