Pinterest just did the unthinkable — again. For the second consecutive quarter, the visual discovery platform shed roughly 20% of its market cap in a single after-hours session. Shares plunged Thursday evening after the company delivered a revenue miss, an earnings miss, and guidance that made analysts wince.
The numbers tell the story. Fourth-quarter revenue came in at $1.32 billion against expectations of $1.33 billion. Earnings hit $0.67 per share versus the $0.69 Wall Street wanted. Small misses on their own — but the forward guidance is where the damage happened. Pinterest projected Q1 revenue between $951 million and $971 million, well short of the $980 million consensus. CEO Bill Ready blamed an “exogenous shock related to tariffs” that crushed ad spending from the company’s largest retail advertisers. CFO Julia Donnelly confirmed those headwinds are expected to intensify in Q1, particularly in Europe and the U.K.
Here’s the awkward part: Pinterest’s user base has never been bigger. Global monthly active users hit a record 619 million in Q4, topping the 613 million analysts expected. So 619 million people are actively pinning recipes, outfits, and home renovations — and the company still can’t turn that engagement into the ad revenue Wall Street demands. The disconnect between usage growth and revenue growth is the kind of thing that keeps CFOs up at night.
Adding to the pressure, Pinterest laid off nearly 15% of its workforce in January to redirect resources toward AI-powered products and capabilities. The restructuring — plus an ongoing overhaul of its sales team — means short-term disruption is baked into the company’s own guidance. Meanwhile, analysts at Jefferies flagged a longer-term concern: AI disruption risk is real and accelerating. As AI tools get better at visual search and product discovery, Pinterest’s core value proposition faces an existential question it hasn’t fully answered.
The bull case is that Pinterest’s commerce platform is still maturing, its international opportunity is massive, and the AI pivot could unlock new ad formats. The bear case is that we’ve now watched this stock get cut by 20% on earnings two quarters running, it’s down more than 40% from its 2024 highs, and the company’s biggest advertisers are pulling back because of tariff-driven cost pressures. When your customers are cutting ad budgets because they’re busy raising prices on consumers, your recovery timeline gets murky fast.