Pinterest shares plummet 15% on earnings miss, weak forecast

Pinterest shares tanked as much as 15% on Tuesday after the company reported third-quarter financial results that missed on earnings per share and provided weak guidance.

Here’s how the company did, compared to analysts’ consensus estimates from LSEG:

• Earnings per share: 38 cents adjusted vs. 42 cents expected
• Revenue: $1.05 billion vs. $1.05 billion expected

Pinterest’s third-quarter sales grew 17% year over year while net income was $92.11 million, up 201% from $30.56 million a year ago during the same period.

The company said fourth-quarter revenue will come in between $1.31 billion and $1.34 billion. The midpoint of the revenue outlook, $1.325 billion, trailed Wall Street’s projections of $1.34 billion.

Pinterest said it recorded 600 million global monthly active users in the third quarter, ahead of the 590 million that StreetAccount was projecting. In August, Pinterest reported 578 million monthly active users for the second quarter.

The company logged $306 million in third-quarter adjusted earnings before interest, taxes, depreciation and amortization, or EBIDTA. That was higher than StreetAccount’s estimates of $295 million.

Third-quarter sales in the U.S. and Canada came in at $786 million, lower than StreetAccount’s estimates of $799 million.

Pinterest’s third-quarter global average revenue per user was $1.78 and less than the $1.79 that StreetAccount was projecting.

“Our investments in AI and product innovation are paying off,” Pinterest CEO Bill Ready said in a statement. “We’ve become a leader in visual search and have effectively turned our platform into an AI-powered shopping assistant for 600 million consumers.”

Tech giants Meta, Alphabet and Amazon reported their most recent quarterly earnings last week. Those reports showed strong digital advertising sales amid their big spending for artificial intelligence infrastructure.

Meta said that its third-quarter revenue, of which 98% is derived from online ads, soared 26% year-over-year to $51.24 billion, representing the company’s strongest year-over-year sales growth since the first quarter of 2024.

Sales in Amazon’s online ad unit rose 24% year-over-year to $17.7 billion, which was a faster growth rate than the tech giant’s AWS cloud computing unit.

Alphabet reported $74.18 billion in total advertising sales for the third quarter, which was a nearly 13% increase from $65.85 billion a year ago. The company’s YouTube unit saw third-quarter online revenue jump 15% increase to $10.26 billion.

Reddit reported third-quarter earnings last Thursday and said sales ballooned 68% year-over-year to $585 million while global daily active uniques were up 19% year-over-year to 116 million, topping estimates of 114 million. 

Snap reports its quarterly results on Wednesday.

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