Shares of dating app company Bumble Inc.
What Happened: The company now anticipates annual revenue to rise by a meager 1% to 2% compared to the previous year. This is a drastic deviation from its earlier prediction of an 8% to 11% growth. Wall Street had expected an 8.4% increase, as per estimates compiled by Bloomberg.
Chandler Willison, a research analyst, told Fortune that Bumble is experiencing a slowdown in growth similar to Tinder as these companies expand and face increasingly challenging year-over-year comparisons. They may also be encountering some degree of market saturation.
"Macroeconomic conditions and the online dating market have become generally less favorable as younger consumers' tastes and willingness to pay continue to change," he said.
At the time of writing, Bumble's stock was trading at $4.86, a significant fall from its closing price of $8.06 on Thursday, as per data from Benzinga Pro.
Why It Matters: Earlier in May, Bumble had shown promise, with experts predicting a 45% upside following strong first-quarter results. The company had reaffirmed its robust performance and outlook for 2024.
However, the company's fortunes seemed to change, when Bumble's second-quarter revenues fell short of analyst estimates. The company reported quarterly earnings of 22 cents per share on $273.12 million of quarterly revenue, which was slightly below analyst expectations. Bumble App Revenue increased 4.8% to $218 million, while Badoo App and Other Revenue decreased 2.2% to $50.6 million for the quarter.
The company, known for its women-centric approach to dating, has been grappling with a falling stock price, layoffs and four new C-suite executives after founder Whitney Wolfe Herd stepped down from her role as CEO. The executives have been tasked to make company's mobile app more appealing for younger users.
Further, in May, a controversial billboard campaign by Bumble in Los Angele aimed to encourage women to reenter the dating scene, drew significant backlash for its perceived insensitivity towards women's personal choices.
