Welcome to the Match Group Second Quarter 2025 Earnings Conference Call. All participants will be in a listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on your telephone keypad. To withdraw your question, please press star, then two. Please note that this event is being recorded. I would now like to turn the conference over to Tanny Shelburne, who is Senior Vice President of Investor Relations. Please go ahead, ma'am. Thank you, Operator, and good morning, everyone. Today's call will be led by CEO Spencer Rascoff and CFO Steven Bailey. They'll make a few brief remarks, and then we'll open it up for questions. Before we start, I need to remind everyone that during this call, 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 earnings release and our periodic reports with the SEC. Also, during this call, we will discuss certain non-GAAP financial measures. Reconciliations to the most directly comparable GAAP financial measures are provided in the published materials on our IR website. These non-GAAP measures are not intended to be a substitute for our GAAP results. With that, I'd like to turn the call over to Spencer. Thanks, everyone, for joining. Since stepping into the CEO role six months ago, my goal has been to confront the hard truths, take decisive action, and reshape Match Group and Tinder into an innovative, product and engineering-first company optimized for user outcomes and built for the long term. Over the last six months, that is exactly what we have done. This is a three-phase turnaround. First, we reset the company, then we revitalize the products, and last, we undergo a resurgence with our audience and investors. Let's start with a recap of phase one. I spent the first few months of this reset phase learning the businesses, getting to know our teams, and rebooting the culture to emphasize urgency and accountability. Match Group is a multi-brand company with over 20 different dating apps in the dating and human connection space. Some of them, like Hinge and Azar, are growing rapidly and simply need more resources and time to achieve their full potential. Other brands need more focused attention in order to improve their results. Tinder needs a lot of work, and it is therefore my primary focus. As the largest dating app in the world by revenue and usage, Tinder has unparalleled brand awareness and scale, but the product had grown stale through a lack of innovation and a focus on short-term monetization. To address this, we acted quickly by installing new management, improving the product roadmap, and placing Tinder under my direct leadership, given its central role in Match Group's performance. We started by fixing what wasn't working at Tinder, beginning with organizational design. We flattened the org by removing over 20% of managers and reducing the size of teams. We then created autonomous product and engineering pods with greater accountability. We retooled the culture to prioritize urgency and user outcomes. We doubled our release cadence. We now ship new code to production every week instead of every two weeks. We have changed decision-making so it is informed by data but no longer burdened by analysis paralysis. We broke down silos between Tinder and other Match Group brands in order to gain the benefits of our company's scale and centralized core functions like shared data and content moderation. We now allow nearly 1,000 engineers at Match Group across all of our brands to see one another's code in a shared GitHub repository, allowing for unprecedented cross-brand visibility and collaboration. In addition to rolling out Cursor and other AI coding assistants globally, we created a centralized AI group building shared AI tooling for all of our brands. The most important changes at Tinder centered around our product strategy and our roadmap, which we realigned to prioritize low-pressure ways to connect. More on that in a moment. An important part of phase one's reset was communicating with employees and shareholders about what needed to change, both internally in our culture and across our products. I shared that directly with employees in a company-wide letter in March, and then when I took the helm at Tinder, followed through with new product principles that are already showing up in how we operate. We are now guided by a commitment to speed, accountability, and relentless product execution. We also aligned all of our brands around a single organizing principle: delivering real user outcomes. We now think about those outcomes across a broad spectrum from casual to serious, romantic to platonic, and we're building apps that support the full range of user preferences. We have crystallized our brand strategy such that Hinge is singularly focused on winning in the intentioned dating category. Tinder is focused on winning in the casual connections category. Our E&E brands are focused on unleashing the power of a unified platform and supporting communities with shared identities. MG Asia is focused on launching and growing our brands in Asia and expanding Azar's low-pressure one-on-one video service globally. With phase one complete, we're now entering phase two, revitalize, where the products begin to reflect our renewed commitment to users and user outcomes. I'm going to talk through the rapid product acceleration at Tinder, the tremendous momentum and growth at Hinge, and how we're scaling new brands across the portfolio with focus and intention. Let's start with Tinder. The product roadmap aims to solve three core user pain points: authenticity, dating fatigue, and outcomes. In just the last few months, there has been a burst of energy and urgency to launch several initiatives at Tinder. We launched Double Date globally in June, giving users a new social way to connect as a pair. Rolled out six months ahead of schedule, it's showing strong early traction, with 92% of Double Date users being under 30. Women who are pairing up are three times more likely to send a like and four times more likely to match compared to when using Tinder solo. In New Zealand, we've piloted an interactive matching product, sometimes referred to as Daily Drop or AI-enabled discovery, which is a whole new way to use Tinder that goes deeper to deliver high-quality personalized matches. We are expanding this to other regions shortly. We've made substantial progress in trust and safety by expanding our FaceCheck service, a facial liveness check feature that helps confirm users are real and match their profile photos to new markets, including California. At the same time, we've made strides on authenticity by enhancing our bot detection systems, reducing false positives, meaning fewer legitimate users are being