We Believe Pinterest, Inc. (NYSE: PINS) is in a Death Spiral but Misleadingly Doctors its Terrible Performance Statistics

Pinterest is losing user engagement at steep rates, while driving users away with ever- increasing ad spam. We present an unprecedented and comprehensive analysis of a large array of different data sets from mutually independent sources that all confirm this conclusion.

With its ad rates already priced at bottom-level by advertisers, Pinterest hides the wreckage of its core business by reporting cleverly cherry-picked but misleading performance metrics, while expanding into financially fruitless low-income markets.

Pinterest even pays for search traffic to window-dress key performance indicators whenever necessary, and we believe it engages fraudulent click-farms to secure KPIs, ad revenue and the CEO’s stock option value.

Currently, Pinterest barely earns money, but projects a rosy future promoting an advertising-focused “growth” strategy, with its new CEO appointed in 2022 who has failed to deliver on these promises.
Since 2020, the number of reported active users has been almost stagnant, and Pinterest proudly reports a small “12%” year-on-year growth in “Global Monthly Active Users” numbers in the recent quarter.
Pinterest focuses on “Monthly Active Users” as its predominant KPI metric to deliberately conceal the decline in user engagement and value. For comparison, other large services use time intervals that include “Daily Active Users,” and/or impressions/clicks, to provide a clearer picture for investors.
To develop a deeper appreciation of financially linked user activity we analyze a wide array of public and paywalled historical data from Ahrefs, SEMrush, SpyFu, AppMagic, Google, SimilarWeb, Yandex, WebFX, SEC filings, and others. All these sources consistently support our conclusion that Pinterest’s business outlook is bleak.
Western markets provide 95.9% of Pinterest’s latest quarterly revenue. However, all data reveals that Pinterest is very rapidly losing interest among U.S. consumers, while competitors are growing. For U.S. users, Pinterest engagement today is down to merely 18% of its peak, depending on the platform and traffic estimator. The picture is similar for European and Canadian users.
Independent data clearly shows that Pinterest statistically makes up for its ongoing traffic losses in Western markets by strategically growing into mostly low-income countries to window-dress traffic statistics. Pinterest’s “Monthly Active Users” reporting conceals the Western decline. Pinterest does not report growth by country and only subsumes all these low-income areas under “Rest of World”, which excludes only the U.S., Canada, and Europe.
In its recent earnings call, Pinterest touts new advertising sales in the “Rest of the World” as a growth story. However, in the long term, profits from advertising in low-income countries can never compensate for Western advertising profits due to the fundamental lack of advertising value in targeting consumers who lack surplus money for spending. For example, the U.S. advertising market has a volume of $369B—India surpassed the U.S. in organic traffic to Pinterest post-COVID, but only has a $14B advertising market.
As the leading search engine in Western markets, Google ramped up its referral links to Pinterest since September 2023, increasing by 71% between August 2023 and April 2024. However, Pinterest’s actual traffic development does not reflect this artificial growth pushed its way. Instead, it is losing even more traffic from other organic sources, generating even less recurring user interest than the traffic numbers indicate.
Hundreds of (former) Pinterest users in Western markets complain about the rapidly increasing spam of cheap ads, which they notice are often unrelated to the content on Pinterest. A recent data analysis by RBC Capital Markets shows that ad load on Pinterest increased by up to 30% per year. We show with a quantitative analysis that competing service’s users complain much less about ad spam than Pinterest’s users. The ad spam stabilized Pinterest’s revenue in recent quarters but destroys the value proposition for its customers.
In 2022, Pinterest appointed a new CEO, Bill Ready, and strategic activist investor Elliott Investment Management L.P. came on board. They hoped for growth and a modern ad strategy that was never successfully realized by Ready. The advertising market prices ads on Pinterest at bottom levels, the lowest among large internet media companies. Elliott’s disclosed investment volume currently stands at about the contractual minimum of 28 million shares today, according to 13F filings, down from apparently over 52 million initially (-46%).
Ready still aggressively paints a picture of growth and increasing user engagement to investors in the latest publications and calls. We find the language and presentation deceptive.
During a phase of crises in 2023, when Pinterest’s share price almost went below CEO Bill Ready’s exercise price for his options at $19.96 per share, visits to pinterest.com from global panel data estimates spuriously spiked up abruptly (from 370.6 million to over 1 billion per month for desktop users globally). After Pinterest’s share price stabilized over $30, the spurious traffic spike dampened again. Our research points to this traffic spike being artificial, sourced from, we believe, click farms or bots. The effects of this manufactured traffic would mislead Pinterest’s advertising clients, while boosting the stock above the strike price of Ready’s option grants.
To fight the decline, Pinterest increased its own advertising expenses to $145.6M in 2023 from $19.2M in 2018 (+658%), but this strategy is still not working to Pinterest’s benefit. Google data shows that Pinterest pays Google for search traffic, a strategy that no other mature social content site depends upon. Pinterest seems desperate to pay for traffic to window-dress KPIs—specifically regarding poor traffic in North America—to investors.
Currently, Pinterest’s only national market with growing user activity is Russia. However, we can show that this effect is almost entirely explained by Pinterest being aggressively pushed in search results by the local search engine Yandex, which has over 71% market share. This might be due to an undisclosed deal between Pinterest and Yandex to artificially inflate traffic statistics.
A January 2024 survey by WebFX among 270 US-based marketers reveals that the market prices advertising space on Pinterest the lowest among competitors—ad space on Facebook, Instagram and Twitter are 2.5x to 5x more valuable, and 20x to 30x on LinkedIn. Despite this fact, Pinterest’s advertising clients are the least satisfied ones. However, Pinterest tells its clients the opposite by citing an outdated 2019 study from a research brand discontinued in 2021.
We believe Pinterest is in a long-term death spiral: Western users leave, and then Pinterest sells more advertising space at cheaper prices to create revenue, which further reduces the overall content quality, and drives more users to abandon the service.
Industry experts and former employees we interviewed corroborate the bleak picture our analysis reveals.
Insiders are currently selling the stock aggressively, further substantiating our belief in the downward trend for Pinterest’s business.
In conclusion, we believe Pinterest’s operations will at best be barely cash flow positive going forward. We estimate Pinterest is worth less than half of its current value of over $40. Our models value Pinterest’s shares in a range between $5.28 and $16.

Pinterest is a California-based image sharing and social media service designed to enable saving and discovery of information (“ideas”) like recipes, home, style, motivation, and inspiration on the internet using images and, on a smaller scale, animated GIFs and videos, in the form of pinboards.

Pinterest.com and the iStore app were launched from 2009 to 2011. The service grew fast and IPOed at the NYSE in April 2019 at a valuation of about $12B, and $27.8B today.

(EPS GAAP = earnings per share after generally accepted accounting principles)

Sources: Yahoo Finance, finviz, retrieved on July 18, 2024

Pinterest reported record users in 2021 and new growth in recent quarters.

