What happened

Shares of Pinterest (NYSE:PINS) fell 22.5% in November, according to data from S&P Global Market Intelligence, after the visual social-media platform announced mixed third-quarter 2019 results. 

To be sure, the stock sank 17% on Nov. 1 alone, the first trading day after the company's quarterly release.

Man watching red arrow chart crash through a concrete floor.

Image source: Getty Images.

So what

That's not to say Pinterest's results looked weak at first glance; quarterly revenue soared 47% to $279.7 million, spurred by a 28% increase in monthly active users to 322 million. That translated to a GAAP net loss of $124.7 million. But after excluding one-time items like stock-based compensation, Pinterest did generate non-GAAP (adjusted) net income of just under $6 million, or $0.01 per share, swinging from an adjusted $0.12-per-share loss in the same year-ago period.

Those results were technically mixed relative to Wall Street's expectations, with consensus estimates predicting a loss of $0.04 per share on higher revenue of $281 million. And Pinterest's top-line growth notably decelerated from the 62% year-over-year increase it posted just three months earlier.

CEO Ben Silbermann noted that the company redesigned its site during the quarter to "to make the service more intuitive" and improve recommendations.

"We are also expanding the number of shoppable products on Pinterest," he said, "which makes it easy for our users to go from inspiration to action."

CFO Todd Morgenfeld also pointed out the company now serves Pinterest advertisements in 28 markets, up from just seven markets at the end of last year.

Now what

Management also revised its full-year 2019 guidance to call for revenue between $1.100 billion and $1.115 billion (up from $1.095 billion to $1.115 billion previously), and for an adjusted EBITDA loss between $10 million and $30 million (narrowed from a loss between $25 million and $50 million before).

Still, it's clear that in recent months, the market is less forgiving of technically mixed reports from high-growth stocks like Pinterest -- particularly when that growth shows signs of decelerating. Until Pinterest can prove it has what it takes to sustain its torrid revenue gains as it works toward consistent GAAP profitability, the stock may remain under pressure.

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