Pinterest projects 60% sales growth for Q4 as ad sales rebound

[BENGALURU] Image-sharing company Pinterest projected a 60 per cent sales growth for the current quarter, off the back of a healthy rebound in ad spending by businesses after the early months of Covid-19 pandemic wreaked havoc in the industry.

The forecast, which the company termed an "informal" one, compares to a 35 per cent growth modelled by Wall Street analysts, according to Refinitiv data.

Shares of the company, which also beat third-quarter sales estimates, jumped 28 per cent to US$63.05 in extended trading.

Pinterest said it benefited as advertisers redirected spending to its platform following a social media ad boycott campaign that began in July.

A long list of companies have pulled advertising from Facebook, in support of a campaign that called out the social media giant for not doing enough to stop hate speech on its platforms. Some companies have returned since.

"Advertisers tell us that Pinterest is brand safe relative to other consumer internet platforms," chief financial officer Todd Morgenfeld said.

That boost may wane after the US election cycle is over in November, Mr Morgenfeld cautioned.

Pinterest also noted it gained four million monthly active users (MAUs) in late September as younger users turned to the platform to get design ideas for customised wallpapers for Apple Inc's new iOS version for iPhones.

"We expect these four million MAUs are more likely to churn in Q4," Mr Morgenfeld said.

Monthly active users jumped 37 per cent to 442 million during the third quarter.

Revenue in the US, the company's largest market, jumped 49 per cent to US$374 million. It reported average revenue of US$1.03 per user, above FactSet estimates of 90 US cents.

Pinterest's total revenue jumped 58 per cent to US$443 million, well ahead of analysts' estimates of US$383.5 million.

REUTERS