Pinterest, Monthly Active Users as reported by company. Source: Statista (link)

However, recent growth in user statistics is predominantly generated from Rest of World-users, which excludes the U.S.A., Canada, and Europe but is opaque about further regional distinctions.

Pinterest’s own reporting shows that the North American market is by far the most critical revenue driver. Its non-Western growth has almost zero impact upon revenue.

Source: Pinterest, 2024 Q1, 10-Q, p. 21 (screenshot). Revenue globally, and by region.

Pinterest announced a record number of “Global Monthly Active Users” and increased revenue in their 2024 Q1 press release:

Source: Pinterest, 2024 Q1 Press Release

Pinterest relies heavily on Monthly Active Users and revenue growth metrics in its reporting. However, we argue that they are misleading benchmarks. Pinterest needs meaningful long-term growth in actual user engagement to be a viable equity investment. The company is still burning money 15 years after its launch, five years after its IPO, and after a favorable but unsustained traffic boost during COVID lock-downs.

This is precisely why Pinterest is still touting a deliberately misleading story about a successful growth strategy for their business. For example, in their latest investor call for 2024 Q1 the word “growth” is mentioned forty times. Here are some quotes from CEO Bill Ready’s introduction (our emphasis).

In Q1, we accelerated our progress against our strategic priorities, growing users and engagement, creating value for our advertisers to our lower funnel solutions and continuing to deliver profitable growth through operational efficiency.
Q1 revenue of $740 million grew 23%, nearly doubling our growth rate with an 11-point acceleration from just a quarter ago.
In fact, we are driving the highest user and revenue growth on the platform since 2021.
Driving demand through third-party partners, resellers and international markets as additional levers to growth.
And we’re driving strong momentum in our business, making it clear that we have shifted into a higher gear as we enter this next stage of growth.
The drivers of user growth I’ll discuss today are consistent with what I’ve laid out since joining Pinterest [2022] and that we elaborated on at our Investor Day.
We’ve been moving fast and executing with tremendous clarity and focus over the past 2 years across the themes I’ve just discussed, which have all compounded to drive our acceleration in user growth.

As our research demonstrates in this report, Pinterest’s growth story is deliberately misleading because it has been on a course of steady decline in user engagement for several quarters.

Pinterest’s investors should be able to carefully evaluate user engagement to forecast the platform’s development in the highly competitive market space of online content. For example, it would make a massive difference if Pinterest was the unique and compelling place for hordes of users seeking lifestyle ideas in the targeted spheres of food, fashion, home decor, hobbies and lifestyles. If Pinterest is only one generic source among many for users who only land on a page very sporadically, it faces a bleak future.

However, Pinterest only reports to investors two primary metrics for user engagement: monthly active users (MAUs) and average revenue per user (ARPU). With these metrics, the trend of rapidly declining user contacts and increasing spam advertisement is—we believe—deliberately hidden. Even an office worker doing internet research daily, who briefly lands every few days at random on a Pinterest page while searching the internet, without engaging in any meaningful way on Pinterest or with its content, is counted. Thus, many people are categorized as a “Monthly Active User” without actively engaging or perceiving Pinterest as anything other than an image and link server.

That is why most (or all) other social media companies provide more granular reporting metrics for usage. Comparing Pinterest’s usage reporting metrics to its competitors reveals that only Pinterest uses such a coarse metric of only monthly activity. We believe monthly user tracking is too indistinct to measure Pinterest’s service. Pinterest’s management may be intentionally putting forward this metric which reflects users who are actually not very active and are of little value. YouTube and TikTok count by content views/impressions. Instagram, Facebook, Reddit, and Twitter report daily users. Pinterest could have easily reported impressions, “board views”, or searches to provide a clearer picture for investors.

Large Social Media Services and Their Usage Indicators for Investor Reporting

Pinterest tries to divert from these critical concerns: “We use these metrics to assess the growth and health of the overall business and believe that MAUs and ARPU best reflect our ability to attract, retain, engage and monetize our users, and thereby drive revenue.” (2023 10-K, p. 7)

All independent data shows that Pinterest’s actual user engagement value by alternative and more useful metrics is collapsing dramatically.

Web services like SEMrush (link), SpyFu (link) or Ahrefs (link) estimate website traffic and retain historical records. Fully reliable web traffic numbers are only available from the web host itself and are usually a carefully kept secret by website owners.

Traffic estimates are, in most cases, either based on public user data from search engine providers or panel data from a large number of tracked test users. Both sets of data support our thesis that Pinterest is dying or—in one specific case—even fraudulently inflating its traffic numbers with click farms or bots.

To provide the most reliable results on Pinterest’s performance by proxying user engagement value, we establish the following principles for this analysis:

We look at all data available to us from public and paywalled sources because different providers use different methods with different sets of weaknesses and strengths. This data includes traffic estimation data, direct search engine data, third-party surveys among users and advertisers, as well as our own surveys.
We compare historical data from the same sources at different points in time to gain a highly reliable proxy of a web service’s overall growth or decline in user engagement.
We compare data from the same sources for different web services to control for overall historical trends of web service usage, e.g. a traffic spike in 2020 during global COVID-19 lockdowns.
We always link directly to the data sources, so every reader can scrutinize and replicate our findings from the original sources.

The result of this analysis provides a highly reliable trend overview that strongly supports our claims about Pinterest’s terrible business outlook.

First, we look at the most important national market for Pinterest by far, the U.S. We compare Pinterest with other prominent social media content websites. To show the traffic development, we compare the latest monthly organic traffic data to the best months for each candidate. Organic traffic is traffic that comes from unpaid search engine results. It serves as a proxy for a website’s overall popularity, because its ranking by search engines best reflects its content quality and popularity.

The following plot shows that Pinterest’s traffic decline to 29.6% of its peak has developed over time.

For comparison: the SEMrush data for other large services in the U.S. are not declining (find domain name at the top-left in screenshot).

Pinterest grew its traffic very successfully during 2020, but so did Instagram. Successful content strategies had massive tailwinds from COVID-19-related lockdowns, which caused a spike in internet traffic and an enormous shift as users expanded their internet activities.

Source: Robert Kenny (link)

Many social media services are increasingly used on mobile platforms. Here is the comparison of traffic from mobile devices.

Again, the decline in user engagement for Pinterest.com on mobile devices has developed over time since late 2020.

Note how Pinterest’s relative decline in organic traffic happened much more abruptly than Facebook’s.

We looked for all publicly available traffic analysis data from other services. Another third-party traffic estimator is Ahrefs (link).

Ahrefs provides an estimate for organic traffic value, which they describe as the “equivalent monthly cost of traffic from all keywords that the target website/URL ranks for organically, if that traffic was paid via PPC instead.” (link) Again, Pinterest is the worst-performing social media site by a wide margin in terms of growth. We compare May 2024’s performance with the height of the COVID-19 lockdown values during peak traffic in September 2020.

In numbers, the traffic value view from this chart looks like the following.

* Some third-party services estimate traffic by including or excluding subdomains specifically. We include subdomains, if this data is available and provides additional information.

