Pinterest’s third quarter was met with a significant negative market reaction, as its results revealed both strengths and challenges. While user growth remained robust and management cited ongoing momentum in visual-first shopping and AI-powered recommendations, the company’s non-GAAP profits fell short of Wall Street expectations. CEO Bill Ready pointed to continued record user engagement, especially among Gen Z users, and highlighted the platform’s progress as an AI-driven shopping assistant. However, CFO Julia Donnelly acknowledged that larger U.S. retailers faced margin pressures due to tariffs, which contributed to a moderation in ad spend in North America.
Is now the time to buy PINS? Find out in our full research report (it’s free for active Edge members).
Pinterest (PINS) Q3 CY2025 Highlights:
- Revenue: $1.05 billion vs analyst estimates of $1.05 billion (16.8% year-on-year growth, in line)
- Adjusted EPS: $0.38 vs analyst expectations of $0.42 (8.8% miss)
- Adjusted EBITDA: $306.1 million vs analyst estimates of $297.2 million (29.2% margin, 3% beat)
- Revenue Guidance for Q4 CY2025 is $1.33 billion at the midpoint, below analyst estimates of $1.34 billion
- Operating Margin: 5.6%, up from -0.7% in the same quarter last year
- Monthly Active Users: 600 million, up 63 million year on year
- Market Capitalization: $18.25 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Pinterest’s Q3 Earnings Call
- Ronald Josey (Citigroup) asked about Pinterest’s strategy for AI-driven agentic commerce and the launch of Pinterest Assistant. CEO William Ready explained that Pinterest’s proactive AI anticipates user needs, guiding users through shopping journeys, and sees further differentiation as AI becomes more central.
- Eric Sheridan (Goldman Sachs) probed the health of the digital ad environment, especially in North America. Ready acknowledged broad pullbacks among large U.S. retailers due to tariffs but noted strong international and mid-market advertiser growth. The company sees AI-based optimization as a future upside driver.
- Richard Greenfield (LightShed Partners) questioned Pinterest’s approach to AI-generated content moderation. Ready clarified that while the platform embraces Gen AI content, users are given control over how much AI-generated content they see, with content quality managed by recommender systems.
- Shweta Khajuria (Wolfe Research) asked about the Magnite partnership and plans to diversify ad demand sources. Ready said third-party demand complements first-party ads, with early Magnite integration and ongoing tests to broaden advertiser access beyond the core platform.
- Mark Kelley (Stifel) inquired about the Performance+ suite’s impact on smaller and mid-market advertisers. Ready reported strong early results, with higher conversion rates and monthly spend growth, and indicated significant ongoing opportunity for further adoption.
Catalysts in Upcoming Quarters
In the coming quarters, our analysts will monitor (1) the effectiveness and user adoption of AI-driven features like Pinterest Assistant and multimodal search, (2) the pace of international monetization as new ad formats and catalog integrations roll out in Europe and emerging markets, and (3) whether margin expansion can be sustained while infrastructure and R&D investments accelerate. We will also track the resilience of U.S. advertiser demand amid ongoing tariff headwinds.
Pinterest currently trades at $27.09, down from $32.93 just before the earnings. Is the company at an inflection point that warrants a buy or sell? Find out in our full research report (it’s free for active Edge members).
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