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Momo shares crash after its Tinder-like dating app gets removed from app stores

Shares of Chinese dating app Momo Inc (NASDAQ: MOMO) took a beating during the early trade on Monday after reports emerged that its subsidiary and peer dating platform Tantan was being removed from numerous app stores. According to Chinese media, the app is currently available for download only on the app stores of Apple (NASDAQ: AAPL) and Xiaomi.

Momo shares tumbled 10% during pre-market trading. During the year-to-date period, the stock has gained 48%.

The drastic move came after multiple users started raising a flag on obscene and erotic content that was being shared across the platform. There were also media reports that ads related to prostitution were showing up on the app.

Founded in 2014, the app uses a swipe format to make matches, similar to Tinder. It was acquired by Momo in February last year for $600 million. At the end of 2018, Tantan had close to 4 million paid users.

READ: SERVICES LIKELY TO DRIVE APPLE’S POST-EARNINGS STOCK MOVEMENT

In an official statement, Momo said it intends to cooperate with the Chinese authorities to restore the app as soon as possible, adding it would do a comprehensive internal review of the app’s content.

“Pending restoration of the Tantan app in the relevant app stores in China, the Company’s ability to attract new Tantan users will be adversely affected, while existing Tantan users may continue to use the app,” the company said.

 

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