Pinterest Q3 2024 Earnings Report

Pinterest Shares plunged as much as 15% on Thursday after the social media company gave weak fourth-quarter revenue guidance, even though it beat on top and bottom lines with its third-quarter earnings.

According to LSEG, this is how the company developed:

• revenue: $898 million versus expected $896 million
• Earnings per share: 40 cents adjusted versus 34 cents expected

The company said fourth-quarter revenue will be between $1.125 billion and $1.145 billion. The median forecast for the fourth quarter was $1.135 billion, falling short of analyst estimates of $1.143 billion.

Pinterest CFO Julia Donnelly told analysts during an earnings call that continued weakness among food and beverage advertisers, part of the broader consumer packaged goods market, had a negative impact on the social media company’s overall revenue. The slump in the sector will likely continue into the fourth quarter, she said.

Pinterest also said in a filing Thursday that its board had approved a $2 billion share buyback.

Pinterest’s third-quarter revenue rose 18% from $763.2 million a year ago.

Pinterest said it had 537 million monthly active users worldwide in the third quarter, beating analyst estimates of 532.6 million.

The company’s net income rose a whopping 354% year-over-year to $30.56 million. Total costs and expenses for the quarter were $904 million, an increase of 17% compared to $768 million a year ago.

Donnelly attributed Pinterest’s increasing spending to investments in research and development and hiring people with expertise in artificial intelligence.

Pinterest’s latest quarterly results follow the recent U.S. presidential election earlier this week, as well as several earnings reports from other technology companies with online advertising businesses.

Last week, Amazon said its advertising business grew 19% year-over-year to $14.3 billion in the third quarter. and Meta announced that third-quarter revenue increased 19% year-over-year to $40.59 billion. However, Meta shares fell slightly due to weaker than expected user numbers and warned of a significant acceleration in infrastructure spending in 2025.