Good day, and welcome to the Match Group's Third Quarter 2025 Earnings Call. Please note, this event is being recorded. I would now like to turn the conference over to Tanny Shelburne, SVP of Investor Relations. Please go ahead.

Thank you, operator, and good afternoon, 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 to 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 substitutes for our GAAP results. With that, I'd like to turn the call over to Spencer.

Good afternoon, everyone, and thank you for joining us. Since joining Match Group in February, my focus has been clear: confront challenges directly, move with urgency, and rebuild the company around product excellence and long-term growth. The work on our three-part turnaround is well underway and focused on reset, revitalize, and resurgence. We've successfully completed the reset phase, instilling a culture of speed, accountability, and outcomes, and this shift has come to life across our products, teams, and users. That progress is reflected in this quarter's results. We delivered on our revenue expectations and exceeded our adjusted EBITDA goals, excluding a legal settlement. At Tinder and Hinge, momentum continues to build as we make progress in our revitalization phase. We're starting to see green shoots and believe continued progress will come from delivering experiences that solve user pain points, deepen engagement, and improve user outcomes. We believe our business model thrives when user outcomes improve. Better outcomes, driven by higher quality experiences, better matches, and more meaningful connections, build confidence in our product and drive new users through positive word of mouth. User success builds trust in the category and in Match Group's apps. By getting the user experience right, we will further deliver real success stories, which we use in marketing to amplify growth by driving new user acquisition and reactivations. Our marketing strategy, especially at Tinder and Hinge, is focused on fueling category consideration, bringing in new and lapsed users through product-led storytelling that reflects real experiences happening across our brands. We estimate there are roughly 250 million actively dating singles worldwide, not currently on dating apps. Reengaging the 30 million lapsed users and attracting the 220 million potential first-time entrants expands our user base, building a healthier, more efficient growth engine that compounds over time, and we are investing to capture this large addressable market. Hinge continues to prove that with the right product experience and brand positioning, we can win with Gen Z and drive real growth at scale. We'll walk through three proof points today: First, our product progress, where our obsession with outcomes is showing up across our brands, especially at Tinder and Hinge; second, the essential work we're doing to strengthen trust and authenticity across the ecosystem; and third, the financial discipline and operational rigor that are now showing up in how we execute. Starting with product. Across Match Group, our brands share one goal: delivering better user outcomes. I want to highlight the progress at our two flagship brands, Tinder and Hinge, and how each is building affinity with users in different segments. At Tinder, our focus this year has been to accelerate innovation, to rebuild trust, and to ship great products so we can reintroduce Tinder in 2026 to our core audience of Gen Z. Our new mission statement, 'Tinder is the most fun way to spark something new with someone new,' captures the energy and the sense of possibilities we want every user to feel. Guided by new personas, prototypical user archetypes that reflect real people and their motivations, we're creating experiences that feel more personal and more aligned with what users want. We've clarified what Tinder stands for and who we're building it for, and that focus is already paying off. Users are seeing and feeling the difference through updates that are reshaping the Tinder experience in the following ways: First, we're building a product and design-led culture. Our new liquid glass refresh planned on iOS this quarter will make the app more modern, fluid, and visually appealing, further bringing our mission to life every time you open the app. Second, Chemistry is redefining how people connect. Powered by AI, this interactive matching feature, now known as Chemistry, is a major pillar of Tinder's upcoming 2026 product experience. It gets to know users through interactive questions and, with permission, learns from their camera roll to better understand their interests and personality. Using deep learning, Chemistry combats swipe fatigue by surfacing a few highly relevant profiles each day, driving more compatible matches and engaging conversations. Chemistry is now live in New Zealand and Australia with plans to expand to additional countries in the coming months. Third, Modes are powering a new social energy on Tinder. Our new Modes navigation gives users more choice in how they use Tinder, from meeting new people with a friend to connecting with their college community. Since launching Modes in September, Double Date adoption is up 30% in the U.S., while College Mode is gaining traction with one in four eligible students using it and over 8% engaging daily as of October. Modes makes the fun part of our mission real, giving new ways to spark something together and redefining Tinder as a fun, social, and low-pressure way to meet new people. We're also seeing this momentum reflected in our marketing. The Double Date Island campaign across Europe drove the highest brand consideration lift of the year, boosted downloads, and particularly resonated with Gen Z. It proved that when we connect product innovation with authentic social-first storytelling, we can reignite excitement and bring new energy back to Tinder. Fourth, evaluating profiles is becoming more meaningful and holistic. We've started