Popular social media platform Pinterest has announced a significant new partnership with the tech giant Google. The collaboration aims to increase ad revenue and broaden Pinterest's reach in international markets.
During the company's earnings call for the fourth quarter of 2023, Pinterest announced the partnership with Google, making Google the platform's second third-party ad partner after Amazon.
Pinterest announces partnership with Google to boost ad revenue and expand global presence. Despite the stock dip, innovative features and strategies aim for growth.
Pinterest's Stock Dip, Google Partnership
Despite reporting below-expectation revenue for the period, with earnings totaling $981 million and a 12% year-on-year growth, Pinterest faced a stock dip of nearly 28%.
TechCrunch tells us that investor confidence was restored after CEO Bill Ready unveiled the Google partnership. Ready stated that the integration of Google's Ad Manager for ad serving on Pinterest had commenced a few weeks prior and was already yielding positive results.
"This partnership will focus on monetizing several of our currently unmonetized international markets by enabling ads to be served on Pinterest via Google's Ad Manager," said Ready during the earnings call.
With 80% of Pinterest's users located outside the US but representing only 20% of revenue, the partnership is poised to increase the average revenue per user in these international markets significantly.
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Pinterest's Plans
In addition to the revenue-boosting partnership, Pinterest outlined its audience growth and engagement strategies. Leveraging artificial intelligence (AI) technology, Pinterest introduced new features, such as the collage feature, available to all iOS users globally. This feature allows users to create unique images using stickers and objects, enhancing user creativity and interaction.
Another innovation introduced by Pinterest is the auto-organizing feature, which identifies similar pins and prompts users to create boards. This feature contributed to a notable 30% increase in the creation of boards on the platform.
Furthermore, Pinterest's generative AI-based search guides assist users in refining their queries, facilitating more accurate and efficient search results. The platform has also taken steps towards inclusivity by incorporating body type ranges in search results, reflecting Pinterest's commitment to diversity and user satisfaction.
While Pinterest's fourth-quarter revenue fell short of analyst expectations, totaling $981.3 million and resulting in a premarket stock tumble of approximately 10%, the company remains optimistic about its future prospects.
Forecasting first-quarter revenue between $690 million and $705 million, Pinterest continues to innovate and expand its offerings to meet the evolving needs of its user base.
Pinterest's partnership with Google marks a significant milestone in its efforts to enhance ad revenue and extend its global reach. With a focus on innovation and user engagement, Pinterest remains poised for continued growth.
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