Pinterest, Inc. (PINS) stock took a nosedive on Friday following a disappointing third-quarter earnings report that left investors feeling underwhelmed. The company’s stock price fell approximately 12% after the bell on Thursday and continued its downward trajectory into Friday’s trading session.
While Pinterest managed to beat revenue expectations, reporting $898 million in sales against analyst estimates of $896.34 million, its earnings per share fell short of the mark. The company reported earnings of 4 cents per share, missing analyst estimates of 7 cents. This miss, coupled with a cautious outlook for the fourth quarter, sent a clear signal to investors that Pinterest might be facing headwinds.
Pinterest provided a breakdown of its revenue, revealing that $719 million came from the U.S. and Canada, $137 million from Europe, and $42 million from the rest of the world. The company also highlighted key business metrics, announcing an Average Revenue Per User (ARPU) of $1.70 and Global Monthly Active Users (MAUs) of 537 million.
Despite the challenges, Pinterest CEO Bill Ready expressed optimism about the company’s future, stating, “Our AI investments are driving results by powering better personalized experiences and greater performance for advertisers, with our lower-funnel ad tools being the fastest-growing part of our business. Advertisers are increasingly relying on Pinterest to engage our growing audience who see us as a great place to find inspiration, curate and shop.”
However, the company’s guidance for the fourth quarter, which anticipates revenue between $1.12 billion and $1.14 billion, fell short of analyst estimates of $1.14 billion, further adding to the downward pressure on the stock.
Following the earnings report, several analysts issued price target changes, reflecting the market’s reaction to Pinterest’s performance. As of this writing, Pinterest stock was trading 15.9% lower at $28.55, according to data from Benzinga Pro.
Investors will be closely watching how Pinterest navigates the current market conditions and whether it can regain its momentum in the coming quarters.
