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Pinterest’s forecast disappoints investors looking for a holiday advertising boost
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Pinterest’s forecast disappoints investors looking for a holiday advertising boost

(Reuters) -Pinterest’s fourth-quarter revenue forecast failed to impress investors looking for a boost from the holiday shopping season as larger online ad sellers comfortably outperformed, sending shares down 12% in extended trading on Thursday.

The company also announced a new share buyback program of up to $2 billion and canceled the September 2023 program, with $500 million available for buybacks.

Pinterest’s results follow quarterly reports from digital advertising companies – including Google parent Alphabet, Meta Platforms, Reddit and Snap – which posted positive revenue in the third quarter, helped by robust ad spending.

Pinterest released the Performance+ suite in October to better target users by improving ad campaigns with new AI tools and automation features on the platform.

“Performance+ is still in the early stages of rollout, with many advertisers limiting budget shifts and new feature adoption during the peak holiday season,” CFO Julia Donnelly said on a post-earnings call.

The company is also seeing “softness” among food and beverage advertisers, Donnelly said.

Pinterest forecast fourth-quarter revenue between $1.13 billion and $1.15 billion, with the midpoint in line with average analyst estimates of $1.14 billion, according to data compiled by LSEG.

The company’s revenue grew 18% to $898.4 million in the reported quarter, compared to estimates of $896.4 million.

Adjusted earnings per share for the quarter came in at 40 cents, compared with estimates of 34 cents.

Global monthly active users on the platform rose 11% to 537 million from July to September, compared to estimates of 531.5 million.

(Reporting by Jaspreet Singh in Bengaluru; Editing by Shailesh Kuber)