BofA analysts said that they believe there is limited risk to Match Group (NASDAQ:MTCH) and Bumble (BMBL) from X's (formerly Twitter) proposed launch of a dating service in 2024.
Reports last week said that during an X all-hands staff meeting, chairman, CTO, and owner Elon Musk announced the planned launch of a "fully fledged dating site" on X in 2024.
"This is inline with plans to pivot X to payment-based services (dating apps generate revenue from subscriptions and in-app purchases). However, details were reportedly not given on demand for the product, pricing, user verification procedures or how the service would be integrated into X," the analysts said.
"Shares of Match and Bumble fell 2.7/1.5% on Friday on the news (vs. +0.5 for Nasdaq-100). Our take: We do not see the potential launch of a dating service by X as a material risk to Match or Bumble users," they added.
The analysts said this is because of MTCH and BMBL's competitive moats, the fact that dating app users often use multiple apps and the limited traction with Meta’s dating service years after launch.