PINS
$21.71
Pinterest
($.85)
(3.77%)
Earnings Details
2nd Quarter June 2022
Monday, August 1, 2022 4:06:00 PM
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Summary

Pinterest Misses

Pinterest (PINS) reported 2nd Quarter June 2022 earnings of $0.07 per share on revenue of $665.9 million. The consensus earnings estimate was $0.18 per share on revenue of $674.8 million. The Earnings Whisper number was $0.21 per share. Revenue grew 8.6% on a year-over-year basis.

The company said it expects third quarter revenue of approximately $664.58 million. The current consensus revenue estimate is $728.68 million for the quarter ending September 30, 2022.

People around the world come to Pinterest for inspiration. It’s a visual discovery engine where people find inspiring creators, shop new products, and seek out ideas to take offline.

Results
Reported Earnings
$0.07
Earnings Whisper
$0.21
Consensus Estimate
$0.18
Reported Revenue
$665.9 Mil
Revenue Estimate
$674.8 Mil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

Pinterest Announces Second Quarter 2022 Results

SAN FRANCISCO--(BUSINESS WIRE)--Pinterest, Inc. (NYSE: PINS) today announced financial results for the quarter ended June 30, 2022.

  • Q2 revenue grew 9% year over year to $666 million.
  • Global Monthly Active Users (MAUs) decreased 5% year over year to 433 million.
  • GAAP net loss was $43 million for Q2. Adjusted EBITDA was $92 million for Q2.

“Pinterest achieved 9% revenue growth year over year in Q2, or 10% revenue growth on a constant currency basis, despite the uncertainty facing our advertisers,” said Bill Ready, CEO, Pinterest. “We accelerated our investment in shopping and ecommerce this quarter, and I am thrilled by the dedication of our leaders and employees to continue to build a positive place on the Internet. Pinterest is uniquely positioned to tackle unsolved problems in our industry, capitalize on long-term digital commerce trends and help people go from inspiration to realization.”

Q2 2022 Financial Highlights

The following table summarizes our consolidated financial results (in thousands, except percentages, unaudited):

 

 

 

Three Months Ended June 30,

 

% Change

 

 

2022

 

 

 

2021

 

 

Revenue

 

 

$

665,930

 

 

$

613,210

 

 

9

%

 

 

 

 

 

 

Net income (loss)

$

(43,076

)

 

$

69,417

 

 

NM

 

 

 

 

 

 

 

Non-GAAP net income*

$

77,365

 

 

$

169,930

 

 

(54

)%

 

 

 

 

 

 

Adjusted EBITDA*

$

92,043

 

 

$

178,213

 

 

(48

)%

Adjusted EBITDA margin*

 

14

%

 

 

29

%

 

 

____________________

 

 

 

 

 

 

 

NM - not meaningful

* For more information on these non-GAAP financial measures, please see "?About non-GAAP financial measures" and the tables under "?Reconciliation of GAAP to non-GAAP financial results" included at the end of this release.

 

Q2 2022 Other Highlights

The following table sets forth our revenue, MAUs and ARPU based on the geographic location of our users (in millions, except ARPU and percentages, unaudited):

 

Three Months Ended June 30,

 

% Change

 

 

2022

 

 

2021

 

Revenue - Global

$

666

 

$

613

 

9

%

Revenue - U.S. and Canada

$

542

 

$

508

 

7

%

Revenue - Europe

$

102

 

$

92

 

10

%

Revenue - Rest of World

$

22

 

$

13

 

71

%

 

 

 

 

 

 

MAUs - Global

 

433

 

 

454

 

(5

)%

MAUs - U.S. and Canada

 

92

 

 

100

 

(8

)%

MAUs - Europe

 

117

 

 

123

 

(4

)%

MAUs - Rest of World

 

223

 

 

231

 

(3

)%

 

 

 

 

 

 

ARPU - Global

$

1.54

 

$

1.32

 

17

%

ARPU - U.S. and Canada

$

5.82

 

$

4.87

 

20

%

ARPU - Europe

$

0.86

 

$

0.72

 

20

%

ARPU - Rest of World

$

0.10

 

$

0.06

 

80

%

Guidance

Our current expectation is that Q3 2022 revenue will grow mid-single digits on a year-over-year percentage basis, which takes into account slightly greater foreign exchange headwinds than in Q2 2022. We expect our Q3 2022 non-GAAP operating expenses to grow low double digits percent quarter-over-quarter*.

