Match Group, Inc. (MTCH) Earnings Call Transcript & Summary

All right. I think -- I know people are going to be moving in as we get started because everyone is shifting around from room to room. But in the interest of time, we're going to get started. Our next fireside chat is with Match Group, and it's with Gary Swidler, President and CFO. Let me read the safe harbor first. During this presentation and during the question-and-answer session, 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 periodic reports filed with the SEC. Gary? Welcome to the conference.

Thanks very much. Thanks for having us.

Okay. So maybe let's start big picture. For those who are less familiar with the story, can you touch upon the array of dating apps inside your portfolio and talk about some of the milestones you've been working towards as we progressed over the last 12 months.

Sure. I mean I think the easiest way to think about it is we have 2 broadly applicable global dating businesses or increasingly global dating business. Tinder obviously being the biggest example, something for everyone essentially on that app in pretty much every country in the world. Hinge also broadly applicable, positioned a little bit more for serious daters, intention daters, but really resonating well around the world. We're continuing to roll it out kind of country by country, region by region. It has swept through Europe very, very effectively. The user growth has been phenomenal. And we're really happy with how that product is resonating on a global basis. And so I think there's a massive amount of opportunity for Hinge as we move through the world. We have a new app called Azar which came with the Hyperconnect acquisition, which is showing real success. It's a little bit different than our other apps in that it's a one-to-one chat app. So it's not specifically a dating app, but I think especially in the world we're living in with younger people, I think that resonates. It's a lower pressure kind of app. You meet people, you chat with them, you may decide to go out with them, and you may not. And I think that's showing real promise. We've rolled that out across Europe now. It's really growing well in France and Italy and a handful of countries in Europe, and we are planning to roll that out into the U.S. over the coming quarters as well. So I'm very optimistic about that app. It could be a significant contributor to our portfolio over time. We have a dating app that's kind of more of a traditional dating app for more serious folks in Japan, which we acquired back in 2014 and the Japanese market remains pretty competitive with a few apps kind of buying for the #1 position, but our Pairs app in Japan I think arguably remains the #1 by users in Japan, and we think there's more opportunity there. And then we've got what we call the Evergreen & Emerging bucket of brands, in the Evergreen brands, there are brands that have been around for a long time. They're no longer growing brands, but they're still very cash flow generative, very profitable brands. That includes Match and OkCupid and Plenty of Fish. And so we are in the midst of consolidating all those apps onto 1 tech platform and reducing redundancies and really benefiting from being as efficient as we can in that bucket of apps, given kind of where they are in their life cycle. And then last but not least, and I know there's a lot to chew on. We have a group of apps that we call the Emerging Brands, which are very specific demographically focused apps. So there's 1 for black people, there's 1 for Hispanic people. There's 1 for Asian Americans, and we have been building these apps on a common tech platform they'll never be as scaled as a Hinge or a Tinder because the demographic that they are going after is a much smaller demographic. But by putting them all on the same platform and making the product offering relatively similar, we can do this very efficiently. And so we've seen really good growth in Chispa, which is the Hispanic focused app. We've seen really good growth in BLK, which is Black focused app. Yuzu, which is the Asian-focused app, is really showing good user growth out of the box. And we believe that we're in a position now where the declining Evergreen apps and the growth from the Emerging apps are going to roughly be in parallel, such that we'll have a relatively flat business in the Evergreen & Emerging bucket in the very near future. So we manage a portfolio. We have some that are faster growing like Hinge, some that are slower growing or not growing like a Match.com, that's been around for 30 years. And our job at the portfolio level is really to manage that portfolio of apps, and I think we do it effectively.

Okay. A lot to mine there, and I think we're going to go down all of those themes as we talk. But maybe first, keep it a big picture for us. I think probably one of the biggest questions we continue to get is around market opportunity. You've talked about the long run rate for growth that you see in the online dating market. How do you, as a company frame the opportunity from here relative to maybe some of the perceptions that are out there in the investment community?

