Pinterest Inc. (PINS) reported its fourth-quarter earnings Thursday after the closing bell, and the results weren't exactly the confidence boost investors were hoping for. The visual discovery platform missed on both the top and bottom lines while serving up guidance that suggests the current quarter won't be much prettier.
Pinterest Slides After Double Miss and Soft Guidance Disappoint Investors
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The Numbers Tell a Mixed Story
Pinterest brought in $1.32 billion in revenue for the fourth quarter, just shy of the $1.33 billion analysts were expecting, according to market data. Adjusted earnings landed at 67 cents per share, missing the 69-cent consensus estimate. Revenue grew 14% year-over-year, which sounds respectable until you factor in those misses and what came next.
On the user front, things looked considerably brighter. Global monthly active users climbed 12% year-over-year to 619 million, hitting all-time highs. Average revenue per user came in at $2.16 globally and $9.41 in the U.S. and Canada during the quarter. The platform is processing more than 80 billion monthly searches as Pinterest continues pushing its AI-powered visual search capabilities.
The company generated $391 million in net cash from operations and $380 million in free cash flow during the quarter. Pinterest closed the period with roughly $969.34 million in cash and cash equivalents on the balance sheet.
"Users are at all-time highs and overall engagement continues to grow, with more than 80 billion monthly searches on our platform as we continue to deliver strong innovation in visual search using AI," said Bill Ready, CEO of Pinterest. "As we navigate a dynamic environment, we're laser-focused on execution and transforming our sales and go-to-market efforts so monetization better reflects the valuable commercial intent we see on Pinterest."
Guidance Adds to the Disappointment
Pinterest expects first-quarter revenue between $951 million and $971 million, falling short of the $980.12 million analysts had penciled in. The company also guided for adjusted EBITDA in the range of $166 million to $186 million for the period. Translation: the monetization challenge Ready mentioned isn't getting solved overnight.
PINS Price Action: Pinterest shares tumbled 13.27% in after-hours trading to $16.08 at publication time Thursday, according to market data.
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