testing several new features resonating with Gen Z by giving users more information to evaluate and connect with potential matches. Bio information now appears on the first photo card, and prompts content is integrated into the photo carousel. These improvements let users learn more about a potential match before deciding to swipe right. We've also started testing features like contextual likes and open messaging, and we fully rolled out prompts on photos to let users share why they swiped right, making interactions more intentional and authentic. Finally, app performance is a major focus and a key driver of user experience. On Android, Tinder startup times are now 38% faster and crash rates are reduced by more than 32%. On iOS, app stability is up more than 57%. We're also removing long-running tests and unused features to make the app leaner. As we bring load times closer to one second on iOS and Android, Tinder already feels faster and smoother. Our app performance work on iOS and Android is in service of the fun part of our mission because no one enjoys a slow buggy app. You can feel the energy across Tinder. During our Hack Week last week, teams brought incredible innovation and creativity, building some of the most exciting products and prototypes we've seen in years. The company feels electric. Meanwhile, Hinge continues to be one of the best and most undiscovered stories in consumer tech, powered by a clear mission, a motivated team, a leading product experience, and sustained momentum. Hinge's 'Designed to be Deleted' philosophy drives a focus on user outcomes, specifically helping people go out on great dates, our North Star. This clarity of purpose has resulted in category-leading growth in both users and revenue. Hinge is leading the way on AI innovation in dating with category-first AI features that drive better connections and more real-world outcomes. This quarter brought both wins and learnings. Conversation starters, which offers personalized prompts for first messages, was a clear win, driving approximately 10% more likes with comments and stronger engagement overall during the test, particularly with women. Updates to our recommendation system improved matching quality through rigorous testing and provided valuable insights that are already refining our approach. Warm intros, designed to surface compatibility cues, didn't resonate, and we won't move forward with it. While understanding compatibility remains a key focus, Hinge continues to prioritize user outcomes over simply launching new tools, reflecting our principled approach to innovation. As we look ahead to the next few quarters, Hinge has an exciting slate of category-first features that showcase our leadership in product innovation and user experience. First impressions help daters lead with personality. This new feature introduces prompts above photos, giving users more ways to express who they are and add depth to their profiles. A similar experience in the standouts section earlier this year was well received, and we're eager to see how users respond as we continue making Hinge more personal and expressive. Preferences will also become more meaningful at Hinge. Reimagined preferences will take a new look at how daters express what they're looking for, capturing compatibility with greater nuance and intentionality. This update addresses key user pain points, helping people share what truly matters and find better matches faster. These are just a few of the ways that Hinge continues to drive innovation in service of user outcomes. The next pillar of our strategy is centered on deepening trust in the category. So turning now to trust and authenticity and the ways in which it strengthens the foundation of our ecosystem. In dating apps, everything depends on the integrity of the ecosystem. No matter how many new features we launch, people use our apps to meet other new people, and that only works when they feel safe, respected, and confident in being themselves. Building and maintaining that trust is core to our long-term success, which is why we're doubling down on trust and safety across our platforms. Nowhere is that more evident than at Tinder, where we're integrating safety directly into the product experience like never before. The centerpiece of this effort is Face Check, our new facial verification feature that helps confirm users are real and match their profile photos. It's now required for all new users in California, Colombia, Canada, India, Australia, and Southeast Asia, and will roll out to additional U.S. states and countries in the coming months. Face Check sets a new standard for authenticity. Using only a short video selfie, it helps confirm a user is real and matches their profile photos. We built this technology with care, ensuring it delivers meaningful improvements to trust and safety while keeping the user experience seamless. Early results are strong and reinforce our confidence in the long-term benefits to the broader ecosystem. We have seen a 60% reduction in user views of profiles later identified as bad actors, and a 40% decrease in reports of bad actor activity. Our ongoing optimization efforts have resulted in only low-single-digit impacts to monthly active users and revenue in test markets, which lessen over time. Early Net Promoter Score results show a clear and sustained improvement in user trust and satisfaction in test markets, with scores up roughly 10 points for men and 5 points for women in key markets where Face Check has launched. This is just the beginning. We plan to expand Face Check across the portfolio, with testing on Hinge beginning in the next few months. We're also expanding safety beyond verification into everyday user interactions. Tinder and Hinge have introduced new fairer enforcement tools to educate users and promote better behavior through faster and more consistent moderation. This approach calibrates responses based on severity, helping create a safer and more