Pinterest, Inc. (NYSE: PINS) today announced financial results
for the quarter ended June 30, 2022.
- Q2 revenue grew 9% year over year to $666 million.
- Global Monthly Active Users (MAUs) decreased 5% year over year
to 433 million.
- GAAP net loss was $43 million for Q2. Adjusted EBITDA was $92
million for Q2.
“Pinterest achieved 9% revenue growth year over year in Q2, or
10% revenue growth on a constant currency basis, despite the
uncertainty facing our advertisers,” said Bill Ready, CEO,
Pinterest. “We accelerated our investment in shopping and ecommerce
this quarter, and I am thrilled by the dedication of our leaders
and employees to continue to build a positive place on the
Internet. Pinterest is uniquely positioned to tackle unsolved
problems in our industry, capitalize on long-term digital commerce
trends and help people go from inspiration to realization.”
Q2 2022 Financial Highlights
The following table summarizes our consolidated financial
results (in thousands, except percentages, unaudited):
Three Months Ended June
30,
% Change
2022
2021
Revenue
$
665,930
$
613,210
9
%
Net income (loss)
$
(43,076
)
$
69,417
NM
Non-GAAP net income*
$
77,365
$
169,930
(54
)%
Adjusted EBITDA*
$
92,043
$
178,213
(48
)%
Adjusted EBITDA margin*
14
%
29
%
____________________
NM - not meaningful
* For more information on these non-GAAP
financial measures, please see "―About non-GAAP financial measures"
and the tables under "―Reconciliation of GAAP to non-GAAP financial
results" included at the end of this release.
Q2 2022 Other Highlights
The following table sets forth our revenue, MAUs and ARPU based
on the geographic location of our users (in millions, except ARPU
and percentages, unaudited):
Three Months Ended June
30,
% Change
2022
2021
Revenue - Global
$
666
$
613
9
%
Revenue - U.S. and Canada
$
542
$
508
7
%
Revenue - Europe
$
102
$
92
10
%
Revenue - Rest of World
$
22
$
13
71
%
MAUs - Global
433
454
(5
)%
MAUs - U.S. and Canada
92
100
(8
)%
MAUs - Europe
117
123
(4
)%
MAUs - Rest of World
223
231
(3
)%
ARPU - Global
$
1.54
$
1.32
17
%
ARPU - U.S. and Canada
$
5.82
$
4.87
20
%
ARPU - Europe
$
0.86
$
0.72
20
%
ARPU - Rest of World
$
0.10
$
0.06
80
%
Guidance
Our current expectation is that Q3 2022 revenue will grow
mid-single digits on a year-over-year percentage basis, which takes
into account slightly greater foreign exchange headwinds than in Q2
2022. We expect our Q3 2022 non-GAAP operating expenses to grow low
double digits percent quarter-over-quarter*.
For the full year, there is no change to our previous expense
outlook of non-GAAP operating expense growth in the range of 35-40%
year over year*.
We intend to provide further detail on our outlook during the
conference call.
*
We have not provided the
forward-looking GAAP equivalents for certain forward-looking
non-GAAP operating expenses or a GAAP reconciliation as a result of
the uncertainty regarding, and the potential variability of,
reconciling items such as share-based compensation expense.
Accordingly, a reconciliation of these non-GAAP guidance metrics to
their corresponding GAAP equivalents is not available without
unreasonable effort. However, it is important to note that material
changes to reconciling items could have a significant effect on
future GAAP results and, as such, we also believe that any
reconciliations provided would imply a degree of precision that
could be confusing or misleading to investors.
Webcast and conference call information
A live audio webcast of our second quarter 2022 earnings release
call will be available at investor.pinterestinc.com. The call
begins today at 2:00 PM (PT) / 5:00 PM (ET). We have also posted to
our investor relations website a letter to shareholders. This press
release, including the reconciliations of certain non-GAAP measures
to their nearest comparable GAAP measures, letter to shareholders
and slide presentation are also available. A recording of the
webcast will be available at investor.pinterestinc.com for 90
days.
