Bumble's Stock Plummets on Weak Outlook
Shares of Bumble dropped nearly 30% on Wednesday following a disappointing earnings report. The dating app's stock has seen a steady decline since its peak shortly after its 2021 IPO.
Investors are concerned about declining user engagement and reduced spending on the platform. Bumble's stock has plummeted since Wednesday, extending a downtrend that has erased over 90% of its market value.
Despite reporting a revenue beat in the fourth quarter, Bumble's guidance overshadowed any positive sentiment. The company projected sales between $242 million and $248 million for the first quarter, below analyst expectations of $256.9 million. Bumble attributed the weaker outlook to a temporary dip in paying users during a brand refresh.
Bumble's shares were trading at around $5.83 midday ET on Wednesday. The decline continues the stock's extended slide, which began after it hit an all-time high of $78.89 in February 2021.
The company's struggles reflect changing sentiments towards dating apps. Users are reporting fatigue, leading to a decline in paying subscribers. Rival Match Group, parent company of Tinder and Hinge, has also experienced a significant drop in stock price.
Bumble is facing challenges in retaining users and maintaining revenue growth. Despite founder Whitney Wolf Herd's optimism about the company's future, the stock's performance indicates continued concerns among investors.