respectful community. We are also enhancing our 'Are You Sure?' feature, which prompts users to pause before sending potentially offensive or disengaging messages with large language models to make it smarter and more effective at encouraging better conversations in real-time. Originally developed at Tinder and later enhanced by Hinge, this LLM-powered version improves accuracy and tone. Now Tinder is incorporating those learnings back into its own experience, a great example of how our portfolio of brands innovates together, share insights, and make each other stronger. Within Hinge, these principles come together through our product design and user experience. Beyond moderation, Hinge continues to refine the onboarding experience to build confidence and trust early in the user journey. Recent updates include clear guidance during setup, refreshed community guidelines at help center, and the introduction of an AI-powered chatbot that quickly answers commonly asked questions. Together, these updates reinforce Hinge's position as a dating app grounded in authenticity and safety, where people can show up as their true selves and form meaningful relationships. Let's now turn to our financial and operational rigor and how it translates into results. The same discipline driving product innovation is also reflected in how we execute day-to-day. We are operating with sharper focus and accountability across the company, hitting deadlines, shipping Match Group-wide features such as alternative payments faster, and acting like a more nimble and decisive company. These improvements are creating operational momentum and financial optionality as we plan for 2026. You can see this strategy in action through Project Aurora, our large-scale test in Australia that brings together many of Tinder's biggest advancements into a faster, safer, and more personal experience. As part of this work, we're overhauling the recommendations engine to better align with user outcomes, improving both match quality and overall satisfaction. We're being thoughtful with our tests prioritizing user trust, outcomes, and long-term impact over quick wins. We may see some short-term revenue and adjusted EBITDA impacts from these tests, which we've included in our guidance, as we trade short-term monetization for a better user experience and improved user outcomes. These tests will help us refine our strategy and further validate that improved user outcomes will drive more sustainable user and revenue growth over the long term, which in turn will drive increased shareholder value. We'll share more of these results next quarter. At Hinge, momentum continues to build as the product delivers meaningful outcomes for users. Revenue, adjusted EBITDA, and user growth remain strong, supported by continued innovation and disciplined execution. Hinge's international expansion remains on track with the successful Mexico launch in September and with Brazil planned for Q4. The team is actively working on plans for new expansion markets in 2026 as well. Hinge launched alternative payments testing ahead of schedule in Q3 with strong early results. We plan to fully roll out alternative payments across our major apps, including Tinder and Hinge in the U.S. in Q4. Strong initial performance at Hinge and ongoing optimizations at Tinder and E&E have increased adoption of web payments, and we now expect to generate approximately $14 million of savings in Q4 2025 and approximately $90 million in 2026. We have seen some impact on gross revenue in some of our tests at Tinder and Hinge, which we're continuing to optimize for. We're also seeing early success from our recent acquisition of HER, which expands our reach among queer women and gender-diverse communities. The team has already delivered strong results with algorithmic improvements and monetization optimizations driving over 20% revenue increase in test markets. This success highlights the opportunity to scale high-potential brands across our portfolio and deepen our presence in key segments of the dating market. That same disciplined approach to growth is reflected in how we manage the business. Our financial discipline earlier this year generated approximately $100 million of annualized savings, allowing us to reinvest approximately $50 million across the portfolio to test user-first features, strengthen marketing, and expand our international footprint. The early results from our Q3 investments are instilling confidence in our strategy, and we're executing well against our Q4 plans. The learnings from these investments and the ongoing benefits of the cost-savings efforts will help inform how we prioritize and deploy capital in 2026. Together, these steps are setting the foundation for the next phase of the turnaround and the resurgence that we expect to take hold in 2026 and 2027. We're entering this next chapter with real progress and a clear path forward. At Tinder, our new measure of success, Sparks, tracks six-way conversations, meaning at least six total messages exchanged between two users. This has become one of the clearest indicators that a genuine connection is forming. While the total number of Sparks is lower year-over-year due to a smaller monthly active user base, Sparks coverage, or the proportion of users in the ecosystem having these deeper conversations, continues to improve and is up year-over-year. This shows that more users are having better experiences on the platform, an early but encouraging sign that our focus on improving product quality and user outcomes is taking hold. Match Group holds a unique position in solving one of the most important challenges of our time, helping people connect in a world that increasingly feels disconnected. Our focus is on fostering genuine human connection, while ensuring technology strengthens relationships and is the social fabric that brings people together. And with that, I'll turn it over to Steve to walk through more on the financials.

