What Happened?
Shares of social commerce platform Pinterest (NYSE: PINS) fell 8.3% in the morning session after the company reported mixed second-quarter results where an earnings per share miss overshadowed strong revenue and user growth. The social media platform reported second-quarter adjusted earnings of $0.33 per share, which fell short of analyst estimates of $0.35. This profitability miss was the primary concern for investors, and it overshadowed the company's strong top-line performance, where revenue grew 16.9% year-over-year to $998.2 million, beating expectations. Pinterest also reported a healthy 10.7% increase in global monthly active users to 578 million. However, the market appeared to be hoping for more, as even a slightly better-than-expected revenue forecast for the next quarter was not enough to overcome the disappointment from the earnings miss.
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What Is The Market Telling Us
Pinterest’s shares are quite volatile and have had 15 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 8 days ago when the stock gained 4.1% on the news that a broad rally in the technology sector, sparked by stellar earnings reports from industry giants Meta and Microsoft. Both technology titans reported results that surpassed analyst forecasts, driven by significant investments in artificial intelligence. Meta, a key competitor in the digital advertising space, saw its shares surge after revealing strong ad revenue. This powerful performance created a wave of positive sentiment that lifted other internet and technology stocks, as investors grew optimistic about the health of the digital advertising market.
Pinterest is up 18.4% since the beginning of the year, but at $36.23 per share, it is still trading 9.4% below its 52-week high of $40 from February 2025. Investors who bought $1,000 worth of Pinterest’s shares 5 years ago would now be looking at an investment worth $1,010.
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