:max_bytes(150000):strip_icc()/GettyImages-2256849701-7c288538b95443c8a36514f9b98ba144.jpg "Pinterest’s Stock Is Getting Hammered. Its Earnings Flashed a Warning Signal About Trump’s Tariffs.")
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Key Takeaways
- Pinterest shares tumbled Friday after the social media company’s fourth-quarter results came in short of estimates.
- Executives said many of Pinterest’s retail clients are pulling back on ad spending as they grapple with higher costs from tariffs.
Pinterest’s stock is plunging after the company said its business took a hit from tariffs—though maybe not in the way you’d expect.
Shares of Pinterest (PINS) were down nearly 20% Friday afternoon, a day after the social media platform cited the impact of higher tariffs on its ad clients for its disappointing quarterly results.
Pinterest CEO Bill Ready told investors in Thursday’s earnings call that tariffs are “disproportionately affecting ad spend from our top retail advertisers” as they grapple with rising costs, according to an AlphaSense transcript.
Why This Is Significant
Pinterest’s results show some retailers are responding to headwinds from President Donald Trump’s tariff policies by cutting advertising costs, and illustrates how the impact of changes in trade policy can ripple across industries.
Pinterest reported adjusted earnings per share of 67 cents on a 14% year-over-year jump in revenue to $1.32 billion for the fourth quarter. Both figures narrowly missed analysts’ estimates compiled by Visible Alpha. The company’s first-quarter outlook of $951 million to $971 million in revenue also fell short of projections.
JPMorgan and Bank of America analysts downgraded Pinterest’s stock to neutral from “buy” or equivalent ratings following the results. JPMorgan analysts warned the pressure from large retailers’ ad spend could worsen in the current quarter.
Pinterest’s worries have had a limited impact on other social media stocks. Shares of Snapchat parent Snap (SNAP) and Instagram owner Meta (META) briefly turned lower Friday before recovering later in the session. Ready said Pinterest’s “higher mix of large retailers relative to some of our peers has resulted in us feeling more of an impact.”
With Friday’s move, Pinterest shares have lost over 40% of their value since the start of the year, and more than 60% in the last 12 months.