Thanks, Spencer. We're pleased with our Q3 results, as Match Group total revenue was in line with expectations for the quarter and adjusted EBITDA meaningfully exceeded our expectations excluding a $61 million charge to settle the Candelore v. Tinder, Inc. case on a class-wide basis. Candelore is a 10-year-old case involving Tinder's former age-based pricing. The parties are preparing a long-form agreement reflecting the settlement terms and will then seek approval of the settlement by the court. In Q3, Match Group's total revenue was $914 million, up 2% year-over-year, up 1% year-over-year on a foreign exchange neutral basis. FX was $4 million better than expected at the time of our last earnings call. Payers declined 5% year-over-year to 14.5 million, while RPP increased 7% year-over-year to $20.58. Indirect revenue of $18 million was up 8% year-over-year, driven primarily by strength in our third-party advertising business. Moving to total company profitability. In Q3, Match Group's adjusted EBITDA was $301 million, down 12% year-over-year, representing an adjusted EBITDA margin of 33%. Excluding the $61 million settlement charge and $2 million of restructuring costs, included in the $25 million of restructuring costs announced in May, adjusted EBITDA would have been $364 million, up 6% year-over-year, representing an adjusted EBITDA margin of 40%. Tinder direct revenue in Q3 was $491 million, down 3% year-over-year and down 4% year-over-year on a foreign exchange neutral basis. Q3 direct revenue includes an approximately $3 million negative impact from user experience testing in the quarter. Payers declined 7% year-over-year to 9.3 million and RPP increased 5% year-over-year to $17.66. Adjusted EBITDA in the quarter was $204 million, down 23% year-over-year, representing an adjusted EBITDA margin of 40%. Excluding the legal settlement charge, adjusted EBITDA would have been $264 million, representing an adjusted EBITDA margin of 52%. Hinge continued its strong momentum in Q3 with direct revenue of $185 million, up 27% year-over-year and up 26% year-over-year on a foreign exchange neutral basis. Payers increased 17% year-over-year to 1.9 million and RPP increased 9% to $32.87. Adjusted EBITDA was $63 million, up 22% year-over-year, representing an adjusted EBITDA margin of 34%. E&E direct revenue in Q3 was $152 million, down 4% year-over-year and down 5% year-over-year on a foreign exchange neutral basis. Payers decreased 13% year-over-year to 2.3 million, while RPP increased 10% year-over-year to $22.22. Adjusted EBITDA was $47 million, up 14% year-over-year, representing an adjusted EBITDA margin of 30%. Match Group Asia delivered direct revenue in Q3 of $69 million, down 4% year-over-year on both an as-reported and on a foreign exchange neutral basis. Excluding the exit of our live streaming businesses, Match Group Asia direct revenue in Q3 was flat year-over-year on both an as-reported and an foreign exchange neutral basis. Azar direct revenue was flat year-over-year and up 2% year-over-year on a foreign exchange neutral basis. Azar direct revenue was negatively impacted by an estimated $3 million after Azar was blocked in Turkey by Turkish regulators in late August. We're pursuing all available legal remedies and working with Turkish regulators to get Azar unblocked. However, it is unclear at this time when that may happen. Pairs direct revenue was down 1% year-over-year and down 2% year-over-year on a foreign exchange neutral basis. Across Match Group Asia, payers increased 6% year-over-year to 1.1 million, while RPP declined 10% year-over-year to $20.73, partially due to the exit of Hakuna mid-last year. Adjusted EBITDA was $15 million, down 14% year-over-year, representing an adjusted EBITDA margin of 22%. Looking at costs, including stock-based compensation expense, total expenses were up 1% year-over-year in Q3. Cost of revenue decreased 2% year-over-year and represented 27% of total revenue, down 1 point year-over-year, driven by reduced variable expenses from the shutdown of our live streaming services mid-last year, lower web services costs, and lower employee compensation expense from our restructuring efforts. Selling and marketing costs increased $12 million or 8% year-over-year and represented 19% of total revenue, up 1 point year-over-year, primarily due to increased marketing spend at Tinder, Hinge, and Match Group Asia, partially offset by lower employee compensation expense from our restructuring efforts. General and administrative costs increased 42% year-over-year, up 5 points year-over-year as a percentage of total revenue to 16%, driven primarily by the legal settlement charge, partially offset by lower employee compensation expense from our restructuring efforts. Product development costs increased 1% year-over-year and were flat year-over-year as a percentage of total revenue at 11%. Depreciation and amortization decreased by $44 million year-over-year to $24 million due to impairments of intangible assets at E&E and Match Group Asia in the prior year quarter and lower internally developed capitalized software costs, primarily at Tinder and Match Group Asia. Turning to the balance sheet. Our trailing 12-month gross leverage was 3.4x and net leverage was 2.5x at the end of Q3. We ended the quarter with $1.1 billion of cash, cash equivalents, and short-term investments on hand. In August, we issued $700 million of 6.125% senior notes due 2033. The proceeds from these notes will be used to repay all of the exchangeable senior notes coming due in 2026 on or before maturity and for general corporate purposes. In September, we repurchased $76 million of the 2026 exchangeable senior notes at a discount to par. Year-to-date through Q3, we delivered operating cash flow of $758 million and free cash flow of $716 million. We repurchased 17.4 million shares at an average price of $32 per share on a trade date basis for a total of $550 million and paid $141 million in dividends, deploying nearly 100% of free cash flow for capital return to shareholders. In October, we repurchased an additional 3 million shares of our common stock for $100 million on a trade date basis and at an average price of $33 per share. As of October 31, 2025, we reduced diluted shares outstanding by 8% year-over-year. We maintain our commitment to target returning 100% of free cash flow to shareholders through buybacks and the dividend. Now turning to guidance. We expect Q4 total revenue for Match Group of $865 million to $875 million, up 1% to 2% year-over-year. This range assumes a nearly 2.5-point year-over-year tailwind from foreign exchange. FX-neutral, we expect total revenue to be down 1% to 2% year-over-year. We expect Match Group adjusted EBITDA of $350 million to $355 million in Q4, representing a year-over-year increase of 9% and an adjusted EBITDA margin of 41% at the midpoint of the ranges. Q4 total revenue guidance reflects continued strong performance at Hinge and Tinder performance that is in line with the expectations we had at our last earnings in August, including an expected $14 million negative impact to Tinder direct revenue from user experience testing. It also reflects weaker-than-expected performance at E&E and assumes the continuation of Azar's block in Turkey. E&E saw weaker trends in Q3, which we are working quickly to address, and we no longer expect Emerging brands' direct revenue growth to offset Evergreen brands' declines in 2025. We expect an estimated $9 million negative impact to Match Group Asia direct revenue from Azar's block in Turkey. We expect indirect revenue to be approximately $15 million in the quarter. Our Q4 adjusted EBITDA guidance includes $4 million of restructuring-related costs, included in the $25 million of restructuring-related costs announced in May, and an $8 million positive impact from an expected sale of one of our two office buildings in L.A. that was not fully utilized. We are increasing our 2025 full-year free cash flow guidance to $1.11 billion to $1.14 billion, which assumes the Candelore settlement will not be paid until Q1 2026. We now expect our 2025 full-year tax rate to be in the high teens.

