Pinterest Inc. announced Monday that its yearly sales broke past the $1 billion mark for the first time in 2019, as the company put more premium on enhanced product, marketing and shopping experience.
Pinterest's fourth quarter earnings report that was released February 6 beat market observers' estimates on top and bottomlines, which was the reason for the stock's strong rally.
After beating Wall Street projections for revenue, adjusted earnings, monthly active users and average revenue per user, Pinterest stock simply skyrocketed.
Pinterest settled at $23.01 late Friday, after the company's shares shot as high as $27.25, up 18.5 percent, before wrapping up the trade at $25.20, for a 9.6 percent rally on the day.
Investors saw Pinterest stock dip from an August peak of $36.83 to end 2019 at just over 50 percent of that value at $18.64. And Friday's better than estimated figure was a much-needed shot in the arm. The question now though, is: can the company keep its solid momentum in the next coming months?
When it comes to the business of online and social media, it all boils down to transparent and promising figures. Venture capitalists want to see growth in the number of customers, and the monetization of those users. With that in mind, Pinterest reported fourth quarter figures that indicated growth is present.
The rise in users and engagement numbers translated to major global sales growth, as well. The $400 million it reported for the fourth quarter is up 46 percent, year on year.
For the current year, Ben Silbermann, Pinterest chief executive officer and co-founder, said they will continue to "pursue our mission of making Pinterest the internet's home for inspiration."
Pinterest became a publicly listed firm in April 2019, at a price of $19 per share, pushing its stock to soar $36 in August before it dropped.
Loop Capital Markets analyst Rob Sanderson, who initiated stock coverage with a buy rating on Wednesday, called the listing as the "most significant of small and mid-cap stocks" in the US online market.
Sanderson added that If the curve of monetization continues to mimic Facebook early on, that would mean a $8.5 billion hike in revenues by 2025, "around twice the forecast of Street."
Pinterest is an American social media and mobile application company founded by Paul Sciarra, Ben Silbermann, and Evan Sharp. Its social platform is used by more than 300 million people as a virtual bulletin board to find, share, and save ideas via GIFs and videos.
