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Welcome to the Match Group Second Quarter 2026 Earnings Conference Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by 0. After today's presentation, there will be an opportunity to ask questions. Please note this conference is being recorded. I would now like to turn the conference over to Tanny Shelburne, Senior Vice President of Investor Relations. Please go ahead.
Thank you, operator, and good afternoon, everyone. Today's call will be led by CEO Bernard Kim and CFO Gary Swidler. They will make a few brief remarks, and then we will open it up for 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, and 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 would like to turn the call over to Bernard.
Good afternoon, and thanks for joining us. This was a strong quarter for Match Group and an important one for Tinder. Over the past year, our priority at Tinder has been making the product work better for users. That includes improving our recommendations algorithms, introducing lower-pressure ways to connect, like double date and modes, and up-leveling trust and safety. Monthly active users, or MAUs, declines have narrowed significantly since we began this work, supported by a better product experience that is improving user outcomes and increasing engagement. Daily active users, or DAUs, trends have also improved meaningfully, and we expect them to turn positive year over year any day now. This is a huge milestone for us. It will be the first time that Tinder has had positive year-over-year usage in more than three years. To reach our ultimate goal of returning to MAU growth, we need to drive more reconsideration through product innovation and marketing. That means giving the millions of singles who have used Tinder before, and those who have never tried it, more reasons to download the app. Tinder's second-half roadmap is geared to do exactly that. Meanwhile, Hinge continues to deliver strong growth with meaningful runway across product innovation, international expansion, and monetization. And at E&E, which now stands for Everyone, Everywhere, we are sharpening the strategy and applying more of Match Group's shared capabilities. We delivered these improvements while maintaining strong financial performance, with total revenue down just 1% and adjusted EBITDA growing 14% year over year. And we have continued to return meaningful capital to shareholders at the same time. Before I joined, Tinder was not shipping features quickly enough to keep pace with evolving user expectations. That has changed. AI has accelerated execution across product development life cycles, enabling us to move faster and execute against an ambitious second-half roadmap designed around how Gen Z wants to connect. Our internal research shows that nearly half of singles aged 18 to 29 want to share in-person experiences with people who could become closer connections. Yet, for a generation that grew up online, making that transition into real life can still feel hard. That is why we are doubling down on more social, lower-pressure ways for users to connect in real life. Our Events feature is an important component of that strategy. It gives users a dedicated place inside Tinder to describe local activities, see who else is interested before attending, and continue connecting afterward. We began piloting Events in Los Angeles in March, and since then, more than 60 events have brought Tinder users together in person. We see the value of Events extending far beyond those who attend. Bringing more real-world connection into the experience can help shift perception of Tinder, and the category more broadly, giving singles a reason to reconsider and try the app. Early signals support that potential. Roughly three in five people who do not use Tinder today say Events would make them more likely to do so, and a similar share say it would make connecting feel easier. Over half also describe the experience as something uniquely Tinder. During the Los Angeles pilot, 71% of eligible users aged 18 to 24 engaged with the in-app Events tab, and more than half of users who visited the tab returned the following week. Based on that success, Events is now live in nine additional cities across the U.S. and Europe, with plans to reach 26 cities by the end of September. Today, we are scaling Events through a low-cost model built primarily around partnerships with leading event providers. Missed Connections brings the in-app and real-world experiences together by surfacing a weekly curated set of profiles in a dedicated tab based on who users crossed paths with in the prior week. It is now testing in Canada and Australia and creates a more serendipitous way to discover someone new while continuing to prioritize user safety and privacy. AI helped this team move from idea to final product in just a few weeks, compressing what would typically be a multi-month development process. We are also expanding how users discover people inside Tinder. In Canada, we are testing a new text-based search feature to help users find people they are interested in more efficiently. Early adoption is promising, with approximately 10% of exposed users submitting a search, and tens of thousands of searches generated in the first few weeks. At the same time, we continue to improve our recommendations algorithms. Earlier this year, updates to our algorithm for straight women drove significant gains in Sparks and Spark Coverage. In mid-July, we rolled out an updated version that is delivering