Coverage: Pinterest falls 17% after first post-IPO earnings

Shares of Pinterest Inc. plunged in extended trading after the company posted a wider-than-expected loss in its first quarterly report following its public-market debut.

Aisha Al-Muslim of The Wall Street Journal had the news:

The drop makes Pinterest the latest technology company to encounter difficulty not long after a much-anticipated public offering.

Pinterest shares were off more than 15% late Thursday afternoon. The stock finished up 8% in regular trading on Thursday, closing at $30.86—62% higher than its $19-a-share initial-public-offering price

The San Francisco-based visual and photo-sharing company on Thursday reported a first-quarter net loss of $41.4 million, or 33 cents a share, compared with a net loss of $52.7 million, or 42 cents a share, a year earlier.

Excluding items like stock-based compensation, Pinterest’s net loss was 32 cents a share. Analysts had expected a loss of 11 cents a share.

Revenue for the quarter rose 54% to $201.9 million, beating the consensus forecast of $200.6 million from analysts polled by Refinitiv.

Lauren Feiner of CNBC.com reported that Pinterest saw strong growth internationally:

Pinterest experienced the most growth in its international markets compared to the U.S. International revenue rose 107% from the same period last year, jumping from $7 million in Q1 of 2018 to $15 million in Q1 of 2019. By comparison, revenue in the U.S. rose 51% compared with last year’s quarter, up from $124 million to $187 million.

International MAUs saw significant growth, up from 160 million in Q1 of 2018 to 206 million in Q1 of 2019, a 29% increase. U.S. MAUs rose just 6% during that same timeframe to 85 million.

On a call with analysts following the report, CFO Todd Morgenfeld said English-speaking countries like the U.K. and Canada have made up the bulk of the company’s international growth, and the company is now focused on expanding in Europe. Pinterest opened in six new markets in the past quarter, bringing its presence to a total of 13 countries.

Pinterest has seen accelerating growth in the number of advertisers on its platform, in part due to the help of its new self-service tool, Morgenfeld said, though he said they don’t expect to see meaningful impact of the tool until next year. Going forward, Pinterest wants to expand its offerings for smaller and mid-sized advertisers.

Emily McCormick of Yahoo Finance reported that the weaker-than-expected outlook for the whole year spooked investors:

For the full year, Pinterest said it expects to see revenue between $1.06 billion to $1.08 billion, lower than the $1.09 billion expected.

Shares fell 17.17% to $25.56 each as of 4:37 p.m. ET, falling below $26 per share for the first time in since late April.

The San Francisco, California-based reported 291 million monthly active users for the first quarter, in line with guidance the company delivered in its prospectus earlier this year. Pinterest’s user base has been growing consistently on a quarterly basis since June, to a size that rivals some other social media peers. Pinterest exited 2018 with 265 million monthly active users.

Twitter posted 330 million monthly active users in the first quarter, while Snap posted daily active users of 190 million (and did not break out first-quarter monthly active users). However, Pinterest’s ecosystem is still dwarfed by Facebook’s, which posted first-quarter monthly active users north of 2 billion.

For the fiscal first quarter, closely watched average revenue per active user was $2.25 per U.S. user, and 8 cents per international user. As with many social media companies, Pinterest derives more revenue from each domestic user, on account of a more mature domestic digital ad market. International revenue accounted for less than 8% of Pinterest’s total quarterly sales.