Pinterest shares soar on third-quarter revenue beat as it bucks online ads trend

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  • Pinterest beats both earnings and earnings per share.
  • The company has bucked the trend of online advertising, which has taken a toll on rivals like Meta and Snap.
  • Pinterest posted a loss of $65 million.

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Pinterest Shares rose more than 12% in extended trading after the company reported third-quarter earnings.

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Here’s how the company did it.

  • revenueExpected: 11 cents per share (adjusted) versus 6 cents per share (adjusted), according to Refinitiv.
  • revenueExpected: $684.6 million versus $666.7 million, according to Refinitiv.

Pinterest said its revenue grew 8% year-over-year on a loss of $65 million.

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The company’s monthly average users remained relatively flat at 445 million.

“Our current expectation is that Q4 2022 revenue will grow mid-single digits on a year-over-year percentage basis, taking into account the slightly higher foreign exchange headwinds compared to Q3 2022,” Pinterest said in a statement. Is.” “We expect our Q4 2022 non-GAAP operating expenses to grow in the low double digits quarter-over-quarter.

The company said operating expenses for 2022 should grow by about 35% year-on-year.

Pinterest’s latest earnings report downplayed a trend of online advertising companies posting results that missed analysts’ expectations. Concerns about a potential slowdown have caused businesses to reduce spending on online advertising, affecting a number of companies, including tech giants such as Meta and Alphabet.

Although Pinterest’s revenue growth rate of 8% during the third quarter was significantly lower than the 43% growth it reported last year in the same quarter, investors could see any positives after several rivals missed their respective earnings reports. Was looking for signs.

For example, shares in Snap fell more than 30% last week after the company reported a revenue default of $1.13 billion.

Earlier this week, Alphabet followed suit when it reported third-quarter revenue growth that fell to 6% from 41% a year earlier, and said ad sales in its YouTube division were falling 2% year over year. $7.07 billion, missing analysts’ estimates.

The next day, Meta announced its second-straight quarter of revenue declines and weak fourth-quarter guidance, preparing investors for another sales decline. Shares of Facebook Parent fell 24% a day after reporting quarterly results.

watch: Weak ad revenue can compromise Meta’s free cash flow.

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