The most recent quarterly report is the first since co-founder Ben Silberman stepped down as CEO.
Image sharing service Pinterest (NYSE: PINS) advanced 20% as it posted 2022 Q2 earnings that were not as terrible as expected. The company’s user numbers for the quarter came out better than expected, triggering a push in its shares. However, Pinterest missed estimates in revenue and earnings for 2022 Q2.
Adjusted earnings were 11 cents per share, lower than analysts’ expectation of 18 cents. Also, revenue came in at $666 million. Meanwhile, Refinitiv had reported an expectation of $667. According to the press release, Pinterest said global Monthly Active Users (MAUs) in 2022 Q2 fell by 5% YoY to 433 million. Although the decline is a significant loss, earlier predictions were that the image-sharing service provider would record a steeper drop to 431 million. Thus, global MAUs for the second quarter were better than expected.
Other social media companies like Meta (NASDAQ: FB), Snap (NYSE: SNAP), and Twitter (NYSE: TWTR) also missed estimates in their quarterly financial results. At the same time, all blamed the weak online advertising market for the disappointing quarterly report.
Pinterest Records Same Users’ Numbers in 2022 Q1 and Q2
In addition, Pinterest cited the persisting adverse effects of the coronavirus pandemic as a factor for the poor performance. The image-sharing service also mentioned lower traffic from search engines as a contributor to the results. Pinterest users’ numbers in 2022 Q2 were flat at 433 million, the same as reported in Q1. The company’s shares jumped 20% in after-hours trading after the earnings announcement.
Addressing investors, Pinterest admitted that it has work to do in order to grow its users. In addition, the company said the ongoing economic challenges are affecting advertisers. The company wrote in a letter:
“The macroeconomic environment has created meaningful uncertainty for our advertiser partners. The company said it saw “lower than expected demand from US big box retailers and mid-market advertisers, who pulled back ad spend due to concerns about weakening consumer demand.”
More terrifying, Pinterest expects its revenue growth for the current quarter to be in the “mid-single digits on a year-over-year percentage basis.” Meanwhile, analysts were predicting a 12.7% revenue increase. The company said its Q3 guidance considers “slightly greater foreign exchange headwinds” from Q2.
The most recent quarterly report is the first since co-founder Ben Silberman stepped down as CEO. Pinterest shares also gained more than 5% upon the announcement, including that Bill Ready will become the new CEO. Moreson, the company amassed more gains mid-July on news of Elliott Management’s 9% stake. Elliot has confirmed its largest stake in Pinterest after the 2022 Q2 results were published.
“As the market-leading platform at the intersection of social media, search and commerce, Pinterest occupies a unique position in the advertising and shopping ecosystems, and CEO Bill Ready is the right leader to oversee Pinterest’s next phase of growth,” wrote the investment management firm.
Ibukun is a crypto/finance writer interested in passing relevant information, using non-complex words to reach all kinds of audience.
Apart from writing, she likes to see movies, cook, and explore restaurants in the city of Lagos, where she resides.
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