Pinterest's Rides on Growing User Base: Will the Uptrend Continue?

Pinterest, Inc. PINS is benefiting from solid user engagement in its platform. In the third quarter, the company reported 17% year-over-year growth in global monthly active users (MAUs) to 600 million, which is an all-time record. The improvement was driven healthy traction across multiple regions.

It is taking various initiatives to bring more actionable content on the platform from a wide range of sources such as users, creators, publishers and retailers. This has resulted in a solid improvement in engagement metrics like sessions, impressions and saves across all regions. The company is also integrating sophisticated AI models to enhance relevancy and personalization. It has partnered with Amazon to further capitalize on the commercial intent of its user base and increase shoppability on its platform.

The social media platform already boasts a strong user base in U.S. and Canada (UCAN) region. In Q3 the company reported 103 million users in UCAN up 4% year over year. It is witnessing rapid expansion outside UCAN region as well. 500 million global users outside UCAN region underscores growing global awareness and product market fit in previously unmonetized international markets as well.

Per a report from Research and Markets, the global social media market which was valued at $185.26 billion in 2024. It is expected to grow at 12.3% compound annual growth rate and projected to reach $208.8 billion in 2029. Pinterest well positioned to gain from this market trend.

How are Competitors Faring?

Pinterest faces competition from META Platforms, Inc. META and Snap, Inc. SNAP in the social media space. META’s Family Daily Active People or DAP, defined as a registered and logged-in user who visited at least one of the Family products (Facebook, Instagram, Messenger and/or WhatsApp) on a given day, was 3.54 billion, up 7.6% year over year. The company has been rapidly integrating AI recommendation systems to improve relevancy. This is driving user growth across META’s social media platforms.

SNAP's global community reached 477 million daily active users (DAU) in the third quarter, up 8% year over year. Snap added 8 million DAU on a quarter-over-quarter basis. However, the company DAU decreased in North America region by 3% year over year.

PINS’ Price Performance, Valuation and Estimates

Pinterest shares have lost 16.9% over the past year against the industry’s growth of 1.6%.

From a valuation standpoint, Pinterest trades at a forward price-to-sales ratio of 3.62, below the industry tally of 4.75.

The Zacks Consensus Estimate for Pinterest’s earnings for 2025 and 2026 have decreased over the past 60 days.

Pinterest currently carries a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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