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Dating app Tinder is booming because of singles willing to pay

·Former Correspondent
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Tinder has seen a massive influx of singles flocking to the dating app in search of love, and they’re willing to pay.

Year-over-year, Tinder saw its revenue grow more than 150% during the first quarter. The app added 368,000 subscribers in the first quarter, bringing the total to 1.4 million over the last three quarters. Subscribers were up 87% year-over-year in the first quarter.

Tinder also saw higher-than-expected renewal rates for its Gold subscription, which offers features such as unlimited likes, the ability to rewind the last swipe and seeing who “likes” you, among other perks. Tinder also benefitted from users purchasing its à la carte features. As a result, the average revenue per user was up 37% year-over-year.

Tinder
Tinder

“We’re seeing that Tinder subscribers both Gold and Plus are willing to pay for additional features if those features improve the chances to connect with someone,” Match Group CEO Mandy Ginsberg said on the company’s earnings call.

Match Group, the parent company of Tinder and other dating platforms, reported better-than-expected first quarter results, driven primarily by growth at Tinder. The company also raised its full-year guidance for 2018 by $100 million because of Tinder exceeding its expectations.

Match also downplayed the threat posed by Facebook (FB) moving into the dating app world. Mark Zuckerberg’s announcement at F8 sent Match’s stock lower.

“Research also says the vast majority of singles would not want to use Facebook for dating primarily due to concerns of data and personal privacy, but more importantly they don’t want to be contacted by strangers on a social network meant for connecting with friends and family,” Ginsberg said on the earnings call. “This resistance is particularly pronounced among women and the younger demographic.”

Ginsberg noted that Tinder is not reliant on Facebook. In July 2017, Tinder introduced an alternate sign-up. New user sign-ups went from 100% using their Facebook to 25% even though it’s the first option and frictionless.

“Said another way, users quickly and decisively separated Facebook from their dating experience,” Ginsberg said.

Tinder says it’s not reliant on Facebook.
Tinder says it’s not reliant on Facebook.

Julia La Roche is a finance reporter at Yahoo Finance. Follow her on Twitter.