What happened
Shares of Pinterest (PINS 0.89%) fell 14.5% on Wednesday, following the release of the social media platform's first-quarter results.
So what
Pinterest's revenue rose 78% year over year to $485 million, besting Wall Street's forecast of $474 million. With people spending more time online during the pandemic, businesses flocked to the image-sharing site to advertise their wares. Pinterest's expansion outside the U.S. also contributed to the gains.
"This quarter, we continued strong growth internationally, including our recent launch of advertising in Brazil, and made significant progress with shopping, making it easier for people to discover and buy products they find on Pinterest," CEO Ben Silbermann said in a press release.
Image source: Getty Images.
Pinterest's adjusted earnings per share of $0.11 also came in above the consensus estimate of $0.07. However, investors seemed to focus more on the company's user growth.
Pinterest's monthly active users (MAUs) climbed 30% to 478 million. Analysts, however, had expected 480.5 million users.
Now what
Management guided for year-over-year revenue growth of 105% in the second quarter. Yet Silbermann cautioned investors to expect Pinterest's monthly active user base to remain flat in the U.S., as health officials relax coronavirus-related social distancing measures.
"We believe that lockdowns probably pulled forward some user growth during 2020, particularly in the U.S. where our service has been available longer," Silbermann said in a letter to shareholders. "Starting in mid-March, the easing of pandemic restrictions slowed U.S. MAU growth and lowered engagement year over year as people spent less time online."
