The dating app industry is undergoing a massive transformation as major players like Match Group’s Hinge and Tinder, Grindr, and Bumble invest tens of millions of dollars into artificial intelligence technology. These companies are racing to use AI to solve a critical problem: user fatigue and declining engagement that has plagued the industry for years.
Match Group’s stock has plummeted over 75% in the past five years, while Bumble’s share price is down more than 50% this year alone. The companies are struggling with frequent user churn due to “swipe fatigue” and difficulty converting free users into paying customers. Match Group’s paying users declined 5% last quarter, while Bumble’s fell 18% and the company laid off 30% of its staff over the summer.
The solution, according to industry leaders, is generative AI that goes beyond traditional machine learning algorithms. Match Group CEO Spencer Rascoff called AI a “platform shift” that is “changing everything” about the company’s dating apps. Grindr CEO George Arison described the potential results as “magical.”
Tinder is piloting “Chemistry,” a matchmaking feature that analyzes users’ camera rolls and prompt responses to deliver a “daily drop” of ideal matches based on values rather than just physical attraction. The goal is fewer swipes and more meaningful connections. Hinge is improving its matching algorithm, while Bumble plans to roll out an AI product next year. Grindr has introduced recommendation features including a “For You” feed and “A-List” that use AI to suggest compatible profiles.
The established players face competition from AI-first startups hoping to capitalize on user dissatisfaction. Apps like Sitch (which raised $9 million and charges $90 for three matches), Known, Ditto, and Amata have all launched in 2024 with AI matchmaking at their core. Even Facebook has introduced an AI dating assistant that searches its massive user base for compatible matches. Notably, Hinge founder Justin McLeod stepped down as CEO this month to launch his own AI dating platform.
However, early results are mixed. Some users report disappointing recommendations that don’t match their stated preferences, suggesting the technology still needs refinement. As analyst Andrew Marok noted, “You can’t just take a product that’s out of favor, put AI on top of it and say, ‘OK, now we have a product that’s in favor.’”
Key Quotes
We’re entering a platform shift with AI. AI is changing everything about the company’s dating apps.
Match Group CEO Spencer Rascoff made this statement during a Los Angeles Tech Week panel in October, signaling how seriously the struggling dating giant is taking AI as a potential solution to its declining user base and stock price.
It’s been a really long time since there’s been a new reason — whether technology, platform, brand, whatever — for consumers to be excited about dating.
Sam Yagan, cofounder of OkCupid and former CEO of Match Group, explained to Business Insider why the industry is ripe for disruption, suggesting AI could be the innovation that reinvigorates user interest after years of stagnation.
Simply, the product doesn’t work as well as people expect it to.
Morgan Stanley analyst Nathan Feather offered this blunt assessment of why dating apps have seen user contraction, highlighting the fundamental problem that AI investments are attempting to solve.
You can’t just take a product that’s out of favor, put AI on top of it and say, ‘OK, now we have a product that’s in favor.’
Raymond James analyst Andrew Marok provided a skeptical perspective on whether AI features alone can rescue struggling dating platforms, suggesting that deeper product issues may require more than technological fixes.
Our Take
This represents a high-stakes bet on AI’s ability to solve human connection problems—arguably one of the most complex challenges in consumer technology. The dating app industry’s desperation is palpable, with massive stock declines forcing companies to embrace AI as a potential savior rather than just an incremental improvement.
What’s particularly interesting is the shift from maximizing swipes to minimizing them—a fundamental business model change that suggests AI might actually align company incentives with user satisfaction for the first time. However, early user reports of poor recommendations reveal that AI matchmaking is far from solved, and the technology may be overhyped.
The real test will be whether AI can capture the nuanced, ineffable qualities that create romantic chemistry—something human matchmakers have struggled with for centuries. The entrance of AI-native startups and tech giants like Facebook suggests this could become a defining battleground for practical AI applications in 2025.
Why This Matters
This story represents a critical inflection point for both the dating app industry and AI adoption in consumer applications. With billions of dollars in market value at stake and hundreds of millions of users worldwide, the success or failure of AI-driven matchmaking will serve as a major test case for whether generative AI can solve real-world problems beyond content creation.
The dating app crisis highlights a broader challenge facing many tech platforms: user engagement and retention in an increasingly saturated attention economy. If AI can genuinely improve match quality and reduce the frustration that drives users away, it could validate AI’s promise across numerous consumer applications.
For the AI industry, this represents a massive new market for practical AI applications. The matchmaking problem is complex, involving personality analysis, preference learning, and behavioral prediction—all areas where modern AI excels. Success here could accelerate AI adoption in other relationship-driven industries like recruiting, networking, and professional services.
The competitive dynamics are also significant, pitting well-funded incumbents against nimble AI-native startups, mirroring battles playing out across the tech landscape as generative AI reshapes established industries.
Related Stories
- CEOs Express Insecurity About AI Strategy and Implementation
- Big Tech’s 2025 AI Plans: Meta, Apple, Tesla, Google Unveil Roadmap
- The Future of Work in an AI World
- Business Leaders Share Top 3 AI Workforce Predictions for 2025
Source: https://www.businessinsider.com/dating-apps-bet-ai-will-increase-users-2025-12