Pinterest's Growing AI Prowess is Driving Growth: Will it Persist?

Pinterest, Inc. PINS is witnessing consistent user growth across all regions in the past several quarters. In the first quarter of 2025, global monthly active users (MAUs) reached 570 million, a record high for the company. Europe reported a MAUs growth of 5% year over year, while the United States and Canada were up 4%. MAUs from the Rest of World reported a solid improvement of 14%, backed by the company’s initiative to accelerate international expansion and open up new monetization opportunities.

Pinterest’s growth strategy is focused on bringing more actionable content on the platform from a wide range of sources such as users, creators, publishers and retailers. Its leading-edge AI recommendation model works as a core element of the platform’s backend infrastructure. The AI model not only shows what the users want at the current moment, but it also effectively anticipates future emerging trends. It leverages a rich dataset derived from searches, saves, and clicks of Pinterest’s vast client base worldwide to generate 400 million predictions every second. This staggering speed and scale allow Pinterest to efficiently understand user intent and drive relevancy across the platform.
 
Moreover, such deep personalization brings far-reaching commercial benefits. It allows Pinterest to introduce audiences to relevant brands, products and emerging trends, boosting the effectiveness of campaigns run by advertisers and retailers. The AI recommendation model has created a strong ecosystem that serves the interests of users, creators, and advertisers across multiple domains and has significantly boosted monetization on the platform.

Pinterest is doubling down on improving relevancy and actionability, leveraging AI, which is likely to drive user growth in upcoming quarters. Per our estimate, in 2025, Pinterest's monthly active users are expected to reach 608.6 million, indicating 10.1% growth year over year.

How Are Competitors Faring?

Pinterest faces significant competition from Meta Platforms, Inc. META and Snap, Inc. SNAP in the digital advertising space. Snap reported 900 million active users in the first quarter. Its daily active users (DAU) grew 3.1% year over year in Europe and 15.9% year over year in the rest of the world. However, Snap witnessed a 1% decline in DAU in North America during this period.

In the first quarter, META recorded 3.43 billion Family Daily Active People (DAP). 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. META’s Instagram has emerged as one of the primary competitors for Pinterest. Instagram has strong e-commerce integration, enabling users to shop directly from posts. META is also steadily investing in an AI-powered recommendation system to increase engagement across its platforms.

PINS’ Price Performance, Valuation and Estimates

Shares of Pinterest gained 15.8% YTD compared with the Internet - Software industry’s growth of 10.6%.

Going by the price/sales ratio, the company shares currently trade at 5.11 forward sales, lower than the industry. It carries a Value Score of D.

Pinterest is currently witnessing a downtrend in estimate revisions. Earnings estimates for PINS for 2025 have moved down 1.62% to $1.82 over the past 60 days, while the same for 2026 has decreased 2.76% to $2.11.
 

Pinterest stock currently carries a Zacks Rank #3 (Hold). 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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