Pinterest share price falls 20% as tariffs hit earnings
on Pinterest Shares gained more than 20% on Friday after the company cited disappointing tariff-related shocks to its fourth-quarter earnings.
The social media company’s Q4 earnings came in below analysts’ expectations, with LSEG revenue of $1.32 billion compared to consensus estimates of $1.33 billion. Net income for the quarter fell 85% to $277 million from $1.85 billion in the prior year.
It also recorded $541.5 million in adjusted earnings before interest, taxes, depreciation and amortization (EBITDA), below the $550 million analysts had predicted.
Pinterest expects first-quarter sales to be between $951 million and $971 million, below analysts’ estimates of $980 million.
CEO Bill Ready said the company “absorbed an exogenous shock related to tariffs this year” and was more exposed to reduced advertising spending by major retailers.
Pinterest also announced plans in January to lay off less than 15% of its workforce and reduce office space in a bid to pivot entirely to AI. He said “resources have been reallocated” to AI-focused teams and “AI-enabled products and capabilities” have been prioritized.
Pinterest one day stock chart.
What analysts say
In a note published Friday, Citi said it had downgraded Pinterest’s shares to Neutral from Buy because “visibility to larger UCAN and EU advertisers is more limited, in part due to tariffs and challenges in certain sectors,” such as home furnishings, a rebuild of its go-to-market sales function as Pinterest expands its advertiser base, and larger investments impacting margins.
Pinterest’s revenue performance is expected to remain “under pressure in the near term due to macro-related headwinds” such as tariffs and consumer spending, Goldman Sachs analysts said in a note on Friday.
But they added: “Despite short-term headwinds, management remains optimistic about its long-term growth strategy, focused on diversifying its advertiser base, automation and performance-focused objectives.
Analysts noted that user growth among Gen Z users was particularly strong.
The company reported that the number of global monthly active users in the fourth quarter rose 12% year over year to 619 million, representing an all-time high.
— CNBC’s Jonathan Vanian contributed to this report
