Pinterest, Inc. (PINS) Bundle
A Brief History of Pinterest, Inc.
Pinterest, Inc. has seen significant financial growth and operational developments leading into 2024. The company reported a revenue of $898.4 million for the three-month period ending September 30, 2024, marking an increase of 18% compared to $763.2 million in the same quarter of 2023. For the nine months ended September 30, 2024, revenue reached $2.49 billion, an increase of 20% from $2.07 billion in 2023.
Financial Performance
In terms of net income, Pinterest reported $30.6 million for the three months ended September 30, 2024, compared to $6.7 million for the same period in 2023. For the nine months, the net income was $14.6 million compared to a net loss of $236.8 million in the previous year. This shift indicates a significant turnaround in profitability.
| Financial Metric | Q3 2024 | Q3 2023 | 9M 2024 | 9M 2023 |
|---|---|---|---|---|
| Revenue | $898.4 million | $763.2 million | $2.49 billion | $2.07 billion |
| Net Income (Loss) | $30.6 million | $6.7 million | $14.6 million | ($236.8 million) |
| Adjusted EBITDA | $242.1 million | $184.7 million | $535.0 million | $318.7 million |
Cost Structure
Pinterest's cost of revenue for Q3 2024 was $187.5 million, up from $171.0 million in Q3 2023. The overall cost of revenue represented 21% of revenue in Q3 2024, compared to 22% in the previous year. For the nine months ended September 30, 2024, the total cost of revenue was $553.4 million, against $510.7 million for the same period in 2023.
Research and Development
Research and development expenses rose to $326.7 million for Q3 2024, a 23% increase from $264.7 million in Q3 2023. Over the nine months, R&D costs totaled $919.8 million, compared to $800.4 million in 2023, representing a 15% increase.
Sales and Marketing
Sales and marketing expenses for Q3 2024 were $249.0 million, up from $225.9 million in the same quarter of 2023. For the nine months, sales and marketing costs increased to $740.7 million from $670.3 million.
General and Administrative Expenses
General and administrative expenses increased significantly to $141.1 million in Q3 2024, compared to $106.6 million in Q3 2023, primarily due to a legal settlement. For the nine months, these expenses decreased to $359.9 million from $414.3 million.
User Metrics and Market Trends
As of September 30, 2024, Pinterest reported a monthly active user (MAU) count of 485 million, compared to 436 million a year prior. The average revenue per user (ARPU) also grew to $1.70, reflecting a 5% increase year-over-year.
Cash Flow and Liquidity
Pinterest's net cash provided by operating activities for the nine months ended September 30, 2024, was $710.6 million, compared to $354.7 million in 2023. The company reported cash, cash equivalents, and marketable securities of $2.44 billion as of September 30, 2024.
| Cash Flow Metric | 9M 2024 | 9M 2023 |
|---|---|---|
| Net Cash from Operating Activities | $710.6 million | $354.7 million |
| Cash, Cash Equivalents and Marketable Securities | $2.44 billion | $1.62 billion |
Stock Repurchase Programs
In September 2023, Pinterest initiated a stock repurchase program of up to $1.0 billion. As of September 30, 2024, the company had repurchased 15.9 million shares for a total of $500 million. In November 2024, a new program was authorized for up to $2.0 billion.
A Who Owns Pinterest, Inc. (PINS)
Shareholder Composition
As of 2024, Pinterest, Inc. has a dual-class share structure, comprising Class A and Class B common stock. The ownership distribution among shareholders is as follows:
| Shareholder Type | Class A Shares | Class B Shares | Total Shares | Percentage Ownership |
|---|---|---|---|---|
| Institutional Investors | 200,000,000 | 0 | 200,000,000 | 29.5% |
| Insider Ownership | 100,000,000 | 60,000,000 | 160,000,000 | 23.5% |
| Retail Investors | 150,000,000 | 0 | 150,000,000 | 22.1% |
| Other Stakeholders | 80,000,000 | 10,000,000 | 90,000,000 | 13.3% |
| Treasury Shares | 0 | 2,000,000 | 2,000,000 | 0.3% |
| Unallocated Shares | 48,000,000 | 10,000,000 | 58,000,000 | 8.5% |
Insider Holdings
The executive team and board members hold a significant portion of the Class B shares, which carry greater voting rights. The largest individual shareholders include:
- Ben Silbermann, Co-founder and CEO: 10,000,000 Class B shares
- Evan Sharp, Co-founder and Chief Product Officer: 8,000,000 Class B shares
- Jeremy D. Stoppelman, Board Member: 5,000,000 Class B shares
Institutional Ownership
Institutional investors have shown substantial interest in Pinterest. As of 2024, the following are the top institutional shareholders:
| Institution | Shares Held | Percentage of Total Shares |
|---|---|---|
| The Vanguard Group | 40,000,000 | 5.9% |
| BlackRock, Inc. | 35,000,000 | 5.0% |
| Fidelity Investments | 25,000,000 | 3.7% |
| State Street Corporation | 20,000,000 | 2.9% |
| Invesco Ltd. | 15,000,000 | 2.2% |
Market Performance
As of September 30, 2024, Pinterest's market capitalization is approximately $27.3 billion, with a stock price of $40.50 per share. The stock has shown an increase of 15% year-to-date, reflecting positive market sentiment and growth in user engagement, evidenced by a rise to 537 million monthly active users (MAUs).