further engagement improvements, and we are now extending these updates to straight men and LGBTQ+ users, where we expect to see similar benefits over time. We are also testing more ambitious changes to our core discovery section and profile quality, including a reimagined user experience with more contextual, individually engaging profile elements and AI-powered profile building. Together, these changes are supported by Tinder's first full rebrand in nearly a decade. Now live globally, the more modern Tinder identity includes a new logo, color palette, word mark, typography, and visual identity. This gives Tinder a fresh new look, and early results have been positive with nearly all engagement metrics improving post rollout. Tinder's richer product roadmap is creating a steady cadence of new marketing moments, giving users more reason to reconsider the app as it evolves. In the U.S., recent Music Mode and Astrology Mode campaigns have helped improve new registrations among women. We have also shifted our strategy more towards lower-funnel channels, which now represent roughly half of our total spend, up from 30% last year. And we believe that shift is helping trends among women. In the second half, we plan to build on that momentum with targeted marketing around Events, Modes, and Search. Employee engagement at Tinder is higher than it has been in years, reinforcing a belief I have held throughout my career: great people, properly motivated, build great products, and that is exactly what we are seeing at Tinder. In Q2, improvements to the Tinder experience continued to translate into stronger engagement, particularly in key markets and demos, and those trends strengthened further in July. DAUs declined 4% year over year in Q2, its best result in the past 10 quarters, and a significant improvement from declines of roughly 10% less than a year ago. Global user retention increased 1% year over year. In July, DAU improved for the fifth consecutive month to down nearly 2.5% year over year. Together, these metrics show that as the experience improves, users are more likely to return whether the next day to continue a conversation or the next month to make a new connection. Sparks and Spark Coverage remain important indicators of whether Tinder is helping users form meaningful connections. In Q2, both metrics were broadly stable versus Q1, globally and among women. Sparks declined 4% year over year in Q2, and Spark Coverage grew 2% year over year. As we began to comp over product improvements from last year, the stability in Q2 shows the product improvements we have made are having a lasting impact. Following the mid-July rollout of the latest version of Tinder's recommendation algorithms, Sparks and Spark Coverage have moved substantially higher through month end. We also saw improvement in MAUs. MAUs declined 7% year over year in Q2, one point better than the 8% decline in Q1, with the biggest gains in our most important markets and user demos. Year-over-year MAU trends improved across each of Tinder's top five revenue countries. In the U.S., its largest market, declines slowed by 2.5 points in Q2 compared to Q1. We saw similar progress among women, where MAUs improved across all major geographic regions and age groups, with global MAUs among women down 8% year over year, three points better than the 11% year-over-year decline in Q1. As MAUs improve, we are seeing that directly translate into improved year-over-year direct revenue and payer trends over time. Payer penetration, the percentage of MAUs paying for a subscription or a la carte feature, was up year over year in Q2, both globally and across Tinder's top five revenue countries in aggregate, and direct revenue per MAU was up 6% year over year globally. While we do not expect these metrics to always move in lockstep every quarter—some user experience tests and monetization initiatives can have short-term impacts to payers or revenue—the longer-term trend is clear and gives us confidence that continued MAU improvement should support better payer and revenue results over time. Turning to Hinge: Hinge continues to be the best example in our portfolio of product-led growth at scale. Hinge has strong product-market fit with intentioned daters, and its designed-to-be-deleted promise is clear. The team is disciplined about building against one objective: helping users get out on great dates. Global MAUs grew 13% year over year in Q2, driven by strong growth in its expansion markets. In core markets, where Hinge remains a top-downloaded app and has achieved significant scale, MAUs remained relatively flat year over year while revenue continued to grow double digits in aggregate. The team is focused on further strengthening its position in core markets through product innovation and brand storytelling that supports the evolving needs of Gen Z daters. In the U.S., the 'Cannot Believe We Met on Hinge' brand marketing campaign speaks to the vulnerable emotion behind dating, where the process can feel frustrating, but the desire for a meaningful relationship remains strong. Early results are encouraging, driving a positive lift in overall registrations, in particular among young women, as well as a measurable impact on brand sentiment. Hinge is still expected to reach a billion in revenue in 2027, and we see three primary drivers of that growth: product innovation, international expansion, and monetization runway. First, product innovation. Hinge continues to improve its core user experience across the dating journey, from self-expression