Another helpful indicator at Ahrefs to proxy a website’s popularity is “organic pages”, which is described as “the total number of unique pages from a target ranking in the top 100 organic search results by month.” Again, Pinterest’s organic traffic decline is one of the worst among competitors.

Yet another competing and independent analysis service, SpyFu (link), also corroborates Pinterest’s comparative decline. SpyFu provides less granular data, does not distinguish between different access devices, and shows more recent growth for all services we checked.

* March 2024 was the latest month with available data at the writing of this report

The poor traffic data from Twitter might be explained by turbulence due to Elon Musk’s takeover in 2022 and the subsequent double domain use of twitter.com and x.com.

In all data, Facebook.com also shows substantially declining traffic. However, from a business perspective, the crucial difference between Facebook and Pinterest is that Facebook already has a highly profitable business model, while Pinterest still needs to develop one, which is hardly possible with rapidly declining user engagements and traffic value.

But what is with the use of Pinterest’s mobile app? Above analysis compares Pinterest’s website to other services that have also provided their services on mobile apps for many years. We analyze Pinterest’s app rating with data from AppMagic (link). AppMagic provides a monthly ranking of mobile apps by download numbers. AppMagic scrapes the data directly from publicly available AppStore and Google Play databases and provides, therefore, fully reliable results. (link) Pinterest is by far the worst performing app when analyzing downloads according to these statistics.

In search interest, the decline is continuous and long-term.

Insiders provide further corroboration of the decline in user engagement. A Pinterest product designer describes in a December 2023 anonymous Glassdoor post that “due to the decline in interest “Pinterest” of the product, the company has made sweeping changes to product priorities. Constantly trying to copy other products in the market.” (link) Several employees comment on the lack of vision and strategy from the top. Many express this view after the latest new CEO appointment in 2022. (link1, link2, link3, link4, link5, link6, link7, link8, link9).

Yet another indicator for web traffic is panel data. We looked at SEMrush traffic analytics, that is data “accumulated and approximated from the user behavior of over 200 million real internet users and over a hundred different apps and browser extensions.” (link)

First, mobile data for U.S. users:

Mobile panel data again corroborates that Pinterest is losing engagement the fastest.

According to SEMrush panel desktop data for pinterest.com, U.S. traffic in May 2024 from peak was a surprisingly decent 73.7% (and therefore, the only indicator we saw where Pinterest doesn’t appear to be in dramatic decline). However, as we discuss in a later chapter, we have extremely strong evidence that Pinterest boosts exactly this metric with click farms or bots. Thus, we interpret this result as unreliable.

Europe, second only to the U.S. in internet revenue generation, confirms Pinterest is on a rapid decline. SEMrush does not provide aggregated results for Europe or the E.U. Our analysis directs us to Europe’s three largest markets, which are also large enough to provide reliable data, as a proxy for Europe.

SpyFu does not provide sufficiently reliable data for European markets outside the U.K. However, SpyFu data for the U.K. corroborates our point, as well.

Ahref also shows the worst decline by Pinterest among competitors in Europe.

Pinterest also uses local domains. (i.e. “pinterest.fr” for the French market); accessing these domains might be treated differently by traffic estimators. However, the data for these local domains indicates traffic as poor as for the “.com”-domain in regional markets.

Obviously, to earn profits, a service like Pinterest needs to generate its traffic organically without the expense of advertising. If entering a new local market, there is an argument to endure some start-up expenses to establish its brand with the plan to create a profitable business after sufficient market penetration is achieved.

Between 2018 and 2023 Pinterest increased its advertising expenses from $19.2M to $145.6M (+658%).

Prima facie, we assumed that these expenses are aimed at conquering new markets abroad. However, our third-party data sources reveal that Pinterest buys traffic within its mature markets.

Source: weekly paid traffic analysis by Ahrefs.com

The following data is very telling.

Source: Ahrefs.com

The paid traffic by Pinterest follows two apparent regimes. Pinterest IPOed in April 2019, and it started ramping up paid traffic since Autum 2018, probably to window-dress its traffic growth numbers for the IPO and early phase of its listing. We interpret the high average paid traffic costs as an indicator that Pinterest was willing to spend some money for lasting growth by getting matched with high-value users.

Then, during the COVID-lockdowns, Pinterest reduced payments for traffic, which came more organically from the global spike in internet activity. Since Summer 2023, Pinterest is back at spending money for traffic, interestingly at much lower cost per user. This looks to us like an indicator that this traffic is even more aimed at finding low value user matches for cheap window-dressing of recently reported KPIs.

Pinterest reports 98M MAU in the U.S. and Canada for 2024 Q1, up from 97M in the previous quarter. Given the paid traffic numbers above, this “growth” could be entirely attributed to paid traffic, or without paid traffic we could even detect a shrinking user base even under the MAU metric.

The following data shows that the top paid traffic has always been generated from Western markets.

Source: Ahrefs.com

As the following data chart shows, meaningful expenses for paid traffic are unusual for mature internet content or social media.

Source: Ahrefs.com

We believe Pinterest is aware of their declining engagements and is desperately trying to turn the ship around or to window-dress its engagement numbers via paid traffic.

We found strong evidence of click-farming and strong financial incentives for such measures to be instructed by CEO Bill Ready directly. Click-farming means that bots or paid users—usually from low-income countries, who masquerade as real users from other countries over VPN—visit sites to generate fake engagement with advertisers and create revenue fraudulently. A recent study alleges that this big fake business costs advertisers globally $71B in 2024. (link) We guide you through our findings.

In April 2023, industry rumors about bad ad performance on Pinterest circulated: “Pinterest — a channel that brands have long struggled to attribute sales to — is no longer making the cut for some companies.” (source: Modern Retail) Days later, Pinterest announced an “ad partnership” with Amazon on April 27^th and sent positive signals to investors (link). However, investors had a negative outlook, and PINS fell from $28.58 on April 14^th to a six-months low of $21.01 (-26.5%) on May 5^th when the Nasdaq-100 index returned about +1% during the same time. PINS had peaked in 2021 at over $85.
Bill Ready’s compensation is heavily tied to the share price’s performance via stock awards and options. With a high share price, the option awards reach triple million valuations.

Source: Pinterest, 2024 DEF 14A Proxy Statement, p. 44

According to page 46 of the same document, the exercise price of Ready’s options is $19.96.

Source: Pinterest, 2024 DEF 14A Proxy Statement, p. 46

The stock options value is determined by Pinterest’s share price minus $19.96. If Ready gets fired at a PINS price lower than $19.96, then his option awards become worthless, because they have to be exercised at contract termination (cf. Pinterest, 2019 OMNIBUS INCENTIVE PLAN) If Pinterest’s share price remains below $19.96, all CEO award options not exercised are worthless.

It seems something had to be done to stabilize the stock price above $20 and the Amazon ad partnership was not enough. We believe, at that point of crisis, Pinterest’s leadership decided to engage click farms to artificially boost traffic. Here is our evidence.

