Here we go – Pinterest recently published its latest performance update, with the platform seeing an increase in users in Q1, but a slowdown in revenue intake, as it continues to expand and diversify its monetization potential.
First off, Pinterest talks users – the app added 13 million more users this quarter, with its growth momentum accelerating in the new year. It’s mainly a return to form – Pinterest got a huge boost in usage during the pandemic when lockdowns forced people to shop online. Much of that growth has been lost when physical stores reopened. Now, it’s on a positive trajectory once more, thanks to new users from other regions coming in.
Pinterest also says that it’s seeing more engagement with sessions, impressions, and time spent growing faster than Monthly Active Users (MAUs). Interestingly, Pinterest also notes that Gen Z is now the fastest-growing demographic, which is another good sign for its future potential as a key discovery element.
In terms of revenue, however, the story isn’t as vibrant. Pinterest brought in $603 million for Q1, which is up YoY, but lower than its corresponding 2022 results. Like all social platforms, Pinterest battles with the broader economic downturn, which has impacted ad spend, but the expanded usage does bode well for its future potential.
Pinterest still has a ways to go in maximizing its potential, with Pinterest ads still in the process of being made available in all regions. As it boosts its international presence, along with its product discovery focus, that should eventually see it drive more revenue from these regions, and the variance between North America and everywhere else does indicate significant growth potential in this respect.
As it stands, the overall declines don’t look good, and the market will likely respond in kind. In terms of key trends, Pinterest says that video content grew nearly 40% in the app for the period, reflecting the broader video trend across all social platforms. Pinterest looks to help brands tap into this by improving its Idea Pins, along with new promotional options such as Premiere Spotlight, which enables brands to purchase premium placement on the search tab.
Pinterest is also looking to provide more creative potential with its separate collage-focused Shuffles app, which has already gained traction in several markets. Pinterest recently opened Shuffles up to more regions, and the stand-out visuals, which link back to Pins, resonated better with younger audiences, forming part of its increased Gen Z appeal.
Overall, Pinterest suffers from the same market conditions that have stunted the results of all social apps, which has forced mass lay-offs even at the likes of Meta, Snapchat, Twitter, and more. Pinterest also had to cull around 5% of its workforce back in February. Even so, its sales, marketing, and admin costs have still increased significantly YoY. That could mean that more cuts are coming, and as the market responds to these numbers, they’re bound to be a focus leading into Q2.