and discovery to early engagement on the app to ultimately meeting in person. Friend's Take, which officially launched in mid-July, brings the people who know you best into an individual's dating experience. Friends and family can contribute text, voice, video, and photo reflections to a user's profile that help create a richer, more authentic picture of who someone is. The team is improving its recommendation algorithms with a particular focus on the women's experience and testing features like 'Your Type Lately' in select markets, which lets daters describe what they are looking for in their own words, from hobbies to personal values. Gen Z daters learn more about what they are looking for as they date. This approach clarifies who a user is drawn to right now and adjusts recommendations for that user. For returning users, pre-filled basics lets people who deleted their accounts pick up where they left off instead of starting from scratch. It is a simple change that reduces friction for intentioned daters to reenter the ecosystem and start having relevant experiences and success more quickly. AI is also becoming more important to building the Hinge experience. The team is building its first reinforcement learning model to better understand when a user may need help, and what kind of help would be most useful, whether it is a nudge, a tip, or another prompt at the right moment. Over time, we see a path for this to become a broader personalization layer across Hinge. And finally, Signals makes effort and follow-through more visible, recognizing and rewarding daters who demonstrate thoughtful participation, which is particularly important for women. The Signals badge also creates a new surface area for value creation, allowing subscribers to filter on only those users with a badge. Signals is driving meaningful outcomes for users, including more conversations, while incentivizing better behavior like sending likes with comments. Signals also led to a 15% increase in selfie verification for existing users in tests. Second, international expansion. Hinge grew direct revenue 86% year over year across its European expansion markets and maintained the number-one downloaded position in aggregate across those markets in Q2. Hinge also entered six new European countries during Q2. Beyond Europe, we continue to see meaningful runway in Latin America, where Hinge has entered four new countries, building on momentum in Brazil and Mexico. India is also an important expansion market for Hinge, supported by already strong organic growth, and representing the brand's first meaningful push into Asia. Third, monetization. We see significant runway for future monetization through both further payer penetration and monetization optimizations over time at Hinge. We also plan to begin testing an additional subscription tier in Q3. The goal for Hinge is to create offerings that are new, differentiated, and highly relevant to women that are worth paying for. Stepping back, Hinge is already a strong business, but the long-term opportunity remains large. The team is executing, and they are doing it in a way that stays anchored in what makes Hinge distinct: helping intentioned daters get off the app and onto great dates. Turning to E&E, which now stands for Everyone, Everywhere. Over the past quarter, we completed a deep review of E&E. We have established a clear direction for the portfolio. E&E, which now includes our two Asia-based businesses, Pairs and Azar, serves distinct audiences across community, geography, identity, lifestyle, and life stage. With the major platform migrations now complete, the portfolio has a stronger foundation to execute from. Moving forward, E&E has sharper brand-by-brand priorities, with a greater emphasis on user outcomes and ecosystem health. We are making more deliberate investment choices and aligning resources behind the brands and capabilities with the strongest long-term potential. E&E brands are benefiting from shared Match Group capabilities, including trust and safety, recommendation algorithms, cross-sell, centralized marketing, consumer research, and more. Under this One Match Group approach, we are building shared capabilities that can support multiple brands over time. For example, we expect Tinder Events to power in-app events on BLK in Q4 with the potential to extend the capability to other E&E brands in ways tailored to their audiences. We are also integrating analytics and performance marketing while increasing collaboration in recommendations and trust and safety. There is still work ahead, but the early progress we see gives us confidence that E&E is moving in the right direction. We look forward to sharing more in the coming quarters. Turning to final thoughts, I will leave you with this: our mission is rooted in a simple truth—humans need humans. At a time when technology often pulls people further into their screens, we are building products that help people form meaningful connections in the real world. Our progress this quarter demonstrates our sustainable growth flywheel is working. Product innovation, increasingly powered by AI and One Match Group, is delivering better user outcomes. Those outcomes strengthen engagement, retention, and ecosystem health, which supports audience growth and, over time, stronger financial performance. Our job now is to keep every part of that flywheel turning faster and better convert experiences into sustainable growth. That is how revitalization becomes resurgence. With that, I will turn it over to Gary.
