Tinder owner Match Group is slowing hiring to pay for its increased use of AI tools

You might think the big story out of Match Group’s first-quarter earnings is Tinder’s turnaround. The dating app’s revenue is slightly up again after quarter-after-quarter of declines.

But we’d like to point to a comment the chief financial officer made about how the company is slowing its hiring right now because it needs more money to pay for AI tools for its employees.

Ah, yes, the good ol’ “let’s blame AI” strategy!

While speaking to analysts on the first-quarter earnings call, Match Group CFO Steven Bailey talked about how the dating app giant was investing in AI technology for internal use at the company — as well as how Match was paying for it.

“We’re making a big push around AI enablement. We’re giving every employee in the company access to all the cutting-edge tools. We’re giving them the training they need to succeed. We’re setting expectations. We really want to become an AI-native company,” Bailey said.

“We think it’s a huge opportunity. But these tools cost a lot of money, as I’m sure you know, and so the way we’re helping to pay for that is by slowing our hiring plans for the rest of the year,” he added.

The company assured investors that the impact would be cost-neutral, as the slowed hiring and lower headcount would make up for the increased software expenses. Plus, Match Group is betting that the increased productivity from employees’ use of AI will ultimately increase revenue growth, the number-cruncher explained.

While on the surface this looks like another example of AI taking people’s jobs — in this case, forcing a company to lower its number of open positions — there’s likely more nuance to this story.

Let’s keep in mind that Match Group’s flagship app, Tinder, has been struggling in recent years. This quarter may be the start of a turnaround, as monthly active users declined by 7% in March compared with the far-steeper 10% drop a year ago. Tinder registrations also grew for the first time since 2024, but by a mere 1%, as Bloomberg pointed out.

This is perhaps a positive sign for Tinder. Or it might be a brief blip driven by users’ curiosity around various product improvements and new features, like IRL events. Time will tell.

Dating meets a generational shift

Match Group remains a company that has to work to squeeze more money out of an oft-dwindling, less-active user base — which, to the company’s credit, it did exactly that. Match’s revenue was $864 million in the first quarter, up 4% year-over-year. However, its next-quarter estimates are coming in lower — around $850-$860 million, down 2% to flat year-over-year.

All these struggles come after many months of what appears to be a growing disinterest in the use of dating apps by younger people. This generational shift sees people opting to meet up in real life, perhaps by pursuing an interest, like running, book clubs, or a hobby that connects them with other people, which then, in turn, expands their network, increasing their chance of meeting someone new.

The trend coincides with a resurgence of nostalgic tech, like digital cameras, flip phones, boomboxes, and even landlines, signaling a generation that’s feeling burned out by always-on connectivity and looking for analog pleasures.

Match Group is aware of this significant shift and says it’s pivoting to address the challenge by increasing the number of its own IRL events.

“Gen Z desperately wants to connect. They know they want to meet new people. They just want to do it in a low-pressure, low-stakes way that doesn’t feel like a job interview,” Match’s CFO Spencer Rascoff told investors on the call. “Traditional dating apps are very highly structured and can be intimidating to a user under 30. So, I think the growth of these alternative ways to meet new people speaks to how Gen Z is trying to find lower-pressure ways to connect.”

“We’ve obviously adapted our roadmap to this reality,” he said.