The latest social media platform to suffer from a slowdown in advertising expenditure by businesses concerned about a bleak economic outlook is Pinterest, which had its worst quarterly revenue growth in over two years and made a loss. This year, firms are being forced to decrease their marketing costs due to decades-high inflation, which is causing online players like Alphabet, Meta, and Snap to fiercely compete for dwindling ad revenue. Similar to its larger competitors, Pinterest’s third-quarter revenue increased by 8% to $684.6 million (or nearly Rs. 5,600 crores). However, according to Refinitiv statistics, the amount was larger than the $666.71 million (or nearly Rs. 5,500 crores) that experts had predicted.
Less individuals are turning to the image-sharing platform for motivation to start projects like house remodeling and recipe-based cooking as a result of the resurgence of outside activities. Despite remaining constant at 445 million, Pinterest’s monthly active users (MAUs) worldwide outperformed Factset’s forecast of 437.4 million.
After Snap, the owner of the photo messaging service Snapchat, predicted no revenue growth for the current quarter earlier this month, Pinterest shares fell along with those of Twitter, YouTube parent Alphabet, Facebook parent Meta, and YouTube parent Alphabet. Other social media stocks that rely on ad revenue fell as a result of the revelation.
In comparison to a profit of $94 million (approximately Rs. 800 crores), or $0.14 (about Rs. 12) per share, a year earlier, the company reported a net loss of $65.2 million (roughly Rs. 500 crores), or $0.10 per share (nearly Rs. 8).
The average revenue per user for Pinterest worldwide increased by 11% to $1.56. (roughly Rs. 130). Due to slightly larger foreign exchange headwinds than in the third quarter, Pinterest said it was anticipating mid-single-digit percentage revenue growth in the current quarter.
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