Pinterest shares slip on fourth-quarter revenue miss and weak forecast
- Pinterest said it expects sales in the first quarter to increase in the "low single digits" from a year earlier. Analysts were expecting growth of 6.9% to $614.8 million.
- The company's fourth-quarter earnings report comes after digital ad companies like Facebook parent Meta and Google parent Alphabet reported tepid numbers.
- Amazon's digital advertising unit represented a bright spot during the fourth quarter, with sales jumping 19% year-over-year to $11.6 billion.
Pinterest shares slipped in extended trading on Monday after the company reported revenue that missed analyst expectations and issued a light forecast for the first quarter. The stock pared its losses after earlier falling by as much as 12%.
Here's how the company did.
- Revenue: $877 million vs. $886.3 million expected, according to Refinitiv.
- Earnings: 29 cents per share adjusted vs. 27 cents expected, according to Refinitiv.
Pinterest said it expects sales in the first quarter to increase in the "low single digits" from a year earlier. Analysts were expecting growth of 6.9% to $614.8 million.
The company said that its chief financial officer and head of business operations Todd Morgenfeld will leave the company on July 1, 2023.
Revenue in Pinterest's fourth quarter grew 4% to $877.2 million from $846.7 million a year earlier, while overall sales for 2022 jumped 9% year-over-year to $2.8 billion.
Pinterest recorded net income of $17.5 million, or 3 cents a share, down from $174.7 million, or 25 cents a share, a year earlier. For the full year, Pinterest logged a net loss of $96 million.
The company said its global monthly active users increased by 4% year-over-year to 450 million. Average revenue per user, or ARPU, for the U.S. and Canada region rose 6% in the fourth quarter to $7.60.
"While the industry as a whole is facing headwinds, we are adapting quickly to a changing macro environment and are committed to creating a more positive online experience for our users and advertisers," Pinterest CEO Bill Ready said in a statement.
The company also said that its chief marketing and communications officer Andréa Mallard and its chief revenue officer Bill Watkins will now report directly to Ready.
Pinterest's fourth-quarter earnings come after many ad-supported companies reported tepid results.
Meta said last week that its fourth-quarter sales dropped 4% year-over-year to $32.2 billion, while Alphabet's Google ad business recorded $59 billion in fourth-quarter revenue, a 3.6% drop from the same quarter last year. Additionally, revenue in Alphabet's YouTube unit sank 8% year-over-year to $7.96 billion in the fourth quarter.
Snap said sales in the fourth quarter were slightly up year-over-year to $1.3 billion, which missed analyst expectations of $1.31 billion.
Amazon's digital advertising unit represented a bright spot during the fourth quarter, with sales in that unit jumping 19% to $11.6 billion.
Pinterest reportedly laid off around 150 employees last week, joining the growing list of technology companies like Meta, Alphabet and Salesforce that have fired workers in recent months.
In August, Elliott Management confirmed that it was Pinterest's top investor and voiced support for Ready, who formerly led Google's commerce business. Ready joined Pinterest in June 2022, replacing longtime CEO and co-founder Ben Silbermann.