(Reuters) – Tinder-owner Match Group Inc (O:) forecast fourth-quarter revenue below Wall Street estimates on Tuesday as it faces stiff competition from rival online dating services, sending its shares down about 15% in extended trading.
The owner of OkCupid and PlentyOfFish expects current-quarter total revenue between $545 million and $555 million, below analysts’ estimate of $559.3 million, according to IBES data from Refinitiv.
Match has been facing increasing competition from a host of rivals including Bumble and Facebook Inc’s (O:) dating platform that recently launched in the U.S. in September.
Bumble also stepped up by launching its app in India late last year, a market with a huge potential for dating-related services.
To fend off competition, Match has boosted its marketing spend on its money-spinner Tinder in emerging markets, including India and Latin America, as well on its other dating services, PlentyOfFish and Hinge.
Match’s total operating expenses rose about 20% to $364.9 million in the quarter.
The forecast overshadowed a better-than-expected quarterly revenue and a 19% growth in average subscribers that rose to 9.6 million from a year ago, including a rise of about 29% subscribers in its international markets.
Tinder — which has made “swipe left” and “swipe right” a point of pop culture conversations – added 437,000 average subscribers in the quarter bringing its total average subscriber count to 5.7 million.
Last month, parent IAC/InterActiveCorp (O:) said it intends to spin off its ownership stake in Match Group resulting in the full separation of the two companies.
Match on Tuesday said it expects spin-off related expense to be about $10 million in fiscal 2020.
Total revenue rose 22% to $541.5 million in the third quarter, edging past analysts’ estimates of about $540.6 million, according to IBES data from Refinitiv.
The company’s net earnings attributable to Match Group shareholders rose to $151.5 million, or 51 cents per share, for the three months ended Sept. 30, from $130.2 million, or 44 cents per share, a year earlier.
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