We have used, and intend to continue to use, our investor
relations website at investor.pinterestinc.com as a means of
disclosing material nonpublic information and for complying with
our disclosure obligations under Regulation FD.
Forward-looking statements
This press release may contain forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Exchange Act of 1934, as amended,
about us and our industry that involve substantial risks and
uncertainties, including, among other things, statements about our
future operational and financial performance. Words such as
"believe," "project," "may," "will," "estimate," "continue,"
"anticipate," "intend," "expect," "plan" and similar expressions
are intended to identify forward-looking statements. These
forward-looking statements are only predictions and may differ
materially from actual results due to a variety of factors
including: the impact of the COVID-19 pandemic, including its
impact on our business as well as on global and regional economies
and economic activity; general economic and political uncertainty
in global markets and a worsening of global economic conditions or
low levels of economic growth, including inflation, foreign
exchange fluctuations and supply-chain issues as well as events
such as Russia's invasion of Ukraine; our ability to provide useful
and relevant content; our ability to attract and retain creators
that create relevant and engaging content on our platform; risks
associated with new products and changes to existing products as
well as other new business initiatives; our ability to maintain and
enhance our brand and reputation; compromises in security; our
financial performance and fluctuations in operating results; our
dependency on online application stores' and internet search
engines’ methodologies and policies; discontinuation, disruptions
or outages in authentication by third-party login providers;
changes by third-party login providers that restrict our access or
ability to identify users; competition; our ability to scale our
business and revenue model; our reliance on advertising revenue and
our ability to attract and retain advertisers and effectively
measure advertising campaigns; our ability to effectively manage
growth and expand and monetize our platform internationally; our
lack of operating history and ability to sustain profitability;
decisions that reduce short-term revenue or profitability or do not
produce expected long-term benefits; risks associated with
government actions, laws and regulations that could restrict access
to our products or impair our business; litigation and government
inquiries; privacy, data and other regulatory concerns; real or
perceived inaccuracies in metrics related to our business;
disruption, degradation or interference with our hosting services
and infrastructure; our ability to attract and retain personnel;
and the dual class structure of our common stock and its effect of
concentrating voting control with stockholders who held our capital
stock prior to the completion of our initial public offering. These
and other potential risks and uncertainties that could cause actual
results to differ from the results predicted are more fully
detailed in our Quarterly Report on Form 10-Q for the fiscal
quarter ended June 30, 2022, which is available on our investor
relations website at investor.pinterestinc.com and on the SEC
website at www.sec.gov. All information provided in this release
and in the earnings materials is as of August 1, 2022. Undue
reliance should not be placed on the forward-looking statements in
this press release, which are based on information available to us
on the date hereof. We undertake no duty to update this information
unless required by law.
About non-GAAP financial measures
To supplement our condensed consolidated financial statements,
which are prepared and presented in accordance with generally
accepted accounting principles in the United States ("GAAP"), we
use the following non-GAAP financial measures: Adjusted EBITDA,
Adjusted EBITDA margin, non-GAAP costs and expenses (including
non-GAAP cost of revenue, research and development, sales and
marketing, and general and administrative), non-GAAP income from
operations, non-GAAP net income, non-GAAP net income per share and
constant currency revenue growth rates. The presentation of these
financial measures is not intended to be considered in isolation,
as a substitute for or superior to the financial information
prepared and presented in accordance with GAAP. Investors are
cautioned that there are material limitations associated with the
use of non-GAAP financial measures as an analytical tool. In
addition, these measures may be different from non-GAAP financial
measures used by other companies, limiting their usefulness for
comparative purposes. We compensate for these limitations by
providing specific information regarding GAAP amounts excluded from
these non-GAAP financial measures.