mistakenly flagged, while also further reducing bad actors. With more sophisticated detection models in place, we're making the platform safer and more trustworthy at scale. We've started testing a more flexible preferences system, like height as a premium preference option, which gives users more control over their matches. This builds on what I shared in February: long-term investments to strengthen the ecosystem and drive sustainable value. Here's what we have planned through the end of the year on Tinder. We're testing major updates to our recommendations engine to show users more compatible matches. We're rolling out contextual liking and messaging, giving users a low-pressure way to engage by reacting to specific parts of a profile. This makes likes more purposeful and increases the chances of starting a real conversation. We're on track to test version one of a redesigned "See Who Likes You" tab this fall, with the goal of helping users connect with people they're more likely to be interested in, as well as to drive more revenue. We're preparing to introduce a feature called Modes, a new navigation system that lets users toggle between different dating goals and discovery experiences in real time for serendipitous connections. We'll expand our interactive matching product with additional geographies coming online by year-end. We'll take the first steps towards a new UI refresh in Q3 with a cleaner, faster, and more modern look across the entire app. For the first time in a long time, Tinder's pace of product innovation is strong. To track progress, I am focused on metrics connected with user outcomes, things like match rate, contact exchange, and inferred IRL meetups. Many of these deeper signals are trending up, and we're actively exploring ways to give investors more visibility into these metrics. Turning now to Hinge. This focus on real-world outcomes applies across the portfolio, and nowhere is that clearer than at Hinge. Simply put, Hinge is crushing it. Hinge's success should put to rest any doubts about whether the online dating category is out of favor among users. Hinge shows that a great team that is highly motivated can build great products which attract huge audiences and create significant revenue and shareholder value. This is the formula we are following in the turnaround at Hinge's sister brand, Tinder. Hinge's success gives me pride in Hinge, but also confidence in Tinder. At Hinge, everything ladders up to one north star: getting users on more great dates. It's how we measure success and stay focused on delivering real-world outcomes. It's been a huge driver of our success at Hinge. As a result, Hinge is well-positioned to deliver accelerating year-over-year revenue growth in each subsequent quarter of 2025, a particularly impressive accomplishment at a business of this scale, while also continuing to expand margins. How is Hinge achieving this? As one might expect, it's the tried-and-true combination of product innovation leading to audience growth. Let's start with product. Over the past several months, Hinge has rolled out a number of core initiatives designed to keep intentionality front and center in our users' dating experience. We launched a new AI-powered recommendation algorithm in March that is driving a 15% increase in matches and contact exchanges, driving meaningfully more dates for our users. It's important to note that while we are creating more value for users, we're also observing meaningful upticks in pair conversion. We rolled out Prompt Feedback, a first-of-its-kind AI feature that gives users real-time suggestions during onboarding to help them better express themselves on their profile. This reduced generic answers by a third and more than doubled thoughtful, high-quality responses, helping spark better first impressions and more meaningful connections. We rebuilt our notifications platform, unlocking faster delivery and robust metrics tracking. This has enabled us to launch chat-specific notifications, helping users maintain momentum with matches they're most interested in. Over the second half of 2025, Hinge will continue to develop its product strategies to address user needs. In the first half of 2025, users' discover experience became more personalized and relevant to their preferences. Now, in the second half, we'll plan to noticeably improve recommendations throughout the app experience as more of our algorithms are powered by AI. Users will see and feel this difference in experiences, including Boost, Standouts, Most Compatible, and more. In the first half of 2025, we experimented with different coaching capabilities and dogfooded several AI-powered features. In the second half, these experiences will move into test, and they include warm intros, which will highlight small yet meaningful details on select profiles to give daters a deeper consideration of compatibility, and conversation starters, which offer personalized prompts to help daters break the ice and spark more meaningful conversations. Turning now to user growth, Hinge is growing users in every geography it operates in. Hinge grew its MAU by nearly 20% year-over-year in the first half of the year. In European markets, its momentum continues to build as we enter our third year of expansion, with MAU up more than 60% year-over-year in European expansion markets in the first half of 2025. This growth is driven by brand campaigns tailored to local dating culture, boosting awareness and perception. While there still is much more room for growth in Europe, we're excited to further Hinge's growth ambitions with planned launches in Mexico and Brazil later this year. With strong user growth and continued product innovation, Hinge is delivering on its mission for users. It has become the most reliable growth engine in our portfolio and one of the most exciting businesses in consumer tech today. Across the rest of our portfolio, we're applying the same focus, building for distinct audiences, prioritizing user outcomes, and driving urgency. With a stronger financial foundation from our recent restructuring, favorable foreign exchange trends, and reduced in-app purchase fees through alternative payments testing, we believe we are in a position to reinvest savings while still delivering on our revenue and margin targets. I'm excited by our plan to allocate approximately $50 million in the second half of 2025 toward product testing at Tinder, geographic expansion for Hinge, Azar, and The League, and early-stage bets like Archer, Her, and a new dating app concept. These investments reflect our commitment to delivering more value to users through product innovation and to driving long-term sustainable growth across