Pinterest is a visual search and discovery platform. It enables users to explore, save, and organize ideas through images and videos.
Listed on the stockmarket in 2019, the company has benefited from strong growth: revenue has almost quintupled in seven years and the company was profitable last year. At first glance, shareholders should therefore remain confident, maybe...
However, competition is intensifying. Online advertising giants (including Meta, Amazon, Alphabet, TikTok, and Reddit) are taking up more and more space, with Pinterest struggling to keep up with their growth rates. At the same time, advertising budgets are shrinking. Companies are facing rising costs and customs duties. They are focusing their expenditure on the most popular platforms, those with the largest audience and powerful artificial intelligence tools. Pinterest therefore remains a minor player in the digital advertising market, with around a 1% market share in the US. Its advertiser base is limited and its dependence on Chinese and American home decor brands is hampering its expansion. Major Chinese retailers such as Temu and Shein are feeling the impact of the end of the "de minimis" exemption, which allowed them to avoid customs duties on small shipments.
In Q3, Pinterest still saw its revenue grow by 17% to $1.05bn. Growth remains solid and is expected to continue to be in double digits over the coming quarters. The number of monthly active users continues to increase, now exceeding 600 million. However, analysts are concerned that new users cannot be monetized at the same rate as existing ones. Engagement may be affected by the rise of artificial intelligence content and large language models. Unlike Meta, Pinterest has not yet been able to improve its advertising prices using these technologies.
The launch of a voice assistant could offer Pinterest a way to differentiate itself from OpenAI. However, this project will require significant investment and time before it yields tangible results. For now, the stock's valuation remains high. Today's decline is a reminder that at such levels, the market does not tolerate disappointment.
Pinterest, Inc. (Pinterest) offers visual search and discovery platform. The Company’s primary service, Pinterest, can be accessed through its mobile application or the Web. People use Pinterest to find ideas. As they browse Pinterest content, Pins, they fine-tune their tastes and find the idea. Users interact with the platform in multi-session journeys to find inspiration, curate their latest look, plan their next project and shop from brands. It has approximately 553 million monthly active users across the world. Content on Pinterest comes from a variety of sources, including retailers, brands, creators, publishers and users. It acquires that content via a range of methods, including product catalog uploads, direct publishing, and user curation. Content formats include images that allow the user to click into an idea to learn more, videos that provide the steps of an idea, and products that brands and merchants upload from catalogs.
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Investor
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Global
Global
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ESG MSCI
ESG MSCI
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