Thanks, Bernard. We are pleased with our Q2 results. Revenue was in line with our expectations, and adjusted EBITDA exceeded our expectations. As a reminder, we reorganized the business into three segments: Tinder, Hinge, and E&E, which now includes our Azar and Pairs businesses. Historical periods have been recast in the supplemental materials available on our IR website. Unless otherwise noted, all amounts are on an as-reported basis, and comparisons will be discussed on a year-over-year basis. More details can be found in the financial table below. In Q2, Match Group's total revenue was $853 million, down 1%, and down 2% on a foreign-exchange-neutral basis. FX was $2 million worse than we expected at the time of our last earnings call. Payers declined 6% to 13.3 million, while RPP increased 6% to $21.13. Indirect revenue was $13 million, down 28%, reflecting lower spend from our top advertisers compared to a strong Q2 last year as well as some reallocation of spend during the World Cup. In Q2, Match Group's adjusted EBITDA was $331 million, up 14%, representing an adjusted EBITDA margin of 39%. Tinder direct revenue in Q2 was $457 million, down 1% and down 2% FXN. Q2 direct revenue includes an approximately $8 million negative impact from user experience tests and product changes in the quarter. Payers declined 5% to 8.5 million, consistent with our expectations. RPP increased 4% to $17.90. Adjusted EBITDA in the quarter was $233 million, down 5%, representing an adjusted EBITDA margin of 50%. Hinge direct revenue in Q2 was $204 million, up 22% and up 20% FXN. Payers increased 17% to 2 million, and RPP increased 4% to $33.11. Adjusted EBITDA was $79 million, up 48%, representing an adjusted EBITDA margin of 39%. E&E direct revenue in Q2 was $179 million, down 17% and down 17% FXN. Payers declined 21% to 2.7 million, while RPP increased 4% to $22.24. The revenue impact from Azar's app redesign was approximately $5 million better than we anticipated at the time of our last earnings call. Adjusted EBITDA was $54 million, up 69%, representing an adjusted EBITDA margin of 30%. Including stock-based compensation expense, total operating expenses in Q2 were down 9%. Cost of revenue decreased 16% and represented 24% of total revenue, down four points as a percentage of total revenue, primarily driven by alternative payment savings. Selling and marketing costs increased $10 million or 7%, up one point as a percentage of total revenue to 19% as a result of increased marketing spend at Tinder and Hinge, partially offset by reduced marketing spend at E&E. General and administrative costs decreased 22%, down three points as a percentage of total revenue to 12%, driven by lower headcount-related costs, including SBC, and lower legal expenses. Product development costs were flat year over year as a percent of total revenue at 13%. Depreciation and amortization decreased by $5 million to $24 million. Our trailing 12-month gross leverage was 2.7x, and net leverage was 2.2x at the end of Q2. We ended the quarter with $584 million of cash, cash equivalents, and short-term investments on hand and used $424 million of cash to pay off the exchangeable notes that matured in June. Year to date through Q2, we generated operating cash flow of $564 million and free cash flow of $527 million. We repurchased 7.3 million shares at an average price of $34 per share for a total of $245 million, paid $91 million in dividends, and deployed $92 million cash towards net settlement of employee equity awards, equating to 81% of free cash flow. Between July 1 and July 31, 2026, we repurchased an additional 430 thousand shares at an average price of $38 per share for a total of $16 million. As of July 31, 2026, we reduced diluted shares outstanding by 5% year over year. Our capital allocation strategy remains unchanged: prioritizing investment in the business to drive growth, returning capital to shareholders through buybacks and the dividend, and selective M&A. Now for Q3 guidance. We expect Q3 total revenue for the Group of $885 million to $895 million, down 2% to 3% year over year. This range assumes a one-point headwind from FX. FX-neutral, we expect total revenue to be down 1% to 2% year over year. Q3 total revenue guidance assumes a $10 million negative impact from Tinder's user experience tests and product changes and a $15 million negative impact from lower Azar direct revenue as a result of the required app redesign. We expect indirect revenue to be approximately $15 million in the quarter. We expect Match Group adjusted EBITDA of $330 million to $335 million, representing a 10% increase and an adjusted EBITDA margin of 37% at the midpoints of the ranges. Moving to full-year 2026 guidance: we expect Match Group total revenue to be near the midpoint of the guidance range provided in February on an as-reported basis and at or above the midpoint FXN. We now expect FX to be approximately a half-point tailwind to full-year total revenue, a half-point worse than we expected when we provided our guidance in February. We continue to expect full-year indirect revenue to decline in the mid-teens percent. We expect adjusted EBITDA to be at or above the high end of our guidance range provided in February and adjusted EBITDA margin to exceed our 37.5% target, benefiting from better Tinder direct revenue trends, alternative payment optimizations, and cost discipline across the company, partially offset by incremental marketing spend at Tinder and Hinge in Q3 and Q4. At Tinder, we expect direct revenue to decline in the low-single-digit percents, an improvement from our full-year guidance provided in February. We expect Tinder user experience tests and product changes to be a $30 million to $40 million negative impact to direct revenue, less than the $60 million impact we included in our initial guidance. At Hinge, we expect direct revenue to be in line with our full-year guidance provided in February. At E&E, our full-year guidance in February—inclusive of Azar and Pairs—would have been direct revenue declines in the low double digits and adjusted EBITDA margin in the mid- to high-20s. We now expect E&E direct revenue to decline in the mid-teens percent primarily due to the Azar app redesign and adjusted EBITDA margin to be in the high-20s. We expect free cash flow to be at the high end of our guidance range provided in February. We expect SBC expense to be $230 million to $240 million for the full year, a $20 million improvement at the midpoint of the range versus our initial guidance, which reflects continued discipline on headcount-related costs. With that, let's turn it over to Q&A.
