Pinterest — Third Quarter 2026 Earnings Summary

Financial Performance:

• Revenue was $1,174 million, representing a 12% year-over-year increase on both reported and constant currency basis.
• GAAP net income was $22 million, a 77% decrease from $92 million in the prior year period; GAAP net income margin was 2% compared to 9% previously.
• Non-GAAP net income was $270 million, a 3% increase year-over-year.
• Adjusted EBITDA was $339 million, an 11% increase year-over-year, with a margin of 29% (unchanged from 29% in the prior year).
• Net cash provided by operating activities was $316 million, a 2% decrease year-over-year.
• Free cash flow was $300 million, a 6% decrease year-over-year.
• Total costs and expenses were $1,144 million; non-GAAP costs and expenses were $841 million.
• Restructuring charges for the quarter were $4 million.

Guidance and Future Outlook:

• Q4 2026 revenue is expected to be between $1,425 million and $1,475 million, implying 8% to 12% year-over-year growth.
• Q4 2026 guidance assumes a modest headwind from foreign exchange based on current spot rates.
• Q4 2026 Adjusted EBITDA is expected to be between $538 million and $588 million.
• Management intends to provide further outlook details during the conference call.

Business Segments and Product Lines:

• Global Monthly Active Users (MAUs) reached an all-time high of 661 million, a 10% year-over-year increase.
• Revenue by geography: U.S. and Canada ($894 million, +14%), Europe ($193 million, 0%), and Rest of World ($87 million, +24%).
• MAUs by geography: U.S. and Canada (107 million, +4%), Europe (161 million, +7%), and Rest of World (394 million, +13%).
• Global Average Revenue Per User (ARPU) was $1.80, a 1% increase year-over-year.
• ARPU by geography: U.S. and Canada ($8.38, +10%), Europe ($1.21, -7%), and Rest of World ($0.23, +9%).
• Management highlighted differentiated AI-driven visual search and shopping experiences as key value drivers for users and advertisers.

Market and Competitive Landscape:

• The company focuses on scaling performance advertising solutions and building an ecosystem to convert high-intent discovery into durable growth.
• No specific market share data or direct competitor comparisons were provided in the release.

Risks and Challenges:

• Forward-looking statements cite risks including general economic uncertainty, inflation, tariffs, and trade protection measures.
• Risks include foreign exchange fluctuations, supply-chain issues, and stress in the banking industry.
• Operational risks involve the ability to attract and retain users, advertisers, creators, and publishers.
• Technology and security risks include cybersecurity breaches, disruptions in third-party single sign-on access, and reliance on Amazon Web Services.
• Regulatory and legal risks include data privacy compliance, litigation, and changes in laws regarding online application stores or search engine methodologies.
• Specific risks related to AI include managing challenges and risks posed by AI development.
• The company noted a restructuring plan and the potential for material changes in reconciling items (like share-based compensation) affecting GAAP results.

Management Commentary and Tone:

• CEO Bill Ready stated the company reached an all-time high in MAUs and is focused on sharpening execution and scaling performance advertising.
• Management expressed confidence in the value of AI-driven visual search and shopping experiences for both users and advertisers.
• The tone emphasizes a focus on long-term growth and converting high-intent discovery.

Other Key Points:

• The company issued convertible notes, resulting in $982 million in convertible notes, net, on the balance sheet as of September 30, 2026.
• Cash and cash equivalents were $654 million, and marketable securities were $816 million as of September 30, 2026.
• Goodwill increased to $475 million from $100 million at the end of 2025, and intangible assets increased to $81 million from $6 million.
• During the nine months ended September 30, 2026, the company repurchased $2,025 million of Class A common stock and incurred $281 million in shares repurchased for tax withholdings.
• The company recorded a $449 million acquisition of business, net of cash acquired, and intangible assets during the nine-month period.
• Share-based compensation expense for the quarter was $288 million.
• The company uses a fixed long-term projected tax rate of 20% for non-GAAP net income calculations.