PINTEREST INC

Previous wording

•Monthly active users ("MAUs") were 522 million, an increase of 12% compared to June 30, 2023.

Current wording

•Monthly active users ("MAUs") were 537 million, an increase of 11% compared to September 30, 2023.

Previous wording

•Total costs and expenses were $875.1 million.

Current wording

•Total costs and expenses were $904.3 million.

Previous wording

•Loss from operations was $21.4 million.

Current wording

•Loss from operations was $5.9 million.

Previous wording

Monthly Active Users. We define a monthly active user as an authenticated Pinterest user who visits our website, opens our mobile application or interacts with Pinterest through one of our browser or site extensions, such as the Save button, at least once during the 30-day period ending on the date of measurement. The number of MAUs do not include Shuffles users unless they would otherwise qualify as MAUs. We present MAUs based on the number of MAUs measured on the last day of the current period. We calculate average MAUs based on the average of the number of MAUs measured on the last day of the current period and the last day prior to the beginning of the current period. MAUs are the primary metric by which we measure the scale of our active user base.

Current wording

Monthly Active Users. We define an MAU as an authenticated Pinterest user who visits our website, opens our mobile application or interacts with Pinterest through one of our browser or site extensions, such as the Save button, at least once during the 30-day period ending on the date of measurement. The number of MAUs does not include Shuffles users unless they would otherwise qualify as MAUs. We present MAUs based on the number of MAUs measured on the last day of the current period. We calculate average MAUs based on the average of the number of MAUs measured on the last day of the current period and the last day prior to the beginning of the current period. MAUs are the primary metric by which we measure the scale of our active user base.

Previous wording

As of June 30, 2024, global MAUs increased compared to June 30, 2023 primarily due to our investments in relevance and personalization beginning in the second quarter of 2022.

Current wording

As of September 30, 2024, global MAUs increased compared to September 30, 2023 primarily due to our ongoing investments in relevance and personalization.

Previous wording

Average Revenue per User (“ARPU”). We measure monetization of our platform through our average revenue per user metric. We define ARPU as our total revenue in a given geography during a period divided by average MAUs in that geography during the period. We calculate ARPU by geography based on our estimate of the geography in which revenue-generating activities occur. We present ARPU on a U.S. and Canada, Europe and Rest of World basis because we currently monetize users in different geographies at different average rates. Our ARPU in U.S. and Canada and, to a lesser extent, Europe is higher primarily due to the relative size and maturity of the digital advertising markets in these geographies.

Current wording

Average Revenue per User. We measure monetization of our platform through our average revenue per user metric. We define ARPU as our total revenue in a given geography during a period divided by average MAUs in that geography during the period. We calculate ARPU by geography based on our estimate of the geography in which revenue-generating activities occur. We present ARPU on a U.S. and Canada, Europe and Rest of World basis because we currently monetize users in different geographies at different average rates. Our ARPU in U.S. and Canada and, to a lesser extent, Europe is higher primarily due to the relative size and maturity of the digital advertising markets in these geographies.

Previous wording

For the three months ended June 30, 2024, global ARPU was $1.64, which represents an increase of 8% compared to the three months ended June 30, 2023. For the three months ended June 30, 2024, U.S. and Canada ARPU was $6.85, an increase of 16%, Europe ARPU was $1.03, an increase of 14%, and Rest of World ARPU was $0.13, an increase of 13% compared to the three months ended June 30, 2023.

Current wording

For the three months ended September 30, 2024, global ARPU was $1.70, which represents an increase of 5% compared to the three months ended September 30, 2023. For the three months ended September 30, 2024, U.S. and Canada ARPU was $7.31, an increase of 13%, Europe ARPU was $1.00, an increase of 10%, and Rest of World ARPU was $0.14, an increase of 18% compared to the three months ended September 30, 2023.