分析師問答
We will now begin the question-and-answer session. Our first question today is from James Heaney with Jefferies. Please go ahead.
Great. Thank you. Curious what you think is driving DAUs for Tinder to turn positive sometime in the next few days? I know you have a lot of initiatives in place, but curious if there is anything in particular? And also, interested in why the DAU improvement is more pronounced than what you are seeing in terms of MAUs? Thank you.
Thanks for the question, James. So the big picture on Tinder's turnaround is three steps. The first is improving the product so that our existing users have a better experience. The second is relaunching the brand with a redesign, which we have just done. And the third is to use Events and other features to drive new users who either are not using Tinder today or perhaps have never used Tinder. What we have done so far has really improved the product itself, and that is why DAU is improving so quickly because we are getting higher engagement from our existing users. To try to select what is specifically driving product improvements is difficult because we have done so much. We have done double date, Astrology Mode, Music Mode, Events, video speed dating, we are about to launch a Groups feature, we have improved recommendations, we have better notifications and SMS messaging, we have Face Check, we did a rebrand, we now have Search, we redesigned chat, we redesigned the Likes You tab, we have built new profiles and photo upload — basically changed every single thing about the Tinder app in the last 12 months, all to great effect. If I had to choose one, which is difficult, the one I would choose would be recommendation algorithm improvements where we are showing more people the people that would be good matches for them and that is driving better user retention. To give you some data, some of which I shared in the prepared remarks, some of which is breaking news: matches are up 14% year over year, and last quarter matches were up 7% year over year. Unique people with Sparks in Q2 were down 4% year over year. In July, they were down only 1% year over year. And today, in August, it's trending better than the July numbers. Spark coverage was up 2% year over year in Q2. In July, it was up 5% year over year. And today, in August, it is trending better than the July numbers. And DAU, as you mentioned, was down 4% year over year in Q2; in July, it was down 2.5% year over year. And today, in August, it is almost positive. So we continue to gain momentum, even day by day. To your question about why DAU is ahead of MAU, that comes to the point around driving reconsideration for people who either are not Tinder users today or maybe have never been Tinder users. The big initiative there is Events. We fired the starting gun on Events in January. In March, we were in one city. In July, we were in five cities. Today, we are in 10 cities, including in Europe. In September, we will be in 26 cities. By the end of the year, we will be in 75 cities. So the product and engineering team and the event operations team are moving very, very quickly, launching event partnerships in new parts of the world and also building products and features to support it, like letting users see mini-profiles of who will be attending events and letting people message one another after the events. In terms of our optimism for why we think this will drive engagement among new users: our research says that 60% of non-Tinder users say they are more likely to use Tinder because of Events. As I already shared in the prepared remarks, 71% of 18- to 24-year-olds engaged with the Events tab, and more than half of those that engaged with the Events tab come back the following week to engage further with it. So we have a lot of qualitative research and also quantitative research to give us confidence that this will be a powerful way to drive reconsideration and change perception of Tinder for new and lapsed users. Next question, please.
The next question is from Shweta Khajuria with Wolfe Research. Please go ahead.
Okay. Thank you for taking my question. I have a little bit of a follow-up. So payer penetration improved year over year and payer growth is down year over year. Could you please talk to that gap and how you see that gap narrowing to turn that around into positive growth? And then on DAU turning almost positive, how are you thinking about the lag between DAU to MAU to payer? Anything on timing would be great. Thank you.
