Latest news with #usergrowth
Irish Times
2 days ago
- Business
- Irish Times
US shoppers ditch Shein and Temu as Trump closes tax loophole
Online retailers Temu and Shein have seen their once rapid user growth go into reverse in the US after US President Donald Trump imposed steep tariffs on Chinese goods and closed a tax loophole that allowed them to undercut rivals. Temu's monthly active users, a measure of engagement on its app, plunged 51 per cent to 40.2 million in the US between March and June, according to data from market intelligence company Sensor Tower. The number of US shoppers using Shein's app also shrank over the same period, albeit not as drastically. The fast-fashion retailer saw a 12 per cent drop in monthly active users to 41.4 million, according to Sensor Tower. Shein and Temu pioneered a new model of ecommerce that has disrupted the retail industry across the western world over the past five years. READ MORE They both escaped import duties by sending Chinese-made goods directly to consumers' homes as individual packages. Cheap prices and a social media advertising blitz enabled Shein and Temu to amass a vast customer base in a matter of months. Shein sought to capitalise on its growth with a stock market float but struggled to win the backing of regulators for a listing in the US and the UK. [ EU to impose €2 tax on low-cost items in blow to Temu and Shein Opens in new window ] Reuters reported last week that Shein imminently plans to file for an initial public offering (IPO) in Hong Kong. Shein declined to comment on its listing plans or business performance. On May 2nd, Mr Trump scrapped the low value goods exemption in the US, known as 'de minimis', for parcels arriving from China and Hong Kong, calling it 'a big scam going on against our country'. The president replaced the exemption, which allowed parcels worth less than $800 (€683) to enter the US duty free, with a 90 per cent tariff. That was subsequently reduced to as little as 30 per cent as part of a wider de-escalation of trade tensions with China. IATA Director General Willie Walsh on airline profits, air fares and why the Dublin Airport passenger cap makes Ireland a laughing stock Listen | 35:56 In the aftermath of Mr Trump's policy changes Temu overhauled its business model in the US. Instead of shipping products from factories in China it began shipping orders from sellers based in the US. The drop in usage of Temu and Shein may also be tied to a decline in each company's advertising spend. Over the past three months Temu's US ad spending fell 87 per cent and Shein's dropped 69 per cent compared with the same period last year, according to Sensor Tower. Last year, they ranked as the 10th and 11th-largest digital advertisers in the US – they now rank outside the top 60, the researcher said. As the environment in the US has become more hostile, Temu and Shein have switched their focus to Europe. The number of people using Temu's app in June jumped 76 per cent in France, 71 per cent in Spain and 64 per cent in Germany, compared with the same period last year, according to Sensor Tower. Meanwhile, Shein's monthly active users rose between 13 per cent and 20 per cent in the UK, Germany and France. But growth in Europe could also be at risk as the EU plans to levy a €2 fee on small packages entering the bloc, and the UK government is considering ending its own import duty exemption scheme. Temu declined to comment on business metrics or ad spending, but said its focus was on 'working with merchants across regions'. 'Since fully opening our marketplace to local sellers in over 20 markets ... we've been helping them expand their reach and grow their businesses.' – Copyright The Financial Times Limited 2025 .
Yahoo
4 days ago
- Business
- Yahoo
Why Duolingo Stock Plummeted This Week
New data shows Duolingo's daily active user growth continues to decelerate. Trading at an already lofty valuation, the company saw its share price plummet. However, Duolingo's long-term investment thesis is intact, and its growth optionality remains abundant. 10 stocks we like better than Duolingo › Shares of the world's largest education app, Duolingo (NASDAQ: DUOL), were down 14% this week as of 2:30 p.m. ET Thursday, according to data provided by S&P Global Market Intelligence. The main reason for this decline came from a Jefferies analyst highlighting that Duolingo's daily active user (DAU) growth slowed to 37% in June. Analysts expected 44% growth in DAUs for the company's second quarter, but the data shows it'll be closer to 39%, prompting the adverse reaction from the market. While 30 days' worth of disappointing DAU data isn't bad in and of itself, it extends a worrying trend. Over the last five months, the company's DAU growth declined from 56% in February to 53% in March, 41% in April, 40% in May, and finally 37% in June. This deceleration is far from a death knell for Duolingo's stock. But the market may be justified in lowering the company's valuation until it sees improving data. Even after this drop, the company trades at 106 times free cash flow, including stock-based compensation. However, following this decline, I may find myself buying more Duolingo shares soon, thanks to its promising growth optionality. Far from just a language learning app, Duolingo has multiple potential growth outlets, like: Adding to its courses, as it has already done with ABCs for children, math, music, and now chess. Building upon its standardized test offerings, such as its Duolingo English Test (roughly 10% of sales). Growing the advertising revenue from its non-subscriber tier (around 6% of sales). Incorporating artificial intelligence (AI) into its offerings, such as its video chat with Lily. Though its days of 50% hypergrowth may be in the past, Duolingo's longer-term growth story is still in its early chapters. Before you buy stock in Duolingo, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Duolingo wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $687,731!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $945,846!* Now, it's worth noting Stock Advisor's total average return is 818% — a market-crushing outperformance compared to 175% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of June 23, 2025 Josh Kohn-Lindquist has positions in Duolingo. The Motley Fool has positions in and recommends Jefferies Financial Group. The Motley Fool recommends Duolingo. The Motley Fool has a disclosure policy. Why Duolingo Stock Plummeted This Week was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
08-06-2025
- Business
- Yahoo
Is Roku Stock a Long-Term Buy?
