May 8 (Reuters) - Pinterest ( PINS ) forecast
current-quarter revenue above Wall Street estimates on Thursday,
a sign of growing advertising spend on the social media platform
despite uncertainty over marketing budgets.
The company's emphasis on direct response ads - designed to
prompt specific actions like shopping, app downloads or website
visits - continues to drive ad spend, even as brand awareness
advertising is weak.
Pinterest's ( PINS ) results follow the termination of a duty-free
import loophole in the U.S., which, combined with deepening
trade tensions, has constrained ad budgets for some social media
platforms.
But Facebook-parent Meta and Reddit ( RDDT ) topped
revenue expectations in the first quarter on strong ad sales. In
contrast, smaller rival Snap said that it would not
issue a quarterly forecast due to economic uncertainty, as
advertisers favor bigger platforms in tough times.
"As the macroeconomic and digital ad landscape evolves, our
strategy and consistent execution have made Pinterest ( PINS ) more
resilient than ever," CEO Bill Ready said in a statement.
Pinterest's ( PINS ) Gen Z users, who comprise over 40% of its user
base, along with its artificial intelligence tools for creating
personalized ad campaigns, make the social media platform
increasingly attractive to advertisers.
The company expects second-quarter revenue of $960 million
to $980 million, the midpoint of which was above the analysts'
average estimate of $966.3 million, according to data compiled
by LSEG.
It expects adjusted earnings before interest, taxes,
depreciation and amortization of $217 million to $237 million
for the second quarter, compared with estimates of $233.1
million.
Revenue grew 16% to $855 million for the first quarter ended
March 31, beating estimates of $846.6 million.
Global monthly active users on the platform rose 10% to 570
million, exceeding estimates of 564 million.