Pinterest Inc (NYSE: PINS) shares are down close to 20% on Friday morning as the social networking service said its monthly average users tanked 5% in the fiscal second quarter. It also warned that the decline accelerated further in July, with the MAUs down about 7% on a year over year basis.
In terms of income and revenue, the San Francisco-based company performed better than last year and topped Wall Street estimates. But investors remained focused on the fact that it lost 24 million active user accounts in one quarter.
Pinterest found a broader user base last year as the COVID-19 crisis restricted people to their homes. After the Q2 report, however, investors are now wondering if Pinterest will retain the user growth after the pandemic?
Julia Boorstin’s remarks on CNBC’s “TechCheck”
After avoiding it for years, Pinterest finally succumbed to the demand for short-form video content this year. It launched Idea Pins in May to further penetrate the creator community.
“We’re seeing Pinterest shift from being a place where you save ideas towards being a place where you might connect with content creators and buy things. It’s about the content creator, and it’s also about commerce. And I think the same certainly holds true with Pinterest,” CNBC’s Julia Boorstin said on “TechCheck”.
Pinterest doesn’t need to look for M&A
Boorstin further highlighted that Pinterest has been investing in tools like shoppable pins and others that pave its way into eCommerce, which is why it might not need to consider mergers and acquisitions like Etsy to expand into social commerce.
“I think the question is how much that ability to have commerce on the platform can drive advertising from eCommerce retailers, and how much the shopping really has to be about this idea of the YouTube,” she added.
According to Boorstin, video ads are more valuable than static ads, and that’s an opportunity that Pinterest wants to tap with its slate of new features. Would that help with the sharply contracting user base, though? That is yet to be known.
The post Here’s why Pinterest shares are down nearly 20% on Friday morning appeared first on Invezz.
from USA – Invezz https://ift.tt/3lfApEy
Wajeeh Khan
Click here to Join RICH DAD SUMMIT online with ROBERT KIYOSAKI - $1 Training for Passive Income: https://bit.ly/RichDadSummitWealthTraining
0 Comments