Roku's earnings are negative by design, as the company focuses on user growth. Roku's price-to-sales and price-to-book ratios suggest the stock is more than reasonably affordable. This growth stock has a long way to run. 10 stocks we like better than Roku › At first glance, Roku (NASDAQ: ROKU) looks like a terrible investment. Earnings are negative. Sales are rising, but much more slowly than they were four years ago. The stock trades at an unaffordable valuation of 125 times forward earnings estimates. After a long-forgotten price spike in the pandemic lockdown era, Roku's stock fell hard and then traded sideways over the last three years. But if you look a bit closer, you should see a healthy long-term growth story in play. Roku targets a huge global market, following in the footsteps of proven winners, and the stock doesn't appear expensive at all from other perspectives. It's actually one of my favorite stocks to buy in 2025, and Roku should be a helpful addition to long-term portfolios. Let me deconstruct the scary qualities I mentioned above. Roku's red-ink earnings are at least partly a voluntary choice. The company treats its streaming hardware as a marketing tool, selling Roku sticks and TV sets below the manufacturing and distribution costs. This user-growth tactic is especially unprofitable in Roku's highest-volume sales periods. The holiday quarter of 2024, for example, nearly quadrupled the devices segment's negative gross margin from 7.6% in the third quarter to 28.6% in the fourth. In other words, Roku is running its business with unprofitable profit margins to maximize its market reach and user growth. Furthermore, I'm talking about generally accepted accounting principles (GAAP), which is the standard accounting method used for calculating taxes. Roku often posts negative GAAP earnings that result in tax refunds rather than expenses. At the same time, free cash flows tend to land on the positive side with modest cash profits. That's just efficient accounting powered by stock-based compensation and amortization of Roku's media-streaming content library. Roku's year-over-year sales growth has averaged 14.7% over the last two years. That's a sharp retreat from 40.9% in the three years before that. But don't forget that the extreme growth was driven by the COVID-19 pandemic. Lots of people turned to digital media during the lockdown period, resulting in a unique business spike for companies like Roku and Netflix (NASDAQ: NFLX). The pandemic also happened to take place just months after Walt Disney (NYSE: DIS) launched the Disney+ streaming service, inspiring a torrent of copycat service launches. Long story short, there may never be a media market like the one in 2020-2021 again. Holding on to nearly half of that nitro-boosted growth rate in recent years is actually really good. Let me point back to the voluntary GAAP losses. Roku isn't trying to generate huge taxable profits at this time, which makes price-to-earnings (P/E) ratios largely unusable. Even the forward-looking version of this common metric relies on Roku's guidance targets filtered through Wall Street's analysis. If anything, the analyst community's projections are more optimistic than Roku's official targets. Management expects a $30 million GAAP loss in fiscal year 2025, which would work out to another "not applicable" P/E ratio. If you look at other valuation metrics, Roku starts to look like a bargain. Trading at 2.6 times trailing sales, the stock is comparable to slow-growth giants such as Caterpillar or Unilever. Roku also seems undervalued, if you base your analysis on its robust balance sheet, with a price-to-book ratio of 4.4 and a price-to-cash multiple of 4.9. I'll admit that Roku's stalled stock chart can be frustrating. Share prices are down 17% over the last three years, missing out on 44% growth in the S&P 500 (SNPINDEX: ^GSPC) market index. Roku's sales are up 45% over this period, while free cash flow rose by 66%. When will the big payoff come, rewarding patient shareholders for Roku's quiet success? That's OK, though. Keeping stock prices low just gives investors more time to build those Roku positions. I have bought Roku more often than any other stock since the spring of 2022, and I might not be done adding shares yet. Whenever I have spare cash ready for investments, Roku pops up as a top idea. That remains true in June 2025. So, let the chart slouch lower. Affordable buy-in prices can set you up for tremendous long-term returns. Before you buy stock in Roku, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Roku wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $669,517!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $868,615!* Now, it's worth noting Stock Advisor's total average return is 792% — a market-crushing outperformance compared to 173% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of June 2, 2025 Anders Bylund has positions in Netflix, Roku, and Walt Disney. The Motley Fool has positions in and recommends Netflix, Roku, and Walt Disney. The Motley Fool recommends Unilever. The Motley Fool has a disclosure policy. Is Roku Stock a Long-Term Buy? was originally published by The Motley Fool Sign in to access your portfolio
Globe and Mail
15-05-2025
- Business
- Globe and Mail
Spotify Stock Skyrockets 112% in a Year: What's Next for Investors?