the portfolio. In 2026 and 2027, we expect to enter the third phase of our product evolution: resurgence. We intend to transform Tinder into a low-pressure, serendipitous experience designed for Gen Z. We expect Hinge to extend its leadership in intentioned dating, powered by both continued AI innovation and international growth. Across the board, we believe the category will enter a new era with renewed trust, strong demand, and long-term growth potential. We are operating like a company that is just getting started, and we believe the best chapters of this category and company are still ahead. We are moving with urgency, we are obsessed with product, and we're building for the long term. Thank you again for being with us. Now, Steven Bailey will walk you through the financials. Thanks, Spencer. We are pleased with the Q2 results, as both Match Group total revenue and adjusted operating income exceeded the high end of our guidance, excluding a $14 million charge for a preliminary settlement with the Federal Trade Commission relating to a case filed in September 2019, which we did not anticipate at the time of May earnings. The team is executing well against the three-part turnaround Spencer laid out to drive sustainable long-term user growth, revenue growth, and profitability. In Q2, Match Group's total revenue was $864 million, flat year-over-year, down 1% year-over-year on an FX neutral basis. FX was in line with our expectations at the time of our last earnings call. Excluding the exit of our live-streaming businesses, total revenue was up 1% year-over-year and flat year-over-year FXN. Pairs declined 5% year-over-year to $14.1 million, while RPP grew 5% to $20. Indirect revenue was up 15% year-over-year, driven by continued strength in the advertising business. Moving to total company profitability, in Q2, Match Group's operating income was $194 million, down 5% year-over-year, representing an OI margin of 22%, and AOI was $290 million, down 5% year-over-year, representing an AOI margin of 34%. Excluding the costs associated with restructuring of our operations of $18 million and the legal settlement charge of $14 million, OI increased 10% year-over-year, representing an OI margin of 26%, and AOI increased 5% year-over-year, representing an AOI margin of 37%. Tinder direct revenue in Q2 was $461 million, down 4% year-over-year and down 5% year-over-year FXN. Pairs declined 7% year-over-year to $9.0 million, and RPP grew 3% year-over-year to $17.14. OI in the quarter was $217 million, down 1% year-over-year, representing an OI margin of 46%. AOI in the quarter was $246 million, down 2% year-over-year, representing an AOI margin of 52%. OI and AOI were negatively impacted by costs associated with the restructuring of our operations. Hinge continued its strong momentum in Q2, with direct revenue of $168 million, up 25% year-over-year and up 24% year-over-year FXN. Pairs grew 18% year-over-year to $1.7 million, and RPP grew 6% to $31.96, driven by strong user growth across all markets, combined with continued monetization optimization. OI was $39 million in the quarter, up 29% year-over-year, representing an OI margin of 23%. AOI was $54 million, up 27% year-over-year, representing an AOI margin of 32%. E&E direct revenue in Q2 was $148 million, down 8% year-over-year and down 10% year-over-year FXN. E&E direct revenue in Q2 was down 6% year-over-year and down 8% year-over-year FXN. Pairs declined 15% year-over-year to $2.3 million, while RPP rose 8% year-over-year to $21.34. In Q2, E&E delivered an operating loss of $4 million, a decrease of $24 million year-over-year, an AOI of $16 million, down 62% year-over-year, representing an AOI margin of 11%. OI and AOI were impacted negatively by the legal settlement charge and costs associated with restructuring of our operations. Match Group Asia delivered direct revenue in Q2 of $69 million, down 6% year-over-year and down 8% year-over-year FXN. Direct revenue in Q2 was up 3% year-over-year and up 2% year-over-year FXN. Azar direct revenue was up 3% year-over-year and up 6% year-over-year FXN. Pairs direct revenue was up 3% year-over-year and down 5% year-over-year FXN. Across Match Group Asia, Pairs increased 6% year-over-year to $1.1 million, while RPP declined 12% year-over-year to $21.53, partially due to the exit of Hakuna mid-last year. Match Group Asia had an operating loss of $0.3 million in the quarter, an improvement of $5 million year-over-year, and delivered AOI of $16 million, up 16% year-over-year, representing an AOI margin of 23%. Looking at costs, including stock-based compensation expense, total expenses were up 2% year-over-year in Q2. Cost of revenue decreased 1% year-over-year and represented 28% of total revenue, flat year-over-year, driven by reduced variable expenses from the shutdown of our live-streaming services mid-last year and lower web services costs at Tinder, offset by an increase in IP fees, primarily at Hinge. Selling and marketing costs decreased $6 million or 4% year-over-year due to lower marketing spend at Tinder and E&E and was down 1 point year-over-year as a percentage of total revenue at 17%. General and administrative costs increased 19% year-over-year, up 3 points year-over-year as a percentage of total revenue to 16%, driven primarily by costs associated with the restructuring of our operations and the legal settlement charge. Product development costs grew 1% year-over-year and were flat year-over-year as a percentage of total revenue at 13%. Depreciation and amortization decreased by $3 million year-over-year to $29 million. Turning to the balance sheet, our gross leverage was 2.8 times and net leverage was 2.5 times at the end of Q2. We ended the quarter with $340 million of cash, cash equivalents, and short-term investments on hand. In Q2, we repurchased 7.6 million of our shares at an average price of $29.45 per share on a trade date basis for a total of $225 million and paid $47 million in dividends, deploying nearly 120% of our free cash flow for capital return to shareholders. We maintain our commitment to target returning 100% of free cash flow to shareholders on a full-year basis through share buybacks and the dividend. Now turning to guidance, we expect Q3 total revenue for Match Group of $910 million to $920 million, up 2% to 3% year-over-year. This range assumes a 1-point year-over-year tailwind from FX. FXN, we expect total revenue to be up 1% to 2% year-over-year. We expect Match Group AOI of $330 million to $335 million in Q3, representing a year-over-year decline of 3%, an AOI margin of 36% at the midpoints of the ranges. The expected year-over-year decline in AOI is driven by an expected 17% year-over-year