Well, I think, first of all, technology to connect people is going to continue to be the way of the future. I don't think anyone really doubts that. And younger users, in particular, are very comfortably using technology for pretty much everything, ordering food, ordering cars. So meeting people is just natural as well. I think that what's happened, though, over the last little while is some fatigue has crept in. People want some different experiences. They want the experiences to be adjusted the way they think of the world and younger people today, by which I mean, 18-, 19-, 20-year-olds, think of the world differently than 27-, 30-year-olds do. And so I think there's a lot of opportunity for us globally, especially in international markets to continue to grow with our portfolio of apps. But we need to make some adjustments in some of the existing apps. And I think Tinder is the biggest example of this. To adjust the experience to better satisfy some of the younger folks that are coming into Tinder for the first time. They're turning 18. They're starting to use dating apps, Tinder is generally the go to app for that person. And they're looking for a slightly different experience. They want a little bit more substance. They want a little bit less superficiality. I think that the swipe mechanic, which is iconic in Tinder has been viewed as a game changer in dating. It brought in all the people in their 20s back when Tinder first burst onto the scene. But now the feedback from younger users is we want a slightly altered experience. And so the Tinder team is working very hard to adjust the Tinder experience, not sacrifice all the great things about it that people love. You've got a big user base that really enjoys in Tinder, but to try to adjust the experience or add to the experience at Tinder to better satisfy some of the younger users coming up, which include things like a lower pressure environment. It's pretty high pressure to constantly matching and meeting people and then say, what am I going to say this person now that we've matched, that's a high-pressure environment. And what younger people are saying is, I want to meet different people, not sure exactly whether I want something serious or not. I'm open to it, but I'm not there specifically to meet that 1 person. And so they might be, but that's not their intent as they enter into the experience at Tinder. And so we need to better satisfy people who have that approach, who are a little bit more open in their thinking, and that's why we've been stressing a Tinder possibilities, meaning you may go on to Tinder and find a love of your life. You may go on to Tinder and find someone who you're going to be with the next 3 months, 6 months, 3 weeks or you may find someone who's fun for the weekend because you're in San Francisco, and we're okay with any and all of those possibilities. And that's the message that we're trying to resonate with the audience, and I think it is working very effectively.

Okay. So sticking with that theme, you have seen stable to improving MAU trends at Tinder. Maybe talk a little bit about the key drivers behind that improved performance and how investors should think about the product road map at Tinder going ahead?

Yes. So the trend of some resistance from younger users has been building for a little while at Tinder. I think some of it is just that generation, some of it is probably some COVID effects. I think there's some different aspects to it. But we've seen it in the numbers in the dating category, generally at Tinder, specifically over the last 2, 3 years. And so the Tinder team has been very hard at work trying to figure out how do we address some of these concerns and issues that, that cohort has been raising. And if they were more simple, we would have already done it. So I think you can assume that it's a complicated undertaking to figure out exactly how to adjust the experience or what to change to satisfy that group, but we have a lot of ideas and things we're focused on. We're going to be rolling those things out over the coming months. We're going to be testing them extensively. And I think we're going to continue to see improving results. As you mentioned, we're already starting to see improving trends. MAUs have stabilized. We've seen now 6 straight months of MAU stable at Tinder since March of this year, which tells me that the plan that Faye and the Tinder team have is starting to deliver the expected results. It's early days. And we're not happy yet with where we are. There's much more to go. But the reality is the marketing approach is starting to change minds. The notion of possibilities is moving the audience away from the notion of Tinder being for hookups, which has been in existence as a stigma for 10 years. And people are starting to say, there's more that goes on at Tinder than just very short-term relationships. People are starting to realize that, they're becoming more open to using Tinder. When they go on Tinder, they're discovering that the ecosystem has improved. We've done a lot of work over the last 12, 13 months to improve the ecosystem at Tinder. At first, it takes a little while to notice that. But as they hear the marketing message, as their friends tell them, they go back on to Tinder. They see that the experience is improved. They see that they're seeing real people that they may want to meet and they start to get more interested in Tinder. And so that's why the things that we're doing are starting to pay dividends are starting to work. We're seeing that in the results in terms of stable month-to-month MAU numbers and that is the first step in getting the business back to a path of improved performance and improved growth.