Spotify Technology S.A. SPOT shares have skyrocketed 112.4% in a year, outperforming the 32.5% rally of its industry and the 12.4% rise in the Zacks S&P 500 Composite. SPOT has outperformed its streaming rivals Apple AAPL and Amazon AMZN for the same period. Apple and Amazon have jumped 12.4% and 14.5% in the past year. One-Year Price Performance The massive rise in Spotify shares may appeal to investors. However, the eminent question that lingers is whether it is the right to invest in SPOT. SPOT's Growth Catalyst is Its User Base Expansion Spotify demonstrated an impressive first-quarter 2025 performance, driven by user growth. The company added nearly 3 million monthly active users (MAU) and 5 million net new subscribers in a single quarter, portraying its ability to attract and retain users globally. This growing user base acts as a vital asset for revenue growth in the future. It not only boosts direct premium subscriptions but also enhances the potential to monetize its ad-supported tier. This strong user rise lays a solid ground for positive developments. Latching onto its continued scalability, the company reinforces its network effects, attracting more users and content creators. Also, Spotify's CEO's aspirational vision of touching 1 billion subscribers shines a light on its long-term growth trajectory. The company can improve its top and bottom line by a huge margin, given that it can achieve the desired number and can exercise strategic price adjustments in mature markets. Initiatives like the Spotify Partner Program, targeted at onboarding more video podcasters, hold the potential to widen the platform's content offerings. This will also attract a wide audience and fuel further MAU growth and engagement in the long run. Spotify is well-positioned to zoom past its competitors and become the dominant audio streaming platform by capitalizing on its user base expansion, and tactfully investing in monetization and content strategy. Spotify's Promising Top & Bottom-Line Prospects The Zacks Consensus Estimate for SPOT's 2025 and 2026 revenues is pegged at $19.9 billion and 22.8 billion, implying 17.4% and 14.3% year-over-year growth, respectively. The consensus estimate for Spotify's 2025 and 2026 earnings per share stands at $9.88 and $13.69, suggesting 66.1% and 38.5% year-over-year increases, respectively. SPOT's Liquidity Position Lags Industry Spotify's current ratio at the end of the first quarter of 2025 stood at 1.48, which sets a good tone for investors. However, something that can raise concern is its stance when compared with the industry average. Currently, the industry average is 2.54, which is substantially higher than SPOT's current ratio. Adding to this concern, the metric has declined 21% from the preceding quarter. If continued, it can hurt the company's liquidity position. Intense Competition Hurts Spotify Apple Music and Amazon Music are the most notable competitors of Spotify. The financial strength of these companies is something to look out for. These major players can use their financial prowess to reduce streaming prices, and lower or limit content availability, thereby hurting SPOT's monetization strategy. Such an incident can bleed into hurting the company's stock price. Strong reliance on third-party content licenses exposes Spotify to royalty cost hikes, affecting margins as the company expands its content offerings to include audiobooks and video. SPOT Stock Looks Pricey Spotify's stock price increase led to elevated valuations. It is priced at 56.1 times forward 12-month earnings per share, which is higher than the industry's average of 37.8 times. When looking at the trailing 12-month EV-to-EBITDA ratio, Spotify is trading at 62.1 times, far exceeding the industry's average of 13.5 times. Spotify: Wait & Watch SPOT's user base expansion is the key to success as it positions the company well for revenue growth. The company provides a strong top and bottom-line outlook, which favors its long-term growth objective. Spotify's robust liquidity position reaffirms its financial strength. However, the market in which the company operates poses a substantial threat to its performance. Adding to this concern is its premium valuation, hurting investor sentiment. We recommend investors take a cautious approach and initiate a 'Hold' strategy. Increasing exposure is suggested after signs of lasting growth and a more attracting valuation appears. Spotify carries a Zacks Rank #3 (Hold) at present. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. 5 Stocks Set to Double Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%. Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor. Today, See These 5 Potential Home Runs >> Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Apple Inc. (AAPL): Free Stock Analysis Report Spotify Technology (SPOT): Free Stock Analysis Report
Yahoo
09-05-2025
- Business
- Yahoo
Pinterest Announces First Quarter 2025 Results, Delivers 16% Revenue Growth and Record Users
