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Home / Business / Pinterest shares rose 40%, reaching their highest point in a quarter

Pinterest shares rose 40%, reaching their highest point in a quarter



Pinterest, led by chairman, co-founder, president and CEO Ben Silbermann, and co-founder, chief design and creative officer Evan Sharp, celebrated the opening bell of Pinterest’s IPO at the New York Stock Exchange, April 18, 2019 day.

Brendan McDermid | Reuters

Pinterest’s stock price soared by more than 40% on Thursday as investors gathered around the company̵

7;s soaring third-quarter performance, indicating that due to the Covid-19 pandemic, advertising demand has risen after a difficult period.

Shares of technology company Facebook, Google parent Alphabet, Amazon and Twitter also rose, helping to make up for some of Wednesday’s losses. The impetus that Pinterest has gained from the advertising industry’s rebound may mark the positive attitude of its technology counterparts, which also have a major advertising business. Alphabet, Facebook, Twitter, and Amazon, which have a growing advertising business, are all scheduled to announce earnings on Thursday afternoon.

Analysts have high expectations for Pinterest’s earnings, especially after Snap’s third-quarter earnings showed that direct response ads have “continuous resilience”, marketers use it to elicit immediate responses, such as clicks link. The industry has also seen a resurgence in brand advertising, which has been hit harder during the pandemic.

Pinterest said that due to the spread of toxic content and misinformation, advertisers have boycotted other social media platforms such as Facebook and Twitter, which has also benefited Pinterest a lot. CEO Ben Silbermann said in the company’s earnings call that advertisers “want to maintain a positive attitude when building brands, and this has also contributed to our growth.”

Pinterest’s total revenue in the third quarter was $443 million, a year-on-year increase of 58%. The company predicts that its fourth-quarter revenue will increase by 60% year-on-year due to the uncertainty surrounding the pandemic and other factors.

Although Michael Levine, an analyst at Pivotal Research, said that due to recent stock performance and after Snap’s results last week, he has gradually raised “very high expectations”, but Pinterest in the third quarter ” The delivered goods far exceeded”.

He wrote in a report on Thursday: “Consistent with SNAP, business seems to have accelerated this quarter, as brand and DR spending both rebounded.”

Morgan Stanley (Morgan Stanley) analysts said in a report on Thursday that the direct response and brand advertising market continues to show signs of a faster-than-expected recovery. They added that as retailers and marketers increasingly invest and experiment with digital technologies to attract shoppers, the bullish trend in digital advertising may continue into the “sanctuary holiday.”

As consumers stay at home, some positive trends are likely to continue: Emarketer analyst Andrew Lipsman said that Pinterest “is currently in a particularly advantageous position” because users are in a particularly favorable position during the pandemic. The home flocks to and draws inspiration from it to benefit from the proliferation of e-commerce.

Aaron Goldman, chief marketing officer of advertising software company Mediaocean, said in an email that advertising expenditures for brands using the company’s closed ecosystem platform increased by nearly 40% year-on-year in the third quarter. He also said that as the company embeds shopping ad units in more places in the app, he hopes that Pinterest’s shopping tools can decouple from consumers and brands.

While upgrading the stock to “buy”, MKM Partners said on Thursday that it also hopes the company’s shopping tools can grow.

The company said: “As far as shopping on Pinterest is concerned, it is still in its infancy.” “The growth of the catalog and integration with leading e-commerce ecosystem stakeholders such as Shopify will increase the importance of Pinterest in the overall shopping channel.”

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