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Pinterest (PINS) Scraps 2020 Guidance on Coronavirus Woes

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Pinterest (PINS - Free Report) is the latest victim of the weakening advertising market due to the coronavirus pandemic.

The company withdrew 2020 revenue and adjusted EBITDA margin guidance that it had issued on Feb 6, citing adverse impact of the COVID-19 outbreak on its advertising revenues.
Pinterest, which currently has a Zacks Rank #4 (Sell), joins Facebook (FB - Free Report) , Twitter (TWTR - Free Report) and Disney, which either dissolved their projections or cautioned against earnings misses due to a weakening advertising market.

Notably, Twitter withdrew its revenue and operating income guidance for the first quarter of 2020 due to the growing adverse impact of coronavirus on the global operating and economic environment as well as on advertiser demand. Facebook admitted that its ad business took a huge beating in countries severely hit by the novel coronavirus.

Additionally, Alphabet (GOOGL - Free Report) division Google’s travel ad revenues are expected to decline due to coronavirus-led global lockdowns and social distancing, which have severely hurt travel & tourism industry. 

Pinterest, Inc. Price and Consensus

Pinterest, Inc. Price and Consensus

Pinterest, Inc. price-consensus-chart | Pinterest, Inc. Quote

2020 Earnings Estimates Go South

Notably, for 2020, Pinterest had anticipated revenues of $1.52 billion. Adjusted EBITDA margin was expected to be flat to up slightly compared with 2019 adjusted EBITDA margin of 1%.

Pinterest stated that it is difficult to estimate the near-term performance (rest of 2020) of its businesses in the aftermath of the COVID-19 outbreak.

The Zacks Consensus Estimate for 2020 revenues is currently pegged at $1.40 billion, indicating growth of 22.8% from the figure reported in the preceding year.

Moreover, the consensus mark for loss currently stands at 10 cents per share, down from earnings of 6 cents per share a month ago.

Preliminary Q1 Results Reflect User Base Growth

Pinterest also announced preliminary first-quarter 2020 results that reflected an expanded user base. The company expects global monthly active users (MAUs) in the range of 365 million to 367 million. Of this, the United States accounts for 89-90 million, while the rest of the world accounts for 276-277 million.

The company reported global MAUs of 335 million in fourth-quarter 2019, up 26% year over year. U.S.-MAUs increased 8% to 88 million while International-MAUs jumped 35% to 247 million.

The Zacks Consensus Estimate for first-quarter 2020 revenues is currently pegged at $259.3 million, indicating growth of 28.4% from the figure reported in the year-ago quarter. Moreover, the consensus mark for loss currently stands at 10 cents per share, down 42.9% in the past 30 days.

Moreover, Pinterest expects preliminarily revenues between $269 million and $272 million. Further, the company ended the first quarter (as of Mar 31) with roughly $1.7 billion in cash, cash equivalents and marketable securities, no financial debt, and an undrawn $500 million revolving credit facility.

The company is set to report full first-quarter 2020 results on May 5.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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