Pinterest shares plummet on disappointing 2019 revenue forecast

Pinterest shares plummet on disappointing 2019 revenue forecast

Pinterest Inc on Thursday gave an unimpressive full-year 2019 revenue forecast after first-quarter sales beat estimates in its first quarter as a publicly traded company, sending shares down 16per cent in extended trading.

FILE PHOTO: Screens display the company logo for Pinterest Inc. during the company's IPO on th
FILE PHOTO: Screens display the company logo for Pinterest Inc. during the company's IPO on the front of the New York Stock Exchange (NYSE) in New York, U.S., April 18, 2019. REUTERS/Brendan McDermid/File Photo

REUTERS: Pinterest Inc on Thursday forecast 2019 revenue broadly in line with Wall Street targets, disappointing investors who had expected more from the freshly public, high flying stock, and sending its shares down 16 percent.

The online scrapbook company's shares have risen 62per cent from its initial public offering price of US$19 last month.

"Clearly the after-hours pullback is a reflection of investor expectations being too high heading into the quarter," DA Davidson analyst Tom Forte said.

Pinterest's sales outlook was a disappointment said Forte, especially given the high expectations reflected in the run up in shares.

The company expects full-year revenue between US$1.055 billion and US$1.08 billion, the mid point of which is slightly above analysts' estimate of US$1.06 billion, driven by average revenue per user (ARPU) in the United States.

Pinterest also said in a regulatory filing it would look to invest in its advertising products through the year.

The company, which calls its users "pinners", added 291 million monthly active users globally in the first quarter, above estimates of 289.3 million, according to IBES data from Refinitiv. ARPU globally rose 26per cent to 73 cents, the company said.

Net loss narrowed to US$41.4 million in the quarter ended March 31 from US$52.7 million a year earlier. Excluding certain items, the company lost 32 cents per share.

Total revenue rose about 54per cent to US$201.9 million, beating estimates of US$200.6 million.

Unlike Pinterest, other companies that made their stock market debut in 2019 such as Lyft Inc and Uber Technologies Inc have seen a steep drop. Uber shares have fallen nearly 18per cent since its IPO, while Lyft is down about 23per cent.

(Reporting by Vibhuti Sharma and Akanksha Rana in Bengaluru; Editing by Shinjini Ganguli)

Source: Reuters

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