Social media stocks Meta Platforms (META 1.47%) and Pinterest (PINS +2.49%) both experienced volatility in 2025, marked by strong sell-offs and rallies throughout the year. But it was Meta that outperformed, turning in an over 10% gain, while Pinterest fell more than 10% as of this writing.
But a new year calls for a fresh look. So let's see which stock is set to outperform in 2026.
The case for Pinterest
NYSE: PINS
Key Data Points
Despite the stock's underperformance in 2025, Pinterest turned in robust results, growing its revenue by 16% through the first nine months of the year. Third-quarter results were strong, with revenue increasing by 17%, while adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) climbed by 24%, and free cash flow jumped by 30%.
The company's growth has been led by international markets where it continues to nicely increase its user base and expand ARPU (average revenue per user). Last quarter, European monthly active users (MAUs) rose 8%, while European ARPU soared 31% to $1.31. Meanwhile, the rest of world MAUs climbed 16%, and ARPU soared 44% to $0.21.
At the same time, Pinterest has embraced artificial intelligence (AI) to transform its site from an online vision board to an AI-powered discovery and shoppable platform. It has developed a multimodal AI model to improve its recommendation engine and power visual search capabilities while also adding AI-powered features like an AI assistant that can go out and buy recommended products. It even has AI features that can act as a virtual stylist and even allow you to try on clothes virtually.
Meanwhile, the company is also using AI on the back end to help advertisers through its Performance+ offering. Its solutions can help advertisers create better campaigns, such as taking a photo of a product and using AI to turn it into a lifestyle image with the product in the picture. One of the most powerful features of Performance+ is its dynamic ROAS (return on ad spending) bidding, which can help advertisers find customers about to make a major purchase and bid accordingly.
With a forward price-to-earnings (P/E) ratio of just above 13 times 2026 analyst estimates compared to 22 times for Meta, the stock is also much cheaper.
The case for Meta Platforms
NASDAQ: META
Key Data Points
While Meta's stock had an up-and-down 2025, the company was hitting on all cylinders. Its revenue growth accelerated throughout the year, going from 16% in Q1 to 26% last quarter.
Like Pinterest, the company's growth is being powered by AI. First, Meta has incorporated AI into its recommendation engine to feed users content they are more interested in. This has led to users spending more time on its platform, and it has brought more new users to its social media sites as well. More time on its apps, meanwhile, creates more space to show ads. At the same time, it has incorporated AI within its ad suite. It can help advertisers create higher-quality ads using generative AI while also better targeting users.
This helped drive Meta's growth last quarter. Its number of daily active users increased by 8% while ad impressions climbed 14%. Meanwhile, better-performing ad campaigns helped lead to a 10% increase in pricing. Heading into 2026, the company also has a big opportunity with both WhatsApp and Threads. It is just starting to gradually introduce ads to these platforms, which should be a solid long-term growth driver.
One of the biggest investor complaints with Meta is how much it is spending on side projects related to both the metaverse and AI. However, the company is reportedly set to lower its metaverse spending by 30% next year, which should boost profits.
Image source: Getty Images.
The verdict
I think both Meta and Pinterest are set up to perform well in 2026. Both companies are nicely benefiting from AI, and if the economy and advertising spend hold up, they should both continue to see strong revenue growth.
However, I think Pinterest will be the stock to outperform in 2026. The shares are just way too cheap given the company's growth, and it has not been credited with the advancements to its platforms that it's made and the strides it's seeing in increasing ARPU in international markets.