increase in marketing spend due to the timing of brand campaigns at Tinder and Hinge and our savings reinvestments. For the full year of 2025, we expect Match Group total revenue to be towards the high end of our guidance range, primarily due to positive FX impacts. We now expect a nearly half-point tailwind from FX, which is nearly three points better than we expected when we provided our initial outlook in February. FXN, XLIVE, we expect total revenue growth to be within the initial guidance range we provided in February. We expect year-over-year indirect revenue growth in the mid-teens, given strong performance in the first half of the year. We expect to achieve our 36.5% AOI margin target after excluding an expected $25 million in costs associated with the restructuring of our operations, of which $18 million was realized in Q2, and the $14 million legal settlement charge, which would equate to an approximately 35.4% AOI margin on an as-reported basis. Our margin expectations include the approximately $50 million of reinvestments Spencer outlined earlier. We will continue to monitor the return on these investments, as well as business and FX trends as the year progresses. We expect free cash flow of $1.06 to $1.09 billion, a meaningful improvement from our initial guidance in February, driven by an increase in free cash flow conversion, partially due to expected lower cash taxes from the new U.S. tax law. We expect capital expenditures of $55 to $65 million. We expect SBC expense to be $260 to $270 million, an improvement from the guidance we provided at our last earnings in May due to restructuring of our operations and our continued focus on managing headcount costs. We continue to test alternative payments across our brands, including Tinder, and expect to have alternative payment options in test at Hinge by late Q3. Additional savings from further rollout and optimizations of alternative payments are not included in our guidance and could provide margin upside or fund growth initiatives. In June, Canada announced its intention to rescind its digital services tax. If and when it enacts the change in the law, we expect a one-time benefit to AOI related to expenses accrued in prior periods. We anticipate this change could be enacted into law as soon as September. However, we have not included it in our AOI guidance. In other updates, we plan to make changes to how we report certain financial measures and metrics to better align ourselves with our tech peers. Starting next quarter, we will rename our non-GAAP profitability measure from adjusted operating income to adjusted EBITDA. There's no numerical difference between adjusted EBITDA and AOI. We plan to continue to include discrete expenses, such as restructuring costs, but intend to reference such expenses, if significant, in our earnings materials. We also plan to change our MAU definition from a last 28-day to a calendar month basis. We plan to provide a reconciliation of MAU using both definitions. Now let's open it up to Q&A. Now begin the question and answer session. To ask a question, you may press star, then one on your touch-tone phone. If you are using a speaker phone, please pick up your handset before pressing the keys. If at any time your question has been addressed and you would like to withdraw your question, please press star, then two. At this time, we will pause momentarily to assemble our roster. Your first question today will come from Corey Carpenter with JP Morgan. Please go ahead. Hey, thanks. Good afternoon. Spencer, you've been clear that one of your big priorities at Tinder is to improve engagement with U.S. users, particularly under the age of 30. Hoping you could give us an update on how this cohort of users have responded to some of your recent product launches and how Tinder engagement trended during the quarter. Thank you. Thanks, Corey. At Match Group and at Tinder, we have incredible insights into Gen Z and Millennials and how they want to connect. Nobody even comes close to understanding this generation's attitudes and preferences towards dating better than we do. It's through the excellent research functions that we have at Hinge, at Tinder, at Match, and our other brands as well as research at the Match Group corporate level. I've also personally been doing focus groups in London and Los Angeles and spending a lot of time on college campuses doing direct consumer research. What we know about this generation of daters is that they're different. They want to connect. They have a loneliness epidemic, and they're exceedingly digital, consumed by smartphone usage. They went through high school or college through COVID, and they want dating apps to have different offerings which are lower pressure. That's the roadmap that we've created and that we're building at Tinder. Corey, I'll just give you four quick examples. Double Date, which we've talked about, is showing great product-market fit. Between 3% and 6% of our users, depending upon the country, are using it already. About 90% of our usage is under 30. Women are four times more likely to match through Double Date than they are when using Tinder solo. Double Date is really resonating with this audience. Number two, we're about to launch a series of college-specific features on Tinder that I'm very optimistic about. It'll allow users to just search within their college or other selected colleges and a number of other features just around the college experience. Number three, the interactive matching experience that we've been testing in New Zealand is specifically designed to appeal to this type of audience, somebody who doesn't just want to be judged based on their physical appearance, which is one of the ways that Tinder got its start, somebody who instead is willing to put in a little bit of time, answer some questions, and then get a custom result back. We're seeing very good product-market fit with under 30 users on that feature in New Zealand, and we're getting ready to expand it to other countries. Number four, there's a whole series of features, some of which I talked about in the prepared remarks, around changing the way that users think of Tinder so that it's less about assessing the attractiveness of a photo and more about assessing the compatibility with that individual. These are things like contextual likes, where you'll be soon responding to specific information in somebody's profile rather than just swiping right, saying, "Yes, I think you're attractive." It's about having prompt information up in the photo carousel. You'll be seeing in what we call the Tappy photo wheel information that comes from deeper in the profile so you can present a different version