For the full year, there is no change to our previous expense outlook of non-GAAP operating expense growth in the range of 35-40% year over year*.

We intend to provide further detail on our outlook during the conference call.

*

We have not provided the forward-looking GAAP equivalents for certain forward-looking non-GAAP operating expenses or a GAAP reconciliation as a result of the uncertainty regarding, and the potential variability of, reconciling items such as share-based compensation expense. Accordingly, a reconciliation of these non-GAAP guidance metrics to their corresponding GAAP equivalents is not available without unreasonable effort. However, it is important to note that material changes to reconciling items could have a significant effect on future GAAP results and, as such, we also believe that any reconciliations provided would imply a degree of precision that could be confusing or misleading to investors.

Webcast and conference call information

A live audio webcast of our second quarter 2022 earnings release call will be available at investor.pinterestinc.com. The call begins today at 2:00 PM (PT) / 5:00 PM (ET). We have also posted to our investor relations website a letter to shareholders. This press release, including the reconciliations of certain non-GAAP measures to their nearest comparable GAAP measures, letter to shareholders and slide presentation are also available. A recording of the webcast will be available at investor.pinterestinc.com for 90 days.

We have used, and intend to continue to use, our investor relations website at investor.pinterestinc.com as a means of disclosing material nonpublic information and for complying with our disclosure obligations under Regulation FD.

Forward-looking statements

This press release may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act of 1934, as amended, about us and our industry that involve substantial risks and uncertainties, including, among other things, statements about our future operational and financial performance. Words such as "believe," "project," "may," "will," "estimate," "continue," "anticipate," "intend," "expect," "plan" and similar expressions are intended to identify forward-looking statements. These forward-looking statements are only predictions and may differ materially from actual results due to a variety of factors including: the impact of the COVID-19 pandemic, including its impact on our business as well as on global and regional economies and economic activity; general economic and political uncertainty in global markets and a worsening of global economic conditions or low levels of economic growth, including inflation, foreign exchange fluctuations and supply-chain issues as well as events such as Russia's invasion of Ukraine; our ability to provide useful and relevant content; our ability to attract and retain creators that create relevant and engaging content on our platform; risks associated with new products and changes to existing products as well as other new business initiatives; our ability to maintain and enhance our brand and reputation; compromises in security; our financial performance and fluctuations in operating results; our dependency on online application stores' and internet search engines’ methodologies and policies; discontinuation, disruptions or outages in authentication by third-party login providers; changes by third-party login providers that restrict our access or ability to identify users; competition; our ability to scale our business and revenue model; our reliance on advertising revenue and our ability to attract and retain advertisers and effectively measure advertising campaigns; our ability to effectively manage growth and expand and monetize our platform internationally; our lack of operating history and ability to sustain profitability; decisions that reduce short-term revenue or profitability or do not produce expected long-term benefits; risks associated with government actions, laws and regulations that could restrict access to our products or impair our business; litigation and government inquiries; privacy, data and other regulatory concerns; real or perceived inaccuracies in metrics related to our business; disruption, degradation or interference with our hosting services and infrastructure; our ability to attract and retain personnel; and the dual class structure of our common stock and its effect of concentrating voting control with stockholders who held our capital stock prior to the completion of our initial public offering. These and other potential risks and uncertainties that could cause actual results to differ from the results predicted are more fully detailed in our Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2022, which is available on our investor relations website at investor.pinterestinc.com and on the SEC website at www.sec.gov. All information provided in this release and in the earnings materials is as of August 1, 2022. Undue reliance should not be placed on the forward-looking statements in this press release, which are based on information available to us on the date hereof. We undertake no duty to update this information unless required by law.

About non-GAAP financial measures

To supplement our condensed consolidated financial statements, which are prepared and presented in accordance with generally accepted accounting principles in the United States ("GAAP"), we use the following non-GAAP financial measures: Adjusted EBITDA, Adjusted EBITDA margin, non-GAAP costs and expenses (including non-GAAP cost of revenue, research and development, sales and marketing, and general and administrative), non-GAAP income from operations, non-GAAP net income, non-GAAP net income per share and constant currency revenue growth rates. The presentation of these financial measures is not intended to be considered in isolation, as a substitute for or superior to the financial information prepared and presented in accordance with GAAP. Investors are cautioned that there are material limitations associated with the use of non-GAAP financial measures as an analytical tool. In addition, these measures may be different from non-GAAP financial measures used by other companies, limiting their usefulness for comparative purposes. We compensate for these limitations by providing specific information regarding GAAP amounts excluded from these non-GAAP financial measures.