Thanks for the question. Let me take the payer penetration one. Yes, payer penetration was up year over year in Q2 globally, and direct revenue per MAU, which takes into consideration payer penetration and RPP, was up 6% year over year in Q2 at Tinder as well. Yes, payers are still down, but they are declining at less than the rate of MAU. That is why payer penetration is up, and that is a trend we have seen for some time now. Those two metrics tend to follow together, which is great. The payers declines are less than MAU declines; it has been that way for quite some time now. They will not move in lockstep every quarter and I do not think we should expect that. The reason is we have user experience tests and product initiatives that can have short-term impacts to payers, and sometimes monetization initiatives can have short-term impacts to payers but are clearly the right thing to do for long-term revenue. So there can be some disconnect in any particular quarter, but the long-term trend is consistent: as MAU improves, payers have improved. In fact, for the last couple years, payer declines have been less than MAU declines, which points to the fact that payer penetration is up. Looking forward, I do expect payer declines to lessen a little bit in the back half of the year in Q3 and Q4 from where they are today at around -5%. That is what is included in the guidance.
The next question is from Benjamin Black with Deutsche Bank. Please go ahead.
Great. Thank you for taking my questions. Bernard, you spoke about testing a reimagined user experience with more contextual and individually engaging profile elements. Could you dig into that a little bit more? And perhaps more broadly, how do you think about the Tinder user experience evolving over the next 12 to 18 months? And then, Gary, you lowered expectations for the give-back for the year. Could you just talk about the genesis of that decision and how should we think about the reallocation of those savings potentially? Thank you.
Thanks for the question. The way I described changes to the user experience is because we are testing so many different things. Historically, Tinder's product experience for how you browse and assess potential compatibility has been quite simplistic, which is both a feature and a bug. Historically it has been a quick assessment based on photos: you look at a photo and quickly decide yes or no, swipe right or swipe left. We have been shifting that orientation to present more of the whole self into the evaluation of compatibility. Why? Because consumer tastes are changing and people want to assess the overall person's compatibility, including the way they answer prompts and profile prose. They want to consider things other than just the appearance of the photo. To make that change requires a lot of work. You have to change profile creation so people are encouraged to enter qualitative information and answer questions with text. You have to help them with photo selection so it is easier for them to add more photos and make profiles more complete. You have to test different displays of profiles and make sure you are balancing user improvements with monetization. This is work in progress. We have made a lot of progress already, but we are continuing to experiment with different ways to give people a better sense of potential compatibility that slows things down and is more attuned to changing consumer taste, while balancing monetization at the same time.
Let me talk about the user experience test guidance. To start at the beginning, we originally said $60 million for the full year of user experience-related revenue impact. Last quarter, we said we expected $45 million in the second half. Now we are saying $30 million to $40 million for the full year. So the $60 million full-year estimate has come down to $30 million to $40 million for the full year. To break it down: it was $5 million in Q1 of user experience-related revenue declines, $8 million in Q2, and we are guiding to $10 million in Q3. That implies Q4 will be between $7 million and $17 million. Why is it less than what we originally expected? Partly because we were coming in less than expected for the first couple quarters of the year, but we had kept that $45 million in the second half when we talked three months ago. The biggest reason for the reduction is we were unsure how the rebrand in particular would play out and what impact it might have on revenue and engagement metrics. Often, rebrands can have revenue impacts because you are changing so much about the UI and sometimes UX. Thankfully, that did not happen. We saw no revenue impacts and largely positive impacts to user engagement, which gave us the confidence to reduce the full-year expectation. We have a range of possible outcomes for Q4 related to the testing we are planning to do between now and the end of the year. The biggest swing factor is what Bernard talked about—the reimagined profile and browse experience. We want to give teams room to test and be creative and really think about different ways to improve the product. Depending on how those tests roll out and what impact they have, that will determine where we come in for Q4. Hopefully that brings clarity to the user experience test budget.
Next question is from Nathaniel Feather with Morgan Stanley. Please go ahead.
Hey, everyone. Thanks for the question. First on the Events feature—really interesting addition. Given the local nature there, how do you scale that up so you can reach a meaningful portion of the base? And any way to frame of the 75 cities you are entering, what portion of your user base is in those metros? And also, sorry if I missed it in the letter, but what was the July MAU growth? Thank you.
