Pedestrians pass in front of Pinterest signage displayed outside of the New York Stock Exchange.
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Pinterest shares rocketed more than 38% in pre-market trading Friday morning after the company reported second-quarter earnings which reflected how people turned to the service for at-home cooking, remote work and activities during the stay-at-home orders.
The company saw total revenue of $272 million, an increase of 4% year-over-year, though it said advertiser demand continued to be affected by the pandemic. Following a sharp drop-off in growth in mid-March as advertisers responded to the pandemic, the company said in a shareholder letter that revenue growth stabilized in April and continued to improve as shelter-in-place restrictions were eased in some states. Pinterest reported its global monthly active users grew 39% year-over-year to 416 million.
“People needed Pinterest in Q2,” the company said in the letter. “They needed a service that helped them adjust to radically changed circumstances — one that inspired them to cook at home, build vegetable gardens, plan activities for their kids and set up remote offices and home gyms, to name just a few typical COVID-19-related use cases we saw during the quarter.”
The company said users who started using Pinterest during Covid-19 continued to have high engagement even after shelter-in-place restrictions eased — it said while overall engagement peaked in mid-April and early May and subsided as stricter lockdowns ended, engagements remain stable “well above pre-Covid-19 levels.”
The company said that its total advertiser growth accelerated year-over-year during the second quarter and that spend from small and medium-sized businesses made up nearly half its total revenue.
Aaron Goldman, chief marketing officer at 4C (which recently announced an acquisition by advertising software company Mediaocean), said advertisers on the company’s platform increased budgets on Pinterest by 20% year-over-year in the quarter. He said that’s in part because Pinterest is a place with strong commercial intent and where advertisers can get traction without having ads displayed near controversial content.