of yourself instead of just the attractiveness of your photo. These are the types of things that we're doing to regain product-market fit among under 30. I'll come back to the question about metrics in just a second. Next question, Operator. Your next question today will come from Nathan Feather with Morgan Stanley. Please go ahead. Hey, everyone. Thanks for taking the question. It really came through in the letter. It seems like product testing velocity has accelerated over the past few months, given the large number of changes the company's making across brands. What's the best way for investors to track the status of the turnaround as you go through this revitalized phase? What are you monitoring internally? Yeah, so it's a whole new team in place. I'm running Tinder personally. We have a new Head of Product. We have a new CTO. We have several new Product Leads. We have a new Head of Design. As we've discussed, it's a new roadmap. All of this has happened within the last couple of months. The team has really reacted incredibly well, and I'm very proud of what we're building. To answer your question about the metrics that I look at, you should think of our product like a funnel. At the top of the funnel is what we call regs, or new accounts created, registrations. Just below that, you kind of layer in existing accounts. Just below that, you get to MAU or DAU or audience. It goes from regs to MAU. Number three, a deeper funnel, you get to four-way chats. This is the chats that go back and forth four or more times. At the bottom of the funnel, you get to what we call contact exchange. That's when in chat, somebody shares their iMessage phone number to move to texting or their WhatsApp handle or their Instagram handle to be able to DM with the user. The reason we care about contact exchange is that's usually the purpose of that is to arrange a date. Those are the four points in the funnel that I look at every single day, that the team looks at every day. Number one, regs. Number two, audience, MAU or DAU. Number three, four-way chat. Number four, contact exchange. As I said in the prepared remarks, I understand and empathize from an external standpoint. It's difficult for investors to track the progress of the turnaround without more visibility into some of these metrics. Steve and I and the team are actively trying to determine which of these metrics, if any, we can start providing investors more transparency on. What I can tell you for now is that all of these metrics are doing better today than they were just a couple of months ago. They're all still declining year-over-year, but the rate of decline has significantly lessened. For example, regs, or new accounts created, is down around 7% year-over-year. A couple of months ago, that metric was down about 15% year-over-year. MAU is today down around 8% to 9% year-over-year. At the time of last earnings, it was down around 9% to 10% year-over-year. Even a metric like MAU, which is very hard to move, that is starting to show some improvement. Frankly, I'm pleasantly surprised that we're already starting to see some of these metrics start to move in the right direction, given that it's just been a couple of months that this new team has been shipping product. Operator, next question, please. Your next question today will come from Robert Coolbrief with Evercore ISI. Please go ahead. Great. Thank you very much for taking our questions. Really appreciate it. Congratulations on some of the early progress. I was just curious on some of the things you're rolling out or expanding, like FaceCheck. I wanted to just ask about that one in particular, the expansion there. Curious if you've made any changes to the experience or if you're just seeing users more willing to make the trade-off of verification in exchange for an improved experience. I know you said that there could be an opportunity for upside related to it, but just wanted to ask about the alternative payments experiments and anything that you can share about your early learnings there and the financial potential of potential expansion there. Thank you very much. Regarding FaceCheck on Tinder, we've had it live in Canada and Colombia for a while, more than six months. We just launched it in California just a month or two ago. What we're studying in all three of those markets is the impact on trust and safety, the impact on revenue, the impact on audience, but perhaps most importantly, the impact on user perception of the safety of the community. Starting about a month ago, we launched an ad campaign mostly on social media in Canada promoting FaceCheck. Now we're in market with research to assess what impact FaceCheck is having qualitatively on perception of Tinder safety. That's one of the metrics that we're looking at and just assessing what the results are in California before we decide whether to move forward. I'll let Steve answer the question about in-app purchase and alternative payments. Yeah, happy to. Thanks for the question. We're making really good progress testing alternative payments on iOS. The first thing I'll say is this is a great example of the power of our portfolio. We mentioned this last quarter. We first started testing across E&E, the E&E brands who have a more mature web presence. Now we've applied those learnings to help guide the testing we're doing at Tinder today and start to inform the plans at Hinge, where we plan to start testing later in Q3. We're testing a lot of different variants, three to five variants, I would say, across any particular brand, and we're continuing to optimize the experience. The tests are ongoing. If you look at the average results we've seen thus far, I would say we're seeing more than a 30% shift in transactions from IAP to the web, and that's resulting in more than a 10% increase in what we call net revenue, which is revenue less IAP fees. In some cases, we're seeing a little bit of a top-line revenue impact that we're optimizing to improve. In nearly all cases, we're seeing a net revenue increase across the board. The impacts to 2025 AOI have been relatively small thus far, call it in the $5 million range, given that Tinder tests are still a relatively low percentage, and we haven't yet rolled it out at Hinge. I think it's a big opportunity for later this year and in 2026 in particular. If you extrapolate the test results out to full rollout across all our brands, including in the U.S., including Tinder and Hinge, that equates to about at least a $65 million AOI savings opportunity in 2026. It could be a big opportunity for us. We continue to test rapidly. We look forward to rolling it out in a test at Hinge later in the quarter. We're also continuing to monitor