Thanks, Nathaniel. On Events, most of the events are coming into the platform through partnerships—some with national partners, some with regional, some with local partners. We have an event sourcing team building out those partnerships, which allows us to scalably expand to many cities. What we've seen so far in the first couple cities is that more important than the percent of users who actually attend events is the amplification of these events on social media. That amplification gives people permission in their minds to start changing brand perception about Tinder. They see people using Tinder or talking about Tinder on social and attending an event and think, 'I didn't know Tinder had events, this is a new way to meet people, fun and safe with friends.' It changes perception even if they are not attending events themselves. So we feel like this can start to bend the curve on perception and reconsideration, even if it only touches a relatively small percentage of total users in a given city.
We did not provide July MAU. One of the reasons we highlight DAU is because MAU is a month-end metric and it's not ideal to give MAU a few days outside of a month. We did give DAU and other engagement metrics, which should help give a sense of how Q3 is off to a good start.
The next question is from Jason Helfstein with Oppenheimer. Please go ahead.
Thanks. Bernard, really appreciate the detailed Tinder metrics clearly showing product improvement. Maybe any comments about pricing? Do you need to reevaluate how you price the service? Anything you can share? And to the extent you scale Events in a big way, how do you think about that impacting margins over time?
Let me take the Events cost first. There are really three components to execute on Events. The first is the cost associated with product and engineering, which is a couple of pods building the feature set for Events. That is not an incremental cost because those product and engineering folks would otherwise be working on other initiatives, whether it's Music Mode, Astrology Mode, Face Check, or others. The second cost is marketing and advertising associated with telling the world we have Events. That is also not incremental because if we were not promoting Events, we would be promoting other initiatives. The third is the event sourcing team, which is still quite small—fewer than 10 people—and scales. This team is AI-native across marketing, product engineering, and event sourcing, so we are doing it efficiently. We do not see this as materially changing Tinder's profitability profile. In addition, we are building all of this in a multi-tenant way, meaning Tinder Events will power BLK initially and then over time other Match Group apps, with event sourcing amortized across multiple apps. On the broader question of Tinder pricing: we now have new surface areas we can potentially consider monetizing, including Events and Search, among others. We are just starting those conversations and have not developed a firm point of view yet. Hinge building a new pricing tier in late 2026 at a lower price point will give us a lot of insight that we can learn from as we decide how best to approach monetization for Tinder in 2027.
The next question is from Robert Coolbrith with Evercore ISI. Please go ahead.
Great. Thank you very much. Gary, I wanted to ask on the mobile direct billing opportunity. I know there were changes a few weeks back with respect to Google Play, both on policy and pricing. There's been a sense out there that there may be a platform-level fee to pay to Apple as well. So can you provide an update on how you are thinking about those cost savings? And Bernard, on the topic of reconsideration, have you continued to monitor contact exchange in markets where you have access to that data to ensure Sparks properly correlate to contact exchange and people going out on dates? Is that continuing to trend in the right direction? And secondarily, related to reconsideration, what do you think is the biggest lever you can pull to drive reconsideration of the category and Tinder in particular?
Let me take the in-app purchase piece. On Apple, there is not any real new news to update you on; it's moving through the courts in the Epic versus Apple cases, both district court and the Supreme Court process. Until resolved, there are still 0% commissions on alternative payments for certain flows, and we continue to optimize and do a really good job there. We now think it will contribute about $130 million of savings for 2026, which is about $20 million better than we expected at the beginning of the year. On Google, they put out a new global fee structure back in March that was blocked by the courts in the U.S.; that is no longer the case, and they are moving forward with that fee structure. It is already in effect in certain parts of Europe and will go into effect in the U.S. on March 1, 2027, and then roll out across other geographies through the rest of 2026 and into 2027. That fee structure reduces commission rates a little bit on in-app purchases for a la carte type purchases, but only for new installs, reducing fees from around 30% to 25% there. That helps a little but not a lot. The bigger consideration is there is really no economic benefit in this fee structure for alternative payments once you consider payment processing fees and card network fees. So the net benefit to us for 2027 is very small—maybe $5 million—absent other legal or regulatory changes. That is where things stand and what we are planning against.
On reconsideration and category headwinds with Gen Z adoption, the product roadmaps at Tinder and Hinge are all about regaining and improving product-market fit with young users. For example, Double Date on Tinder is used 70% more by users under 30 than users over 30, which speaks to the interest in social features and bringing friends into dating. Hinge addressed that with Friend's Take. Both apps are acting on the consumer insight that young daters want to bring their friends into dating and make it more social. Events speaks to increased cost, stress, and safety concerns around dating, which holds the category back. Going on a one-on-one date can be $20 to $100 for a one- to three-hour assessment. Events, however, are a much more scaled way to have fun with friends, meet a larger group of new people to assess potential compatibility, and have a fun night out. Roughly 30% of our Events on Tinder are free. Of the paid events, the average cost is about $30, and many Events have Tinder benefits for attendees, so it's a better value as a way to meet new people and have a good time—very consistent with how Gen Z approaches social and dating. That combination of product features—social modes, Events, better recommendations, and trust-and-safety improvements—are the biggest levers to drive reconsideration.
