Social media platform Pinterest (PINS) makes money from advertising. Shares started trading on the New York Stock Exchange on April 18 under the symbol “PINS.”
Founded in 2010, Pinterest went public on April 18, 2019. Its initial public offering (IPO) price was at $19 per share and it raised $1.4 billion, giving it a valuation of roughly $12.7 billion including restricted stock and options. As of Dec. 26, 2022, the company had a market capitalization of $16.6 billion. Roughly 445 million users, or "pinners," use the bulletin board-like platform every month to browse and share images and other content in the form of "pins."
Key Takeaways
- Pinterest makes its money via advertising, specifically, promoted pins. These promoted pins are ads that look similar to user-generated pins (posts).
- The company has integrated a “buy it” button which permits users to buy pinned products directly from Pinterest, rather than visiting a separate merchant site.
- In 2021, the company generated $2.57 billion in revenue but posted a net loss of $316 million.
- In its most recent quarterly report, Pinterest reported that revenue grew 8% in the third quarter of 2022 to $684.6 millionfrom the previous year, on a loss of $65 million, surpassing expectations.
- Opportunities for increasing revenue that Pinterest plans to pursue include greater international expansion, focusing on video and increasing ad capabilities, as well as pursuing its own e-commerce efforts.
Pinterest History
The company, which grew out of an app called Tote that dated from 2008, received $100 million in financing when it was valued at $1.5 billion in 2012. The funding firms included Rakuten, Goldman Sachs (GS), and Andreessen Horowitz. It was valued at $12.3 billion during its last round of funding in 2017. The company has a dual-class structure.
When it was founded, Pinterest seemed to follow the model of social network sites like Meta Inc. (META), formerly Facebook—meaning that it aimed to develop a massive network of users first and then to install means of generating revenue later on. It generated $756 million in revenue in 2018, a jump of 60% from the previous year.The company generated $261 million in revenue during the second quarter of 2019, a 62% year-over-year increase.
“Our advertising products help businesses reach Pinners across their decision-making journey," said the company, which cited a Talk Shoppe survey that said 68% of weekly active users discovered a new brand or product on Pinterest.
"We address various advertiser objectives through our Promoted Pin ad format, which contains either a single image, a carousel of images or video. Our ability to develop new and improve existing advertising products will be an important driver of our future growth."
So just how has Pinterest come to be one of the most-hyped social media companies among investors and what is a promoted pin?
Monetizing Pins
Before looking at more traditional means of generating revenue, it’s worth looking at how Pinterest has utilized its unique pin system to create opportunities for monetization. The company has integrated a “buy it” button which permits users to buy pinned products directly from Pinterest, rather than visiting a separate merchant site.
Merchants participating in BigCommerce, Shopify, or Salesforce Commerce Cloud are allowed the opportunity to partner with Pinterest; it’s unclear whether Pinterest charges any commissions from these partners.
Promoted Pins
Pinterest’s primary source of revenue is what it calls “promoted pins.” These special pins are effectively advertisem*nts, paid for by identified sponsors. As with Facebook’s timeline feature, promoted pins look very similar to (but not exactly the same as) standard pins. Pinterest utilizes user data to target advertisem*nts based on user interests and searches, as well as other demographics. Given that users pin items that they are interested in already, this process is relatively straightforward for the company.
Pinterest's revenue is driven by interest and use of its platform, which is increasingly popular among fashion and beauty brands. Given that the users of Pinterest are overwhelmingly female and have above-average incomes, using its platform as an e-commercegateway is more than ideal.
Next Steps
Pinterest's user base has grown over the years, where it’s carved out a niche that allows it to not directly compete with the likes of Facebook. Pinterest’s leadership has adopted a much less aggressive approach to growth than its competitors. Revenue has grown since the company has gone public, but so has its net loss, as the company has ramped up spending on sales and marketing and research and development.
One big future opportunity is being able to tap the international markets, where Pinterest currently has little reach. Beyond that, Pinterest is interested in building out its e-commerce efforts (what exactly that looks like remains to be seen), as well as continuing to develop advertising tools— including video capabilities—for advertisers.
FAQs
Pinterest makes its money via advertising, specifically, promoted pins. These promoted pins are ads that look similar to user-generated pins (posts). The company has integrated a “buy it” button which permits users to buy pinned products directly from Pinterest, rather than visiting a separate merchant site.
How does Pinterest pay money? ›
Yes, you can make money on Pinterest in a variety of ways, including receiving commissions from affiliate link clicks, getting paid for creating sponsored content through Pinterest's paid partnership tool, and using Pinterest ads to generate sales for a product or service.