Beginning from May 2023 on, we find a spurious pattern of traffic boost in SEMrush’s panel data that tracks “200 million real but anonymized Internet users in over 190 countries and regions” (link). Be advised that it is infeasible to protect a 200 million users panel against interference from click farms or bots with fake profiles and the help of VPN technology to fake IP locations. The pattern of click farm or bot accesses we found is statistically strongly significant, as we show in the following.

The following is the example from the U.K. with a strange traffic bump in desktop traffic.

Before and after the spurious traffic spike the average monthly desktop visits in the U.K. are around 7-12 million. During the spike, they reached up to 45 million.

We chose the U.K. as an example because it is a sufficiently large market to gather reliable statistics. Due to the use of the English language, other English-speaking markets should show similar spikes, if a genuine cause for the spike exists (e.g. a super celebrity brings traffic to the site). However, the lack of any traffic spike among mobile users already hints at the absence of any such reason.

The spike also doesn’t occur in traffic data from organic searches:

The spike is also not reflected in Google searches for “Pinterest”:

The spike for the U.S. market is far less dramatic in relative terms. We believe this is due to the much higher base rate of traffic in the U.S., and the click-farm provider did not appropriately scale up their activity to accurately represent its activity to Pinterest’s traffic footprint in different markets.

Other large media websites don’t show such a strong relative effect in the data for U.K desktop users, and also not for mobile users.

The following chart shows the overall effect on global panel traffic.

Pinterest.com had 370.6M global desktop visits in April 2023 and then over 1B in September 2023, without any change in mobile traffic. This can only be due to inflated fake visits. The magnitude and uniqueness of such a spike among different domains and devices drive our conclusion that this data reflects intentional intervention in web traffic rather than being an artifact of bad data gathering by SEMrush.

U.K. desktop panel traffic data for the regional domain pinterest.co.uk does not demonstrate the unusual traffic spike.

And zoomed out to a longer time horizon (mobile data has only been available since April 2021 under a static methodology):

The—as we believe—overly excessive click-farming ended in November 2023. But Why? On October 30^th, 2023, Pinterest formally reported a financially strong quarter (link), and the share price rose to over $30 and did not dip below $30 again. Thus, the award options are not in danger of becoming (nearly) worthless. However, from this episode, we infer that click-farming might still be a practice for Pinterest today, but it is less excessive. This would explain the bottom-level advertising prices that Pinterest attracts in the ad market due to its abysmal conversion rates.

Unpaid traffic from Google is crucial for Pinterest to gain new users and engagement. Google decides whether to foster or de-boost search traffic to Pinterest. After a noticeable de-boost by Google from 2021 to 2023, Google ranks Pinterest results more favorably again in 2024. However, search traffic to Pinterest has not recovered in 2024, indicating an even bleaker metric for Pinterest’s attractiveness to users.

For a service like Pinterest, organic (i.e. unpaid) referrals from search engines are crucial to generate traffic and find new monetizable users. With a share far above 90% in all Western markets, Google Search is the main factor here.

Until recently, Pinterest heavily gained traffic from Google Search referrals. As Reddit user “integrateus” vents about three years ago: “Half of the images Google Images returns are from Pinterest.” (link) In 2018, the problem of Pinterest links by Google was already so significant in the eyes of many users that developers started to provide browser add-ons specifically removing Pinterest results. (link)

By the end of 2022, the number of Google referrals suddenly declined. In their 2023 10-K, Pinterest admits in understated rhetoric that “throughout 2021, Google made certain changes to their search algorithms which also negatively impacted traffic and user sign-ups.” (p. 27)

In March 2024, Google and Pinterest announced an ad partnership. (link) Subsequently, referral keywords from Google also recovered globally and in the U.S. from a low point in July 2023 to a new all-time high in April 2024. However, as the following SEMrush data shows, the organic traffic from searches never recovered during that time. In other words, despite Google rating Pinterest higher again in search results, Pinterest fails to generate organic traffic from this and would overall look even worse without the preferential treatment by Google.

Source: SEMrush

In addition to the intentionally misleading MAU Global metric, Pinterest generates growth in many highly unattractive low-value advertising markets abroad.

A high-ranking former Pinterest insider we talked to even told us, “Honestly, the company is very public about the fact that it is not looking to grow a user base that is low-value because that just swallows up their engineering resources.” As we will see, Pinterest is targeting these low-value users to window-dress its growth statistics.

Google recorded the highest interest in “Pinterest” over the last twelve months in the following regions (interest value of 50 or above; retrieved in June 2024; GDP per capita in US$ according to World Bank):

Azerbaijan (100; $7,762)
El Salvador (85; $5,127)
Indonesia (75; $4,788)
Cambodia (73; $1,760)
Peru (73; $7,126)
Ecuador (71; $6,391)
Myanmar/Burma (67; $1,149)
Guatemala (64; $5,473)
Argentina (63; $13,651)
Venezuela (60; $15,976)
Bolivia (58; $3,600)
Pakistan (58; $1,589)
Colombia (58; $6,624)
Panama (57; $17,358)
Mexico (56; $11,497)
Philippines (55; $3,499)
Türkiye (53; $10,675)
Honduras (53; $3,040)
Costa Rica (53; $13,365)
Uruguay (50; $20,795)
Brazil (50; $8,918)

…

64. United States (18; $76,330)

For comparison, “Reddit” has the most regional interest over the last twelve months in Canada (100), Singapore (86), United States (71), Australia (60), New Zealand (53), and Ireland (53).

Due to expansion in low-income countries, global interest in “Pinterest” stands still at 89% (in comparison to 15% in the U.S.) of its peak in March 2023.

Worldwide, according to SEMrush, the decline in user engagements on a global scale is smaller. This must be caused by increasing traffic from low-value overseas markets.

SEMrush: Mobile Panel Traffic by Users to Domains*

We have seen how Pinterest conquered, peaked, and is declining in the markets of the U.S., Europe, Brazil, and Mexico. A closer look reveals that these “expansion” processes happen very similarly worldwide, following the same playbook: 1. Pinterest becomes popular, 2. Pinterest increases monetization with ads, 3. Pinterest’s traffic dries up.

The following table shows how the Pinterest caravan moved from North America, over Europe to South America and East Asia. The table is ordered by the date of peak Google search interest. The only market where Pinterest traffic is still growing is Russia—an advertising market that contracted by about 32% in 2022 due to international sanctions. (link) This outlier is even discussed among marketing experts, for example, in Brandon Leonardo’s article The Surprising Popularity Of Pinterest In Russia (September 2022). For our analysis, Pinterest’s apparent “success” in Russia further supports the fact that the decline in all other markets is genuine and not a data artifact. The former high-ranking insider we interviewed told us Pinterest is “not looking to grow a low-value user base—so I don’t think they’re gonna go after Russia. (…) I think Russia has just circumstantial behavior.”

* All traffic numbers to domain “pinterest.com”. Does not include all countries with <0.1% of global traffic.