Our first question comes from Cory Carpenter with JPMorgan.

Spencer, you mentioned in your prepared remarks that the early reinvestments are giving you confidence in your strategy. Could you expand a bit on the green shoots you're seeing across the broader company and then also at Tinder specifically?

Yes. Thanks, Cory. Let me start with Tinder and then if we want to expand from there, we will. At Tinder, we now have a clear mission statement, which we understand. So we know why we're building what we're building. We have clear consumer personas, so we know who we're building them for. And now we have a clear metric, 6-way conversations, or what we call Sparks so that we know how to measure whether we're driving good user outcomes. And Sparks, we think, are a good measure of product efficacy. Globally, they're down in the low single-digit range year-over-year, but they're improving and close to flat. And it's actually quite a bit better than now, which has kind of stabilized in the 9%, 10% kind of high single-digit year-over-year range. Sparks coverage. As I said just a moment ago, Sparks coverage is actually up year-over-year, but it's up the most among U.S. Gen Z. So all this by way of saying the product is working better today to help Sparks something new with someone new than it was a year ago. That's encouraging. There are a couple of reasons why that the product is having improved efficacy. The first is a lot of our recommendations tests are bearing fruit. So at any point in time, we have dozens, sometimes hundreds of different recommendation algorithms in the market. And we ended up finding one of them, it actually improves women matches by 4% and improves Sparks and improves retention, with no revenue trade-off, which is really uncommon. Usually, when we have recommendation improvements that improve user outcomes, it comes at some revenue hit. And in this case, it did not. So we've rolled this out globally. Our work is not done on REX. We are always continuing to improve them, but I'm encouraged by where we're headed. The second point is regarding Double Date. Double Date is resonating very well with our target users. I mentioned earlier that adoption for Double Date has increased significantly. Currently, about 17% of U.S. users aged 18 to 22 have a Double Date pair, which is significant. When you consider that almost 1 in 5 Gen Z Americans using Tinder are now swiping with a friend to find pairs, it shows how the perception of Tinder is evolving and how users engage with the platform. This shift is crucial for us to enhance reconsideration and ultimately boost our monthly active users. Finally, I will just hit on a basket of features at Tinder, which, in the aggregate, help people assess the whole person rather than just quickly assessing the attractiveness of the photo. These are features like contextual likes, which Hinge pioneered, features like putting biographical information on the first photo. And the good news here is those types of features have improved user outcomes like Sparks without impacting revenue. So we were prepared to accept the small revenue hit for these types of features, but many of them actually just improved user outcomes and have not impacted revenue. Let me sort of pause there. I'm happy to elaborate on the road map and kind of where it's going, but that brings you pretty current with what we've shipped on Tinder over the last couple of months and the early positive results that we're seeing on user outcomes.

And the next question comes from Nathan Feather with Morgan Stanley.

Really encouraging to see the faster product velocity at Tinder. I guess any way to get a sense if that's also accelerating the curve as you think of user outcomes and underlying metrics? And connected to that, as you start prioritizing user outcomes, you mentioned a negative Tinder revenue headwind in Q4. I guess to what extent should we expect that to continue into next year as you continue to make these product improvements?

Thank you, Nathan. It’s likely too early for us to provide a definitive answer regarding 2026. Right now, we are evaluating various tests in key markets, including Australia, where we are trying a variety of approaches to improve user outcomes and marketing efficiencies. This will help us determine how to operate the company in 2026 with regard to profitability. Steve mentioned in his prepared remarks that we anticipate a potential $14 million impact on Tinder revenue, which is included in our guidance for Q4. This impact is due to features like different recommendation algorithms that we are still testing to enhance user outcomes, as well as the rollout of new Modes. Today, we have College Mode and Double Date Mode, with several more Modes in development which may slightly affect revenue. We are focusing on enhancing open messaging and providing additional free user experiences, such as showing users some free pairs of who likes them, and redesigning specific aspects of Tinder. We plan to integrate Chemistry into the main card stack and expand its availability to more regions. Additionally, we will roll out Face Check across the entire United States by the end of the year, and globally, with the exception of the EU and the U.K. by spring. All of these initiatives are leading us towards a product event in spring 2026 for the media, influencers, and investors, where we aim to showcase what we have developed at Tinder over the past six months, as well as what lies ahead. This event is crucial, and the Tinder team is working diligently to enhance the product to improve user experiences by that spring 2026 event.

And the next question comes from Jason Helfstein with Oppenheimer.

So just maybe follow up a little bit. I mean you did elaborate in the letter that you plan to unlock $40 million of payment savings. Is the idea that like if you do decide to lean in more into these, I guess, kind of cleanup initiatives or however you want to describe them, that $90 million could help potentially offset that revenue headwind next year? And I guess, like to that point on Project Aurora and like if you did go kind of fully roll this out, like, I guess, should investors assume like how dramatically would you be willing to let revenue come down to kind of end up with like the right place from a user experience standpoint?

