A banner for the web image board Pinterest Inc. hangs from the Latest York Stock Exchange on the morning Pinterest made its initial public offering, April 18, 2019.
Spencer Platt | Getty Images
Pinterest reported third-quarter earnings on Monday that beat on the highest and bottom lines. The stock jumped 14% in prolonged trading.
Here’s how the corporate did:
- Revenue: $763.2 million vs. $743.5 million expected, in accordance with LSEG, formerly referred to as Refinitiv.
- Earnings: 28 cents per share, adjusted, vs. 20 cents expected, in accordance with LSEG.
Pinterest’s revenue increased 11% from $684.6 million within the third quarter of 2022.
The number of world monthly energetic users within the quarter rose 8% from a yr earlier to 482 million. Analysts were expecting Pinterest to report 473 million global monthly energetic users. Average revenue per user was $1.61, which was higher than analysts’ projections of $1.59.
“As we lean into Pinterest’s unique differentiators as a visible search, discovery, and shopping platform, we’re finding our greatest product market slot in years,” Pinterest CEO Bill Ready said in an announcement. “Our users are engaging deeply and we’re delivering higher results for advertisers through improved measurement and innovation across the total funnel.”
For the fourth quarter, Pinterest said it expects revenue growth of 11% to 13%. The midpoint is higher than analyst estimates, which call for growth of 11.3%, in accordance with LSEG.
Last week, Meta reported better-than-expected third-quarter financial results, but its stock price dropped over 3% after finance chief Susan Li told analysts the corporate “observed softer ads at first of the fourth quarter” on account of the Israel-Hamas war.
Due to the volatility surrounding the Middle East crisis, Meta widened its fourth-quarter revenue guidance range. Snap also noted some detrimental effects from the Israel-Hamas war in its earnings report last week, and said it would not provide official fourth-quarter guidance “on account of the unpredictable nature of war.”
Snap said it “observed pauses in spending from a lot of primarily brand-oriented promoting campaigns immediately following the onset of the war within the Middle East.”
In a call with analysts on Monday, Ready acknowledged the impact of the Middle East crisis, saying that “advertisers do react to major geopolitical moments.”
Ready said concerns over the Israel-Hamas war caused some brand advertisers to temporarily pause spending, but he noted that Pinterest has since seen big advertisers return. If the crisis worsens, he expects that “platforms skewing more to brand awareness could be more impacted than us,” underscoring Pinterest’s efforts to increasingly give attention to shopping, as exemplified by its recent partnership with Amazon.
Amazon said last week in its third-quarter earnings report that sales in its internet marketing unit grew 26% yr over yr to $12.06 billion.
Still, Ready said that if the Middle East crisis deepens, leading to more advertisers pausing their online promotional and marketing campaigns, the corporate “won’t be immune” to a drop-off.
Pinterest swung to a net income of $6.73 million, or a penny a share, from a lack of $65.2 million, or 10 cents a share, throughout the year-earlier period.
Expenses within the quarter rose nearly 2% to $768.2 million from the $753.9 million a yr earlier. The corporate said its fourth-quarter 2023 non-GAAP operating expenses, which don’t include the prices of revenue, will decline within the range of 9% to 13% yr over yr.
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