We define Adjusted EBITDA as net income (loss) adjusted to exclude depreciation and amortization expense, share-based compensation expense, interest income, interest expense and other income (expense), net, provision for (benefit from) income taxes and non-cash charitable contributions. Adjusted EBITDA margin is calculated by dividing Adjusted EBITDA by revenue. Non-GAAP costs and expenses (including non-GAAP cost of revenue, research and development, sales and marketing, and general and administrative) and non-GAAP net income exclude amortization of acquired intangible assets, share-based compensation expense and non-cash charitable contributions. Non-GAAP income from operations is calculated by subtracting non-GAAP costs and expenses from revenue. Non-GAAP net income per share is calculated by dividing non-GAAP net income by diluted weighted-average shares outstanding. We use Adjusted EBITDA, Adjusted EBITDA margin, non-GAAP costs and expenses, non-GAAP income from operations, non-GAAP net income and non-GAAP net income per share to evaluate our operating results and for financial and operational decision-making purposes. We believe these non-GAAP financial measures help identify underlying trends in our business that could otherwise be masked by the effect of the income and expenses they exclude. We also believe Adjusted EBITDA, Adjusted EBITDA margin, non-GAAP costs and expenses, non-GAAP income from operations, non-GAAP net income and non-GAAP net income per share provide useful information about our operating results, enhance the overall understanding of our past performance and future prospects and allow for greater transparency with respect to key metrics we use for financial and operational decision-making. We present Adjusted EBITDA, Adjusted EBITDA margin, non-GAAP costs and expenses, non-GAAP income from operations, non-GAAP net income and non-GAAP net income per share to assist potential investors in seeing our operating results through the eyes of management and because we believe these measures provide an additional tool for investors to use in comparing our operating results over multiple periods with other companies in our industry. There are a number of limitations related to the use of Adjusted EBITDA, Adjusted EBITDA margin, non-GAAP costs and expenses, non-GAAP income from operations, non-GAAP net income and non-GAAP net income per share rather than net income (loss), net margin, total costs and expenses, income (loss) from operations, net income (loss) and net income (loss) per share, respectively, the nearest GAAP equivalents. For example, Adjusted EBITDA excludes certain recurring, non-cash charges such as depreciation of fixed assets and amortization of acquired intangible assets, although these assets may have to be replaced in the future, and share-based compensation expense, which has been, and will continue to be for the foreseeable future, a significant recurring expense and an important part of our compensation strategy.

For a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures, please see the tables under "?Reconciliation of GAAP to non-GAAP financial results" included at the end of this release.

Limitation of key metrics and other data

The numbers for our key metrics, which include our MAUs and ARPU, are calculated using internal company data based on the activity of user accounts. We define a monthly active user as an authenticated Pinterest user who visits our website, opens our mobile application or interacts with Pinterest through one of our browser or site extensions, such as the Save button, at least once during the 30-day period ending on the date of measurement. Unless otherwise indicated, we present MAUs based on the number of MAUs measured on the last day of the current period. We measure monetization of our platform through our average revenue per user metric. We define ARPU as our total revenue in a given geography during a period divided by the average of the number of MAUs in that geography during the period. We calculate average MAUs based on the average of the number of MAUs measured on the last day of the current period and the last day prior to the beginning of the current period. We calculate ARPU by geography based on our estimate of the geography in which revenue-generating activities occur. We use these metrics to assess the growth and health of the overall business and believe that MAUs and ARPU best reflect our ability to attract, retain, engage and monetize our users, and thereby drive revenue. While these numbers are based on what we believe to be reasonable estimates of our user base for the applicable period of measurement, there are inherent challenges in measuring usage of our products across large online and mobile populations around the world. In addition, we are continually seeking to improve our estimates of our user base, and such estimates may change due to improvements or changes in technology or our methodology.