Why don't I take the first part of that question. Here's the way I think about the $90 million. The $90 million gives us clear flexibility, right, and optionality. And as Spencer just said, the $14 million Q4 impact from Tinder user outcome testing is an estimate, right? These are tests. So it's probably premature to speculate on whether we'll need the $90 million to offset the revenue declines or whether there will be revenue declines at all until we see how these tests play out. And so the plan is to continue testing throughout the rest of the quarter, to go through our annual planning process like we always do and then we'll give clear guidance on 2026 in a lot more detail on our investment strategy and the outcome of these tests and all the learnings we've gathered at that time. That's the plan.

And the next question comes from Ben Black with Deutsche Bank.

This is Kunal for Ben. A couple on Hinge. And right from the beginning, Hinge was designed to be deleted or meant to be deleted. Has the engagement profile of the users kind of changed since the beginning? And then you talked about how Hinge is expanding into Mexico and Brazil in the coming months. How does that change the addressable market?

Yes. Thanks, Kunal, good questions. Yes, Hinge is really meant to be the last dating app that you'll ever use, and Tinder is meant to be the first dating app that you'll ever use. So that positioning is clear in terms of how we think about marketing the two apps and in terms of the product road map and focus of the teams at Hinge and Tinder. That positioning for Hinge hasn't changed since Match Group purchased it. It's been very consistent. And I think that consistency is one of the reasons for Hinge's continued success. Hinge just launched in Mexico a couple of weeks ago. It's off to a faster start in Mexico than when Hinge launched in Europe several years ago. So that's extremely encouraging. Brazil will launch in the next few weeks. And when you look at Hinge's success in the markets that it's in or even this recent fast start in Mexico, it gives me a lot of optimism that the total addressable market for Hinge is massive, that this customer segmentation or psychographic segmentation between Tinder opening a world of possibilities at the kind of fun spontaneous side of dating and Hinge being for more serious and intentional daters, that duality should be true globally. It's hard for me to envision a country where there wouldn't be an opportunity for an intentional dating app like Hinge to be a significant player in that market. As we approach the annual planning process that Steve mentioned in the upcoming weeks, we will consider which markets to expand Hinge into in 2026. We have already integrated certain aspects of our strategy, particularly in Asia, where Match Group now offers shared services for all of our brands as we enter new markets there. This approach allows us to expand more efficiently and effectively in a coordinated way, which is a benefit that only our multi-brand scaled portfolio as the category leader can offer. I believe this will provide even more support as Hinge enters new markets in 2026.

The next question comes from Eric Sheridan with Goldman Sachs.

I think based on the early learnings in Australia, how do you think about the philosophically going to market with a wider array of offerings and changes to Tinder all at once relative to looking out towards next year and thinking about being more strategic and sort of directed in the way certain enhancements go global, either by country by country or by geo? Just curious how you think about that.

Yes, that's a great question, Eric. The unique aspect of this category, which can be overlooked by those not involved on a daily basis, is that we create products and market them, but our primary role is to facilitate connections between strangers. Therefore, the success of these products is heavily dependent on the quality and behavior of our community members. One reason we're launching Project Aurora is to enhance not just the feature set but also to focus on marketing initiatives that prioritize trust and safety. We aim to revitalize the entire market collectively, as the ecosystem of these products functions in a way that traditional e-commerce does not. So in terms of how we roll this out, these types of changes in 2026, I do want to be clear that we're not standing still. So for example, the REX algorithm that I mentioned that's in Australia, we've also rolled that out in other markets. Face Check, which we've rolled out in Australia, we've also rolled out in a handful of other markets. So we're certainly not waiting for a clean read from a single market, but it is helpful for us as we decide what the answer is to, I think it was Jason's question, about 2026 and profitability for next year. We will benefit from having greater insight into how the product investments and the marketing hang together to improve the whole ecosystem, and that will help us articulate what the plan is for 2026.

The next question comes from Ygal Arounian with Citi.

Spencer, you noted that MAUs are stabilizing in the 9% to 10% decline range. Considering the various initiatives you're implementing, from smaller adjustments in specific markets to broader efforts like Project Aurora, how do you anticipate the timeline for seeing improvements in these KPIs? When do you expect MAUs to begin turning around? Additionally, regarding the increased savings from in-app payments compared to what you mentioned last quarter, could you explain what factors are contributing to that increase?

Yes, I'll take the first question. So a number of the product initiatives that we've been doing to improve user outcomes actually have the effect of hurting monthly active users. For example, Face Check hurts monthly active users by a little bit, at least initially, a couple of percentage points. And the recommendation algorithm also can have the effect of hurting male monthly active users. It improves female retention, the female experience, but that can have the effect of pulling female attention away from certain male users, and then we sometimes lose their visits. And that's okay. So the fact that MAU is hanging in there in the high single-digit year-over-year, even while we're improving user outcomes is a good sign, just as the fact that we're able to improve user outcomes at minimal impact to revenue with a couple of the examples I cited, that's also a good sign. I'll let you talk to the IP.

