Pinterest Cuts Workforce by 15%, Shares Drop 10.3%
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 2d ago
0mins
Source: seekingalpha
- Layoff Announcement: Pinterest disclosed plans to cut less than 15% of its workforce, impacting approximately 700 employees out of a total of 5,200, as part of a strategy to reduce operational costs amid market challenges.
- One-Time Charge: The company expects to incur a one-time charge of $35 million to $45 million related to the layoffs, which will pressure short-term financials but may facilitate long-term cost savings.
- Cost Savings Outlook: Analysts at Evercore ISI estimate that the layoffs could generate up to $175 million in annual cost savings, although a significant portion of these savings may be redeployed back into the business to support growth.
- Market Reaction: By 2:00 p.m. ET, nearly 23 million shares of Pinterest had changed hands, 1.5 times its three-month average trading volume, indicating market concerns regarding the company's ability to reaccelerate growth in the U.S. and Canada.
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Analyst Views on PINS
Wall Street analysts forecast PINS stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for PINS is 38.41 USD with a low forecast of 30.00 USD and a high forecast of 50.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
24 Analyst Rating
18 Buy
6 Hold
0 Sell
Strong Buy
Current: 22.560
Low
30.00
Averages
38.41
High
50.00
Current: 22.560
Low
30.00
Averages
38.41
High
50.00
About PINS
Pinterest, Inc. (Pinterest) offers visual search and discovery platform. The Company’s primary service, Pinterest, can be accessed through its mobile application or the Web. People use Pinterest to find ideas. As they browse Pinterest content, Pins, they fine-tune their tastes and find the idea. Users interact with the platform in multi-session journeys to find inspiration, curate their latest look, plan their next project and shop from brands. It has approximately 553 million monthly active users across the world. Content on Pinterest comes from a variety of sources, including retailers, brands, creators, publishers and users. It acquires that content via a range of methods, including product catalog uploads, direct publishing, and user curation. Content formats include images that allow the user to click into an idea to learn more, videos that provide the steps of an idea, and products that brands and merchants upload from catalogs.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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