PINTEREST, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except par value)

(unaudited)

 

 

June 30,

 

December 31,

 

 

2022

 

 

 

2021

 

ASSETS

 

 

 

Current assets:

 

 

 

Cash and cash equivalents

$

1,641,509

 

 

$

1,419,630

 

Marketable securities

 

1,017,510

 

 

 

1,060,488

 

Accounts receivable, net of allowances of $8,803 and $8,282 as of June 30, 2022 and December 31, 2021, respectively

 

511,468

 

 

 

653,355

 

Prepaid expenses and other current assets

 

75,583

 

 

 

48,090

 

Total current assets

 

3,246,070

 

 

 

3,181,563

 

Property and equipment, net

 

66,074

 

 

 

53,401

 

Operating lease right-of-use assets

 

218,325

 

 

 

227,912

 

Goodwill and intangible assets, net

 

145,673

 

 

 

61,115

 

Other assets

 

17,890

 

 

 

13,247

 

Total assets

$

3,694,032

 

 

$

3,537,238

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:

 

 

 

Accounts payable

$

57,906

 

 

$

17,675

 

Accrued expenses and other current liabilities

 

292,949

 

 

 

242,131

 

Total current liabilities

 

350,855

 

 

 

259,806

 

Operating lease liabilities

 

192,543

 

 

 

209,181

 

Other liabilities

 

14,545

 

 

 

29,508

 

Total liabilities

 

557,943

 

 

 

498,495

 

Commitments and contingencies

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

Class A common stock, $0.00001 par value, 6,666,667 shares authorized, 579,656 and 568,228 shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively; Class B common stock, $0.00001 par value, 1,333,333 shares authorized, 90,470 and 88,644 shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively

 

7

 

 

 

7

 

Additional paid-in capital

 

5,216,308

 

 

 

5,059,528

 

Accumulated other comprehensive loss

 

(13,258

)

 

 

(2,181

)

Accumulated deficit

 

(2,066,968

)

 

 

(2,018,611

)

Total stockholders’ equity

 

3,136,089

 

 

 

3,038,743

 

Total liabilities and stockholders’ equity

$

3,694,032

 

 

$

3,537,238

 

PINTEREST, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share amounts)

(unaudited)

 

 

Three Months Ended June 30,

 

 

2022

 

 

 

2021

Revenue

$

665,930

 

 

$

613,210

Costs and expenses:

 

 

 

Cost of revenue

 

164,896

 

 

 

127,819

Research and development

 

233,508

 

 

 

181,731

Sales and marketing

 

212,037

 

 

 

164,340

General and administrative

 

89,994

 

 

 

68,122

Total costs and expenses

 

700,435

 

 

 

542,012

Income (loss) from operations

 

(34,505

)

 

 

71,198

Interest income

 

3,365

 

 

 

1,125

Interest expense and other income (expense), net

 

(9,252

)

 

 

337

Income (loss) before provision for income taxes

 

(40,392

)

 

 

72,660

Provision for income taxes

 

2,684

 

 

 

3,243

Net income (loss)

$

(43,076

)

 

$

69,417

Net income (loss) per share:

 

 

 

Basic

$

(0.07

)

 

$

0.11

Diluted

$

(0.07

)

 

$

0.10

Weighted-average shares used in computing net income (loss) per share:

 

 

 

Basic

 

662,242

 

 

 

636,190

Diluted

 

662,242

 

 

 

692,364

PINTEREST, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(unaudited)

 

 

Six Months Ended June 30,

 

 

2022

 

 

 

2021

 

Operating activities

 

 

 

Net income (loss)

$

(48,357

)

 

$

47,743

 

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

 

 

 

Depreciation and amortization

 

16,355

 

 

 

13,537

 

Share-based compensation

 

190,653

 

 

 

179,720

 

Non-cash charitable contributions

 

 

 

 

20,490

 

Other

 

12,473

 

 

 

9,398

 

Changes in assets and liabilities:

 

 

 

Accounts receivable

 

143,877

 

 

 

98,686

 

Prepaid expenses and other assets

 

(31,057

)

 

 

(18,342

)

Operating lease right-of-use assets

 

25,103

 

 

 

20,643

 

Accounts payable

 

40,557

 

 

 

(1,498

)

Accrued expenses and other liabilities

 

10,605

 

 

 

25,662

 

Operating lease liabilities

 

(26,752

)

 

 

(20,646

)

Net cash provided by operating activities

 

333,457

 

 

 

375,393

 

Investing activities

 

 

 

Purchases of property and equipment and intangible assets

 

(19,916

)

 

 

(3,428

)

Purchases of marketable securities

 

(367,806

)

 

 

(571,216

)

Sales of marketable securities

 

4,168

 

 

 

154,586

 

Maturities of marketable securities

 

393,784

 

 

 

373,162

 

Acquisition of business, net of cash acquired

 

(86,059

)

 

 

 

Net cash used in investing activities

 

(75,829

)

 

 