Previous wording

We define Adjusted EBITDA as net income (loss) adjusted to exclude depreciation and amortization expense, share-based compensation expense, interest income (expense), net, other income (expense), net, benefit from income taxes and restructuring charges.

Current wording

We define Adjusted EBITDA as net income (loss) adjusted to exclude depreciation and amortization expense, share-based compensation expense, interest income (expense), net, other income (expense), net, provision for (benefit from) income taxes and certain other non-recurring or non-cash items impacting net income (loss) that we do not consider indicative of our ongoing business performance.

Previous wording

Benefit From Income Taxes. Benefit from income taxes consists primarily of income taxes in foreign jurisdictions and U.S. federal and state income taxes adjusted for discrete items.

Current wording

Provision for (Benefit from) Income Taxes. Provision for (benefit from) income taxes consists primarily of income taxes in foreign jurisdictions and U.S. federal and state income taxes adjusted for discrete items.

Previous wording

Adjusted EBITDA. We define Adjusted EBITDA as net income (loss) adjusted to exclude depreciation and amortization expense, share-based compensation expense, interest income (expense), net, other income (expense), net, benefit from income taxes and restructuring charges. See “Non-GAAP Financial Measure” for more information and for a reconciliation of net income (loss), the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted EBITDA.

Current wording

Adjusted EBITDA. We define Adjusted EBITDA as net income (loss) adjusted to exclude depreciation and amortization expense, share-based compensation expense, interest income (expense), net, other income (expense), net, provision for (benefit from) income taxes and certain other non-recurring or non-cash items impacting net income (loss) that we do not consider indicative of our ongoing business performance. See “Non-GAAP Financial Measure” for more information and for a reconciliation of net income (loss), the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted EBITDA.

Previous wording

Revenue for the three and six months ended June 30, 2024 increased by $145.7 million and $283.1 million, respectively, compared to the three and six months ended June 30, 2023 primarily due to growth in demand from our conversion and consideration objectives. Revenue growth was primarily driven by a 12% increase in MAUs as well as 8% and 9% respective increases in ARPU for the three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023. The number of advertisements served increased by 35% and 36% for the three and six months ended June 30, 2024 while the price of advertisements decreased by 11% for the three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023, respectively.

Current wording

Revenue for the three and nine months ended September 30, 2024 increased by $135.2 million and $418.2 million, respectively, compared to the three and nine months ended September 30, 2023 primarily due to growth in demand from our consideration and conversion objectives. Revenue growth was primarily driven by 5% and 8% respective increases in ARPU supported by an 11% increase in MAUs for the three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023. The number of advertisements served increased by 41% and 38% while the price of advertisements decreased by 17% and 13% for the three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023, respectively.

Previous wording

Revenue based on our estimate of the geographic location of our users increased by 19% and 20% in U.S. and Canada to $672.9 million and $1,264.7 million, Europe revenue increased by 25% and 26% to $142.7 million and $260.7 million, and Rest of World revenue increased by 32% and 29% to $38.1 million and $68.3 million for the three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023, respectively.

Current wording

Revenue based on our estimate of the geographic location of our users increased by 16% and 19% in U.S. and Canada to $719.5 million and $1,984.2 million, Europe revenue increased by 20% and 24% to $136.6 million and $397.3 million, and Rest of World revenue increased by 38% and 32% to $42.3 million and $110.6 million for the three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023, respectively.

Previous wording

Cost of revenue for the three and six months ended June 30, 2024 increased by $16.1 million and $26.3 million, respectively compared to the three and six months ended June 30, 2023 primarily due to increased users and engagement offset by infrastructure efficiency initiatives.

Current wording

Cost of revenue for the three and nine months ended September 30, 2024 increased by $16.5 million and $42.7 million, respectively, compared to the three and nine months ended September 30, 2023 primarily due to increased users and engagement offset by infrastructure efficiency initiatives.

