Pinterest, the popular social media platform, experienced a drop in shares following the release of a weaker-than-expected forecast and disappointing revenue. The company reported quarterly revenue of $981 million, slightly below the projected $991 million. However, it did beat expectations for earnings per share, with 53 cents per share, adjusted, compared to the estimated 51 cents per share.
The fourth quarter also saw an increase in monthly active users, rising by 11% to 498 million, surpassing analyst estimates. Despite this, Pinterest’s global average revenue per user fell short at $2, lower than the estimated $2.05.
Looking ahead, Pinterest projected a first-quarter revenue range of $690 million to $705 million, with a year-over-year growth of 15% to 17%. Initially, the stock tumbled by 28% in after-hours trading but later recovered to a 10% decline after the announcement of a “third-party app integration with Google.”
This integration with Google, similar to Pinterest’s partnership with Amazon, aims to enhance the monetization of markets outside of the United States. While the Google integration did not significantly contribute to fourth-quarter revenue, it has played a role in boosting third-party ad demand.
Pinterest sees huge potential for growth in its international markets, considering them to be under-monetized. Therefore, the company believes the integration with Google could help increase revenue in the first quarter and beyond.
Investors will be closely watching Pinterest’s progress in expanding its monetization efforts and capitalizing on its international markets. With the stock experiencing fluctuations following the release of its forecasts, the company’s ability to execute its plans will be essential for its future success.
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