the Epic versus Google case and growing regulatory pressure and other geos too. Hopefully that gives you a little bit of guidance on the size of the opportunity we're seeing. Next question. Your next question today will come from Shweta Kajuria with Wolfe Research. Please go ahead. Thanks a lot for taking my questions. Let me try two, please. Spencer, understood on the MAU growth and the context there. When you think about just the trajectory of these metrics that you are trying to improve, not Pairs necessarily, the registrations to contact exchanges, how are you thinking about it in terms of improvement, in terms of the magnitude of improvement? Any context there would be helpful. The second thing is on marketing spend. Could you please provide a little bit more color on when you think about reinvesting it for Tinder and for Hinge? How are you thinking about it for the back half of this year and especially into Q1 of next year? Thanks a lot. Thanks, Shweta. The first thing we have to do is create new product offerings that we think will be well received by younger users, some of whom we had lost product-market fit with. The next thing we have to do is drive reconsideration by making sure that people know that they should reconsider Tinder. I know their sports analogies are probably overused here, but it feels like we're probably in the second of nine innings on this front. The team is really just assembled now. We're just starting to ship product. We have a really robust roadmap. We have to drive reconsideration of it. That's how I think about moving these metrics. While nobody here is particularly proud of seeing these metrics be down year over year, metrics like registrations or the number of four-way chats or the number of contact information exchanged, it doesn't feel good to see those down year over year. It feels great to start seeing the rates of decline lessen. Before a line can go, if a line has a negative slope, the only way to get it to a positive slope is first to get it to flat. To see the first derivative of that line, the slope of that line start to change is where it has to begin. Steve, I'll let you answer the question about marketing expense as it relates to the reinvestment. Sure. Why don't we just take a little step back and talk about the $50 million investment as a whole and give you a little bit more context there? The way I would think about it is about a third of that investment is going towards Tinder product tests that optimize user outcomes, really in three main areas: the recommendation algos, trust and safety initiatives, and UI/UX improvements. These tests could have some impact on short-term revenue that flow through to AOI. We're going to test and see. That accounts for about a third of the $50 million investment. The next third is in marketing at Tinder and Hinge to support product launches like Double Date and to drive user growth in core markets. The last third is really in geographic expansion at Hinge, Azar, The League, and in investments in new growth bets like Archer, Her, and a new dating app concept. That's really how the $50 million investment splits up: a third, a third, a third. If you look at Tinder marketing in particular, of the sort of two-thirds that are going to largely towards marketing, the bulk of that is going towards Tinder, and a piece is going to Hinge as well. Hinge has ample COA budget to begin with. They're spending up in line with revenue more or less year over year in COA. Tinder is where we've held marketing a little flatter year over year. This reinvestment allows us to really put some dollars behind exciting new rollouts like Double Date. Hopefully, that helps. Next question, please. Your next question today will come from Brad Eriksen with RBC Capital Markets. Please go ahead. Yeah, thanks. Just had a follow-up on the kind of secular industry trends. Spencer, you mentioned the Gen Z cohort. Wanted to drill in a bit more there. COVID had these negative effects, but there's a view out there that maybe we're just sort of in an air pocket here, and maybe the next cohort might be exhibiting different behavior and maybe more favorable behavior. In all of your research, you mentioned, would be curious just to understand anything of your learnings that might support that view and what might be going on there. Thanks. That would be welcome news. I don't think we yet know how Gen Alpha is going to interact with the online dating category overall. I'm focused for now on improving product-market fit with Gen Z, so that's 18 to 28, and also Millennials. I am optimistic that Gen Alpha will be more drawn to the category, but that's not the immediate focus. For us, the immediate focus is regaining product-market fit, especially with 18 to 24. The other thing I'd say about the category, Brad, is I read these articles or I see these headlines of reporters saying that online dating as a category is over and people have moved on. Rumors of the online dating category's death are patently false. All you have to do is look at Hinge's results to know that that's the case. Hinge's audience is growing around 20% year over year. In some key markets in Europe, it's growing around 60% year over year. Clearly, young people are voting with their thumbs to continue to use the category. In fact, in all of the Gen Z research and focus groups that I've been leading personally, young people say they're in the category and they want to connect digitally. They just think that we need to offer different offerings for them. They haven't left the category per se. They're just dissatisfied with the current offerings that Tinder in particular has not innovated on. I'll give you one other stat to give you a sense of the scale of participation in the category. There are 100 million messages sent every day across all of Match Group apps. To say that people aren't using the category is sort of ridiculous if you think for a moment that's 100 million messages inside of our apps a day. 100 million people, or not people, 100 million instances of flirting or people sending one message to another. There's lots of vibrancy in this category. We just have to deliver for them the experiences that they seek. Operator, next question, please. Your next question today will come from John Blackledge with TD Securities. Please go ahead. Hi, this is Bill on for John. Thanks for the question. Could you please just talk about some of the, you had seen some weakness in a la carte trends among younger users. Have you seen those persist, and how are you addressing those weaknesses caused by macro factors and potential economic weakness? I had another follow-up question as well. Yeah, why don't I take that