Previous wording

Research and development for the three and six months ended June 30, 2024 increased by $43.4 million and $57.4 million, respectively, compared to the three and six months ended June 30, 2023. These increases were primarily due to $19.9 million and $28.0 million respective increases in share-based compensation expense and 16% and 13% respective increases in personnel expenses.

Current wording

Research and development for the three and nine months ended September 30, 2024 increased by $62.0 million and $119.4 million, respectively, compared to the three and nine months ended September 30, 2023. These increases were primarily due to 26% and 17% respective increases in personnel expenses and $25.7 million and $53.7 million respective increases in share-based compensation expense.

Previous wording

Sales and marketing for the three and six months ended June 30, 2024 increased by $22.1 million and $47.3 million respectively, compared to the three and six months ended June 30, 2023, primarily due to $12.1 million and $25.1 million respective increases in marketing expenses, 2% and 6% respective increases in personnel expenses and $4.5 million and $10.3 million respective increases in share-based compensation expense.

Current wording

Sales and marketing for the three and nine months ended September 30, 2024 increased by $23.1 million and $70.4 million, respectively, compared to the three and nine months ended September 30, 2023. These increases were primarily due to $6.5 million and $16.8 million respective increases in share-based compensation expense, 6% and 6% respective increases in personnel expenses, higher outsourced services costs and for the nine months ended September 30, 2024, an increase of $28.1 million in marketing expenses.

Previous wording

General and administrative for the three months ended June 30, 2024 increased by $12.2 million compared to the three months ended June 30, 2023 primarily due to $10.0 million in non income-based taxes. General and administrative for the six months ended June 30, 2024 decreased by $88.9 million, primarily due to $119.4 million of restructuring charges in 2023, offset by an $11.1 million increase in non income-based taxes, a $6.3 million increase in outsourced services costs and $6.2 million increase in share-based compensation expense.

Current wording

General and administrative for the three months ended September 30, 2024 increased by $34.5 million compared to the three months ended September 30, 2023 primarily due to a legal settlement of $34.7 million, net of insurance proceeds. General and administrative for the nine months ended September 30, 2024 decreased by $54.4 million, primarily due to $119.4 million of restructuring charges in 2023, offset by a legal settlement of $34.7 million, net of insurance proceeds, a $16.0 million increase in legal-related expenses and a $12.7 million increase in non income-based taxes compared to the nine months ended September 30, 2023.

Previous wording

Interest and other income (expense), net for the three and six months ended June 30, 2024 increasedby $3.0 million and $4.5 million, respectively, compared to the three and six months ended June 30, 2023, primarily due to higher returns on our marketable securities as a result of higher invested balances and higher interest rates offset by higher foreign currency exchange losses.

Current wording

Interest and other income (expense), net for the three and nine months ended September 30, 2024 increasedby $13.6 million and $18.2 million, respectively, compared to the three and nine months ended September 30, 2023, primarily due to higher returns on our marketable securities as a result of higher interest rates and higher invested balances as well as foreign currency exchange gains for the three months ended September 30, 2024.

Previous wording

Benefit from income taxes for all periods presented was primarily due to the losses generated in U.S. federal, state and certain foreign jurisdictions. All periods include the effects of the capitalization and amortization of research and development expenses as required by the 2017 Tax Cuts and Jobs Act.

Current wording

Provision for (benefit from) income taxes for all periods presented was primarily due to the income (losses) generated in U.S. federal, state and certain foreign jurisdictions. All periods include the effects of the capitalization and amortization of research and development expenses as required by the 2017 Tax Cuts and Jobs Act.

Previous wording

Given our recent history of generating net income in the U.S., we believe that there is a reasonable possibility that within the next twelve months sufficient positive evidence may become available to allow us to determine that a significant portion of the valuation allowance recorded against our U.S. deferred tax assets should be released. The reversal would result in a significant income tax benefit for the period when we release the valuation allowance in the U.S. However, the exact timing and amount of the valuation allowance release are subject to change based on our actual operating results.

