Pinterest Inc forecast fourth-quarter revenue growth in the high-teens percentage range, after online retailers splurging on ads before the holiday season helped the image-sharing company beat quarterly estimates.
Shares of the company rose 6.5% after the bell on Thursday, as increased demand from large retail advertisers and growth in its international business boosted third-quarter revenue 43%.
Advertisers in the consumer packaged goods segment, however, were hurt by global supply chain constraints, impacting Pinterest’s revenue growth rate.
In a post earnings call, the company also said it did not face any material impact from Apple’s privacy changes which have made it difficult for social media companies to target audiences and measure advertising capabilities.
Pinterest’s monthly active users (MAU), meanwhile, grew just 1% to 444 million, missing Factset estimates of 460 million. Last year, the company had notched a 37% surge as users stuck at home turned to social media to keep themselves entertained.
“We believe the slowdown was due to the pandemic unwind,” Chief Financial Officer Todd Morgenfeld said in an interview. Many GenZ users are returning to school, while others who had used the app to explore cooking and home decor projects during lockdowns are now venturing out more, he added.
Still, in a sign that the pandemic-accelerated shift to online shopping may be here to stay, Pinterest’s quarterly revenue of $633 million surpassed analysts’ average estimate of $630.9 million, according to IBES data from Refinitiv.
Its users, called “pinners”, using the app’s shopping features increased 60% from a year ago.
Net income was $94 million, or 14 cents per share, during the quarter ended Sept. 30, compared with a loss of $94.2 million, or 16 cents per share, a year ago.
Excluding items, it gained 28 cents per share, above estimates of 23 cents per share.
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