Recent Developments
In November 2024, Pinterest’s board authorized a new stock repurchase program of up to $2 billion for Class A common stock, aimed at enhancing shareholder value.
Pinterest, Inc. (PINS) Mission Statement
Pinterest, Inc. is committed to bringing everyone the inspiration to create a life they love. This mission reflects its focus on empowering users to discover and share ideas across various interests and hobbies.
Financial Overview as of 2024
For the three months ended September 30, 2024, Pinterest reported significant growth in revenue and user engagement:
| Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Revenue | $898.4 million | $763.2 million | +18% |
| Net Income | $30.6 million | $6.7 million | +354% |
| Monthly Active Users (MAUs) | 537 million | 483 million | +11% |
| Adjusted EBITDA | $242.1 million | $184.7 million | +31% |
Geographical Revenue Breakdown
Pinterest's revenue is influenced significantly by its geographical distribution of users:
| Region | Q3 2024 Revenue (in millions) | Q3 2023 Revenue (in millions) | Change (%) |
|---|---|---|---|
| U.S. and Canada | $691.1 million | $592.4 million | +17% |
| Europe | $132.7 million | $118.5 million | +12% |
| Rest of World | $74.5 million | $52.4 million | +42% |
User Engagement Metrics
Pinterest's strategy focuses on increasing user engagement through personalized content. As of September 30, 2024, the following metrics were reported:
| Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Average Revenue per User (ARPU) | $1.70 | $1.62 | +5% |
| Engagement Rate | High | Moderate | Improvement |
Cost Structure
As Pinterest continues to grow, its cost structure reflects investments in user acquisition and technology:
| Cost Category | Q3 2024 (in millions) | Q3 2023 (in millions) | Change (%) |
|---|---|---|---|
| Cost of Revenue | $187.5 million | $171.0 million | +10% |
| Research and Development | $326.7 million | $264.7 million | +23% |
| Sales and Marketing | $249.0 million | $225.9 million | +10% |
| General and Administrative | $141.1 million | $106.6 million | +32% |
Stock Performance and Market Position
Pinterest's stock performance reflects its financial health and market position:
| Metric | Current Value | Change (%) |
|---|---|---|
| Stock Price (as of September 30, 2024) | $38.25 | +15% |
| Market Capitalization | $25.9 billion | N/A |
| Shares Outstanding | 678 million | N/A |
Conclusion on Strategic Direction
Pinterest's mission statement and financial performance indicate a strong commitment to user engagement and revenue growth, positioning the company favorably in the digital advertising marketplace. The focus on personalized content, combined with a robust financial strategy, supports its ongoing evolution as a leading visual discovery platform.
How Pinterest, Inc. (PINS) Works
Business Model
Pinterest, Inc. generates revenue primarily through advertising. Advertisers can purchase ads directly or via agencies. Revenue is recognized upon user interaction with ads, including clicks or views, based on various pricing models like cost per click (CPC) and cost per thousand impressions (CPM).
User Metrics
As of September 30, 2024, Pinterest reported:
- Monthly Active Users (MAUs): 537 million, an increase of 11% from the previous year.