In most countries, the traffic to Pinterest peaked in October or November 2020. The reason for this is that during the COVID-19-related lockdowns globally, users tried new online services while being forced to stay home.

The comparative values of countries’ total advertising markets reveal that expansion into non-OECD countries cannot financially compensate for declining user engagement in North America and Europe. Despite some of the low-income economies, like India, showing decent economic growth, we believe the Pinterest caravan implies that Pinterest will very likely be outcompeted in any growing advertising markets that become more attractive to competitors in the future, as well.

Pinterest reports record revenue in 2023 despite declining user engagement since 2020 in the majority of the most lucrative markets. Pinterest comments:

“Revenue for the year ended December 31, 2023 increased by $252.5 million compared to the year ended December 31, 2022 primarily due to growth in demand from our awareness and conversion objectives. Revenue growth was driven by an 8% increase in average MAUs and a 1% increase in ARPU for the year ended December 31, 2023 as compared to the year ended December 31, 2022.” (Pinterest, 2023 10-K, p. 53, our emphasis)

This sounds a bit cryptic—likely intentionally—but this explanation sounds like a change in the advertising placement, intensity or fit. We know from our analysis that despite a slight statistical increase of MAU from international expansion into mostly low-value markets, actual user engagements in high-value markets is in decline since 2020. Thus, our working hypothesis should be that Pinterest significantly ramped up the ad spam in high-value markets. Strong evidence supports this thesis.

We took a deep-dive into the relationship between Pinterest’s current ad-based monetarization approach and product quality. We made three observations:

Ads on Pinterest masquerade visually as content but are often only loosely connected to the Pins. If users click without much care on Pins—as most users likely do—they quickly end up on the website of an external advertiser without the intention to do so. Thus, the more ad density a pin has, the lower its content quality.
By all relevant metrics of advertising performance—including conversion rates, ROI, times on site—Pinterest rates at the bottom of the table among its competitors.
Hundreds of users vent in online forums about Pinterest’s massive ad spam. The users’ impression of ad spam is a much bigger issue for Pinterest than for competitors.

Our web traffic analysis shows that 2020 Q4 was the quarter when Pinterest’s U.S. user engagement peaked. For that quarter, Pinterest reports an Average Revenue per User (ARPU) of $1.57. (2020 10-K, p. 54) For the latest reported quarter, Pinterest reports an ARPU of $2.00 at constant Monthly Active User’s but a decline of engagements by about two-thirds. From this follows that the ad load for a user must have roughly increased by a factor of about 3.8x.

Content providers need to earn money through ads and sponsorships. We wouldn’t criticize this if we couldn’t clearly trace the rapid decline in user engagements. We have strong reasons to believe in the causal chain from ad spam to abandonment by users, based upon the hundreds, if not thousands, of complaints posted by users online.

Pinterest presents itself as a premium provider for advertising clients. The following is from their website for advertisers (link).

Source: Pinterest’s website for advertisers

The romantic idea behind the slogan “Stop interrupting. Start inspiring.” is the following:

“Outside of reaching your target audience, Pinterest has a plethora of additional benefits. While Facebook and Instagram are primarily used to keep up with friends and influencers, Pinterest users are on the hunt for new projects, brands, and products. Ads on other platforms may feel like an interruption on a user’s feed, but Pinterest ads are appreciated because users are already looking to make a purchase.”

(Anni Miller, May 2022)

Source: Pinterest’s website for advertisers

The footnote 2, where we would expect the data source of such a strong claim, is only accessible by clicking a little “+” sign right at the bottom of the page. Footnote 2 only says, “Product screens are for illustrative purposes only, and results may vary.” However, next to it is footnote 1, which mentions a five-year-old pre-COVID study: “Neustar, Retail meta study with five US retail brands, June 2019”. The Neustar brand was discontinued in 2021 (link), and any claims in the study are obviously outdated. Again, Pinterest is deliberately deceiving its advertising clients.

We found further evidence of how Pinterest apparently works in the background to re-frame its poor economics as a success story. SensorTower (sensortower.com) is an often-cited marketing intelligence company with strong corporate customer base. Since June 2020, Sensor Tower has compared Pinterest with other apps in a category called “Lifestyle Apps”. This was the first time Pinterest had appeared in this category. (sensortower.com/blog). The category is dominated by digital storefronts for paid services like Netflix or Wish. That is why Pinterest looks very successful in this category, appearing on the spot one or two in June 2020. Pinterest is a platform where users find content curated by other users; Pinterest’s business model is to gather attention and user engagement that is then sold to advertisers. That is why before 2020, SensorTower rightfully compared Pinterest’s app in their reporting as a social media app, where Pinterest never was a leading brand against Instagram, TikTok, Facebook and others. SensorTower has used the “Lifestyle” category since at least 2012. (link) Thus, Pinterest was deliberately re-categorized. SensorTower—for whatever incentive—re-categorized Pinterest into “Lifestyle App”, to make it look more successful to their readers. We believe this is yet another paid-for or otherwise incentivized favor for Pinterest.

We have never read or heard even one word of general warning from Pinterest’s leadership that the quality of user engagements or advertising contacts might be declining or challenged in any way. Pinterest’s paints a rosy picture in their latest earnings call (2023, Q4):

“As we’ve demonstrated that our users have a commercial intent on our platform, the ads can be great content. You’ve seen that in our increase of impressions, ad impressions, while also increasing engagement, demonstrating that the ads can be great content when they use it in a commercial context”
“On Gen Z, we’ve talked about it’s more than 40% of our user base now. And, you know, there’s multiple factors driving the improvement in users and engagement.”
“We believe that our continued investments to help users find their next use case and quickly pivot from inspiration to action and shopping are paying off as we’ve been able to drive deeper engagement with our users.”
“Our strong product delivery in Q4 and throughout 2023 with investments focused in lower-funnel offerings like mobile deep linking, shopping ads, API for conversions, and, most recently, direct links, are delivering sustained ROI improvements for advertisers. This is leading to advertisers growing their budgets with us and has resulted in further acceleration so far in Q1”
“We more than doubled the amount of clicks we drove to advertisers year over year, a substantial increase during a retailer’s most important time of year.”
“For example, Urban Outfitters saw a 132% increase in outbound clicks and a 57% decrease in cost per click with a direct links-enabled campaign. This is strong tangible evidence that we are creating significant real value for advertisers.”
“Each time we have launched products that created meaningful advertiser value, we have seen budgets shift in our direction in the month and quarters that followed, as advertisers were able to see and measure sustained performance.”
“We also offer a suite of first-party and third-party measurement tools to plug into advertisers measurement system of truth, whether it’s brand and conversion lift studies, platform metrics and insights, or highly sophisticated media mix modeling and multitouch attribution studies.”
“Offsetting the growth in ad impressions was a 16% decline in ad pricing due to our continued work to drive greater platform efficiency for lower funnel advertisers, which lowered prices and improved return on ad spend for those advertisers.”
“We see multiple of our large sophisticated retail advertisers allocating more of their performance budgets to us after seeing a longer track record of return on ad spend.”

