(Reuters) -Pinterest Inc topped market estimates for first-quarter revenue and profit on Wednesday as the image-sharing platform benefited from higher ad spending by businesses, sending its shares 9% higher in extended trading.
Revenue rose 18% in the first three months of the year to $575 million, compared with the average analyst expectation of $572.5 million, according to Refinitiv IBES data.
Like its peers, Pinterest recorded strong user growth in the early months of pandemic as home-bound consumers sought projects to keep themselves entertained. But that boom has faded with the economic reopening, prompting the company to double down on efforts to grow its ad business.
Pinterest said its monthly active users (MAUs) – a key metric that shows engagement – declined 9% to 433 million. The figure also missed a FactSet estimate of 437.9 million.
But its mobile app MAUs, the group that represents most of Pinterest’s revenue, grew by mid-single digits.
“We also saw continued strength in the younger demographic, with Gen Z users growing mid-single digits,” the company said.
Pinterest forecast second-quarter revenue to grow by 11%.
On an adjusted basis, it earned 10 cents per share in the first quarter, exceeding Wall Street estimates of 4 cents per share.
(Reporting by Sonia Cheema and Tiyashi Datta; Editing by Aditya Soni)