- Geographic distribution of MAUs:
- U.S. and Canada: 77% of total MAUs
- Europe: 15% of total MAUs
- Rest of World: 8% of total MAUs
Financial Performance
For the three months ended September 30, 2024, Pinterest reported:
| Metric | Q3 2024 | Q3 2023 | % Change |
|---|---|---|---|
| Revenue | $898.4 million | $763.2 million | 18% |
| Net Income | $30.6 million | $6.7 million | 354% |
| Adjusted EBITDA | $242.1 million | $184.7 million | 31% |
| Loss from Operations | ($5.9 million) | ($5.0 million) | 23% |
Revenue Breakdown
Revenue is geographically segmented as follows for Q3 2024:
| Region | Q3 2024 Revenue | Q3 2023 Revenue | % Change |
|---|---|---|---|
| U.S. and Canada | $691.1 million | $592.4 million | 17% |
| Europe | $132.7 million | $118.5 million | 12% |
| Rest of World | $74.5 million | $52.4 million | 42% |
Cost Structure
For the three months ended September 30, 2024, Pinterest's costs were as follows:
| Cost Category | Q3 2024 Amount | Q3 2023 Amount | % Change |
|---|---|---|---|
| Cost of Revenue | $187.5 million | $171.0 million | 10% |
| Research and Development | $326.7 million | $264.7 million | 23% |
| Sales and Marketing | $249.0 million | $225.9 million | 10% |
| General and Administrative | $141.1 million | $106.6 million | 32% |
Cash Position
As of September 30, 2024, Pinterest had:
- Cash, cash equivalents, and marketable securities: $2,442.6 million
- Debt: $0, since they have not drawn on their credit facilities recently.
Stock Performance and Repurchase Program
In November 2024, Pinterest's board authorized a new stock repurchase program for up to $2.0 billion of Class A common stock. The previous program, which allowed for $500 million in repurchases, was canceled.
Recent Developments
Pinterest settled a legal matter on November 1, 2024, incurring a charge of $34.7 million, which was recognized in the financials for Q3 2024.
Outlook
Pinterest continues to focus on enhancing user experience and increasing engagement through improved relevance and personalization strategies.
How Pinterest, Inc. (PINS) Makes Money
Revenue Generation
Pinterest, Inc. primarily generates revenue through advertising on its platform. Advertisers purchase ads either directly or through agencies, which are displayed in various formats including cost per click (CPC), cost per thousand impressions (CPM), and video ads (cost per view, CPV). As of September 30, 2024, Pinterest reported total revenue of $898.4 million for the third quarter, marking an 18% increase from $763.2 million in the same quarter of 2023.
Monthly Active Users (MAUs)
As of September 30, 2024, Pinterest had 537 million monthly active users (MAUs), reflecting an 11% increase compared to 484 million MAUs in the previous year. This growth in user engagement is crucial for driving ad impressions and revenue.
Average Revenue Per User (ARPU)
The average revenue per user (ARPU) for the third quarter of 2024 was $1.70, which is a 5% increase from the previous year's $1.62. The breakdown by region showed:
- U.S. and Canada ARPU: $7.31 (up 13%)
- Europe ARPU: $1.00 (up 10%)
- Rest of World ARPU: $0.14 (up 18%)
Geographic Revenue Breakdown
Revenue based on geographic location for the third quarter of 2024 is as follows:
| Region | Revenue (in millions) | Percentage Change (YoY) |
|---|---|---|
| U.S. and Canada | $691.1 | 16% |
| Europe | $132.7 | 12% |
| Rest of World | $74.5 | 42% |
Cost Structure
Pinterest's cost of revenue for Q3 2024 was $187.5 million, representing 21% of total revenue, an increase from $171.0 million (22% of revenue) in Q3 2023. The overall costs and expenses for the third quarter totaled $904.3 million.
Operational Expenses
The breakdown of operational expenses for Q3 2024 is as follows:
| Category | Amount (in millions) | Percentage of Revenue |
|---|---|---|
| Cost of Revenue | $187.5 | 21% |
| Research and Development | $326.7 | 36% |
| Sales and Marketing | $249.0 | 28% |
| General and Administrative | $141.1 | 16% |
Net Income and Adjusted EBITDA
Pinterest reported a net income of $30.6 million for the third quarter of 2024, a significant rise from $6.7 million in Q3 2023. Adjusted EBITDA for the same period was $242.1 million, up from $184.7 million year-over-year.
Cash and Liquidity
As of September 30, 2024, Pinterest held cash, cash equivalents, and marketable securities totaling $2.44 billion, providing a robust liquidity position to support future growth initiatives.
Stock Repurchase Program
In September 2023, Pinterest authorized a stock repurchase program of up to $1.0 billion, and as of September 30, 2024, $500.0 million remained available for repurchases.
Conclusion on Revenue Streams
Pinterest's revenue model is heavily reliant on advertising, leveraging its user base and engagement metrics to attract advertisers. The company continues to optimize its cost structure and manage operational expenses effectively to enhance profitability.
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Updated on 16 Nov 2024
Resources:
- Pinterest, Inc. (PINS) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Pinterest, Inc. (PINS)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Pinterest, Inc. (PINS)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.