Concerns over tariff impact on Pinterest's advertising revenue lead to a 20% drop in stock price

Pinterest (PINS.US) reported third-quarter results that did not meet market expectations, primarily impacted by large retailers cutting advertising spending due to tariff issues, leading to a 20% plunge in the company's stock price on Wednesday.

Several investment banks have lowered their target prices for Pinterest, citing reasons including intensified advertising competition and an unclear macroeconomic environment. JP Morgan has reduced its target price but maintained an "Overweight" rating, believing that Pinterest's active development of artificial intelligence applications will help drive long-term growth. Morgan Stanley analyst Doug Anmuth stated that short-term macro pressures and Pinterest's reliance on large retailers and home goods may limit the stock price in the short term, but he remains optimistic about its user growth, deeper engagement, and overall monetization potential.

Pinterest's adjusted earnings per share for the last quarter were 38 cents, below expectations; revenue met market expectations. Sales in the U.S. and Canada for the third quarter were $786 million, below expectations. Pinterest's Chief Financial Officer Julia Donnelly indicated that some large U.S. retailers are experiencing profit compression due to tariffs, leading to signs of a slowdown in advertising spending for the quarter, and she expects this trend to continue with the Trump administration's new tariffs on home goods