Match Faces Lawsuit Over Misleading Statements

Match is a technology and social media company that operates a large portfolio of online dating brands and apps. Among its most notable dating apps are Tinder, Hinge, OkCupid, and PlentyOfFish. Tinder is Match’s largest and most important brand, generating more than half of its revenue during the Class Period, which started on November 3, 2021.

Defendants, in a letter to shareholders, praised Tinder’s “radical product transformation,” which included recently launched product initiatives such as a new “Explore” feature. They also noted that Tinder was working on several other monetization opportunities, such as an in-app virtual currency, and assured investors that Tinder was “on track” with critical product initiatives.

However, on August 2, 2022, Match announced financial results for the second quarter of 2022, which warned investors that Tinder’s growth was expected to slow in the second half of 2022 due to poor product execution. The price of Match common stock declined by more than 17% on this news.

Defendants continued to assure investors that the new Tinder team was successfully executing on initiatives, but on January 31, 2023, Match reported disappointing financial results for 2022, including total revenue that missed Match’s prior guidance. Defendants largely attributed the shortfall to “weaker-than-expected product execution at Tinder, the effects of which became more pronounced as the year progressed.” On this news, the price of Match common stock declined by 5%.

The Complaint alleges that Defendants made materially false and/or misleading statements and failed to disclose material adverse facts about Match’s business and operations throughout the Class Period. Specifically, Defendants misrepresented and/or failed to disclose that Match was not effectively executing on Tinder’s new product initiatives, which would prevent Tinder from delivering planned product initiatives in 2022. As a result, Defendants’ statements about Match’s business, operations, and prospects lacked a reasonable basis.