How many Pinterest views do you need to get paid? ›
How to Make Money on Pinterest with Google Adsense? Once you are ready with your blog, you can post relevant display ads on your blogs through Google Adsense. You can earn somewhere between $50 and $200 monthly for 10,000 to 40,000 page views. In addition, Google Adsense doesn't necessitate any minimum page views.
How many followers do you need on Pinterest to make money? ›
Most users don't know it, but it's never about the followers on Pinterest. You can have a few followers on the platform and still earn with affiliate programs. It depends on the strategy you choose to generate revenue from this platform.
How is Pinterest doing financially? ›
SAN FRANCISCO--(BUSINESS WIRE)-- Pinterest, Inc. (NYSE: PINS) today announced financial results for the quarter ended June 30, 2024. Q2 revenue grew 21% year over year to $854 million. Global Monthly Active Users ("MAUs") increased 12% year over year to 522 million.
Why is Pinterest so valuable? ›
Pinterest is an aspirational platform. Its users come to discover solutions for their wants and needs. Over 75% of weekly Pinterest users say they use it to plan for purchases. In other words, Pinners have high purchase intent - making them primed for your ads and Shoppable Pins.
How to make passive income on Pinterest? ›
9 Pinterest affiliate marketing tips to earn passive income
- Know the rules.
- Create several pins per post.
- Schedule pins in advance.
- Enable rich pins.
- Pin to group boards.
- Optimize for SEO.
- Build an email list through Pinterest.
- Analyze pin performance.
What is Pinterest? Pinterest is a visual discovery engine for finding ideas like recipes, home and style inspiration, and more. With billions of Pins on Pinterest, you'll always find ideas to spark inspiration. When you discover Pins you love, save them to boards to keep your ideas organized and easy to find.
How does Pinterest payment work? ›
We charge you for accumulated spend for your active ads on the first day of the following month, or when you reach your billing threshold, whichever comes first. You can prevent further spend by pausing your ads, which stops your Pins from serving. Please note our list of accepted payments .
What is a good monthly view on Pinterest? ›
Typically, advertisers have 1M+ monthly views. The monthly views are helpful as an indicator that Pinterest is distributing your content.
How many impressions are good on Pinterest? This is highly variable and depends upon a number of factors. In other words, there is no fixed number of impressions that can be considered good. If you are new to the whole Pinterest area, then anywhere from 1k to 10k monthly impressions can be considered as good.
How many views is considered viral on Pinterest? ›
The truth is that the definition of viral varies from blog to blog. For example, if you normally receive 50 clicks a day from Pinterest, viral may mean 125 clicks in a single day. However, if your traffic is around 100 clicks a day, it may be closer to 250 for it to be considered viral.
How do beginners make money on Pinterest? ›
Pinterest doesn't pay content creators directly. Primary ways to make money with Pinterest involve using the platform as a marketing or influencer tool, where earnings come through outside sources like your own business, an affiliate program or a brand you work with.
What is the average income of Pinterest users? ›
Pinterest usage reach in the United States 2021, by household income. As of February 2021, 21 percent of respondents in the United States who were using Pinterest said that they earned 30,000 U.S. dollars or less. A further share of 40 percent stated that their household income was over 75 thousand U.S. dollars.
Will Pinterest pay you? ›
Will Pinterest pay me directly? Pinterest does not facilitate payment for monetisation programmes such as product tagging, affiliate links or brand partnerships. For those programmes, you'll organise payment terms and logistics directly with your brand or affiliate partners.
Has Pinterest ever been profitable? ›
Pinterest, like many other tech companies, has had a history of both profits and losses. Here's a breakdown of their recent performance: 2021: Pinterest generated $2.57 billion in revenue but posted a net loss of $316 million Investopedia: How Pinterest Makes Money.
How much money does Pinterest make a year? ›
Pinterest revenue for the twelve months ending June 30, 2024 was $3.338B, a 16.22% increase year-over-year. Pinterest annual revenue for 2023 was $3.055B, a 9.01% increase from 2022. Pinterest annual revenue for 2022 was $2.803B, a 8.71% increase from 2021.
What is Pinterest's net worth? ›
Market cap: $19.80 Billion
As of September 2024 Pinterest has a market cap of $19.80 Billion. This makes Pinterest the world's 974th most valuable company by market cap according to our data.
Why was Pinterest called a unicorn? ›
In 2015, investors valued Pinterest, Inc. at $11 billion, making it a "unicorn" (a start-up with a valuation exceeding $1 billion).