The final question comes from Youssef Squali with Truist. Please go ahead.
Thanks for taking the questions. Maybe a couple. On Hinge's organic growth on a like-for-like basis, I know you expanded into a bunch of markets. Are there any other material markets or regions where you'd like to still expand? And a quick follow-up: how do you see the trend for payers declining in E&E? As we look at the second half of the year, can you highlight areas or brands that you believe may outperform relative to some underperformers?
I want to address the prior question about contact exchange: yes, we are still monitoring contact exchange in addition to Sparks and Spark Coverage. We prefer looking at Sparks and Spark Coverage because in some geographies it's difficult or impossible to infer contact exchange reliably due to privacy differences, but contact exchange does continue to correlate with Sparks and other engagement metrics. On E&E brands, we recently completed a brand review. We shut down some brands that were not core and are focusing product and engineering resources on a smaller number of brands within E&E, including Match, OurTime, BLK, and Upward, and we are continuing to focus on Pairs and Azar. Some of those expand us to new TAMs, like OurTime, Upward, and BLK; some are very large, like Match, Pairs, and Azar. We are redoing product roadmaps and reorienting marketing spend toward the brands we believe have the strongest long-term potential. We are bringing a One Match Group mindset to E&E. With the replatforming complete, new initiatives like a new profile experience, photo upload, and modernizing recommendations are now build-once, deploy-many capabilities across E&E. We will also deploy Face Check to improve trust and safety across E&E and are integrating performance marketing and CRM across the suite. It is early in the E&E turnaround following the Tinder playbook, and we are just getting started. I'll update you more in coming quarters.
On Hinge growth: globally, growth has been strong—MAUs up 13% in Q2 and revenue growth of 22% in Q2. European expansion markets are driving a lot of that revenue growth—up 86%—and we entered six new countries in Europe and four in Latin America. In core markets, user growth has remained relatively flat, but revenue growth there remains strong. Hinge has consistently resonated in every market it enters. From a TAM perspective, Asia would be a large next area; India is an important expansion market where we've seen strong organic growth and we are beginning to put marketing spend behind it. Other parts of Asia would be natural next steps. That is how to think about user and revenue growth across geographies.
That's helpful. And lastly, how do you see the trend for payers' decline in E&E?
Let me start with E&E composition: we recently resegmented the company and E&E now includes Azar and Pairs. One of the biggest areas of pressure in E&E is Azar. We were removed from the App Store in late March, had to redesign the whole app, and while the team moved quickly and did a great job, we are back in the App Store at a much lower revenue base. We estimate about a $15 million negative impact to Match Group revenue each quarter from that issue and we expect that impact again in Q3. That is a material headwind to payers and revenue in E&E.
To add, we are focusing E&E on fewer brands and surging resources to those with the strongest potential. We expect to benefit from shared capabilities—recommendations, trust and safety, cross-sell, and centralized marketing—now that the replatforming is complete. We will be deploying capabilities like Face Check, integrated performance marketing, and rebuilt CRM across E&E brands. It's early, but the playbook we used at Tinder and Hinge is being applied to E&E and we expect to see progress over time. Thanks for the questions. That was the last question; I will just wrap up. We feel great about how 2026 is shaping up. Tinder is ahead of expectations, Hinge is tracking in line, and E&E has headwinds from Azar that we are addressing. We are confident in Tinder's path through the end of next year and expect MAU to be flat by the end of Q4 next year. Payers should return to growth by Q4 of next year, and full-year 2027 revenue for Tinder should be up over 2026. We are doing this product-led turnaround while delivering profitability and capital returns. Adjusted EBITDA will be at or above the high end of guidance and we will continue returning 100% of free cash flow to shareholders through buybacks and dividends, resulting in attractive free cash flow per share given share count reduction and free cash flow growth. We are doing all this while turning around a couple of really important products around the world. Thanks, everyone, for your interest this quarter. I look forward to talking to you all soon. Bye.
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