Maybe 1 last 1 on Tinder and sticking with this theme. With Tinder -- I'm sorry, with Tinder ALC is what I wanted to follow up on next. Is there anything specific you'd call out in terms of what's driving performance around that with respect to the Tinder brand?

Yes. Like everything, unfortunately, there's complicated answers to these questions. I think when you look at a la carte at Tinder, there's a few different drivers of why we're seeing weakness there. One is you have a weaker economy, you have a lot of young people at Tinder with more limited disposable income and a lot of our a la carte buyers at Tinder are subscribers. There's massive 90%-plus overlap subscribers to a la carte buyers. So with a little bit more focus on discretionary income, cost of living, having risen substantially people look at that and they say, Okay, I'm still a subscriber at Tinder. The subscription numbers have been strong, but I'm going to pull back on my a la carte. I view that as more discretionary, right? That's buying myself a little more attention. That's giving myself a little bit better shot, I'll pull back on that or I won't buy as much if I used to buy 20 of those, maybe I'll buy 10 or 5 or 1, but I'm not going to sprinkle those on as liberally because I'm a little more focused on managing my finances. That's a piece of it. I would say that overall, that macroeconomic headwind has been relatively stable. It's there, but it's not worsening in any way. It's something we're watching carefully. Obviously, don't know exactly where the macro economy is going. But I think there's relative stability in it, but it's still a headwind that Tinder is dealing with on the a la carte revenue side. So that's 1 piece of it. The second piece of it is slightly reduced efficacy of these a la carte features. I use the a la carte features to boost myself, get myself more attention. Am I getting back what I think for that. And obviously, it's related to the economic argument because if you get back a lot, you think it's worth more, and you'll pay for it. If you're like, okay, I'm using these things. I'm trying to boost myself up and get more attention. I'm not seeing the results I want, they pull back on the usage of a la carte. So the solution for that from our perspective, is try to improve the efficacy of those a la carte features make sure people are educated about the efficacy of those a la carte features, and they feel like they're getting bang for the buck or benefits from deploying those a la carte features. So that's a tweak that we're working on. I can't do too much about the economy, but I can do a lot about the efficacy of the a la carte features. And then -- you also have the fact that we haven't really refreshed the lineup of a la carte features at Tinder for a long time. We've had Super Like and Boost pretty much since the inception of revenue-generating features that has become a little bit stale. We haven't given people a new product on the a la carte side to say, oh, well, now you have this a la carte, I'm really interested in that. So we are testing a couple of new ones. And we are testing some what we call unbundling of existing features, things that are in the subscription package that might make sense to sell on an a la carte basis as well because there might be people out there who say, well, I don't want to pay $16 a month for a subscription, but I will buy myself a handful of a la carte products today or this week or this month, and we want to see if we can satisfy people who have that appetite. So we're testing all those things very carefully, very methodically. And I think you can expect to see some new a la carte features as well as some unbundling of existing features over the coming months, certainly by the end of the year. And I think we were hoping to get a little bit more impact in the third quarter. I think ultimately, my hope is to get a little bit of impact from that in the fourth quarter.

Okay. Understood. Let's turn to Hinge, where you continue to see strong user growth. Talk a little bit about the building blocks of getting to $1 billion of revenue for Hinge.