We define Adjusted EBITDA as net income (loss) adjusted to
exclude depreciation and amortization expense, share-based
compensation expense, interest income, interest expense and other
income (expense), net, provision for (benefit from) income taxes
and non-cash charitable contributions. Adjusted EBITDA margin is
calculated by dividing Adjusted EBITDA by revenue. Non-GAAP costs
and expenses (including non-GAAP cost of revenue, research and
development, sales and marketing, and general and administrative)
and non-GAAP net income exclude amortization of acquired intangible
assets, share-based compensation expense and non-cash charitable
contributions. Non-GAAP income from operations is calculated by
subtracting non-GAAP costs and expenses from revenue. Non-GAAP net
income per share is calculated by dividing non-GAAP net income by
diluted weighted-average shares outstanding. We use Adjusted
EBITDA, Adjusted EBITDA margin, non-GAAP costs and expenses,
non-GAAP income from operations, non-GAAP net income and non-GAAP
net income per share to evaluate our operating results and for
financial and operational decision-making purposes. We believe
these non-GAAP financial measures help identify underlying trends
in our business that could otherwise be masked by the effect of the
income and expenses they exclude. We also believe Adjusted EBITDA,
Adjusted EBITDA margin, non-GAAP costs and expenses, non-GAAP
income from operations, non-GAAP net income and non-GAAP net income
per share provide useful information about our operating results,
enhance the overall understanding of our past performance and
future prospects and allow for greater transparency with respect to
key metrics we use for financial and operational decision-making.
We present Adjusted EBITDA, Adjusted EBITDA margin, non-GAAP costs
and expenses, non-GAAP income from operations, non-GAAP net income
and non-GAAP net income per share to assist potential investors in
seeing our operating results through the eyes of management and
because we believe these measures provide an additional tool for
investors to use in comparing our operating results over multiple
periods with other companies in our industry. There are a number of
limitations related to the use of Adjusted EBITDA, Adjusted EBITDA
margin, non-GAAP costs and expenses, non-GAAP income from
operations, non-GAAP net income and non-GAAP net income per share
rather than net income (loss), net margin, total costs and
expenses, income (loss) from operations, net income (loss) and net
income (loss) per share, respectively, the nearest GAAP
equivalents. For example, Adjusted EBITDA excludes certain
recurring, non-cash charges such as depreciation of fixed assets
and amortization of acquired intangible assets, although these
assets may have to be replaced in the future, and share-based
compensation expense, which has been, and will continue to be for
the foreseeable future, a significant recurring expense and an
important part of our compensation strategy.
For a reconciliation of these non-GAAP financial measures to the
most directly comparable GAAP financial measures, please see the
tables under "―Reconciliation of GAAP to non-GAAP financial
results" included at the end of this release.
Limitation of key metrics and other data
The numbers for our key metrics, which include our MAUs and
ARPU, are calculated using internal company data based on the
activity of user accounts. We define a monthly active user as an
authenticated Pinterest user who visits our website, opens our
mobile application or interacts with Pinterest through one of our
browser or site extensions, such as the Save button, at least once
during the 30-day period ending on the date of measurement. Unless
otherwise indicated, we present MAUs based on the number of MAUs
measured on the last day of the current period. We measure
monetization of our platform through our average revenue per user
metric. We define ARPU as our total revenue in a given geography
during a period divided by the average of the number of MAUs in
that geography during the period. We calculate average MAUs based
on the average of the number of MAUs measured on the last day of
the current period and the last day prior to the beginning of the
current period. We calculate ARPU by geography based on our
estimate of the geography in which revenue-generating activities
occur. We use these metrics to assess the growth and health of the
overall business and believe that MAUs and ARPU best reflect our
ability to attract, retain, engage and monetize our users, and
thereby drive revenue. While these numbers are based on what we
believe to be reasonable estimates of our user base for the
applicable period of measurement, there are inherent challenges in
measuring usage of our products across large online and mobile
populations around the world. In addition, we are continually
seeking to improve our estimates of our user base, and such
estimates may change due to improvements or changes in technology
or our methodology.