Current wording

Given our recent history of generating net income in the U.S., we believe that there is a reasonable possibility that sufficient positive evidence may become available to allow us to determine that a significant portion of the valuation allowance recorded against our U.S. deferred tax assets could be released within the next twelve months. The reversal would result in the recognition of material U.S. deferred tax assets and a corresponding income tax benefit estimated to be $1.5 billion to $1.7 billion in the period the release is recorded. However, the exact timing and amount of the valuation allowance release are subject to change based on our actual operating results.

Previous wording

Net income for the three months ended June 30, 2024 was $8.9 million compared to net loss of $34.9 million for the three months ended June 30, 2023. Net loss for the six months ended June 30, 2024 was $15.9 million compared to $243.5 million for the six months ended June 30, 2023. Adjusted EBITDA was $179.9 million and $292.8 million for the three and six months ended June 30, 2024 compared to $107.0 million and $134.0 million for the three and six months ended June 30, 2023, due to the factors described above. See “Non-GAAP Financial Measure” for more information and for a reconciliation of net income (loss), the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted EBITDA.

Current wording

Net income for the three and nine months ended September 30, 2024 was $30.6 million and $14.6 million compared to net income of $6.7 million for the three months ended September 30, 2023 and a net loss of $236.8 million for the nine months ended September 30, 2023. Adjusted EBITDA was $242.1 million and $535.0 million for the three and nine months ended September 30, 2024 compared to $184.7 million and $318.7 million for the three and nine months ended September 30, 2023, due to the factors described above. See “Non-GAAP Financial Measure” for more information and for a reconciliation of net income (loss), the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted EBITDA.

Previous wording

We finance our operations primarily through payments received from our customers. Our primary uses of cash are personnel-related costs and the cost of hosting our website and mobile application. As of June 30, 2024, we had $2,735.2 million in cash, cash equivalents and marketable securities. Our cash equivalents and marketable securities are primarily invested in short-duration fixed income securities, including government and investment-grade corporate debt securities and money market funds. As of June 30, 2024, $152.3 million of our cash and cash equivalents was held by our foreign subsidiaries.

Current wording

We finance our operations primarily through payments received from our customers. Our primary uses of cash are personnel-related costs and the cost of hosting our website and mobile application. As of September 30, 2024, we had $2,442.6 million in cash, cash equivalents and marketable securities. Our cash equivalents and marketable securities are primarily invested in short-duration fixed income securities, including government and investment-grade corporate debt securities and money market funds. As of September 30, 2024, $162.4 million of our cash and cash equivalents was held by our foreign subsidiaries.

Previous wording

On September 16, 2023, our board of directors authorized a stock repurchase program of up to $1.0 billion of our Class A common stock. Under the stock repurchase program, we are authorized to repurchase, from time-to-time, shares of our Class A common stock through open market purchases, in privately negotiated transactions or in such other manner as permitted by securities law and as determined by management at such time and in such amounts as management may decide. The program does not obligate us to repurchase any specific number of shares and may be modified, suspended or discontinued at any time. The timing, manner, price and amount of any repurchases are determined by management in its discretion and depend on a variety of factors, including legal requirements, price and economic and market conditions. During the six months ended June 30, 2024, we repurchased and retired 804,297 shares of our Class A common stock for an aggregate purchase price of $34.4 million. As of June 30, 2024, $965.6 million remains available for repurchases under the stock repurchase program.

Current wording

On September 16, 2023, our board of directors authorized a stock repurchase program of up to $1.0 billion of our Class A common stock (the "September 2023 program"). Under the September 2023 program, we are authorized to repurchase, from time-to-time, shares of our Class A common stock through open market purchases, in privately negotiated transactions or in such other manner as permitted by securities law and as determined by management at such time and in such amounts as management may decide. The September 2023 program does not obligate us to repurchase any specific number of shares and may be modified, suspended or discontinued at any time. The timing, manner, price and amount of any repurchases are determined by management in its discretion and depend on a variety of factors, including legal requirements, price and economic and market conditions. During the nine months ended September 30, 2024, we repurchased and retired 15,894,701 shares of our Class A common stock for an aggregate purchase price of $500.0 million. As of September 30, 2024, $500.0 million remained available for repurchases under the September 2023 program.