Well, first of all, we've learned very clearly over the last 9, 10 years, that user growth is paramount. And so the fact that the product at Hinge is resonating, the fact that user growth is strong in all its markets, it continues to gain share is very, very encouraging. And we want to keep doubling down on that. And so Hinge is still a relatively small business in Europe. That was the first set of international markets that the brand went into. We think there's lots more runway and opportunity. So there's a real focus on marketing in Europe, getting brand awareness and continuing to build the user base. Monetization of dating apps always comes after user growth. If you only have a couple of people on an app, it's not much to monetize. But when you have hundreds of thousands, millions of people in the market, that's when there's real benefit to monetization, because you pay to stand out, get more attention, get good matches. And so that's really the logic behind user growth, monetization activities and that kind of equation over time. So Hinge is still growing extremely well on the user side. I don't see any real impediment to that product is resonating in the market. We're going to keep pushing, keep marketing as well, keep making changes to the product, benefit from AI to really improve the product as well. There's lots of product initiatives going on at Hinge, and I think it will continue to resonate in all its markets, we'll probably look to expand in some other international markets over time, and we'll continue to dial up the monetization efforts. Those things together, continuing user growth, increasing monetization and Hinge is in the very early days of its sophistication and monetization, Tinder is very sophisticated in monetization, Hinge is early. And so over time, Hinge will become more sophisticated, more variance in pricing, more dynamic approaches. And so over time, we will generate more and more revenue from that user base, but we're still in the early days of that. So as I look at it and just look at the amount of revenue that Hinge is adding this year over last year, I can pretty easily see a path to being a $1 billion business. And so I think given all the trends at Hinge, it is clearly on that path to get there.

Okay. Maybe following up on some of the point you made a little bit earlier, but going a little bit deeper with respect to reallocating resources at Hyperconnect into capitalizing at growth at Azar. How do you plan on thinking about supporting growth there, reallocating resources? And how does that show up in terms of the broader portfolio at Match?

So just to make sure you and others understand, Azar has its own team, a very highly qualified team, particularly of AI engineers. It's done some great things on the recommendation side to use AI to say, okay, well, I'm in this chat. I have all these people I could potentially meet, which people am I going to meet and which one do we show to different people, which one first, which one second. They've done some very good things on that front. So that team is a full stack team, right, product people, engineering people, et cetera, focused on Azar and now marketing to go into Europe to go into the U.S. So that app runs like every other app that we have, kind of a full team doing all the different aspects of the business. So that's going. And then we've taken a bunch of people who were at Hyperconnect either working on Hakuna, or on other projects there. And we've said we're going to leverage those people across the other apps within Match Group, primarily Tinder and Hinge our 2 global growth-oriented businesses. And we're going to leverage their AI capabilities to build AI functionality at Tinder and Hinge. And the reason for that, some of it is economic, it's hard to find good quality AI engineers in the U.S. market. They're very expensive. They're very sought after. So we have this team sitting there in Asia who is very well trained, and they're excited to work on Match Group related projects, and we've plugged them into Tinder. We've plugged them into Hinge drive AI-related initiatives and it's working extremely well. So we're sort of doubling down on that or whatever you want to say. And the first example was we built a photo selector product for Tinder, which basically enables the machine to scroll through your camera roll and pick the right photos for your profile. That's something that men in particular, but people generally have trouble with, okay, I've got to set up a profile at Tinder, what photo do I use? How do I figure out which ones? Now we just answered the question for you. We say based on all of our knowledge of what photos work on Tinder, which is a substantial amount of knowledge, these photos will work best for you on your profile. So that gives people a significant leg up. It makes the work a lot less and they're likely to get more success in matching because they've got the best photo profiles -- best profile photos already selected for them. So that has been working well at Tinder. We've also rolled out a similar technology out to Hinge because there's no reason to think that it won't work at Hinge. And in fact, because Hinge requires a larger number of pictures for your profile, it's actually a little bit more work at Hinge. So, the benefits of the AI on the profile setting up at Hinge are even more substantial. And there's initial evidence that shows that people improving their profile is actually leading to better dates, more dates and really leading to success at Hinge. So we're very optimistic that, that AI-driven feature that's been built between Tinder and Hyperconnect team between Hinge and the Hyperconnect team is actually really going to be successful at Hinge as well. So that's an initial example of something we've done in connection with our various brands and with the Hyperconnect team that is out in the market that is yielding results, and we feel really good about. And I said in a lot of meetings where people talk about AI-driven features and what can be done. And I'm aware that out in the broader world, there's a lot of talk and buzz about AI and people are struggling to figure out what is real and what is not and what is going to make sense and what's not going to make sense for cost reasons or other things. When I hear the different things that we can do in the dating experience with AI, it's incredibly exciting to me. There seems to be a lot that we can do. I gave some examples on the profile on the onboarding part of it, so we're scratching the surface there. The recommendations part of it, which is a key part of dating, I think AI can help us get much, much better. Improving the recommendations inside a dating app is extremely powerful and we do it pretty well, but AI can really bring us much, much further along. So there's a lot of fertile ground there on the recommendation side for both Tinder, Hinge and every other app we have to really use AI to improve the recommendations. And then what we call the post-match experience, once you've met somebody, and you're wondering what to say to them, that's a very intimidating time. It's just as intimidating as when you set up your profile and we're able to make some recommendations to say, I know this person loves museums, and so you should maybe think about asking them to go to a museum with you. I know this person is a foodie. That's something you guys could talk about. And we can really use AI to help generate those conversations, take down the pressure, which I talked about is one of the concerns at Tinder, taking down the pressure and really benefit from technology to improve the experience. So I think that all aspects of the dating experience are going to be touched by AI in a meaningful way. We've got a lot of capabilities in this area. Not only do we have the Hyperconnect team as well as teams of AI folks inside Tinder and inside Hinge, but we have a lot of data and information, which is the lifeblood of AI. We know what photos work based on the data we have. We know certain things about characteristics that people are looking for or care about or don't care about in their matches. And we can highlight the characteristics that people care about in their matches and really highlight those to the other person who's matched to make the matches really work well. So there's a lot to do and a lot to go. It's going to take time. right. This is not an immediate thing. We're making, I think, the right level of investments, although calibrating that is challenging, but we're trying to make the right level of investments in people, in infrastructure to do this, leveraging all this external capability. We've got this big partnership with OpenAI, which is, I think, working really well for us. And there's going to be a lot of exciting things that happened in the space. over the coming years, leveraging AI, that I'm certain of.

