Many investors are questioning if the online dating market has become saturated and, in turn, if there is still a growth runway for the industry.----- Transcript -----Welcome to Thoughts on the Market. I'm Lauren Schenk, Equity Analyst covering Small and Mid-Cap Internet stocks. Along with my colleagues bringing you a variety of perspectives, today I'll discuss the next leg of growth for the online dating industry. It's Wednesday, March 29th at noon in New York. Investors are understandably focused on turmoil in banking, but today we'll be taking a break from banks to cover a hot topic in any macro environment, online dating. Almost every investor call I get includes the question, "Is online dating just becoming saturated, mature or over-monetized?" Several data points have driven this market view. First, revenue growth at the top dating apps slowed in 2022 and provided more modest fiscal year 2023 guides and expected. Second, survey data suggests U.S. online dating adoption slowed over COVID. Third, app data implies U.S. monthly active users have been flat for five plus years, suggesting that monetization has driven all the growth and may slow from here. This data prompted us to dig deeper into the multiple growth drivers of online dating revenue growth to see if investor concerns are well founded. And we found that online dating is not just about users and user growth. Today, roughly 32% of the U.S. addressable single population uses online dating and 26% of that 32% pay for online dating either through a subscription or a la carte purchase. In fact, our analysis suggests there's still plenty of growth runway. There are effectively four key drivers of online dating growth between users and monetization, potential users, or total addressable market, online dating usage, payer penetration and revenue per payer. Most dating apps employ a "Freemium" model, meaning the service and platform are free to use, but the experience and success rate can be improved via a monthly subscription of bundled features or one-off a la carte purchases. To be sure, user growth has provided a solid boost to revenue growth over the last many years as mobile swipe apps expanded usage among young users. However, we see slowing U.S. single population growth and a slowing of user penetration from here. We estimate that user growth will likely contribute only 3% of industry revenue growth from 2022 to 2030, while the bulk of online dating revenue growth will increasingly come from monetization. With that said, compared to user growth, monetization growth is far more dependent on execution, which could make the industry growth inherently more volatile going forward, supporting our thesis that the leading apps' steep recent slowdown is not a function of oversaturation so much as mis-execution. Given all this, we believe the U.S. online dating industry will see durable, above consensus revenue growth medium to long term. We think the 2022 slowdown was due to mis-execution and monetization, with almost no payer growth and macro challenges, rather than saturation, as three of the four primary industry growth drivers, online dating usage, payer penetration and revenue per payer, are still on a growth path. Thanks for listening. If you enjoy the show, please leave us a review on Apple Podcasts and share Thoughts on the Market with a friend or colleague today.