TLDR:
- Pinterest missed Q1 earnings estimates with $0.23 EPS versus expected $0.25
- Revenue beat expectations at $855 million, up from $740 million a year ago
- Monthly active users reached 570 million, exceeding Wall Street estimates
- Stock jumped 15% in after-hours trading on strong Q2 guidance
- Company faces some challenges from reduced digital ad spending by Asia-based e-commerce retailers
Pinterest reported mixed first-quarter results yesterday but saw its stock surge 15% in extended trading after providing better-than-expected guidance for the coming quarter. The social media platform, which has positioned itself as a shopping destination, missed earnings estimates but beat revenue projections.
The company reported quarterly earnings of $0.23 per share, falling short of the $0.25 per share analysts had expected. This represents an earnings surprise of -8%.
Despite the earnings miss, Pinterest posted revenues of $855 million for the quarter ended March 2025, surpassing estimates by 1.09%. This revenue figure shows strong growth compared to $740 million in the year-ago quarter.
Pinterest shares have struggled this year, losing about 5.7% since January while the S&P 500 declined 4.3% in the same period.
User Growth Continues
One bright spot in the report was Pinterest’s user metrics. The company reported 570 million monthly active users in the first quarter, ahead of Wall Street’s expectations of 565 million.
This continued user growth suggests Pinterest’s efforts to reposition itself as a shopping destination are bearing fruit. CEO Bill Ready told analysts that executives have focused on transforming the company “from a platform with declining users and modest revenue growth a few years ago into a secular share taker.”
Ready emphasized the platform’s appeal to younger demographics, stating, “Pinterest is where Gen Z goes to shop.”
Regional Performance Mixed
First-quarter sales from the U.S. and Canada totaled $663 million, slightly missing analysts’ estimates of $664 million.
European revenue showed stronger performance, coming in at $147 million and exceeding projections of $141 million.
The company recorded $1.52 in first-quarter global average revenue per user, which was in line with analysts’ expectations.
Strong Guidance Drives Stock Jump
What really caught investors’ attention was Pinterest’s outlook for the second quarter. The company said it expects second-quarter sales to be between $960 million and $980 million.
At the midpoint, this guidance is higher than analysts’ expectations of $966 million, which helped drive the 15% stock jump in after-hours trading.
Pinterest logged $172 million in first-quarter adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA). This was higher than the $164 million that Wall Street was expecting.
The company’s EBITDA margin was 20%, beating analysts’ expectations of 19.4%.
Economic Headwinds Persist
Pinterest’s finance chief Julia Brau Donnelly acknowledged some economic challenges during the earnings call. While stating that the company’s overall business is healthy, she noted they are “not immune to the macro environment.”
Donnelly mentioned that “there have been small pockets of spend that have been impacted by tariffs in recent weeks.” She specifically pointed to Asia-based e-commerce retailers reducing their digital ad spending following the recent ending of the de minimis trade loophole.
These comments echo similar sentiments from other tech companies like Meta, whose finance chief Susan Li recently noted that “Asia-based e-commerce exporters” have cut back on digital advertising.
Pinterest is navigating these challenges alongside other ad-supported platforms. While many tech companies reported solid first-quarter results, there’s growing concern about the coming quarters.
For example, Snap declined to provide guidance due to macroeconomic uncertainties, while Reddit executives discussed challenges related to the tough economy during their earnings call.
Google parent Alphabet reported that its advertising sales rose 8.5% year over year to $66.89 billion in Q1, but executives warned of potential headwinds to their core advertising business, particularly from Asia.
Pinterest’s second-quarter revenue expectations show confidence in its ability to weather these economic challenges. The company’s focus on shopping features and its growing appeal among younger users could help it maintain momentum in a difficult advertising market.
The company’s next consensus EPS estimate is $0.35 on $960.53 million in revenues for the coming quarter and $1.73 on $4.11 billion in revenues for the current fiscal year.
Pinterest shares jumped 15% in after-hours trading following the earnings report, despite having underperformed the broader market so far this year.
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