Okay. So super clear, reallocating resources, focusing on AI, touching pretty much all aspects of the user journey and the user experience.

That's the plan.

Just to fine point on it. Okay. Great. I wanted to sort of turn to the Emerging Brands. You talked a little bit about a few of them before. You recently launched Yuzu and highlighted strong engagement on the app. Can you talk about that app in particular? What's driving that? And how should investors be thinking about market opportunity, growth opportunity around some of these Emerging Brands?

So the interesting thing about the user app -- and what we tend to do is we tend to do experimentation for the overall portfolio inside some of the Emerging Brands, in particular. And so in Yuzu, what we've actually done is we give people a choice. Are you here for dating or you are here for social and dating? Are you open to both? And what we're finding, this is a testing ground for us. And keep in mind, some of the things I said about Tinder and the lower pressure and people wanting to be less defined. So you can make the -- if you draw the line, I think, from things we're doing, testing in emerging including at Yuzu and what we might be thinking down the road for Tinder. So it's not willy-nilly. We're not -- we have a plan. And what we're finding a little bit to our surprise, quite frankly, is that the take rate of people on Yuzu who are choosing social and dating is a lot higher than we initially expected. Now keep in mind, Yuzu has only been in the market for several months, it's relatively new. So as on the Asian community right now primarily in the United States, let's say. And we're seeing, especially women on Yuzu, say, "I'm here for social and dating." And so to us, that's a very important and initial indication that people might not want to say I'm just here for dating. They're happy to use the apps to meet people, but they want the purpose that they're there for to be broader than just dating. They're perfectly happy if they go on for social and dating and they find someone to date. No one ever complains about that. right? But they want the flexibility to say, well, if I'm in a city, and I don't know anybody, and I meet someone and the person shows me around for the weekend and shows me -- to say the city, and that's what the app is useful for. I'm okay with that. And what we're finding is because the Asian community in the U.S. is a smaller community, it's a little bit more viral community, and there's benefits that people on that app see of meeting other people in their community. And so I don't want to draw too many conclusions yet. It's early, not exactly sure where we're going with this information, but that is the testing ground that we've sort of benefited from at Yuzu, and we're obviously trying to take the learnings from that and see where else it could be applied.

