Pinterest reported strong results in its latest earnings call, with Q1 revenue up 18% year-on-year and beating analysts expectations. It also recorded an all-time high of 631 million global monthly active users, an increase of 11%.
Like all other major platforms, Pinterest is all in on AI. It has spent several months reshaping its business around AI initiatives. In January, the company announced restructuring plans that included cutting 15% of its workforce.
The efforts are paying off, at least in advertising. Ad impressions increased 24% in Q1, demonstrating how integrating AI within its system is creating greater effectiveness. Some of these efforts include the improvement of Performance Plus+, its AI-powered performance product that was introduced in 2024 to compete with Google’s Performance Max and Meta’s Advantage+. Management said that adopters grew their lower funnel spend at nearly twice the rate of non-adopters.
One of the latest introductions is an A/B testing tool that was launched in beta form in Pinterest’s ad manager this quarter. CEO Bill Ready gave the example of how fine jewelry brand Mejuri ran a four-week A/B test comparing a dedicated Pinterest Performance Plus campaign to its normal approach. The former delivered a 46% increase in ROAS and a 62% increase in conversions, according to Ready.
Despite the positivity, ad pricing declined 5% in Q1. That ties into an issue that management continually referenced: monetisation is not following engagement. Ready said that Pinterest now sends five times the number of clicks to advertisers than it did three years ago, yet monetisation has not increased anywhere near as much.
During that same time frame, Ready said that Pinterest has gone from ‘primarily selling upper-funnel ads to large US CPG and retailers’ to now selling ‘full funnel performance solutions across more verticals, more advertiser segments, and more geographies’.
While Pinterest is happy to benefit from AI opening the doors to smaller advertisers that would not have had the resources to manage campaigns before, it still has its eyes on the whales of the industry. The key to unlocking the spend Pinterest deserves is greater measurement and attribution, ensuring the platform gets the credit for those clicks.
That’s why it is piloting integrations within third party proprietary in-house measurement systems. This will enable bidding systems to respond dynamically to a set definition of a successful outcome. For example, in early testing, one advertiser who prioritised lifetime value saw a 15-20% improvement in lifetime value ROAS, according to Pinterest.
The acquisition of TvScientific was also confirmed during Q1 and that’s another way that Pinterest is attempting to turn its intent-rich audience into actual results. The CTV platform specialises in outcomes-based ad buying, aligning with Pinterest’s general transition into a performance marketing platform.
Early results from TvScientific are encouraging, according to Pinterest. One early partner, a leading home furnishings omni-channel retailer, saw a nearly 190% increase in incremental audience reach and a 159% increase in incremental sales after leveraging Pinterest audience data into its CTV campaigns.
There was also a chance for Ready to speak about Pinterest’s recent campaign that attempted to differentiate the platform from other social media sites. The CEO was keen to stress that difference to investors, stating that they believe social media companies should ‘compete on their safety record the same way car manufacturers compete on their safety ratings’. This is clearly a competition Pinterest believes it would win, and it’s a smart play to push that angle when social media has become an almost toxic term.