Yes, I can take the IP, sure. Yes, we've made a lot of progress over the last few months on alternative payments. And you're right, the expected savings in 2026 has gone up quite a bit. So let me just give you a little bit more detail. Basically, back in August, Hinge had yet to start testing. We said it was going to start testing in September. That happened, and we were sort of extrapolating Tinder and E&E results and seeing about a 30% shift to web payments, of course, in the U.S. and we extrapolated that out to about a 10-point increase in net revenue, which equates to about $65 million in savings in 2026. As of October, Tinder, Hinge, and most of the E&E apps are fully rolled out. We've implemented these apps quicker than initially planned, which is positive. Hinge has shown exceptionally strong initial results, outperforming E&E, and Tinder has been performing well since August, along with E&E, in terms of optimization. Now that most of our apps, including Tinder and Hinge, have been completely rolled out in the U.S. and fully optimized, we are observing a shift of 40% to 60% to web usage depending on the app. This shift is leading to a 15-point increase in net revenue and savings of $90 million. So the net of it is strong results at Hinge out the gate and continued optimization at Tinder and E&E has resulted in more of those payments going to web, which is resulting in more savings. And the other thing I'll just mention, I don't know if you caught this, but Google mid-last week updated its Play Store policy, allowing for web payments as well in the U.S. without fees similar to the Apple situation, and so we plan to test there too. That's a smaller opportunity. We have less Android users in the U.S., and we have Apple users and also the fee we pay Google for in-app purchases is more like 18% versus the 27% we pay Apple. So there's less savings to be had from shifting to web. But if you sort of pencil it out, our early estimate is about a $10 million to $15 million additional savings through Google on an annualized basis. So we're excited about that opportunity, too. We'll start testing and confirm those initial estimates.

And the next question comes from John Blackledge with TD Cowen.

It's Logan Whalley on for John. Could you talk about any traction or the traction that you cited from recent marketing efforts? And then kind of maybe how you approach the opportunity with last daters versus those that have never used the app before? And then sticking to marketing on the cost side, maybe how you're thinking about marketing spend and the traditionally more expensive Q4 advertising season?

Yes. I will address the last part first, which is that we decrease our advertising in Q4. Our peak season usually follows Christmas when people often set New Year’s resolutions to start dating, and we capitalize on that with our marketing. However, during the period between Thanksgiving and Christmas, advertising costs rise due to e-commerce and other products, so we tend to reduce our marketing budget. Regarding our overall marketing strategy, we have just finished Project Prism, which was Match Group's first endeavor to evaluate marketing spending uniformly across all our brands. This initiative allows us to assess the effectiveness of our marketing expenses and helps us forecast for 2026. For instance, if we allocate $5 million or $10 million to a specific brand, we can estimate the potential downloads it would generate, the user demographics, user retention rates, and the costs associated with generating leads or other key performance indicators we monitor across our brands. Now we have a consistent framework to evaluate all our brands equally. This is something that we worked with an outside resource on a marketing executive, a person that used to run marketing for me at Zillow Group; and before that, we worked together at Expedia Group. So she has created shared marketing frameworks in several multi-brand Internet companies before. And that project has been really illuminating in order to inform our 2026 decisions. So if you take all these different things together that we've mentioned, the Tinder user tests, the Tinder testing in Australia, a shared understanding of what marketing efficacy is across all of our brands, the IAP savings that Steve just talked about, and now you have a little window into what the next couple of weeks are going to be for us as we go through business unit by business unit, creating our annual plans for 2026, rolling them up, discussing them with the Board, making final decisions about how we're going to operate the company by the end of the year and then communicating it with all of you in early February at earnings. But it's great to be going into that process with the work done on Project Prism, so we understand marketing efficacy by brand. And with the work kind of still in flight on the Tinder front in terms of the different testing that we've been doing, but much more well informed than we were even a couple of weeks ago now that we have a lot of these features in flight, and we're starting to see the impact on user outcomes as well as revenue and expenses.

The next question comes from Shweta Khajuria with Wolfe Research.

Spencer, you mentioned you'll evaluate next year's growth and investment opportunities considering the trends in your product and marketing. My question is what specific factors will you be examining? Will the increase in the top-of-the-funnel primarily influence your confidence in your product roadmap and marketing efforts? If growth is slower than anticipated, will you adjust your reinvestment strategy accordingly? How should we approach this as we think about next year?

Yes, I am focusing on what I believe will increase the stock price in three years. There are many factors to consider, including user outcomes, revenue, and market expansion on platforms like Tinder and Hinge. Numerous variables influence this. However, if there is one guiding principle that summarizes how I and the leadership team are integrating everything, that is it. I think the big question marks going into 2026 are what level of profitability we choose to run Tinder at. To date, Match Group has opted for a much higher level of profitability for Tinder compared to Hinge. The two key components are how much benefit users receive and what type of cost of acquisition we decide to allocate for Tinder. These are some of the main questions we will face during our planning. My decision-making is based on what I believe the stock price will be in a couple of years. The critical factors affecting the stock price are, as you know, the net present value of future cash flows divided by the shares outstanding. As Steve mentioned, we bought back 8% of our shares year-over-year, which is quite remarkable and worth noting.