one? You're right. Last quarter, we talked about some concern about macro more generally. I think a lot of companies were talking about it at that time. We specifically called out an area where we were starting to see some, which was Tinder a la carte revenue amongst younger users. A quarter later, I think we're feeling a lot better about the macro in general. We haven't seen any further macro pressure in any of the data we're looking at. We do still see it a bit at Tinder, again, amongst younger users. It hasn't necessarily gotten better, but it also hasn't gotten worse. It's relatively small in the grand scheme of things. We're continuing to test various merchandising and monetization strategies that help deal with the pricing and macro pressures on younger users today. I think at the highest level, we feel much better about the macro environment and impacts on our business than we did a quarter ago. We're not really seeing it aside from some small pressure at Tinder that we mentioned last call. Great. Next question. Thank you. Yeah, and then just my follow-up was, you mentioned in the prepared remarks that you're expecting Hinge revenue acceleration in the back half of the year. Could you just talk about some of the key drivers there that'll get you to that accelerating growth? Thank you. Sure. Hinge is firing on all cylinders. I mean, it's got a really impressive and distinctive company culture, very highly engaged employees, shipping innovative products. They've got a terrific brand and a clear product strategy. They understand their users incredibly well and what users want from them. The last compliment I'll pay is that more than any of our other brands, they've infused AI into the product at an even greater rate than others. It really shows. In terms of the roadmap of where they're going from here, there are a lot of features on Hinge coming that will increase AI usage towards the bottom of the funnel that's driving people from chats to dates. Number two, there's a significant focus on the female experience and making sure that we improve that even more. Number three, there's a lot of work to do on onboarding and profile creation. That's a big focus of theirs over the next six months. Number four, international expansion. Just to size it, for example, Hinge is only in 25 countries, and Tinder's in 188. Even that 25 really overstates it because there are many countries of those 25 that Hinge is nominally in, but Hinge hasn't really marketed in. Two-thirds of Hinge's revenue is still U.S.-based, whereas only 45% of Tinder's revenue is U.S.-based. There's a lot of opportunity for Hinge with global expansion. That'll be a focus in late 2025 going into 2026. Next question, please. Your next question today will come from Jason Helfstein with Oppenheimer. Please go ahead. Thanks for taking the question. Just one. Spencer, to your point that the naysayers are that just online dating is dead and just hit a secular wall, it sounds like you believe a lot of this has to do with making the product better. As you roll out more features in Tinder, do you think this helps you better understand kind of who either the bad actors are or those who don't really want to engage in real life? Ultimately, you can kind of use the algorithm to make sure those people don't get surfaced, and you just have this improvement in the overall experience. Maybe elaborate a little bit more on how the new feature and the feature roadmap could ultimately kind of pick some of the complaints that you've heard from users about that, right? Like converting to something real. Trust and safety is a huge driver of user satisfaction or lack of satisfaction. It absolutely impacts brand perception of the category. As the category leader, to the extent that we can improve trust and safety, that will start to change category perception of the prevalence of bad actors. The new product pods and organizational design that we talked about on the last quarter call is helping address this quite significantly. We now have an integrated trust and safety engineering team between Tinder and our E&E brands. That gives us better combined scale, better ability to use AI cross-brand to stop bad actors, better AI models to detect bad actors, and a better ability to reduce heuristic rules that were incorrectly banning good users, which is that false positive issue. It can be a real issue. We've gotten a lot better at that over the last six months. It's a constant focus of ours in improving trust and safety. One thing that we also now need to do, which we're doing in Canada, for example, is marketing our improved trust and safety so we can start to change category perception. While I will not give an inch on the question of whether the category is dead or not, because it's clearly not, I will concede that the category suffers from a perception issue with respect to trust and safety. That's something that we have to deliver actual improvements on. Then we have to tell that story to our users and to the media so they understand that meeting people through a dating app like Tinder or Hinge is the safest way to meet somebody, actually. It's certainly safer than meeting a stranger in real life. Next question, please. Your next question today will come from Benjamin Black with Deutsche Bank. Please go ahead. Hi, this is Jeff Anferban. Thanks for taking our questions. Maybe could you just give a little bit of color on the RPP trends that you're seeing at Tinder and maybe some of the initiatives that you have there to improve that? You mentioned some of the upcoming features like the See Who Likes You tab could be a driver of revenue. Maybe you could talk about that feature and others, how they could drive monetization. Thank you. Sure. The See Who Likes You section, or what we call Gold Home, hasn't been redesigned, or that code has barely been touched in about five years. There is a lot of opportunity there. We have to do it carefully and test and learn our way through those changes because it is so important. The revenue team, who's excellent here at Tinder, is totally focused on that redesign of the See Who Likes You section of the app. To try to give you a little more insight into how we think about product roadmap, we don't really have initiatives other than a small handful, like an important one, like the redesign of Gold Home, which are specifically tied to revenue per pair. We have a very robust roadmap around improving audience growth through new regs, through contact exchange, everything that I've discussed. We have a strong belief that as we grow audience and improve user outcomes at the bottom of the funnel, that will generate more revenue, and that will have the effect of