On February 19, Bumble's shares dropped by 28% following a first-quarter forecast that highlighted challenges with a slowdown in paying user growth. The Austin-based company has seen a 40% decline in its stock over the past year. Recently, Bumble appointed Whitney Wolfe Herd as its CEO, among other executive changes.
During the past year, Bumble has introduced enhancements, including an expansion of its "make the first move" feature to incorporate prompts that enable women to initiate engaging conversations. Concerns persist regarding the company's performance, with Citigroup analyst Ygal Arounian noting a lack of full-year guidance which impacts visibility.
The company faces a potential loss of $240 million in market value. Bumble's current valuation is $876.3 million, notably lower than its competitor Tinder's parent company, Match Group, valued at $8.85 billion.
M Science analyst Chandler Willison highlights that both Tinder and Bumble are adapting their platforms to suit the preferences of Generation Z, as younger users are becoming more ambivalent towards dating apps. Bumble has decided to discontinue its Fruitz and Official dating apps by mid-year to focus on reshaping the Bumble App and resource allocation.
Outgoing CEO Lidiane Jones emphasized the company's strategic realignment efforts while nine brokerages have adjusted Bumble's price target post its recent earnings report. Bumble currently trades at 9.98 times its estimated earnings for the next year compared to Match Group's 16.51 times valuation.