FILE PHOTO: The dating app Tinder is shown on a mobile phone in this picture illustration taken September 1, 2020. Picture taken September 1, 2020. REUTERS/Akhtar Soomro/Illustration/File Photo

FILE PHOTO: The dating app Tinder is shown on a mobile phone in this picture illustration taken September 1, 2020. Picture taken September 1, 2020. REUTERS/Akhtar Soomro/Illustration/File Photo

Nov 2 : Tinder's daily active users in the US returned to annual growth in October, parent Match Group's chief financial officer told Reuters on Monday, a key milestone in the dating app's turnaround efforts.

Improvements in DAU were largely driven by better algorithms, helped by the use of AI to analyze unstructured data and identify more compatible users, finance chief Steve Bailey said, without disclosing the monthly numbers.

Tinder's global DAU had returned to year-over-year growth in September for the first time in three and a half years.

Dating apps have turned to AI as younger Gen Z users' growing disillusionment with endless swiping fuels weaker user engagement.

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Last month, rival Bumble struck a $1.3 billion deal with Ithaca Holdings to go private after struggling for years to revive growth.

Match Group reported a 1 per cent drop in Tinder's global DAU for the third quarter, compared with a 10 per cent decline a year earlier.

The company expects to spend around $10 million on AI tools in 2026. Match Group is slowing hiring to offset rising AI costs and not laying off employees, Bailey said.

The company estimated fourth-quarter revenue to be between $865 million and $875 million, compared with analysts' expectations of $871.4 million, according to data compiled by LSEG.

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