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Ad rebound drives Pinterest revenue beat; shares surge - Metro US

Ad rebound drives Pinterest revenue beat; shares surge

Screens display the company logo for Pinterest Inc. during the company's IPO on the front of the NYSE in New York

(Reuters) – Image sharing company Pinterest Inc <PINS.N> said advertising demand began to improve in May as it reported better-than-expected quarterly results, sending its shares nearly 28% higher.

More people turned to Pinterest’s platform for content to keep themselves entertained during coronavirus lockdowns, leading to a 39% jump in monthly active users to 416 million in the quarter, beating estimates of 372.7 million.

In a post-earnings call, Chief Financial Officer Todd Morgenfeld said the ad boycott on Facebook’s <FB.O> platform gave Pinterest “an opportunity to win some budgets and educate advertisers about how and why Pinterest is different.”

Ad spend recovered from a slump since mid-March as economic activity resumed following the easing of lockdowns, Morgenfeld said.

Both Google <GOOGL.O> and Facebook <FB.O>, which rely heavily on digital advertisement, reported strong ad sales on Thursday.

Pinterest also benefited from its updated shopping feature, with a 50% growth in users who visited shopping-only feeds in the first half of the year.

Graphic: Rise in Pinterest’s monthly active users – https://graphics.reuters.com/PINTEREST-RESULTS/jbyprkxbyve/chart.png

Pinterest, which had withdrawn its full-year outlook in April, now expects current-quarter revenue to increase in the mid-30% range year-over-year, with revenue growth of about 50% for this month through July 29.

The company slashed total expenses by about 74%, helping it narrow net loss to $100.7 million in the quarter ended June 30 from a loss of $1.16 billion last year.

Excluding items, Pinterest reported a loss of 7 cents per share, smaller than an estimate of 14 cents.

Total revenue rose 4% to $272 million, beating analysts’ average estimate of $251.2 million, according to Refinitiv IBES data.

(Reporting by Ayanti Bera in Bengaluru; Editing by Devika Syamnath)

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