The Match Group has announced that it has scaled back the plans and ambitions of its Tinder dating app and meeting friends, as well as plans to stop offering Tinder Coins within the app, due to declining profits.
According to The Verge, the tech news site, Match Group CEO Bernard Kim, and CEO of Tinder, who became the first CEO of the dating app last September, announced that he would leave the position as well, after Kim himself was appointed as president. Just two months ago.
Tinder acquired a company called Hyperconnect last year, which focuses on video, artificial intelligence, and augmented reality technology, and Nyborg later cited the avatar-based “Single Town” experience as a way Tinder users might one day be able to meet and interact in virtual spaces, TechCrunch reported in that time.
Kim says he instructed Hyperconnect to downsize, adding that “given the uncertainty about the ultimate frontiers of metaverse and what will or won’t work, as well as a more challenging operating environment, I’ve instructed the Hyperconnect team to iterate but not invest heavily in the metaverse at this time… We will continue to carefully evaluate this space, and will consider moving forward at the appropriate time when we have more clarity on the overall opportunity and feel our service is well positioned to succeed.”
Match Group cited the acquisition of Hyperconnect as a contribution to an operating loss of $10 million in the second quarter of 2022, down from operating income of $210 million in the same quarter last year.
There was also bad news about Tinder Coins, the in-app currency that Tinder had hoped would encourage more spending on the service. They will then be accepted as payment for premium Tinder features like super likes, and as of February this year, the feature has been launched in a few markets around the world.
Kim explained that the company is re-evaluating its Tinder Coins plans, writing in the earnings statement: “After seeing mixed results from testing Tinder coins, we’ve decided to step back and re-examine this move so it can more effectively contribute to Tinder’s revenue.” The company previously said that it wants to roll out the feature widely in the third quarter of this year.
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