This sounds like a mix of a successful growth narrative with some inflated marketing mumbo-jumbo. Based on such descriptions by Pinterest long-term growth in revenue is extrapolated by naïve forecasters like the source of the following chart.

Naïve Consensus view Derived from Misleading KPIs (insiderintelligence.com)

The advertising industry is very sensitive to performance metrics and several sources provide independent insights.

The real current market indicators for Pinterest’s performance as an advertiser look incredibly bleak. The following numbers are from a fresh 2024 survey of 270 US-based marketers. We can see how Pinterest is considered the antithesis of a premium advertiser. This further supports to our thesis that Pinterest is—at least in stress phases—engaging in click-farming.

Source: WebFX, March 14, 2024 (link)

SEMrush tracks purchase conversion in its panel traffic data. SEMrush’s results also indicate a bottom-of-the-scale conversion rate for Pinterest.

Pinterest’s touted in their 2023 Q4 earnings call: “On the monetization front, the teams innovated across the entire funnel with particular emphasis in the lower funnel as we made it more seamless for users to pivot from inspiration to action through increased shopability.” Low funnel advertising is advertising that quickly leads to sales, e.g. for daily goods with low ticket prices. Pinterest’s eroding cost-per-click prices indicate that they are not very successful in this regard, or the sold goods are of low-margin, and therefore do not justify an advertising budget worth chasing.

According to the same survey, advertisers are most displeased with their return on investment from Pinterest.

Source: WebFX, March 14, 2024 (link)

One key performance indicator for advertising quality is the conversion rate, which is the percentage of consumers exposed to the ad that take the desired action, e.g. purchasing an advertiser’s product. As the following studies show, advertisers report that Pinterest generally has a very poor conversion rate, strongly outshined by Alphabet, Meta and Microsoft services.

Source: databox, March 23, 2021 (link)

Source: Novocall, March 15, 2022 (link)

The Hotsuite Social Media Trends Report 2024 (link) provides a helpful overview of current advertising trends and the landscape. As the following statistics from the report clearly show, Pinterest is widely regarded as a poor-quality platform for businesses, and high-recognition brands often abandon Pinterest, per next charts.

Source: Hotsuite Social Media Trends report 2024, p. 23

Source: Hotsuite Social Media Trends report 2024, p. 21

Source: Hotsuite Social Media Trends report 2024, p. 22

An Australian study shows that Pinterest’s user engagement is actually shockingly low. This supports our evidence-driven impression that many “Monthly Active Users” land briefly on Pinterest while searching for images on the web without any intention of engaging with Pinterest.

Source: Genroe, January 2024 (link)

As the following chart shows, Pinterest’s users do not only spend the least amount of time on Pinterest.com, but users that come from an ad or link on Pinterest stay the lowest amount of time on the client’s website. This is further evidence that advertising on Pinterest is junk-level.

Source: yotpo, February 7, 2024 (link)

Advertisers are aware of Pinterest’s low-cost low-value offering. That is why Pinterest can only demand relatively low prices in comparison, which provides the strongest indicator for the junk-level value of ads on Pinterest. In their 2023 Q4 earnings call, Pinterest said they further lowered their prices to advertisers which will lead to further necessary ad spam to create revenue.

As Pinterest proudly reports, they are increasing the average revenue per user by a factor of two since their traffic peak in 2020, despite the dramatic collapse of U.S. user engagements and advertising prices.

Source: FourWeekMBA, February 11^th, 2024 (link)

The best explanation to these statistical findings in combination is that Pinterest is currently throwing a “Hail Mary”: escalating ad spam in the hope their business somehow sorts itself out. Other researchers corroborate this. In June 2023, investment firm RBC Capital Markets compared the ad load on Pinterest with the ad load in April 2023, and concluded an increase of 305 basis points in top categories from 27% to 30% in the past two months (link). Web data analyst Ebrahim Hossen Emon concludes in a Quora post in September 2023: “Pinterest’s ad load has been growing at a rate of 30% plus year-over-year. This means that the amount of space on the platform that is dedicated to ads is increasing by 30% or more each year.” (link)

Every user receives the content and ads differently, depending on the user’s activity on the platform and Pinterest’s proprietary algorithms, which are not available as open source for analysis. Every user’s perception of the amount and selection of ads is subjective. That is why we observed user reactions regarding ad spam in online forums, such as Twitter and Reddit.

Here are a few exemplary Twitter search results for “pinterest, ads” with some recent results with screenshots:

Skeptical readers of this report might claim that these examples are just anecdotal evidence and social media services used by millions of users are always subject to a white noise of various complaints. However, we can quantify the complaints employing simple statistics on the Twitter/X database. We pick five random recent dates and manually count the specific and unambiguous customer complaints regarding too many ads. We searched for “[service name], ads” and manually counted the complaining comments detected.

We compare the number of complaining comments with the total number of search results, which serves as a proxy of the amount of chatter about the service on Twitter.

We did not include Twitter itself within the comparative analysis because—obviously—the discussions about Twitter on Twitter are an almost endless volume of Tweets. However, we can reliably say that there are not more complaints about excessive ads for Twitter than we found for Facebook, Instagram, TikTok or Reddit.

Qualitatively speaking, tweets about ads on Facebook, Instagram, TikTok, and Reddit are mostly about unique creative or weird ads or about advertising strategy from the advertisers’ perspective. Some users even praise the high degree of suitability of the ads they see on Meta services. Tweets about ads on Pinterest (see list below), and to a lesser degree on YouTube, are dominated by complaints about too many ads and unsuitable targeting (e.g. Pampers ads for childless teenagers).

Our quantitative analysis clearly shows that for Pinterest users, too many ads are a significant point of concern, but not for the other services. YouTube users also complain about too many ads to a moderate degree. However, YouTube offers a prime service to avoid ads as a crucial part of its business model. We believe YouTube’s value proposition which drives users to pay for subscription, is more compelling as a unique selling point than Pinterest due to YouTube’s more differentiated content, the technically more demanding long-form video content creation, and a more differentiated audience.

Our results also show how capable Meta is in monetizing its platforms Instagram and Facebook without annoying their users too much.

To further strengthen our thesis of users leaving Pinterest due to ad spam, we conducted the same analysis for the period when Pinterest was fast-growing user engagement in the first three quarters of 2020.

All comparative results are stable and reliably support our thesis that Pinterest is now oversaturating its users with ad spam. It was far more prudent during the phase when it grew genuine user engagement.

