Key Takeaways
- Pinterest reported Q1 adjusted earnings of $0.27 per share, beating the $0.22 estimate.
- Revenue grew 18% year-over-year to $1.01 billion, also topping forecasts.
- The company's monthly active users rose to a record 631 million.
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Pinterest Stock Jumps 13% After AI-Fueled Earnings Beat
Pinterest Inc. (NYSE:PINS) shares surged more than 13% after the company reported first-quarter revenue of $1.01 billion, beating estimates and signaling its investments in artificial intelligence are driving growth.
"Our AI investments are also translating into better advertiser performance," CEO Bill Ready told investors, noting the company's AI-powered ad suite continues to drive strong results.
The visual discovery platform reported adjusted first-quarter earnings of 27 cents per share, surpassing the consensus estimate of 22 cents. Monthly active users climbed to a record 631 million. For the second quarter, Pinterest expects revenue between $1.13 billion and $1.15 billion, ahead of the $1.12 billion analysts projected.
The stock rose to approximately $23 in trading. The strong report and a newly announced $2 billion share buyback program may help reverse the stock's 10% year-to-date decline.
The better-than-expected results were driven by improvements to Pinterest's advertising platform, which are helping to counteract spending pullbacks from some clients facing tariff-related issues. CFO Julia Donnelly confirmed that while these headwinds remain, the AI enhancements are successfully offsetting some of the negative impact.
Following the report, several analysts boosted their outlook on the company. JPMorgan raised its price target on Pinterest to $25 from $20, and UBS lifted its target to $30, with its analysts noting the platform is becoming a "more attractive destination" for ad spending.
The company's performance and forward-looking guidance suggest its strategy of integrating AI and cutting costs, which included layoffs earlier in the year, is beginning to yield significant financial improvements.
The guidance raise signals management expects advertising demand to remain strong. Investors will watch the Q2 earnings call in three months for confirmation that user growth and monetization efforts can be sustained.
This article is for informational purposes only and does not constitute investment advice.
[1] Pinterest shares jump on Q1 earnings beat, upbeat guidance[2] Here's What Key Metrics Tell Us About Pinterest (PINS) Q1 Earnings[3] Pinterest's Stock Is Soaring After Better-Than-Expected Earnings. Its CEO Says AI Helped Drive Growth.[4] Pinterest shares pop double-digits on Q1 beat and better-than-expected guidance[5] Pinterest surges on Q1 beat, $2B buyback and AI gains
