Pinterest (NYSE: PINS) stock plunged almost 10% on Friday after the social media company posted lower-than-expected revenue for the fourth quarter while issuing a bleak forecast for the current quarter.
Pinterest (PINS) reported a 12% increase in fourth-quarter revenue from a year ago, reaching $981 million. However, this figure fell below market expectations. Revenue increased by 9% to $3.06 billion for the year. Despite this growth, Pinterest ended the year with a net loss of $35.6 million.
Europe was a bright spot for Pinterest in the fourth quarter, as they saw a 32% increase in revenue there. Their user base also grew, with 498 million people using the platform monthly, representing an 11% increase.
Pinterest provided a lower-than-expected forecast for the first quarter, expecting revenue between $690 million and $705 million.
Even though big companies like Amazon (AMZN) and Meta (META) are doing well in the digital advertising market, Pinterest’s results suggest that smaller firms might find it harder to keep up.
Nevertheless, JPMorgan analysts foresee a robust 2024 for Pinterest. They mention new partnerships with Google and Amazon, expansion in regions beyond the U.S., and investments in new products on the Pinterest platform as reasons for their optimism.
Pinterest’s CEO, Bill Ready, acknowledged that the platform is not making as much money from international users as it could. He noted that 80% of its users are from outside the U.S., yet they contribute only 20% of the revenue.
Analysts at Jeffries are optimistic about Pinterest’s future growth, suggesting that the company still has room for significant revenue increases.
Pinterest (NYSE: PINS) Stock Movement
PINS shares plummeted -9.45% to close at $36.87 on Friday, causing a loss of about $3 billion in market value, marking the steepest one-day drop since April 28, 2023. The traders had exchanged hands with 42,672,206 (42.67 million) shares compared to the average daily trading volume of 9.74 million.
Edward Cooke is a financial analyst, freelance writer, and editor. He has six years of experience in financial journalism. He has an in-depth understanding of equities markets, tracking major indices and providing real-time analysis on stock price movements, corporate earnings, and market sentiment.
