Pinterest’s stock tumbles on sales, earnings misses

Pinterest also announced its board of directors authorized a repurchase of up to $500 million of its Class A common stock over the next 12 months.

“While the industry as a whole is facing headwinds, we are adapting quickly to a changing macro environment and are committed to creating a more positive online experience for our users and advertisers,” new Pinterest Chief Executive Bill Ready said in a statement.

Pinterest said first-quarter revenue will “grow low single digits on a year-over-year percentage basis” and that Chief Financial Officer Todd Morgenfeld will leave the company July 1. 

Analysts on average expected Pinterest to report adjusted earnings of 27 cents a share on sales of $888 million, according to FactSet. Shares drooped 14% in after-hours trading Monday before rallying. In the regular session, Pinterest shares inched up 1.6% to $27.93.

Monthly active users jumped 4% to 450 million; Wall Street analysts on average predicted 451.7 million.

The financial results mirrored sagging revenue and earnings that plagued Snap Inc.
SNAP,
+9.73%,
Alphabet Inc.’s 
GOOGL,
-1.79%

GOOG,
-1.66%
Google and Facebook parent company Meta Platforms Inc. 
META,
-0.25%
last week as online ad buyers scale back spending in a slowing economy.

Last week, Pinterest announced a workforce reduction of less than 5%, or about 150 jobs.

Evercore ISI analyst Mark Mahaney had expected better things financially from Pinterest “given its relatively low impact from [Apple Inc.’s
AAPL,
-1.79%
App Tracking Transparency] and potential share gains from [Twitter], but the checks also point to a clear sign that the Ad Winter is extending into Q1,” he said in a note Sunday. “We continue to believe that in an Ad Winter, marketing budgets will concentrate to the largest platforms –– META & GOOG.”

Pinterest’s stock has risen 15% so far this year, while the S&P 500 index
SPX,
-0.61%
 has risen 7% in 2023.