Gary Swidler: Sure. So, let me kind of unpack the revenue outlook. I stated in my remarks, right now, I think we’re looking for 6% to 7% year-over-year total revenue growth for the Match Group, so above the bottom of that range and within the range that we provided the 5% to 10%. And that includes the 8% to 9% year-over-year revenue growth outlook that we provided for Q3. If you go further, we said Tinder is expected to deliver approximately 10% year-over-year direct revenue growth in Q3 and solidly double-digit, so assume better than the Q3 number in Q4 as we see continued acceleration in Tinder’s growth. If Tinder is able to deliver solidly double-digit growth in Q4, it’s logical to think that the overall company is going to deliver a similar kind of growth rate as well has been the general pattern, and that’s how the math works out.
And so, if you layer the Tinder growth and then you have Hinge, which is accelerating from the 35% that we have in Q2 and accelerating through the rest of the year. And then if you look at the other businesses, they’re down mid-single digits is our expectation for Q3. So, I think we might see a little bit of improvement there. Certainly, there’s a path for a little bit of improvement. And I think when you boil all that together, you’ve got the components that gets you to double-digit growth for the company in Q4 and then the 6% to 7% overall for the full year. So, I think those are all the pieces and tells you where we’re going. And I would say that the clarity in all of this and our confidence continues to improve, which is obviously very good to see.
And then, from an AOI margin perspective, the driver really is the level or the magnitude of Tinder growth. As it continues to grow, it’s high-margin revenue, and that obviously is helping the overall company’s AOI margin. So, sitting here today, we could see a path to at least 50 basis points of margin improvement on a year-over-year basis, 2023 over 2022. But obviously, that will be impacted by what Tinder and some of the other businesses do as the rest of the year progresses. And then, we also will have some decisions to make in terms of marketing spend levels at Tinder as we see the effects of all of its marketing and what it’s doing from a user growth perspective, but obviously, it’s helping. So, it’s possible we’re going to want to spend into that strength.
And then, the newer apps like Archer and The League, if we see those take off like we’re hoping in the back half of the year, it will make sense to spend marketing dollars into those businesses as well to help set us up for a strong Q1 next year, which is our most important quarter of the year, and to give us the right level of momentum into 2024. We’ve talked before, we didn’t have the momentum we’d like to see coming into 2023, which made payer growth and revenue much more challenging in the early goings of 2023. So, we’d like to make sure we’re set up well to drive accelerating revenue growth into 2024. I think the organic trends are obviously very good. But to the extent we can supplement it with marketing spend, we will do that to give us the momentum we want into 2024 as well.
Hopefully, that helps you as you think through the trends on AOI and on revenue.
Justin Patterson: Thank you.
Operator: Our next question comes from Lauren Schenk with Morgan Stanley. Please go ahead.
Nathan Feather: Hey, you’ve got Nathan Feather on for Lauren. So, continuing on the AOI trends and given the impressive 2Q operating income result, what are kind of the one or two key drivers which could lead to further AOI upside in the back half? Thanks.
Gary Swidler: So, as I mentioned on the last call, I mean, I think the biggest variable is what level of growth we’re going to get across the company and specifically at Tinder. We’ve seen a pretty dramatic acceleration just over the last three months versus what we were expecting, because the initiatives — the revenue initiatives are really working better than we thought. So, we have to see how that continues to proceed through the year. But obviously, we’re feeling better and better about the revenue growth trajectory at Tinder and, frankly, across the company where we’ve seen dramatic improvements, it’s pretty much everywhere. So that’s, I think, the biggest variable. And then on the other side of it is the marketing spend, primarily.
I think everything else is pretty known in terms of what we’re going to do; our hiring is pretty muted, you know what the App Store fees are going to be. And so, the biggest variable is marketing spend. It’s obviously entirely within our control. But to focus on additional growth for 2024 and beyond, we’re going to calibrate the growth that’s being derived from the businesses, the benefits we see from the marketing spend we’re doing and try to figure out what level of marketing investment we want to make in the various businesses in the — towards the very end of this year. Obviously, we’ll provide lots more color on what we think is going to happen in Q4 on our next call. But we’re very happy to see the outperformance. That’s giving us some really nice choices to make, and we’re thrilled to be in that position right now.