(46,896

)

Financing activities

 

 

 

Proceeds from exercise of stock options, net

 

4,080

 

 

 

14,935

 

Shares repurchased for tax withholdings on release of restricted stock units and restricted stock awards

 

(37,953

)

 

 

 

Net cash (used in) provided by financing activities

 

(33,873

)

 

 

14,935

 

Effect of exchange rate changes on cash, cash equivalents and restricted cash

 

(1,947

)

 

 

(305

)

Net increase in cash, cash equivalents and restricted cash

 

221,808

 

 

 

343,127

 

Cash, cash equivalents and restricted cash, beginning of period

 

1,427,064

 

 

 

678,911

 

Cash, cash equivalents and restricted cash, end of period

$

1,648,872

 

 

$

1,022,038

 

Supplemental cash flow information

 

 

 

Accrued property and equipment

$

7,314

 

 

$

905

 

Operating lease right-of-use assets obtained in exchange for operating lease liabilities

$

15,899

 

 

$

1,657

Reconciliation of cash, cash equivalents and restricted cash to condensed consolidated balance sheets

Cash and cash equivalents

$

1,641,509

 

$

1,012,928

Restricted cash included in prepaid expenses and other current assets

 

1,834

 

 

299

Restricted cash included in other assets

 

5,529

 

 

8,811

Total cash, cash equivalents and restricted cash

$

1,648,872

 

$

1,022,038

PINTEREST, INC.

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL RESULTS

(in thousands)

(unaudited)

 

 

 

Three Months Ended June 30,

 

 

 

2022

 

 

 

2021

 

Share-based compensation by function:

 

 

 

Cost of revenue

$

1,417

 

 

$

2,180

 

Research and development

 

81,436

 

 

 

70,729

 

Sales and marketing

 

18,501

 

 

 

13,996

 

General and administrative

 

16,059

 

 

 

13,356

 

Total share-based compensation

$

117,413

 

 

$

100,261

 

 

 

 

 

 

Amortization of acquired intangible assets by function:

 

 

 

Cost of revenue

$

938

 

 

$

94

 

Sales and marketing

 

1,893

 

 

 

 

General and administrative

 

197

 

 

 

158

 

Total amortization of acquired intangible assets

$

3,028

 

 

$

252

 

 

 

 

 

 

Reconciliation of total costs and expenses to non-GAAP costs and expenses:

 

 

 

Total costs and expenses

$

700,435

 

 

$

542,012

 

Share-based compensation

 

(117,413

)

 

 

(100,261

)

Amortization of acquired intangible assets

 

(3,028

)

 

 

(252

)

Total non-GAAP costs and expenses

$

579,994

 

 

$

441,499

 

 

 

 

 

 

Reconciliation of net income (loss) to Adjusted EBITDA:

Net income (loss)

$

(43,076

)

 

$

69,417

 

Depreciation and amortization

 

9,135

 

 

 

6,754

 

Share-based compensation

 

117,413

 

 

 

100,261

 

Interest income

 

(3,365

)

 

 

(1,125

)

Interest expense and other (income) expense, net

 

9,252

 

 

 

(337

)

Provision for income taxes

 

2,684

 

 

 

3,243

 

Adjusted EBITDA

$

92,043

 

 

$

178,213

 

 

 

 

 

 

PINTEREST, INC.

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL RESULTS

(in thousands, except per share amounts)

(unaudited)

 

 

 

Three Months Ended June 30,

 

 

 

2022

 

 

 

2021

Reconciliation of net income (loss) to non-GAAP net income:

Net income (loss)

$

(43,076

)

 

$

69,417

Share-based compensation

 

117,413

 

 

 

100,261

Amortization of acquired intangible assets

 

3,028

 

 

 

252

Non-GAAP net income

$

77,365

 

 

$

169,930

 

 

 

 

Basic weighted-average shares used in computing net income (loss) per share

 

662,242

 

 

 

636,190

Weighted-average dilutive securities (1)

 

25,463

 

 

 

56,173

Diluted weighted-average shares used in computing non-GAAP net income per share

 

687,705

 

 

 

692,364

Non-GAAP net income per share

$

0.11

 

 

$

0.25

____________________

(1)

Gives effect to potential common stock instruments such as stock options, unvested restricted stock units and unvested restricted stock awards.

 

Press:
LeMia Jenkins
press@pinterest.com

Investor relations:
Neil Doshi
ir@pinterest.com

Source: Pinterest, Inc.