Bumble Inc. (NASDAQ: BMBL) saw its shares climb approximately 5% on Tuesday after the dating app announced it is abandoning its signature women-first messaging requirement, a move aimed at revitalizing user engagement as the company contends with slowing growth and intensifying competition.
Effective immediately, either party in a heterosexual match can now send the first message, a departure from the policy that defined Bumble since its 2014 launch. The company also extended the response window from 24 to 72 hours, giving users more time to reply and reducing the pressure to respond quickly.
Investor reaction and stock performance
Despite the positive market response, Bumble's stock remains under pressure. The shares are down roughly 22% year-to-date and have lost more than half their value over the past 12 months. The latest gains come after a period of significant decline, with the stock trading near $2.88 as of Tuesday's close.
Goldman Sachs analyst Eric Sheridan recently cut his price target on Bumble to $3.50 from $5, maintaining a neutral rating, citing ongoing growth challenges.
Strategic shift amid industry headwinds
The policy change marks a significant strategic pivot for Bumble, which built its brand on empowering women to make the first move. The company says pilot programs in Canada showed promising results: higher chat initiation rates, fewer expired conversations, and more mutual exchanges between matched users.
Founder and CEO Whitney Wolfe Herd defended the update, stating, "While women making the first move was a radical idea, being women-first was never about prescribing just one way to connect. It was about designing an experience with women's needs in mind to create better outcomes for everyone." She added that users are seeking "more flexibility, less pressure, and more opportunities to create real, meaningful connections."
Bumble's own survey found that 66% of women preferred men to send the first message, citing reduced stress. Additionally, more than half of surveyed members said the longer response window improved their experience.
Financial pressures persist
The product changes come as Bumble faces declining revenue and user numbers. The company projects third-quarter revenue between $205 million and $213 million, below the analyst consensus of $215.1 million, according to LSEG data. Second-quarter revenue fell 15.2% year-over-year to $210.5 million, roughly in line with expectations.
Total paying users dropped 16.4% to 3.2 million, though average revenue per paying user rose 1.2% to $21.96. These figures underscore the broader slowdown in the online dating sector, which is also affecting competitors like Match Group, owner of Tinder, which issued weaker-than-expected third-quarter guidance on the same day.
As dating apps grapple with user fatigue and increased competition, many are turning to artificial intelligence and product tweaks to boost engagement. Bumble's latest move is part of that trend, but whether it can reverse the company's growth trajectory remains to be seen. For context, other tech names like Nvidia's recent AI-driven rally highlight how innovation can drive investor sentiment, but Bumble's challenges are more fundamental.
Investors will be watching closely to see if the messaging change can translate into sustained user growth and revenue improvement. The company's next earnings report will provide early signals on the effectiveness of this strategic shift.
This article is for informational purposes only and does not constitute financial advice.