Previous wording

For the six months ended June 30, 2024 and 2023, our net cash flows were as follows (in thousands):

Current wording

For the nine months ended September 30, 2024 and 2023, our net cash flows were as follows (in thousands):

Previous wording

Cash flows from operating activities consist of our net loss adjusted for certain non-cash reconciling items, such as share-based compensation expense, depreciation and amortization, non-cash restructuring charges and changes in our operating assets and liabilities. Net cash provided by operating activities increased by $216.4 million for the six months ended June 30, 2024 compared to the six months ended June 30, 2023 primarily due to a decrease in our net loss and an increase in accrued expenses and other liabilities due to timing of payments to vendors.

Current wording

Cash flows from operating activities consist of our net income (loss) adjusted for certain non-cash reconciling items, such as share-based compensation expense, depreciation and amortization, non-cash restructuring charges and changes in our operating assets and liabilities. Net cash provided by operating activities increased by $355.9 million for the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023 primarily due to an increase in our net income and an increase in accrued expenses and other liabilities due to timing of payments to vendors.

Previous wording

Cash flows from investing activities consist of capital expenditures for improvements to new and existing office spaces and acquisitions of businesses. We also actively manage our operating cash and cash equivalent balances and invest excess cash in short-duration marketable securities, the sales and maturities of which we use to fund our ongoing working capital requirements. Net cash used in investing activities increased by $195.8 million for the six months ended June 30, 2024 compared to the six months ended June 30, 2023, primarily due to an increase in net purchases of marketable securities.

Current wording

Cash flows from investing activities consist of capital expenditures for improvements to new and existing office spaces and acquisitions of businesses. We also actively manage our operating cash and cash equivalent balances and invest excess cash in short-duration marketable securities, the sales and maturities of which we use to fund our ongoing working capital requirements. Net cash used in investing activities increased by $194.1 million for the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023, primarily due to an increase in net purchases of marketable securities.

Previous wording

Cash flows from financing activities consist of tax remittances on release of RSUs and RSAs, repurchases of our Class A common stock and proceeds from the exercise of stock options. Net cash used in financing activities decreased by $426.4 million for the six months ended June 30, 2024 compared to the six months ended June 30, 2023, primarily due to a decrease in the repurchase of Class A common stock offset by an increase in tax remittances on release of RSUs and RSAs due to an increase in our stock price.

Current wording

Cash flows from financing activities consist of tax remittances on release of RSUs and RSAs, repurchases of our Class A common stock and proceeds from the exercise of stock options. Net cash used in financing activities increased by $46.0 million for the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023, primarily due to an increase in tax remittances on release of RSUs and RSAs due to an increase in our stock price.

Previous wording

We generate revenue by delivering ads on our website and mobile application. We recognize revenue only after transferring control of promised goods or services to customers, which occurs when a user clicks on an ad contracted on a cost per click ("CPC") basis, views an ad contracted on a cost per thousand impressions ("CPM") or cost per day ("CPD") basis or views a video ad contracted on a cost per view ("CPV") basis. We recognize revenue over the service period for ads contracted on a CPD basis, which do not contain minimum impression guarantees. We typically bill customers on a CPC, CPM, CPV or CPD basis, and our payment terms vary by customer type and location. The term between billing and payment due dates is not significant.

Current wording

("CPD") basis or views a video ad contracted on a cost per view ("CPV") basis. We recognize revenue over the service period for ads contracted on a CPD basis, which do not contain minimum impression guarantees. We typically bill customers on a CPC, CPM, CPV or CPD basis, and our payment terms vary by customer type and location. The term between billing and payment due dates is not significant.