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Has Pinterest Missed The Retail Media Boat?

Michael Shields

Pinterest announced its Q3 earnings results earlier this week, showcasing 18% growth, and an insane 354% jump in profitability.

And the stock tanked.

That’s because, per CNBC, the social bookmarking/dreamboard-making site provided downward guidance, citing weakness in food and beverage advertising.

This is weird/noteworthy for several reasons. Aren’t the holidays coming up? And inflation down? Wouldn’t food and beverage brands be blowing the doors off this quarter?

Plus, we’re in the midst of a massive retail media boom. Somewhere along the way, Pinterest dropped the ball on becoming a pure shopping engine - people research and fantasized about all sorts of products, but don’t always shop on Pinterest - or at least not like they do on other pure eCommerce sites.

But that was supposed to be changing, as Pinterest inked big deals with both Amazon and Google over the past year. The question is, why aren’t those paying off to the degree that they are showing up in earnings/guidance? Well, Madison and Wall analyst Brian Wieser said we may need to give Pinterest more time, particularly to let its AI ad product to kick in.

“Looking forward, several key enhancements should sustain rapid growth,” he wrote.

If you look at Pinterest’s size and growth, it should be in great shape going forward… assuming that more people continue to look to fulfill there, rather than just browse. My guess, and this is just speculation, is that Pinterest may have a problem going forward in how it is “bucketed.” I would expect most of its ads deals come from social budgets, rather than that sweet retail media money.

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