Match Group (NASDAQ: MTCH) Stock Surges on Activist Investor Interest

Match Group (NASDAQ: MTCH) stock surged in the early morning trade Tuesday following reports that activist investor Starboard has acquired a stake of over 6.5% in the company, advocating for a strategic sale of the Tinder owner.

Activist investor Starboard Value has acquired over a 6.5% stake in Match Group, the owner of popular dating apps such as Tinder and Hinge, and is urging the company to consider a sale if efforts to improve its performance do not succeed, according to a report by the Wall Street Journal.

Starboard’s intervention comes as Match shares have declined about 12% in 2024, nearing their lowest levels in seven years.

The activist investor advocates for enhancements to Tinder, which generates more than half of Match’s revenue, and sees significant growth potential for Hinge and other emerging dating apps within the company’s portfolio.

The report suggests that Starboard believes Match Group should consider going private if it cannot implement the necessary changes, including more aggressive share buybacks.

A spokesperson for Match stated that the company remains committed to Tinder’s growth and the expansion of Hinge. “We look forward to continuing our open dialogue with all of our investors, including Starboard,” the spokesperson added in an emailed statement.

In addition to Starboard’s recent stake, Match Group has faced pressure from other activist investors. Earlier this year, Elliott pushed for performance improvements and successfully appointed Instacart (NASDAQ: CART) executive Laura Jones and Zillow (NASDAQ: ZG) co-founder Spencer Rascoff to Match’s board. Furthermore, Anson Funds Management also acquired a stake and advocated for board refreshment, as reported by Bloomberg in March.

Match Group offers dating apps such as Tinder, Hinge, and OkCupid, and has been struggling with slowing revenue growth due to weaker discretionary spending by users amid an uncertain economic environment.