These are the tweets from the test days in 2024 we counted as complaints for Pinterest:

@katiaiceyyy: “pinterest ads will be the death of me” (2:20 PM · Feb 25, 2024)
@FalseClippy: “my entire freaking Pinterest home feed is just Poshmark ads, girl I’m so tired” (7:52 PM · Feb 25, 2024)
@andrea__kaufman: “yes but ads on pinterest are so loud” (2:41 PM · Feb 25, 2024)
@kryshoran: “these ads on my pinterest r ruining the aesthetic” (8:57 PM · Feb 25, 2024)
@H0PERISTA: “when will they release pinterest pro where i don’t have to see ads every other pin” (7:59 PM · Feb 25, 2024)
@fluttershae: “the ads and products on pinterest are getting ridiculous” (3:04 AM · Feb 25, 2024)
@yunginator: “i hate how every third post on pinterest is an ad, it makes scrolling so unenjoyable” (10:08 AM · Feb 25, 2024)
@nashantisarai: “@Pinterest y’all showing us to many ads ! PLEASE STOP ! don’t ruin my favorite app” (3:28 PM · Mar 1, 2024)
@BaboobrazArt: “does anyone know any good places for pose reference? i used to use pinterest but its all ai garbage and ads now and the before:2021 search feature doesnt work on there” (11:19 PM · Mar 1, 2024)
@haileyh412: “Is there any way to make your Pinterest feed not be 3/4 ads” (10:14 PM · Mar 1, 2024)
@CerezaCosplay: “I wish I could use Pinterest and it not just be ads” (9:56 PM · Mar 1, 2024)
@IceesStuff: “PINTEREST ADS ARE CRAZY😭😭😭” (10:39 PM · Mar 1, 2024)
@beetlebrainn: “Pinterest needs to chill tf out with ads” (7:59 AM · Mar 1, 2024)
@MandisaGaba: “My Pinterest has ADs, why does my Pinterest have ADs🥹” (9:09 AM · Mar 1, 2024)
@sup3rn0va_x: “the amount of ads on pinterest now makes me wanna fucking vomit oh my god it’s horrendous we are living in HELL” (6:07 AM · Mar 1, 2024)
@naijag1rl: “pinterest is like 80% ads now what’s going on” (7:32 AM · Mar 1, 2024)
@annelisoow: “WHY DOES PINTEREST HAVE ADS EVERY 4 PINS NOW.” (5:19 PM · Mar 5, 2024)
@seultons: “the insane amount of pinterest ads now is actually so irritating” (4:27 AM · Mar 5, 2024)
@spacewritings: “what are the first 4 pics on my pinterest? they’re ads. they’re all ads” (6:55 PM · Mar 5, 2024)
@lovelyzmp3: “the pinterest ads are so annoying” (1:46 PM · Mar 5, 2024)
@rcvrad: “pinterest gets more and more ads everyday i swear” (5:24 AM · Mar 5, 2024)
@ellenmurphy__: “@Pinterest PLSSSSSS why is there ads on the app 😭😭😭 DONT DO THIS TO US I BEG” (9:44 PM · Mar 5, 2024)
@terpqueen_eevee: “scrolling through pinterest with ad blocker on is crazy bc why is half my feed missing” (7:59 PM · Mar 5, 2024)
@kobbynewton: “Ads has made its way onto Pinterest now. It seems like everyone is constantly trying to sell you something these days” (10:15 PM · Mar 5, 2024)
@starkeypov: “ads has ruined pinterest” (9:46 PM · Mar 5, 2024)
@gyuglobal: “pinterest ads are so fucking weird like ??? thank you ?? i think ???” (11:39 PM · Mar 13, 2024)
@n0b0dygetsm3: “what could i possibly have searched on pinterest to warrant these kinds of ads” (10:28 PM · Mar 13, 2024)
@vampiresnoopy: “I’ve said this before but the pampers ads I get on Pinterest seriously concern me. I absolutely do not search anything related to babies/kids/family and yet.. I get a lot of strange diaper ads. im mostly looking at kpop dudes and clothes/makeup💀” (2:48 AM · Mar 13, 2024)
@zentavri: “Since when does pinterest have so many ads??? Every second pin is an ad wtf” (8:01 PM · Mar 13, 2024)
@chyraqs: “pinterest ads are so weird and underwhelming like wtf” (1:38 AM · Mar 13, 2024)
@ali3nsooperst4r: “first 4 on pinterest! (i hate ads..)” (2:49 AM · Mar 13, 2024)
@vrult: “tiktok bout to be banned, youtube got 20 women vs a goblin, instagram reels, pinterest filled with ads, elon is controlling twitter, facebook, discord filled with racists, social media is falling off 💔” (3:38 AM · Mar 13, 2024)
@thatonegirl_Liz: “Im so upset that Pinterest is now just a bunch of ads 😪 smh like why am I getting all these promoted posts I don’t want thiisssss” (4:44 AM · Mar 13, 2024)
@b3rryyong: “HOW IS PINTEREST HOME PAGE ALWAYS UGLY😔i always get random stuff or ads” (8:53 PM · Mar 13, 2024)
@AxlotlSarkozy: “IM SORRY BUT WHY THE FUCK DO I KEEP GETTING STUPID ASS ADS ON PINTEREST AND TWITTER ABOUT HOW TO ORGASM/CLIMAX GET THE FUCK AWAY FROM ME FLO, I DONT WANT YOUR STUPID FUCKING ADS FUCK OFF am okay, i swear just.. annoyed ;-;” (10:50 PM · Mar 13, 2024)
@deeganmariee: “I miss the days when @Pinterest wasn’t all ads and i could actually use my account.” (4:07 PM · Mar 13, 2024)
@altaristaylena: “according to my first 4 photos on my Pinterest homepage, would you sit with me at lunch? 🥰 (Refreshed once bc first picture when I opened the app originally was a shein ad 🤢)” (5:43 PM · Mar 13, 2024)
@Squidwheel: “Why does pinterest always give me the goofiest ads ever whenever im looking at my favorite characters” (1:46 PM · Mar 13, 2024)
@xoAshleee: “@Pinterest really blows mine now with all the ads. Like 50% of my scrolling is an ad. It was my favorite app” (7:05 AM · Mar 13, 2024)
@PokeKellz: “Ok it’s been a bit but what the fuck happened to Pinterest? It’s 99% AI images and pervasive ads” (12:37 AM · Mar 14, 2024)
@AxlotlSarkozy: “No! I don’t actively look up anything nsfw on Twitter and ESPECIALLY not on Pinterest! Yet these stupid ass ads show up on my Pinterest so many fucking times and it makes me so uncomfortable. Like why on Pinterest????” (11:26 PM · Mar 13, 2024)
@fadedyIan: “all the ads on pinterest is pissing me off” (8:29 AM · Mar 13, 2024)
@Vals_ded: “Yup!! I would get a ton of pampers ads too!! Seems like other ppl are having the same thing on their Pinterest as well!!” (3:13 AM · Mar 13, 2024)
@Annalisa840917: “I didn’t know Pinterest does that too, ugh. I used to LOVE Pinterest until they junked it up with ads. Literally half my feed is ads and suggested content instead of the stuff I actually subscribed to. I still have the app but I probably open it only twice a year.” (11:26 AM · Mar 13, 2024)
@sweetdovetea: i’m sick. why does pinterest have ads (8:51 PM · Jun 17, 2024)
@_PetiteTing: Pinterest being taken over by ads is just so infuriating…. (3:54 PM · Jun 17, 2024)
@wStephy_: Pinterest also has ads. miss how many times it’s been yt and only spotify has ads.😭 (8:33 AM · June 17, 2024)
@bvckspoet: why are there so many freaking ads on pinterest THIS IS NOT AESTHETIC! (8:21 AM · Jun 17, 2024)
@jenoluver: bruh i can’t search anything on pinterest the results are entirely ads or links to buy stuff 😭😭(4:05 AM · Jun 17, 2024)
@preciatis: There’s a Pinterest ad that really irritates me and it always appears to me that it’s someone searching for TEMPURA and then a bunch of photos of sushi appear. congratulations to the marketing team because I think about him constantly (and foam with hate (2:58 AM · June 17, 2024)
@tynelo: Why does Pinterest have ads??? Nooooooo this is my safe space!! – Like wtf is this?? Im only supposed to see pretty things when i scroll (2:58 AM · Jun 17, 2024)
@chelseaaabee_: the ads on pinterest are PISSING ME OFF – can’t even look for makeup inspo without a thousand fucking adverts for temu or some other shit website (2:14 AM · Jun 17, 2024)