Q1 Revenue of $855 million, an increase of 16%, or 17% on a constant currency basis Record 570 million global monthly active users, an increase of 10% SAN FRANCISCO, May 08, 2025--(BUSINESS WIRE)--Pinterest, Inc. (NYSE: PINS) today announced financial results for the quarter ended March 31, 2025. Revenue was $855 million, growing 16% year over year. On a constant currency basis, revenue would have grown 17% year over year. Global Monthly Active Users ("MAUs") increased 10% year over year to 570 million. GAAP net income was $9 million and Adjusted EBITDA was $172 million. Net cash provided by operating activities was $364 million and free cash flow was $356 million. "Our strong results in the first quarter demonstrate continued momentum in revenue, user growth and engagement," said Bill Ready, CEO of Pinterest. "As the macroeconomic and digital ad landscape evolves, our strategy and consistent execution has made Pinterest more resilient than ever. The fundamentals in the business are strong and we're continuing to see healthy growth. Our AI advancements are helping users take action and make more intentional shopping decisions. We're driving performance for advertisers and winning market share, giving us a solid foundation for long-term, sustainable growth." Q1 2025 Financial Highlights The following table summarizes our consolidated financial results (in thousands, except percentages, unaudited): Three Months Ended March 31, % Change 2025 2024 Revenue $ 854,988 $ 739,983 16 % Constant currency % growth(1)(2) 17 % Net income (loss) $ 8,922 $ (24,812 ) NM Net income (loss) margin 1 % (3 )% Non-GAAP net income(2) $ 159,562 $ 119,846 33 % Adjusted EBITDA(2) $ 171,649 $ 126,089 36 % Adjusted EBITDA margin(2) 20 % 17 % Net cash provided by operating activities $ 363,706 $ 356,146 2 % Free cash flow(2) $ 356,417 $ 344,033 4 % _______________________ NM = not meaningful (1) On a constant currency basis, revenue for the three months ended March 31, 2025 was $865.1 million due to a $10.1 million unfavorable impact of changes in foreign exchange rates. (2) For more information on these non-GAAP financial measures, please see "―About non-GAAP financial measures" and the tables under "―Reconciliation of GAAP to non-GAAP financial results" included at the end of this release. Q1 2025 Other Highlights The following table sets forth our revenue, MAUs and average revenue per user (ARPU) based on the geographic location of our users (in millions, except ARPU and percentages, unaudited): Three Months Ended March 31, % Change 2025 2024 Revenue - Global $ 855 $ 740 16 % Revenue - U.S. and Canada $ 663 $ 592 12 % Revenue - Europe $ 147 $ 118 24 % Revenue - Rest of World $ 45 $ 30 49 % MAUs - Global 570 518 10 % MAUs - U.S. and Canada 102 98 4 % MAUs - Europe 148 140 5 % MAUs - Rest of World 320 279 14 % ARPU - Global $ 1.52 $ 1.46 5 % ARPU - U.S. and Canada $ 6.54 $ 6.05 8 % ARPU - Europe $ 1.00 $ 0.86 17 % ARPU - Rest of World $ 0.14 $ 0.11 29 % Guidance For Q2 2025, we expect revenue to be in the range of $960 million to $980 million, representing 12% - 15% growth year over year. We expect Q2 2025 Adjusted EBITDA* to be in the range of $217 million to $237 million. We intend to provide further details on our outlook during the conference call. _____________ *We have not provided the forward-looking GAAP equivalent for forward-looking Adjusted EBITDA or a GAAP reconciliation as a result of the uncertainty regarding, and the potential variability of, reconciling items such as share-based compensation expense and income taxes. Accordingly, a reconciliation of these non-GAAP guidance metrics to their corresponding GAAP equivalents is not available without unreasonable effort. However, it is important to note that material changes to reconciling items could have a significant effect on future GAAP results and, as such, we also believe that any reconciliations provided would imply a degree of precision that could be confusing or misleading to investors. Webcast and conference call information A live audio webcast of our first quarter 2025 earnings release call will be available at The call begins today at 1:30 PM (PT) / 4:30 PM (ET). This press release, including the reconciliations of certain non-GAAP measures to their nearest comparable GAAP measures and slide presentation are also available. A recording of the webcast will be available at for 90 days. We have used, and intend to continue to use, our investor relations website at as a means of disclosing material nonpublic information and for complying with our disclosure obligations under Regulation FD. Forward-looking statements This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Exchange Act of 1934, as amended, about us and our industry that involve substantial assumptions, risks and uncertainties. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts and are often characterized by the use of words such as "believe," "estimate," "expect," "may," "will," "can," "could," "would," "might," "continue," "intend," "plan," "forecast," "target," "anticipate," "potential," "looking ahead," "long-term" or and similar expressions, or by discussions of strategy, plans or intentions. Such forward-looking statements involve known and unknown risks, uncertainties, assumptions and other important factors that could cause our actual results, outcomes, performance or achievements, or industry results, to differ materially from historical results or any future results, outcomes, performance or achievements expressed, suggested or implied by such forward-looking statements. These risks and uncertainties include, but are not limited to, statements about: general economic uncertainty in global markets and a worsening of global economic conditions or low levels of economic growth, including inflation, tariffs and related retaliatory actions and other trade protection measures, stress in the banking industry, foreign exchange fluctuations and supply-chain issues; the effect of general economic and political conditions; our financial performance, including revenue, cost and expenses and cash flows; our ability to attract, retain and recover users and maintain and grow their level of engagement; our ability to provide content that is useful and relevant to users' personal taste and interests; our ability to develop successful new products or improve existing ones; our ability to maintain and enhance our brand and reputation; potential harm caused by compromises in security, including our cybersecurity protections and resources and costs required to prevent, detect and remediate potential security breaches; potential harm caused by changes in online application stores or internet search engines' methodologies, particularly search engine optimization methodologies and policies; discontinuation, disruptions or outages in third-party single sign-on access; our ability to compete effectively in our industry; our ability to scale our business, including our monetization efforts; our ability to attract and retain advertisers and scale our revenue model; our ability to attract and retain creators and publishers that create relevant and engaging content; our ability to develop effective products and tools for advertisers, including measurement tools; our ability to expand and monetize our platform internationally; our ability to effectively manage the growth of our business; our ability to continue to use and develop artificial intelligence ("AI") as well as managing the challenges and risks posed by AI; our ability to successfully manage our flexible work model with a more distributed workforce; our ability to sustain profitability; decisions that reduce short-term revenue or profitability or do not produce the long-term benefits we expect; fluctuations in our operating results; our ability to raise additional capital on favorable terms or at all; our ability to realize anticipated benefits from mergers and acquisitions, joint ventures, strategic partnerships and other investments; our ability to protect our intellectual property; our ability to receive, process, store, use and share data, and compliance with laws and regulations related to data privacy and content; current or potential litigation and regulatory actions involving us; our ability to comply with modified or new laws and regulations applying to our business, and potential harm to our business as a result of those laws and regulations; real or perceived inaccuracies in metrics related to our business; disruption of, degradation in or interference with our use of Amazon Web Services and our infrastructure; and our ability to attract and retain personnel. These and other potential risks and uncertainties that could cause actual results to differ from the results predicted are more fully detailed in our Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2025, which is available on our investor relations website at and on the SEC website at All information provided in this release and in the earnings materials is as of May 8, 2025. Undue reliance should not be placed on the forward-looking statements in this press release, which are based on information available to us on the date hereof. We undertake no duty to update this information unless required by law. About non-GAAP financial measures To supplement our condensed consolidated financial statements, which are prepared and presented in accordance with generally accepted accounting principles in the United States ("GAAP"), we use the following non-GAAP financial measures: Adjusted EBITDA, Adjusted EBITDA margin, non-GAAP costs and expenses (including non-GAAP cost of revenue, research and development, sales and marketing, and general and administrative), non-GAAP income from operations, non-GAAP net income, non-GAAP net income per share, constant currency revenue and free cash flow. The presentation of these financial measures