Pinterest Inc (NYSE:PINS) shares are tumbling on Wednesday after the company released fourth-quarter revenue guidance below analyst estimates.
What Happened: Pinterest reported third-quarter adjusted earnings of 38 cents per share, missing the analyst consensus estimate of 42 cents per share. The company posted quarterly revenue of $1.05 billion, which was in line with expectations.
Total revenue increased 17% year-over-year on a reported basis and 16% on a constant currency basis. Pinterest’s global monthly active users reached an all-time high of 600 million, a 12% increase year-over-year.
The company generated GAAP net income of $92 million and adjusted EBITDA of $306 million during the quarter. Net cash provided by operating activities was $322 million and free cash flow reached $318 million.
“We had a strong Q3, with 17% year-over-year revenue growth,” said Bill Ready, CEO of Pinterest. “Our investments in AI and product innovation are paying off. We’ve become a leader in visual search and have effectively turned our platform into an AI-powered shopping assistant for 600 million consumers. In turn, global advertisers are increasingly counting on Pinterest as a go-to search platform to reach their customers and drive sales.”
Pinterest expects fourth-quarter revenue in the range of $1.31 billion to $1.34 billion, versus the analyst consensus estimate of $1.34 billion.
PINS Analyst Ratings
Following the earnings report, multiple analysts lowered their price targets on Pinterest. Bank of America analyst Justin Post maintained a Buy rating and reduced the price target to $39 from $44. Rosenblatt analyst Barton Crockett downgraded the stock to Neutral from Buy and cut the price target to $30 from $49.
Barclays analyst Ross Sandler maintained an Equal-Weight rating and reduced the target to $36 from $40. Goldman Sachs analyst Eric Sheridan kept a Buy rating and lowered the target to $36 from $43. Cantor Fitzgerald analyst Deepak Mathivanan maintained an Overweight rating and cut the target to $34 from $40.
PINS Price Action: Pinterest shares were down 22.08% at $25.65 at the time of publication on Wednesday, according to Benzinga Pro.
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