The next question comes from Youssef Squali with Truist.

Spencer, can you please talk about the state of the broader dating market in the U.S., how it's performing, given the macro environment, competitive intensity, and any early read or impacts from Facebook Dating? And then Steve, just quickly, what does the Q4 revenue guide imply in terms of payers growth and RPP?

Yes. We've always had competitors. I'm sure we'll always continue to have competitors, whether they be big tech companies or startups. I like our brands. I like the network effects that the brands provide. Our biggest challenge as a company is growing category acceptance. I think there was a prior question, which I only answered partially about bringing new people into the category. There are 250 million people globally that are single and dating in countries that we serve that are not on dating apps, 250 million; and only 30 million of those have used dating apps and they're not currently using dating apps. 220 million of them have never been in the category. So to the extent that Meta and Facebook or any competitor educates people that they can use a dating app, they can use the power of technology to safely meet people and get up off the couch and go out on dates and form human connections, that benefits Match Group as the category leader, especially because this is a category with multi-app usage. So we welcome any and all initiatives, whether they've come from Match Group, such as our Face Check initiative, which we think brings new people into the category as we improve trust and safety in the apps or others such as Meta to raise attention and awareness to the power of technology to drive human connections. That's what we're here for.

Yes. Let me discuss the macro situation first. I would say we are still observing the same trend we've noted previously this year. We've mentioned during the last couple of calls that there is a slight weakness in ALC among younger users on Tinder. This trend hasn't worsened, but it hasn't improved either, so it's more of the same. However, we are not seeing this weakness in other areas of the Tinder business, including subscription revenue, nor do we see it across our other brands or Hinge. We will continue to monitor the situation closely, but that is our current observation. We don't usually provide specific guidance on payers and RPP, as our main focus is on revenue and user growth. However, the trends for those metrics have remained fairly stable, similar to the trends in MAUs, and I expect to see something comparable in Q4.

And the next question comes from Chris Kuntarich with UBS.

Maybe just one on Face Check. You mentioned it being fully rolled out in the U.S. by the end of the year. I just want to clarify, does that include existing users? And if it doesn't, could you just give us a bit of an update on your thinking about rolling out to that cohort of users for Tinder? And then maybe just one follow-up. Any early read on the level of inefficient marketing spend that you've been able to identify with Project Prism?

Face Check is applied only to newly created accounts because that's the method that malicious actors exploit to target us. Spam accounts are generated by these bad actors, and if we can prevent them using Face Check, that's precisely what's occurring. We've observed a 60% reduction in interactions with spam accounts. To provide more insight into the improvement in trust and safety resulting from Face Check, we conduct surveys asking users if they believe the profiles they see on Tinder are real. In the markets where Face Check is implemented, between 5% and 10% more respondents affirm that they believe the profiles on Tinder are genuine. This enhancement not only increases safety and authenticity but also boosts perceived authenticity, which is essential for encouraging users to reconsider our service. Marketing. Yes, I guess what I would say there is, unsurprisingly, Hinge's marketing drives new registrants, new downloads, or Sparks at a lower cost per than Tinder's does, and that makes sense for a couple of reasons. First of all, Hinge is a newer brand. Hinge's product is better at taking users and kind of moving it down the funnel in that way. And more of Tinder's spend is focused on brand marketing than direct response user acquisition. The reason for that is Tinder is trying to drive reconsideration and change user perception, whereas Hinge has a pristine user perception. And so therefore, most of their spend can be focused on user acquisition. And user acquisition spend is always going to be more effective on paper than brand spend will be. So that's not surprising. And as we go into 2026, and we think about the marketing levels that we want to run the company at and the allocations between the brands, we'll have to weigh that, of course. But boy, it feels good to be going to that decision actually having some levers to look at. And previously, we were kind of flying this plane without an altimeter, and now we actually can see some metrics across different brands and start making informed decisions based on that.

And the last question comes from Robert Coolbrith with Evercore ISI.

This is Georgia on for Rob. Thanks for the color on Sparks and MAUs. I guess, last quarter, you noted some encouraging movement at the top of the funnel. Can you provide an update on that so far?

Thank you for the question, Georgia. Our monthly active users for Tinder have decreased by a high single-digit percentage, which is consistent with the trend we've seen over the past couple of months. This number can fluctuate slightly due to various tests we're conducting. Initiatives like Face Check and recommendations can enhance user experiences, but they can also impact monthly active users negatively. Overall, this metric has stabilized within that range. It's also important to mention that Tinder's revenue has dropped by 3% year-over-year this quarter, following a 4% decline last quarter, indicating some stabilization in our revenue as well. While we certainly want to see improvements rather than year-over-year declines, it's encouraging to observe some stabilization in these metrics. As I mentioned in the last call, our first step in addressing a declining trend is to get that trend flat. It’s good to see some of those numbers beginning to flatten. Thank you, and we look forward to speaking with you next quarter. Have a great day, everyone.

This concludes our question-and-answer session. The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.