Post by : Badri Ariffin

Pinterest shares dropped 18% on Wednesday, erasing billions in market value as investors reacted to a conservative revenue projection. The visual-platform faces growing difficulty in accelerating its growth amid stiff competition and trade-related margin pressures.

Revenue Forecast Falls Short

The company set quarterly revenue guidance between $1.31 billion and $1.34 billion, a touch under analyst expectations. The guidance prompted a premarket sell-off that, if sustained, could slice roughly $4.36 billion from Pinterest’s market capitalization.

Competition and Weakening Ad Demand

Unlike some digital ad rivals — including Alphabet, Meta and Reddit — that reported strong third-quarter advertising momentum, Pinterest is losing pace. Social rivals such as Instagram, Facebook and TikTok continue to win large retailers with broader audiences and more integrated AI-driven ad tools.

The pressure is most acute in Pinterest’s top markets, the United States and Canada. CFO Julia Donnelly said larger U.S. retailers are confronting margin squeezes tied to tariffs, leading to scaled-back ad budgets. International competitors, notably Temu and Shein, have also trimmed marketing outlays amid trade uncertainty.

Although Pinterest has climbed about 13.6% year-to-date — ahead of Meta’s roughly 7.2% gain — analysts warn the platform lacks obvious near-term catalysts to accelerate growth, a concern for investors who favour companies showing clear innovation and upward revisions.

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