growing RPP and pairs. We don't go after RPP as a metric, and we don't go after the number of pairs as a metric. We go after audience and user outcomes and corresponding revenue, and then revenue per pair and number of pairs are really outputs of those numbers. Next question, please. Your next question today will come from Ygal Aronian with Citi. Please go ahead. Hey, guys. Just want to understand the puts and takes on the products for Tinder and kind of what's embedded. I know you're not giving pair guidance anymore, but just how to think about the trends in the back half. For example, are you seeing any pair headwinds from the trust and safety features like bots and FaceCheck? Is that having an impact at all? Any of the products driving any kind of notable pay or improvement, I guess, not increase. Is that not happening? On the in-app fees, I just wanted to see if we could bridge from what you're experiencing at E&E, which, like you said, has more of the kind of historical web model versus Tinder and what you might expect to see at Hinge. I know you haven't done that yet. Are you seeing similar reception from users and moving to web-based? Is it kind of a different hurdle on that front? Thanks. I'll take the first question around Tinder trust and safety. There are times, and I'm sure there will be quarters under my watch where trust and safety changes have the effect of reducing audience. I know there were quarters in the past where that had, that's what happened. That was kind of the story of the quarter where we reduced the prevalence of bots, and that had the effect of reducing audience. The changes, that's not what we're experiencing right now. What we're experiencing right now on most of these trust and safety initiatives are having the effect of increasing audience. That is one of the reasons that we're starting to see some of these green shoots in audience and engagement mid-funnel and bottom funnel metrics because we're reducing the number of false positives of people that basically we're letting in more good people or we're keeping out fewer good people that we otherwise would have been kept out in the past. That has all been a good tailwind to the metrics over the last couple of months with respect to trust and safety. Steve, I'll let you answer the question about IAP, I think it was. Sure, I'd be happy to. Here's the way I would think about it. You're right, E&E is a little bit more mature, and they've seen, in some cases, a bigger shift to web than the Tinder test. In the few tests we're running on Tinder right now, we are seeing that roughly 30% shift to web and at least a 10-point increase in net revenue. That's applying to Tinder as well. I would assume, we don't know, we haven't started testing it yet, but that gives me confidence Hinge should be on a similar path as well. That's why I'm sort of extrapolating that 30% shift and 10-point net revenue increase to the entire U.S.-based company and getting to that $65 million plus AOI savings opportunity in 2026. Next question, please. Your next question today will come from Chris Kuntaric with UBS. Please go ahead. Great. Thanks for taking the question. You guys have talked a lot today about some really good early success on the product front for Tinder. Are you expecting to capture any more value by taking price in the back half of the year? Steve, I believe you made a comment last quarter that you were kind of expecting similar year-over-year payer declines at Tinder as you were kind of expecting similar year-over-year declines for MAUs. Just want to make sure if that's still the right way to be thinking about it. Thanks. The first answer is no, we're not planning on taking price as a result of this product roadmap at Tinder. On the contrary, as Steve described, a significant portion of the $50 million is actually about improving the value that users get from Tinder. I'll give you a very specific example. In our recommendations algorithm, when we're deciding whom to show to whom, we are changing the prioritization in that algorithm to be more focused on driving user outcomes. More focused on showing the person that we think is the right match for you and less focused on driving revenue. For example, if the AI is tuned more towards revenue optimization, it might put in front of me somebody that was potentially going to churn. If I then indicate interest in her, maybe she will be less likely to churn and will keep her revenue. If she's not right for me, then I wouldn't want to see her. By prioritizing the recommendation algorithm more towards user outcomes and less towards revenue, that's what part of that $50 million investment is geared towards. We think that over the medium term and definitely over the long term, improving user outcomes will have the effect of growing audience, improving user outcomes, and then in turn growing revenue. In the short term, we're willing to make those trade-offs. I'm really pleased and proud that we're able to continue to hit the commitments that we've made around Investor Day and around guidance and consensus while still giving these user value improvements to Tinder users as part of this turnaround. Steve, what was the last? I'll just reiterate what Spencer Rascoff already said, which is we're not really focused on the Pairs metrics specifically or sort of giving guidance around Pairs. I would think about it as users. That's what we're focused on, turning around the MAU trends and some of the other funnel trends Spencer mentioned earlier on the call, which I would expect Pairs to head in that same general direction when that happens. Operator, I think we have time for one more, please. Your last question today will come from Curtis Nagle with Bank of America. Please go ahead. Great. Thanks very much for taking the question. I'm not really sure how much you can say on this, Spencer, but just very curious about the point you made about a new dating app concept. Would this theoretically be a new form factor, maybe something less holistic in terms of a brand focused on a demo group? Anything you could say on that would be very helpful and enlightening. I'm sorry to end on a disappointing answer, Curtis. For competitive reasons and other reasons, we're not going to share right now. We periodically incubate brand new apps, and we got something that we're cooking up, which I'm excited about. Thank you, everyone, for joining the call today. We are excited to update you on our progress and can't wait to talk to you next quarter. Maybe I'll have an update for you then on this front as well, Curtis. Thanks very much, everyone. Conference has now concluded. Thank you for attending today's presentation. You may now disconnect.