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Pinterest valued at $12.7 billion in IPO, sign of tech demand after Lyft struggles

Joshua Franklin
APRIL 18, 2019 / 7:10 AM / UPDATED 2 HOURS AGO

NEW YORK (Reuters) - Pinterest Inc’s initial public offering set the online scrapbook company’s valuation at $12.7 billion on Wednesday, above its expectations and a sign of strength for the tech IPO market after Lyft Inc’s struggles.

Pinterest, where users save ideas for clothes, décor and recipes, is due to start trading on the New York Stock Exchange on Thursday. Its performance will be a key test of the tech IPO market after the Nasdaq debut of ride-hailing start-up Lyft at the end of last month.

Lyft raised more than it had set out to do when it went public, but shares have dropped around 17 percent from its IPO price, raising concerns about bigger rival Uber Technologies Inc when it prices its IPO next month.

A key difference between Pinterest and Lyft however were their valuation expectations. Lyft, which lost $911 million last year, was seeking a valuation of up to $24.3 billion in its IPO, higher than the $15 billion valuation it attained in its latest private fundraising round in 2018. Pinterest lost $63 million in 2018.

Pinterest’s initial $15-$17 per share target range target range had set it on course to be valued below its last private fundraising valuation of $12.3 billion in 2017.

At $19 per share, Pinterest, which offers advertisers a venue to sell to consumers, raised around $1.4 billion at a roughly $12.7 billion valuation.

The fact that Pinterest attained a higher valuation in the IPO will be a relief to investors who participated in prior fundraising rounds and gives some vindication to the company ahead of its public market debut on Thursday.

Pinterest is also the most high-profile listing of a U.S. social media company since Snap Inc in 2017. Snap’s stock also priced well in its IPO but is now down more than 30 percent below its IPO price.

Other IPOs this year, such as cloud computing company PagerDuty Inc and jeans maker Levi Strauss & Co have also traded above their IPO prices since going public.

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What real value does Pinterest brings....
Pinterest stock plunges 20% on revenue miss and disappointing forecast
* Following Google’s reported advertising growth of 17% and Facebook’s growth of 28%, Pinterest showed on Thursday that it’s picking up market share against its much larger rivals.
* Pinterest ’s stock is up from its IPO price in April, but has lost almost one-third of its value since peaking in August.

Ari Levy

Pinterest shares dropped 20% in extended trading Thursday after the image-sharing site reported disappointing third-quarter results.

Here are the key numbers for the period ended in September:
- Earnings per share: 1 cent, excluding some items, vs. 4-cent loss forecast by Refinitiv
- Revenue: $279.7 million, vs $280.6 million forecast by Refinitiv
- Monthly active users: 322 million, vs. 311.8 million forecast by FactSet
- Average revenue per user: 90 cents, vs 91 cents forecast by FactSet

Pinterest also missed estimates for its 2019 full-year outlook. The company said that revenue for the year will come in at $1.1 billion to $1.115 billion. Analysts were expecting sales of $1.12 billion, according to Refinitiv.

The stock sank to $20.11 following the report after closing down 3% at $25.14. At its after-hours price, Pinterest is narrowly above its $19 IPO price from April.

While much smaller than online ad rivals Google and Facebook, Pinterest is growing at a faster clip and picking up some market share. Sales grew 47% in the latest quarter from a year earlier, topping Facebook’s 28% ad sales growth and Google, which reported an increase of 17%.

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Pinterest sees strong sales as ad spending booms in holiday rush

Reporting by Nilanjana Basu and Nivedita Balu in Bengaluru; Editing by Devika Syamnath
November 5, 2021 5:59 AM +07

Nov 4 (Reuters) - Pinterest Inc (PINS.N) forecast fourth-quarter revenue growth in the high-teens percentage range, after online retailers splurging on ads before the holiday season helped the image-sharing company beat quarterly estimates.

Shares of the company rose 6.5% after the bell on Thursday, as increased demand from large retail advertisers and growth in its international business boosted third-quarter revenue 43%.

Advertisers in the consumer packaged goods segment, however, were hurt by global supply chain constraints, impacting Pinterest's revenue growth rate.

In a post earnings call, the company also said it did not face any material impact from Apple's (AAPL.O) privacy changes which have made it difficult for social media companies to target audiences and measure advertising capabilities.

Pinterest's monthly active users (MAU), meanwhile, grew just 1% to 444 million, missing Factset estimates of 460 million. Last year, the company had notched a 37% surge as users stuck at home turned to social media to keep themselves entertained.

"We believe the slowdown was due to the pandemic unwind," Chief Financial Officer Todd Morgenfeld said in an interview. Many GenZ users are returning to school, while others who had used the app to explore cooking and home decor projects during lockdowns are now venturing out more, he added.

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Specuvestor: Asset - Business - Structure.

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