PINTEREST, INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(in thousands, except par
value)
(unaudited)
June 30,
December 31,
2022
2021
ASSETS
Current assets:
Cash and cash equivalents
$
1,641,509
$
1,419,630
Marketable securities
1,017,510
1,060,488
Accounts receivable, net of allowances of
$8,803 and $8,282 as of June 30, 2022 and December 31, 2021,
respectively
511,468
653,355
Prepaid expenses and other current
assets
75,583
48,090
Total current assets
3,246,070
3,181,563
Property and equipment, net
66,074
53,401
Operating lease right-of-use assets
218,325
227,912
Goodwill and intangible assets, net
145,673
61,115
Other assets
17,890
13,247
Total assets
$
3,694,032
$
3,537,238
LIABILITIES AND STOCKHOLDERS’
EQUITY
Current liabilities:
Accounts payable
$
57,906
$
17,675
Accrued expenses and other current
liabilities
292,949
242,131
Total current liabilities
350,855
259,806
Operating lease liabilities
192,543
209,181
Other liabilities
14,545
29,508
Total liabilities
557,943
498,495
Commitments and contingencies
Stockholders’ equity:
Class A common stock, $0.00001 par value,
6,666,667 shares authorized, 579,656 and 568,228 shares issued and
outstanding as of June 30, 2022 and December 31, 2021,
respectively; Class B common stock, $0.00001 par value, 1,333,333
shares authorized, 90,470 and 88,644 shares issued and outstanding
as of June 30, 2022 and December 31, 2021, respectively
7
7
Additional paid-in capital
5,216,308
5,059,528
Accumulated other comprehensive loss
(13,258
)
(2,181
)
Accumulated deficit
(2,066,968
)
(2,018,611
)
Total stockholders’ equity
3,136,089
3,038,743
Total liabilities and stockholders’
equity
$
3,694,032
$
3,537,238
PINTEREST, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(in thousands, except per share
amounts)
(unaudited)
Three Months Ended June
30,
2022
2021
Revenue
$
665,930
$
613,210
Costs and expenses:
Cost of revenue
164,896
127,819
Research and development
233,508
181,731
Sales and marketing
212,037
164,340
General and administrative
89,994
68,122
Total costs and expenses
700,435
542,012
Income (loss) from operations
(34,505
)
71,198
Interest income
3,365
1,125
Interest expense and other income
(expense), net
(9,252
)
337
Income (loss) before provision for income
taxes
(40,392
)
72,660
Provision for income taxes
2,684
3,243
Net income (loss)
$
(43,076
)
$
69,417
Net income (loss) per share:
Basic
$
(0.07
)
$
0.11
Diluted
$
(0.07
)
$
0.10
Weighted-average shares used in computing
net income (loss) per share:
Basic
662,242
636,190
Diluted
662,242
692,364
PINTEREST, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
Six Months Ended June
30,
2022
2021
Operating activities
Net income (loss)
$
(48,357
)
$
47,743
Adjustments to reconcile net income (loss)
to net cash provided by operating activities:
Depreciation and amortization
16,355
13,537
Share-based compensation
190,653
179,720
Non-cash charitable contributions
—
20,490
Other
12,473
9,398
Changes in assets and liabilities:
Accounts receivable
143,877
98,686
Prepaid expenses and other assets
(31,057
)
(18,342
)
Operating lease right-of-use assets
25,103
20,643
Accounts payable
40,557
(1,498
)
Accrued expenses and other liabilities
10,605
25,662
Operating lease liabilities
(26,752
)
(20,646
)
Net cash provided by operating
activities
333,457
375,393
Investing activities
Purchases of property and equipment and
intangible assets
(19,916
)
(3,428
)
Purchases of marketable securities
(367,806
)
(571,216
)
Sales of marketable securities
4,168
154,586
Maturities of marketable securities