is not intended to be considered in isolation, as a substitute for or superior to the financial information prepared and presented in accordance with GAAP. Investors are cautioned that there are material limitations associated with the use of non-GAAP financial measures as an analytical tool. In addition, these measures may be different from non-GAAP financial measures used by other companies, limiting their usefulness for comparative purposes. We compensate for these limitations by providing specific information regarding GAAP amounts excluded from these non-GAAP financial measures. We define Adjusted EBITDA as net income (loss) adjusted to exclude depreciation and amortization expense, share-based compensation expense, payroll tax expense related to share-based compensation, interest income (expense), net, other income (expense), net, provision for (benefit from) income taxes and certain other non-recurring or non-cash items impacting net income (loss) that we do not consider indicative of our ongoing business performance. Adjusted EBITDA margin is calculated by dividing Adjusted EBITDA by revenue. Non-GAAP costs and expenses (including non-GAAP cost of revenue, research and development, sales and marketing, and general and administrative) and non-GAAP net income exclude amortization of acquired intangible assets, share-based compensation expense and payroll tax expense related to share-based compensation. In addition to these exclusions, we also subtract an assumed provision for income taxes to calculate non-GAAP net income. We calculate the non-GAAP income tax provision using a fixed long-term projected tax rate in order to provide better consistency across reporting periods. The fixed long-term projected tax rate uses a financial projection that excludes the direct impact of our non-GAAP adjustments and eliminates the effects of items that can vary in size and frequency. For 2024 and 2025, we used a long-term projected tax rate of 20%, which reflects currently available information, as well as other factors and assumptions. The non-GAAP tax rate could be subject to change for a variety of reasons, including significant changes in the geographic earnings mix or changes in tax laws and regulations. We re-evaluate this long-term rate on an annual basis or if any significant events that may materially affect this long-term rate occur. Non-GAAP income from operations is calculated by subtracting non-GAAP costs and expenses from revenue. Non-GAAP net income per share is calculated by dividing non-GAAP net income by diluted weighted-average shares outstanding. We calculate constant currency revenue by translating our current period revenue using the corresponding prior period's monthly exchange rates for currencies other than the U.S. dollar. We define free cash flow as net cash provided by operating activities less purchases of property and equipment. Free cash flow is not intended to represent our residual cash flow available for discretionary expenditures. We use these non-GAAP financial measures to evaluate our operating results and for financial and operational decision-making purposes. We believe these measures help identify underlying trends in our business that could otherwise be masked by the effect of the income and expenses they exclude. We also believe these measures provide useful information about our operating results, enhance the overall understanding of our past performance and future prospects and allow for greater transparency with respect to key metrics we use for financial and operational decision-making. We present these non-GAAP measures to assist potential investors in seeing our operating results through the eyes of management and because we believe these measures provide an additional tool for investors to use in comparing our operating results over multiple periods with other companies in our industry. There are a number of limitations related to the use of non-GAAP financial measures rather than the nearest GAAP equivalents. For example, Adjusted EBITDA excludes: (i) certain recurring, non-cash charges such as depreciation of fixed assets and amortization of acquired intangible assets, although these assets may have to be replaced in the future, and (ii) share-based compensation expense and payroll tax expense related to share-based compensation, which have been, and will continue to be for the foreseeable future, significant recurring expenses and an important part of our compensation strategy. In addition, constant currency revenue excludes the effect of changes in foreign currency exchange rates, which have an actual effect on our operating results, and free cash flow does not reflect our future contractual commitments arising from purchases of property and equipment. For a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures, please see the tables under "―Reconciliation of GAAP to non-GAAP financial results" included at the end of this release. Limitation