Okay. Understood. Maybe pivoting to cost savings. So you talked a little bit before about re-platforming and putting collections of brands on 1 tech stack. You also talked about exiting live streaming and reallocating resources. How should we think about within the prism of -- some of those resources will reallocated, but other elements of that can yield cost savings to the organization?

I mean look, I think that is the right way to think about it. If we have strong resources we're going to deploy them into places where we want to see strength. So if we have somebody who's affected by our shutdown of live streaming, and we think they can be especially helpful at Tinder and Hinge which are 2 of our big growth initiatives, then we're going to redeploy them. So we're trying to be smart about that. We've -- we've closed down live streaming, as you said, it wasn't meeting our financial targets. We didn't think it was going to. And so we closed that down at Plenty of Fish and a couple of other U.S.-based apps. We closed down the Hakuna app, which was live streaming in Korea and Japan. And especially Hakuna, had some very, very capable engineering talent and other talent in that app. And we've been retaining that talent or trying at least to retain that talent and move it into other aspects of the portfolio. And similarly, as we reduce duplication as we combine the E&E platforms and teams, if there's somebody who doesn't have a future in that business, but could be a great marketer inside of Tinder or inside of Hinge, we would move them. And so we're trying to be smart with our resources and just allocate them to the highest and best use, trying to be pruning the portfolio where it makes sense to prune it. I think the portfolio is actually in the best shape that it's been in my tenure. I feel really good about the apps that we have and the opportunity that we have for these apps now. And so we just have to keep driving and being smart with our resources.

Okay. Sticking with the theme of your resources and the portfolio. Maybe talk a little bit about your marketing strategy right now and how are you thinking about new user acquisition across your brands?

First of all, I would say you have to think of user growth as primarily driven by product. And so Hinge has great marketing and a very appealing brand narrative, but the reason that Hinge is growing the way it's growing is primarily because the product really resonates. People have a good experience. They tell their friends who go on. And that is amplified by marketing. People might discover Hinge initially because of the marketing in a new market like in some of the European markets. But at the end of the day, the product accounts for the vast majority of the user growth. And so when we look at now Tinder, the same thing applies. We need product-driven innovation, product adjustments at Tinder to drive user growth. We're not able -- and it would be very uneconomic to try to drive user growth by just pushing on marketing. I think that would be a very big failure. I've seen lots of people do it, but I know enough to know that would not be a successful recipe. So again, with Tinder, we're trying to change some minds. We're trying to get people to give it another look. We're trying to tell people that there's new product features and a different experience than maybe what they remember from 2 years ago and the last time they were on it. So we're using marketing for all those things. But at the end of the day, it needs to be about the product. People need to say, I went on to Tinder. It was a great experience. I met the people I wanted to meet. I didn't have disrespect or other things that made me feel bad about myself. And if we can accomplish that with a product, all of which we're working on very feverishly, we can amplify that with the marketing. But user growth is not going to be driven by primarily or led by marketing. It's a supplement to the product work.

Okay. Understood. So we've talked a lot so far and we're coming towards the end of our time. But maybe just put a finer point first, on the key investment priorities for the company. When you think about the remainder of this year and then looking out towards beyond just 2024, what are those key investment priorities?

I mean I think for the rest of the year, the initiatives that are being tested on Tinder are really a very big focus. I think -- we have a large number of them focused on ecosystem health, women's experience, in particular, trying to take some of the pressure off. So all of those things have various initiatives, a la carte, which you asked about as well. We have a bunch of those things in flight or about to be in flight. Learning about that, and I expect to be able to report on how they're going late in the year, I think it's very important because those are going to inform 2025 and 2026. So we're in a testing period now for a lot of important initiatives. We're also thinking through where we can take Tinder over the next few years. I think there'll be a lot to talk about and a lot to look at as we get through the balance of the year. That is a very, very high priority. Hinge, we have a pretty clearly defined road map, marketing is working, product is working. We're making some advances in the product to leverage AI a little bit more. But I feel like I know where that's going with pretty good specificity. I think the Azar move to continue through Europe is critically important. I want to see that product get into the U.S. as soon as we feel we're ready to do that. That's another important milestone for us. So there's a lot of critical initiatives across the company. We're making more progress on the E&E consolidation over the course of the next couple of months. So there's a lot of big milestones that we're focused on.

