PINS Q4 Deep Dive: User Growth Strong, Monetization and Guidance Lag Expectations

Social commerce platform Pinterest (NYSE: PINS) missed Wall Street’s revenue expectations in Q4 CY2025, but sales rose 14.3% year on year to $1.32 billion. Next quarter’s revenue guidance of $961 million underwhelmed, coming in 2.1% below analysts’ estimates. Its non-GAAP profit of $0.67 per share was in line with analysts’ consensus estimates.

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StockStory’s Take

Pinterest’s fourth quarter was met with a significant negative reaction from the market, as revenue came in just below Wall Street’s expectations and guidance for the next quarter disappointed. Management attributed the gap to continued advertising pullbacks from large retail clients, who have been disproportionately impacted by tariffs and margin pressures. CEO Bill Ready described the company’s performance as not meeting its potential and highlighted the urgent need to diversify Pinterest’s advertiser base and accelerate its sales transformation. He specifically pointed to the company’s exposure to large retailers as a key reason why Pinterest felt industry-wide ad spending headwinds more acutely than some competitors.

Looking ahead, Pinterest’s updated guidance is shaped by ongoing challenges with large retailers and organizational changes in its sales force. CFO Julia Donnelly emphasized that near-term revenue headwinds may persist, as disruption from a recent sales restructuring and the ramp-up of new leadership could take several quarters to play out. Management remains focused on expanding the mid-market, small business, and international advertiser base, with new Chief Business Officer Leigh Brown leading these efforts. Donnelly noted, “We are in a moment in time where both of these near-term factors are impacting us, and we know we have a lot of execution to do on the monetization side.”

Key Insights from Management’s Remarks

Management cited strong user and engagement growth, but emphasized that revenue performance was hampered by external pressures and strategic execution gaps.

• Tariff-driven ad pullbacks: Management pointed to recent tariffs as a major factor causing large retailers to reduce advertising spend, which weighed on Pinterest’s revenue mix and contributed to the shortfall versus expectations.
• Strong user and engagement metrics: Pinterest achieved its tenth consecutive quarter of record monthly active users, with Gen Z now representing more than half of its user base and remaining its fastest-growing cohort. Engagement per user also increased, with growth in queries, boards, and outbound clicks outpacing total user growth.
• AI-powered platform enhancements: Advancements in artificial intelligence, including the launch of the proprietary OmniSage and PinFM models, have improved content relevance and engagement while keeping infrastructure costs efficient. These models have driven higher sitewide saves and more personalized recommendations for users.
• Shift to broader advertiser base: CEO Bill Ready and CFO Julia Donnelly acknowledged the company’s outsized reliance on large retailers, noting that efforts are underway to expand Pinterest’s footprint with mid-market, small business, and international advertisers through new leadership and a more sophisticated go-to-market approach.
• Sales and go-to-market transformation: The appointment of Leigh Brown as Chief Business Officer and Claudine Cheever as Chief Marketing Officer signals a renewed focus on strengthening global monetization. Management highlighted that this transformation will require further investment in technical sales capabilities and measurement integrations to better serve a diverse advertiser set.

Drivers of Future Performance

Pinterest expects revenue growth to hinge on diversifying its advertiser base, ramping up AI investment, and navigating ongoing external headwinds.

• Broadening advertiser mix: Management’s top priority is accelerating growth among mid-market, small business, and international advertisers. CEO Bill Ready stated that these segments have shown stronger advertising spending trends and represent a significant opportunity to drive more resilient and balanced revenue growth over time.
• AI and infrastructure investment: Pinterest is deliberately increasing investment in artificial intelligence and GPU capacity to power its visual search and personalized shopping features. CFO Julia Donnelly explained that this will drive improvements in advertiser performance and user engagement, but may result in near-term margin pressure as these costs are absorbed.
• Salesforce transition and execution risk: The recent restructuring and new go-to-market leadership are expected to cause some disruption in the first half of the year. Management cautioned that it may take multiple quarters for these changes to translate into improved revenue trends, and that visibility on macroeconomic headwinds remains limited.

Catalysts in Upcoming Quarters

In the coming quarters, the StockStory team will be watching (1) evidence of successful expansion into mid-market, small business, and international advertisers, (2) the pace and impact of AI-powered product rollouts like Pinterest Assistant and Performance Plus enhancements, and (3) the speed and effectiveness of the new sales and go-to-market transformation. Progress on these fronts will be critical for closing the gap between user engagement and monetization.

Pinterest currently trades at $15.18, down from $18.58 just before the earnings. Is there an opportunity in the stock?See for yourself in our full research report (it’s free).

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