Pinterest (PINS-US) delivered mixed third-quarter results on Tuesday (Apr. 4), sending its stock into a tailspin. While revenue matched Wall Street expectations, earnings fell short, and management flagged ongoing weakness in advertising spending. Shares plunged nearly 20% in after-hours trading, erasing year-to-date gains and raising questions about the company’s near-term growth trajectory.
Q3 Results: Revenue Meets, Earnings Miss
Pinterest reported revenue of $1.05 billion, up 17% year-over-year and in line with consensus estimates. Adjusted EPS came in at $0.38, below analyst expectations of $0.42. Net income surged to $92.1 million, more than tripling from $30.6 million a year earlier, thanks to cost controls and efficiency gains.
Other key metrics:
- Global Monthly Active Users (MAUs): 600 million vs. 590 million expected
- Adjusted EBITDA: $306 million vs. $295 million expected
- U.S. & Canada Sales: $786 million vs. $799 million expected
- Global ARPU: $1.78 vs. $1.79 expected
Despite solid user growth, monetization lagged, particularly in North America, where tariff-driven cost pressures are squeezing advertisers.
Management Commentary: AI Progress vs. Ad Weakness
CEO Bill Ready highlighted Pinterest’s progress in artificial intelligence and product innovation, noting that the platform has evolved into an AI-driven shopping assistant for its 600 million users. He emphasized that visual search and personalization remain long-term growth drivers.
CFO Julia Donnelly, however, struck a more cautious tone. She pointed to a slowdown in U.S. and Canadian ad spending, tied to tariff pressures on large retailers. With new tariffs on lumber, logs, kitchen cabinets, and furniture imports announced in September, home furnishing retailers in particular are cutting marketing budgets. Donnelly warned that these headwinds will likely persist into Q4.
Pinterest guided Q4 revenue to $1.31–$1.34 billion, slightly below the consensus estimate of $1.34 billion.
Competitive Landscape: Falling Behind Peers
Pinterest’s struggles stand in stark contrast to the robust digital advertising results reported by larger peers:
- Meta (META-US): Q3 revenue surged 26% to $51.24 billion, its fastest growth since early 2024.
- Alphabet (GOOGL-US): Advertising revenue rose 13% to $74.18 billion, with YouTube up 15%.
- Amazon (AMZN-US): Online ad revenue jumped 24% to $17.7 billion, outpacing AWS growth.
Meanwhile, Reddit (RDDT-US) posted a 68% revenue increase to $585 million, beating expectations, while Snap (SNAP-US) is set to report next, with investors watching its short-video ad momentum.
The Bottom Line
Pinterest is caught in a tough spot: user growth is strong, but ad monetization is under pressure. Tariffs are squeezing retailers, dampening ad budgets, and leaving Pinterest exposed just as competitors post blockbuster results.
While management points to AI innovation as a long-term differentiator, investors are focused on the near-term reality: slowing ad sales in core markets. With shares down nearly 20% after hours, Pinterest faces a credibility test in proving it can weather tariff headwinds and keep pace in the crowded digital advertising race.