Pinterest Q4 Earnings: What Traders Should Expect Amid Stock Selloff

Pinterest (PINS) is down nearly 6% on Wednesday ahead of the company’s quarterly earnings report, which is due out on Thursday, February 12, after the market close. Pinterest has lost a lot of value this year, declining about 26% year-to-date.
The social commerce platform is investing heavily in artificial intelligence. To focus on those efforts Pinterest announced that it would conduct layoffs this year that target less than 15% of headcount. Pinterest is facing headwinds from chatbots and agents offered from companies like OpenAI that help consumers shop, potentially impacting its user base and advertising revenues. The company has admitted that it faces a tough competition landscape against larger companies.
Those concerns surfaced during its last earnings report in November, when Pinterest reported some moderations in ad spend in North America. Executives at Pinterest attributed the sales moderation to large retailers in the United States amid tariff pressures. Leadership forecasted the sales moderation to continue as tariffs impact furniture, a notable sales segment.
According to TradingView, analysts expect to see earnings per share (EPS) come in at $0.67 on $1.33 billion in revenue. That would compare to EPS of $0.56 on $1.15 billion in revenue a year ago. Last quarter, EPS came in at $0.38 on $1.05 billion in revenue.
Investors also want to see growth in its user base. Last quarter, Pinterest reported over 600 million global monthly active users, which was an increase of 12% from a year ago. If that growth stalls, it could mean trouble for the post-earnings reaction.
Pinterest had an implied volatility rank (IVR) of 61.6 as of Wednesday, February 11. That means volatility is elevated compared to the past twelve months of trading.
The expected move according to the options market is +/- 2.3 points, or 12% of Wednesday’s stock price. That is above the average 5% to 10% earnings moves for S&P 500 companies.
Pinterest is trading at its lowest level since August 2022 after falling 14.5% in January and 13.4% so far in February. That said, if PINS reaches the downside target of the expected move it would be right near the August May 2022 low of 16.14, a possible area of support. That said, selling a put spread at 16 offers a risk-defined way to call a bottom in the stock.

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