Pinterest (PINS), a leading visual discovery platform, has evolved into a new phase of customer growth by leveraging AI (artificial intelligence) tools to offer a more personalized shopping experience. In the earnings call, CEO Bill Ready recently highlighted that AI has become a key component in enhancing Pinterest’s recommendation system, search capabilities, and advertising tactics. As a result, this innovation has enabled the company to build a strong customer engagement model, transforming how brands interact with users.
Through its platform, Pinterest allows users to explore, share, and save creative ideas through images, videos, and links.
Pinterest Breaks Through with First Billion-Dollar Quarter
The company recently unveiled its fourth-quarter results for 2024, achieving a major milestone with its first $1 billion revenue quarter.
The company saw an 18% rise in its quarterly revenue, totaling $1.15 billion, driven by a strong holiday shopping season and an increased use of AI tools to enhance advertising strategies. Meanwhile, the platform’s global monthly active users (MAUs) hit a record 553 million, marking an 11% year-over-year increase. Following the solid results, PINS stock gained 19% in after-hours trading on February 6.
Pinterest Enhances User Experience with AI Innovation
The company credits its growth to AI-driven advertising technology, which has successfully enabled businesses to boost ad spending while reaching more precise target audiences. Consequently, the platform demonstrated its capacity to turn user engagement into sales, reflected in a 90% year-over-year rise in clicks to advertisers.
Additionally, the company revealed that its AI-driven Taste Graph, which maps how user behavior, content, and products are related, has grown its connections by 75% in the last two years. The company is also incorporating AI into its development process, with 15% of its current codebase now created using AI assistance tools. This shift toward AI in internal operations indicates that Pinterest is streamlining both its user-facing features and backend systems for greater efficiency.
Looking ahead, the company expects Q1 2025 revenue to range between $837 million and $852 million, reflecting a year-over-year growth of 13-15%.
Is Pinterest Stock a Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on PINS stock based on 16 Buys and eight Holds assigned in the past three months. The average PINS price target of $38.65 per share implies 15.06% upside potential.
