Pinterest plunged into the red after declining quarterly revenue growth for the first time in nearly two years. Modern social media platforms have fallen victim to reduced advertising spending by businesses worried about the bleak economic outlook.
Decades of high inflation have forced companies to slash marketing budgets this year, as online players like Alphabet, Meta, and Snap compete fiercely to cut ad spending.
Pinterest’s third-quarter revenue rose 8 percent to $684.6 million (roughly Rs. 560 billion), underscoring the growth of its larger rivals. However, this was higher than analysts’ expectations of $666.71 million (about Rs 5.5 billion), according to Refinitiv data.
The resurgence of outdoor activities also means that fewer people are turning to image-sharing platforms for inspiration for activities such as home renovations and recipe-based cooking. Pinterest’s global monthly active users (MAU) remained flat at 445 million but beat FactSet’s estimate of 437.4 million.
Earlier this month, Pinterest shares fell, along with YouTube parent Alphabet, Facebook parent Meta, and Twitter. After Snap, the owners of the photo messaging app Snapchat predicted zero sales growth this quarter. The announcement sent other social media stocks that rely on advertising revenue down.
The company posted revenue of $65.2 million (roughly Rs. 500 crores), or $0.10 per share (roughly Rs. 800 crores), for the quarter that ended September 30, while profit was $94 million (roughly Rs. 800 crores). Net loss from $0.14 (roughly Rs. 12) per share a year ago.
Pinterest’s global average revenue per user rose 11% to $1.56 (roughly Rs. 130). Pinterest said it expects sales growth to be in the single digits for the quarter, driven by slightly higher currency headwinds than in the third quarter.
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