Okay. Building on that answer, which focused on investing in the business. Maybe talk to us a little bit about your broader capital allocation priorities through the prism of investing in the business, the potential for M&A and then obviously the potential to return capital to shareholders.

So I would say we've obviously been very focused on returning capital to shareholders, right. I have agreed that we're going to return at least 75% of our free cash flow to shareholders. We've been buying back the stock very aggressively. We continue to believe that it's the best investment we can make because we see all the opportunity we have. We know that we have plans to capture that opportunity and the stock continues to reflect a pretty dire set of circumstances in my mind. And so we're going to continue to buy back the stock aggressively. We've been doing that, and I don't see us stopping. So that's a significant commitment that we've made that we're continuing to make good on. Obviously, we want to make the right level of investment in product, in marketing, in AI specifically, to drive the business for the next 5, 10 years. We're focused on that at Tinder. We're focused on that at Hinge. And so that's clearly one of our priorities. We're trying to find ways to recycle capital by reducing expenditures in the E&E brands. That's part of the strategy as well. So all of that is well underway. And look, when I look at M&A, we've been inwardly focused for the last few years now. I think we remain focused on getting our house in order as the #1 priority. At the same time, market considerations need to be brought into the mix. And if the risk/reward equation, our potential targets has changed in our favor, it's something that we have to look at. We've been very good at M&A. When you look at Hinge, we paid about $15 million for Hinge. It's a multibillion-dollar valuation business today. And so we've created a lot of value when we've stayed in apps that we really understand well and know well like Hinge. And if we see opportunities like that elsewhere in the world, as valuations have become more challenged, we should absolutely consider that. I don't think it's a today or tomorrow kind of thing. But as the world continues to evolve, it's something we will take a harder look at.

Okay. So let's end on looking forward. So, when you think about the next 12 to 18 months, we were sitting here having this conversation a year from now, maybe 2-part question. Number one, what are you focused on in terms of milestone goals like where the company wants to go over that period over the next 12 to 18 months? And if we were sitting here a year from now, what you would be thinking back might surprise people with respect to the industry in the next 12 months?

Look, I think overall, for the industry, we need to get the industry back to growth. We are the leader in the industry. It had a very nice long period of user growth. That has stagnated. You see it across some of our competitors as well. We need to lead in that regard. We need to deploy our resources, our data, our focus our capabilities and really drive product innovation and product improvement and drive back to growth. And I think we're in the early days of being able to do that. That's the path that we're on. We're not waiting for somebody else to do it. It's not likely to be somebody with 2 guys in a garage, it's not likely to be one of our competitors, it's likely to be us. and we need to make sure that that's what happens. So innovation, improving the product, improving the product experience is paramount to us and the thing that we're focused on and trying to make sure we make the right level of investment to make that happen. That is critically important. I think we are trying to be as disciplined as we can in making all these investments and being smart with our resources. I'm hoping that, that will be the perception. If we sit down again a year from now, people say they have been very smart with their resources, they've gotten the company back to a path of growth, but the margins continue to be industry-leading or market-leading margins for these kinds of companies. So I think that's critically important. And the last thing that I'll leave you with is, I believe that we will have some level of app store reform if we sit back down here again in 12 months from now. I think that we haven't factored that in any of this into our outlook, we've been talking about this for a long time. I think at the end of the day, the pressure continues to mount on the app stores to change their practices. I think the DMA, the European regulator is very, very serious about making that happen. Apple and Google sort of continue to stall that out as long as they can, which I understand why they do that. But at the end of the day, February, March of next year are important milestones where they face significant fines and maybe they'll find some way to continue to drag it out. But I'm assuming that they're going to find some ways to make adjustments to their policies such that when we sit here next year, there will be significant changes in the way Apple and the app stores conduct themselves. So we'll see if that comes to fruition, but I'll give you that prediction a year from now.

Okay. Gary. I always appreciate the opportunity to chat. Please join me in thanking Match for being part of the conference this year.