of key metrics and other data The numbers for our key metrics, which include our MAUs and ARPU, are calculated using internal company data based on the activity of user accounts. We define an MAU as an authenticated Pinterest user who visits our website, opens our mobile application or interacts with Pinterest through one of our browser or site extensions, such as the Save button, at least once during the 30-day period ending on the date of measurement. The number of MAUs does not include Shuffles users unless they would otherwise qualify as MAUs. Unless otherwise indicated, we present MAUs based on the number of MAUs measured on the last day of the current period. We measure monetization of our platform through our ARPU metric. We define ARPU as our total revenue in a given geography during a period divided by the average of the number of MAUs in that geography during the period. We calculate average MAUs based on the average of the number of MAUs measured on the last day of the current period and the last day prior to the beginning of the current period. We calculate ARPU by geography based on our estimate of the geography in which revenue-generating activities occur. We use these metrics to assess the growth and health of the overall business and believe that MAUs and ARPU best reflect our ability to attract, retain, engage and monetize our users, and thereby drive revenue. While these numbers are based on what we believe to be reasonable estimates of our user base for the applicable period of measurement, there are inherent challenges in measuring usage of our products across large online and mobile populations around the world. In addition, we are continually seeking to improve our estimates of our user base, and such estimates may change due to improvements or changes in technology or our methodology. PINTEREST, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands, except par value) (unaudited) March 31, December 31, 2025 2024 ASSETS Current assets: Cash and cash equivalents $ 1,252,310 $ 1,136,460 Marketable securities 1,362,913 1,376,409 Accounts receivable, net 709,994 893,403 Prepaid expenses and other current assets 77,041 78,435 Total current assets 3,402,258 3,484,707 Property and equipment, net 51,232 45,624 Operating lease right-of-use assets 79,475 85,867 Goodwill and intangible assets, net 110,228 110,103 Deferred tax assets 1,624,944 1,602,539 Other assets 14,559 13,820 Total assets $ 5,282,696 $ 5,342,660 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 96,691 $ 84,026 Accrued expenses and other current liabilities 307,708 314,107 Total current liabilities 404,399 398,133 Operating lease liabilities 143,956 151,364 Other liabilities 45,872 42,009 Total liabilities 594,227 591,506 Commitments and contingencies Stockholders' equity: Class A common stock, $0.00001 par value, 6,666,667 shares authorized, 593,694 and 593,462 shares issued and outstanding as of March 31, 2025 and December 31, 2024, respectively; Class B common stock, $0.00001 par value, 1,333,333 shares authorized, 82,494 and 82,471 shares issued and outstanding as of March 31, 2025 and December 31, 2024, respectively 7 7 Additional paid-in capital 4,966,164 5,039,439 Accumulated other comprehensive income (loss) 1,538 (130 ) Accumulated deficit (279,240 ) (288,162 ) Total stockholders' equity 4,688,469 4,751,154 Total liabilities and stockholders' equity $ 5,282,696 $ 5,342,660 PINTEREST, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share amounts) (unaudited) Three Months Ended March 31, 2025 2024 Revenue $ 854,988 $ 739,983 Costs and expenses: Cost of revenue 199,270 181,091 Research and development 331,665 280,275 Sales and marketing 253,920 226,289 General and administrative 105,610 106,744 Total costs and expenses 890,465 794,399 Loss from operations (35,477 ) (54,416 ) Interest income (expense), net 27,293 31,266 Other income (expense), net 4,519 (4,526 ) Loss before benefit from income taxes (3,665 ) (27,676 ) Benefit from income taxes (12,587 ) (2,864 ) Net income (loss) $ 8,922 $ (24,812 ) Net income (loss) per share: Basic $ 0.01 $ (0.04 ) Diluted $ 0.01 $ (0.04 ) Weighted-average shares used in computing net income (loss) per share: Basic 676,523 678,819 Diluted 689,358 678,819 PINTEREST, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) (unaudited) Three Months Ended March 31, 2025 2024 Operating activities Net income (loss) $ 8,922 $ (24,812 ) Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation and amortization 5,848 4,861 Share-based compensation 187,426 162,473 Deferred income taxes (22,074 ) 330 Net amortization of investment premium and discount (5,408 ) (6,788 ) Other 760 (2,690 ) Changes in assets and liabilities: Accounts receivable 185,081 201,188 Prepaid expenses and other assets 961 (10,615 ) Operating lease right-of-use assets 7,222 8,727 Accounts payable 13,036 4,639 Accrued expenses and other liabilities (10,402 ) 29,728 Operating lease liabilities (7,666 ) (10,895 ) Net cash provided by operating activities 363,706 356,146 Investing activities Purchases of property and equipment (7,289 ) (12,113 ) Purchases of marketable securities (415,336 ) (336,522 ) Sales of marketable securities 2,350 2,999 Maturities of marketable securities 432,224 342,517 Net cash provided by (used in) investing activities 11,949 (3,119 ) Financing activities Proceeds from exercise of stock options, net 8,053 16,756 Repurchases of Class A common stock (175,000 ) — Shares repurchased for tax withholdings on release of restricted stock units and restricted stock awards (93,754 ) (99,708 ) Net cash used in financing activities (260,701 ) (82,952 ) Effect of exchange rate changes on cash, cash equivalents and restricted cash 902 (709 ) Net increase in cash, cash equivalents and restricted cash 115,856 269,366 Cash, cash equivalents and restricted cash, beginning of period 1,141,221 1,368,532 Cash, cash equivalents and restricted cash, end of period $ 1,257,077 $ 1,637,898 PINTEREST, INC. RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL RESULTS (in thousands) (unaudited) Three Months Ended March 31, 2025 2024 Share-based compensation by function: Cost of revenue $ 4,072 $ 2,948 Research and development 119,482 102,355 Sales and marketing 30,331 24,989 General and administrative 33,541 32,181 Total share-based compensation $ 187,426 $ 162,473 Payroll tax expense related to share-based compensation by function: Cost of revenue $ 304 $ 269 Research and development 9,592 9,015 Sales and marketing 2,214 2,069 General and administrative 1,742 1,818 Total payroll tax expense related to share-based compensation(1) $ 13,852 $ 13,171 Amortization of acquired intangible assets by function: Cost of revenue $ 1,508 $ 1,508 Sales and marketing 135 135 General and administrative 197 197 Total amortization of acquired intangible assets $ 1,840 $ 1,840 Reconciliation of total costs and expenses to non-GAAP costs and expenses: Total costs and expenses $ 890,465 $ 794,399 Share-based compensation (187,426 ) (162,473 ) Payroll tax expense related to share-based compensation(1) (13,852 ) (13,171 ) Amortization of acquired intangible assets (1,840 ) (1,840 ) Total non-GAAP costs and expenses $ 687,347 $ 616,915 Reconciliation of net income (loss) to Adjusted EBITDA: Net income (loss) $ 8,922 $ (24,812 ) Depreciation and amortization 5,848 4,861 Share-based compensation 187,426 162,473 Payroll tax expense related to share-based compensation(1) 13,852 13,171 Interest (income) expense, net (27,293 ) (31,266 ) Other (income) expense, net (4,519 ) 4,526 Benefit from income taxes (12,587 ) (2,864 ) Adjusted EBITDA $ 171,649 $ 126,089 PINTEREST, INC. RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL RESULTS (in thousands, except per share amounts) (unaudited) Three Months Ended March 31, 2025 2024 Reconciliation of net income (loss) to non-GAAP net income: Net income (loss) $ 8,922 $ (24,812 ) Share-based compensation 187,426 162,473 Payroll tax expense related to share-based compensation(1) 13,852 13,171 Amortization of acquired intangible assets 1,840 1,840 Income tax effects and tax adjustments(2) (52,478 ) (32,826 ) Non-GAAP net income $ 159,562 $ 119,846 Basic weighted-average shares used in computing net income (loss) per share 676,523 678,819 Weighted-average dilutive securities(3) 12,835 22,758 Diluted weighted-average shares used in computing non-GAAP net income per share 689,358 701,577 Non-GAAP net income per share $ 0.23 $ 0.17 Reconciliation of free cash flow: Net cash provided by operating activities $ 363,706 $ 356,146 Less: Purchases of property and equipment (7,289 ) (12,113 ) Free cash flow $ 356,417 $ 344,033 _____________________________ (1) We began excluding payroll tax expense related to share-based compensation from Adjusted EBITDA and non-GAAP net income in the fourth quarter of 2024 because these taxes are variable due to our stock price and other factors outside our control and therefore are not reflective of our ongoing business operations or the underlying trends in our business. Accordingly, although payroll tax expense related to share-based compensation is a cash expense that we will continue to incur in the future, we believe excluding this expense provides investors with a better understanding of the performance of our core business and serves as a tool for investors to use in comparing our core business operating results over multiple periods with other companies in our industry. Prior period amounts have been restated to conform to this presentation. (2) Includes the income tax effect of our non-GAAP adjustments using a long-term projected tax rate of 20% and other tax adjustments. Prior period amounts have been restated to conform to this presentation. (3) Gives effect to potential common stock instruments such as stock options, unvested restricted stock units and unvested restricted stock awards. 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