Pinterest reported a 11% boost in third-quarter sales which surpassed expectations of analysts. Expenditures rose almost 2% from $753.9 million in the same period last year to $768.2 million. Last week, both Meta and Snap highlighted the uncertain nature of their earnings due to the conflict between Israel and Hamas.
Pinterest reported third-quarter financial results on Monday that surpassed expectations on both the top and bottom lines. Shares surged 14% in after-hours trading. Revenue for the quarter was $763.2 million, higher than the anticipated $743.5 million projected by LSEG (formerly Refinitiv). Earnings per share, adjusted, came in at 28 cents, compared to the 20 cents predicted by LSEG.The company saw an 8% increase year-over-year in global monthly active users to 482 million, and a 11% rise in revenue to $684.6 million from the prior year's third quarter. The average per-user earnings were $1.61, higher than analysts' forecasts of $1.59.In a statement, CEO Bill Ready noted that "we're finding our best product market fit in years" as Pinterest emphasizes its advantage as a visual search, discovery, and shopping platform.For the fourth quarter, Pinterest expects earnings to climb 11-13%. That midpoint comes in higher than the LSEG forecast of 11.3% growth.Meanwhile, Meta released encouraging third-quarter results last week, however its stock price experienced a 3% decline after CFO Susan Li informed analysts that the company had "observed softer ads in the beginning of the fourth quarter" owing to the Israel-Hamas war. This led to wider-than-expected revenue projections for the fourth quarter. Snap also reported some negative effects from the Israel-Hamas conflict in its earnings report last week, and decided not to provide fourth-quarter guidance "due to the unpredictable nature of war." Ready acknowledged the effects of the Middle East crisis, saying that some brand advertisers temporarily halted expenditures but have since returned. He also said that should the conflict intensify, platforms centering on brand awareness would be more affected than Pinterest.On the contrary, Amazon reported in its third-quarter earnings that sales in its online advertising unit had increased 26% year over year to $12.06 billion. Ready conceded, however, that if the Middle East crisis worsens and more advertisers stop their online marketing and promotional campaigns, Pinterest "won't be immune" to a drop-off.Pinterest swung to a net income of $6.73 million in the third quarter, compared with a loss of $65.2 million a year ago. Its fourth-quarter 2023 non-GAAP operating expenses, which excludes costs of revenue, will drop 9-13% year-over-year.
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