Reuters/Brendan McDermid
Pinterest CEO Ben Silbermann.
- Pinterest reported third-quarter results Thursday that missed Wall Street expectations for revenue.
- Shares fell as much as 24% on the news, pushing the company's stock below its initial public offering price.
- The company also reported a full-year 2019 outlook that failed to live up to Wall Street's expectations though it said that losses will shrink this year.
- Watch Pinterest trade live on Markets Insider.
Pinterest disappointed Thursday when its third-quarter earnings release showed revenue that missed analyst expectations.
Shares of the social media pinning service fell as much as 24% in on Friday, bringing the stock below its initial public offering price.
Here's what Pinterest reported, versus what analysts surveyed by Bloomberg expected:
- Revenue: $279.7 million reported versus $282.1 million (expected)
- Earnings per share: 1 cent, excluding some items, reported, versus -4 cents (expected)
The company also reported a full-year 2019 outlook that failed to live up to Wall Street's expectations. Pinterest said it expects yearly revenue to be between $1.1 billion and $1.115 billion, where analysts were expecting $1.12 billion.
Pinterest said that losses will shrink this year, and the company now expects an adjusted yearly loss between $10 million and $30 million. That's less than the previous expected range of loss between $25 million and $50 million.
The company showed promising growth in some areas during the quarter. Global monthly active users were up 28% from last year to 322 million, which is higher than the 310.9 million users analysts expected. That translated into strong sales, up 47% in the quarter, showing growth that beat out much larger rivals. Facebook reported ad sales up 28% in the last quarter, and Google's sales grew 17% in the same timeframe.
"We saw double-digit user growth in nearly all international countries," Todd Morgenfeld, chief financial officer of Pinterest, said in a press release. "We are thrilled to serve Pinterest ads in 28 markets currently, compared to seven at the end of 2018."
However, overseas growth generates less revenue than user growth in North America. The company added only 2 million new users in the US.
Analysts are all positive or neutral on the company. Pinterest has 11 "buy" ratings, 11 "hold" ratings, and no "sell" ratings, according to Bloomberg data. The average price target on the stock is $28.12.
Pinterest is up 4% year to date.