393,784
373,162
Acquisition of business, net of cash
acquired
(86,059
)
—
Net cash used in investing activities
(75,829
)
(46,896
)
Financing activities
Proceeds from exercise of stock options,
net
4,080
14,935
Shares repurchased for tax withholdings on
release of restricted stock units and restricted stock awards
(37,953
)
—
Net cash (used in) provided by financing
activities
(33,873
)
14,935
Effect of exchange rate changes on cash,
cash equivalents and restricted cash
(1,947
)
(305
)
Net increase in cash, cash equivalents and
restricted cash
221,808
343,127
Cash, cash equivalents and restricted
cash, beginning of period
1,427,064
678,911
Cash, cash equivalents and restricted
cash, end of period
$
1,648,872
$
1,022,038
Supplemental cash flow
information
Accrued property and equipment
$
7,314
$
905
Operating lease right-of-use assets
obtained in exchange for operating lease liabilities
$
15,899
$
1,657
Reconciliation of cash, cash
equivalents and restricted cash to condensed consolidated balance
sheets
Cash and cash equivalents
$
1,641,509
$
1,012,928
Restricted cash included in prepaid
expenses and other current assets
1,834
299
Restricted cash included in other
assets
5,529
8,811
Total cash, cash equivalents and
restricted cash
$
1,648,872
$
1,022,038
PINTEREST, INC.
RECONCILIATION OF GAAP TO
NON-GAAP FINANCIAL RESULTS
(in thousands)
(unaudited)
Three Months Ended June
30,
2022
2021
Share-based compensation by
function:
Cost of revenue
$
1,417
$
2,180
Research and development
81,436
70,729
Sales and marketing
18,501
13,996
General and administrative
16,059
13,356
Total share-based compensation
$
117,413
$
100,261
Amortization of acquired intangible
assets by function:
Cost of revenue
$
938
$
94
Sales and marketing
1,893
—
General and administrative
197
158
Total amortization of acquired intangible
assets
$
3,028
$
252
Reconciliation of total costs and
expenses to non-GAAP costs and expenses:
Total costs and expenses
$
700,435
$
542,012
Share-based compensation
(117,413
)
(100,261
)
Amortization of acquired intangible
assets
(3,028
)
(252
)
Total non-GAAP costs and expenses
$
579,994
$
441,499
Reconciliation of net income (loss) to
Adjusted EBITDA:
Net income (loss)
$
(43,076
)
$
69,417
Depreciation and amortization
9,135
6,754
Share-based compensation
117,413
100,261
Interest income
(3,365
)
(1,125
)
Interest expense and other (income)
expense, net
9,252
(337
)
Provision for income taxes
2,684
3,243
Adjusted EBITDA
$
92,043
$
178,213
PINTEREST, INC.
RECONCILIATION OF GAAP TO
NON-GAAP FINANCIAL RESULTS
(in thousands, except per share
amounts)
(unaudited)
Three Months Ended June
30,
2022
2021
Reconciliation of net income (loss) to
non-GAAP net income:
Net income (loss)
$
(43,076
)
$
69,417
Share-based compensation
117,413
100,261
Amortization of acquired intangible
assets
3,028
252
Non-GAAP net income
$
77,365
$
169,930
Basic weighted-average shares used in
computing net income (loss) per share
662,242
636,190
Weighted-average dilutive securities
(1)
25,463
56,173
Diluted weighted-average shares used in
computing non-GAAP net income per share
687,705
692,364
Non-GAAP net income per share
$
0.11
$
0.25
____________________
(1)
Gives effect to potential common
stock instruments such as stock options, unvested restricted stock
units and unvested restricted stock awards.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220801005710/en/
Press: LeMia Jenkins press@pinterest.com
Investor relations: Neil Doshi ir@pinterest.com
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