NEW YORK, Nov 1 — Pinterest Inc fell short of Wall Street estimates for quarterly revenue on lower-than-expected average revenue per user and its revised full-year sales forecast came marginally below expectations, sending its shares tumbling 19%.
Yesterday’s after-market plunge is expected to wipe out a majority of the gains since the online scrapbook company’s blockbuster initial public offering in April, leaving the stock just about 6% from its IPO price.
Pinterest on average posted revenue of 90 cents per user globally in the third quarter, falling just short of analysts expectation of 91 cents, according to research firm FactSet.
The company’s net loss widened to US$124.7 million (RM521.1 million) from US$18.9 million a year earlier, as total costs and expenses nearly doubled to US$413.4 million.
Pinterest has been investing in areas such as advertiser diversification which would “bear fruit over the coming several quarters and years,” Chief Financial Officer Todd Morgenfeld said on a post earnings call with analysts.
“We’re still in the early days of that, and it will unfold over a period of time.”
Pinterest, which calls its users “Pinners”, said monthly active users jumped 28% to 322 million. Analysts had expected about 307 million users.
Total revenue rose about 47% to US$279.7 million in the quarter ended September 30, but fell short of analysts’ estimates of US$280.6 million, according to IBES data from Refinitiv.
The company generates revenue by placing advertisements among pins or posts, basically ideas for clothes, décor and recipe, uploaded on the site by users.
Excluding certain items, the company earned a cent per share. Analysts were expecting a loss of 4 cents.
Pinterest expects 2019 total revenue to be between US$1.10 billion and US$1.115 billion, compared to its prior forecast of US$1.095 billion and US$1.115 billion. Analysts were expecting US$1.12 billion, according to IBES data from Refinitiv.
Pinterest was one of the most high-profile social media companies to list in the United States since Snap Inc in 2017. — Reuters
