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In this video, I’ll cover the good, bad and bad sides of Pinterest‘s (NYSE: PIN) Second Quarter Results Report. The stock slumped 20% after the market closed as the company missed user growth and failed to provide advice. However, revenue grew 125% year over year (YOY) and 26% quarter over quarter (QOQ) despite a decrease in the average number of monthly users (MAU). In the second quarter, MAUs on mobile applications grew by more than 20% in the United States and globally, year-over-year. You can find the video below.
What happened
Pinterest beat profits with second-quarter revenue of $ 613.2 million and earnings per share of 25 cents. However, Pinterest shares have always fallen, as the company reported MAU growth of just 9% to 454 million. Some other key figures:
- Global MAUs up 9%, down 5% quarter over quarter.
- US MAU down 5% year over year and quarter over quarter.
- International MAUs up 13% but down 4.5% QOQ.
- Worldwide average revenue per user (ARPU) up 89% year over year and 27% in QOQ.
- US ARPU up 103% YOY and 27.32% QOQ.
- International ARPU up 163% YOY and 38% QOQ.
The current expectation is that third quarter revenue will grow in the low 40% year-over-year range. The company expects third-quarter operating expenses to increase slightly quarter-over-quarter as it continues to increase its investments in long-term strategic priorities, with plans to resume brand marketing campaigns early in the fourth quarter. No guidance was given on MAUs.
So what
Every social media platform has gone through a rough patch where user growth has stalled or even declined. COVID has affected Pinterest’s growth for better and for worse. Many people took to Pinterest during the lockdown because they were looking for inspiration while stuck at home; now that the world is reopening, you are seeing the opposite effect. So while the pandemic has increased Pinterest’s user base, some of those users aren’t the type Pinterest usually attracts, and that’s why you’re seeing a decrease. On the other hand, those who stay on the platform are much better monetized.
For the full information, watch the video below.
* The stock prices used were the closing prices of July 29, 2021. The video was published on July 30, 2021.
This article represents the opinion of the author, who may disagree with the “official” recommendation position of a premium Motley Fool consulting service. We are heterogeneous! Challenging an investment thesis – even one of our own – helps us all to think critically about investing and make decisions that help us become smarter, happier, and richer.
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