Another indicator for users perceiving a service having too many ads is counting the expression of “too many ads” among all internet sites except those under the service’s own domain that mention the service’s name. The exclusion of the own domain helps to exclude a lot of chatter on a social media platform about another service. The latter is a reliable proxy for the overall mention of the services on the internet.

The results are again as expected with the exception of Reddit. This is for the last twelve months:

We consider these results less reliable than the Twitter analysis above because many statistical positives of complaints are articles about social media ads in general. The lower base rates of smaller social media brands increase the relative positives of complaints. However, the direct comparison between Pinterest and TikTok provides a strong indicator that ads are perceived much more negatively on Pinterest than on TikTok.

The data clearly shows that Meta services’ advertising space is much higher priced and more well-received by its users. We consulted industry experts and former Pinterest insiders. They explained to us that Pinterest is in fact not a premium advertiser for three reasons:

Pinterest is not really a social media to communicate with others but rather a place for creative “self-time”. That is why many users might receive ads on Pinterest as more intrusive and distractive than on a social media communication platform.
Pinterest does not have the amount of user data for user profiling that Meta (Facebook, Instagram, WhatsApp) and Alphabet (Google, YouTube) have with their vast internet ecosystems.
Pinterest’s ad inventory is much smaller and restricted, due to its small overall reach and market power compared to Meta and Alphabet.

The issue of Pinterest having too many ads is also widely discussed in other online forums. This is an analysis of posts on Reddit over the last year. Pinterest is much rarer discussed than other services but with an extremely high instance of discussion about ad spam.

In the following, we quote some selected impressions from related discussions on Reddit.

https://www.reddit.com/r/Pinterest/comments/18b9vga/increased_amount_of_ads_on_pinterest/

https://www.reddit.com/r/Pinterest/comments/178hjrx/so_many_ads/

Note how many users clearly state that Pinterest has become worse recently, is unusable, or that they stopped using it often or left the platform altogether.

Reddit thread: so many ads!!! (link)

Usernameederman: “Its like half my feed is just ads”
Rad-uwu-dude “Me too! It varies but there are times where literally half of my feed is adds…..”
Phenomenal_kat_: “out of curiosity I counted 20 Pins, then went back and counted how many were ads. 8/20.”
Team Pantofola: “It’s becoming unusable, terrible user experience. It’s a real shame. Not just an ads problems but it’s surely annoying as hell”
Rain_in_numbers: “….like at any given moment scrolling pinterest 60-75% of the screen is ads.”

Reddit thread: The ads on pinterest are getting a little out of hand (link)

CatsTrustNoOne: “What I really hate is how all the ads I see are from scam companies.”
NoStar3850: “My Pinterest has an ad like every 3rd pin right now. Crazy”
Hazyhoneysky: “I got 5 ads in a row in my feed this evening. I couldn’t believe it. After that, I noticed that almost every other pin is an ad now. It’s really depressing.”
Reble77: “I have just deleted Pinterest after nearly 3 years because of the random pin banning and snotty emails that came with it and then there’s the emails from strange men making inappropriate comments and sending pins of weird stuff you know what I mean”

Reddit thread: why every single pin Is an ad ? (link)

Agreeable-Exercise23: “I’ve been using Pinterest for a good few years now and I noticed that for the last two weeks or so every single pin Is an ad….”
Te-Co: “it’s just a giant store now. i can’t find anything related to my search that is not some product for sale.”
Diegolo22: “It is even worse now. Sadly, it has become unusable.”
Narr0wEscape: “I’m browsing right now on the mobile app and I noticed as I scrolled, there are three ads and zero pins visible in some spots. Other times it’s 3/4 images are ads. It’s horrendous. It’s so much easier to just Google image search and get ideas that way.”

Reddit thread: Too much ads! (link)

Maymay-2004: “I’v been so put off Pinterest lately every two to three swipes or scrolls there is ad after ad it’s terrible. Anyways how do you guys feel about it?”
[deleted user]: “stopped using it on my phone”
Grouchy_Presence_745: “I have no problem with them using ads. I have a problem with they’re being more ads than actual pins and some of the ads are disguised as pins so that you’ll accidentally click on them.”

Reddit thread: anyone getting more ads than usual? (link)

Slidekiss95: “…usually one per every 15 pins while scrolling through the home page, but now im getting about 5-6 ads every 10 pins.”
Ophidian534: “Pinterest has become a cesspool of advertising and generated art. You have to Google search if you wish to pin specific ideas since the search bar wields meager results or unrelated content.”

Reddit thread: The ads… all the ads! (link)

SibenSevenVier: “There are so, so, so many ads that Pinterest has become unusable both on the browser and app versions. I’m eyeballing 30% to 40% of the content being ads. And this is done so sneakily that every time I see something I like, I need to inspect it, read the caption thoroughly, look for company icons and only then go ahead and click/tap it.”
Jinsyjones: “It’s completely unusable. I’ve been moving away from Pinterest over the last few years.”
MushroomMage11: “I opened the app the first time in a while and it’s awful! I’m considering deleting it since it’s more work sifting through ads and trying to find related content.”
Unable-7: “Pinterest management really needs an audit.”

Reddit thread: Ads 😭 (link)

Weary_Mousse_8405: “As I mourn the loss of pinterest, does anyone have any suggestions of similar apps without as many ads?”
Acctforstylethings: “They keep serving me ads like how to pluck a chicken, and I’m vegan.”
Lone_wolf1580: “Like you, I loved being on/scrolling through Pinterest for hours. That is until ads started ruining that experience for good.”
Afraid_Resort1673: “Yes. It’s ruined for me. It knows and tracks all the things I would likely buy – make up, shoes, clothing… And they look just like real pins most the time.”
Embarrassed-Sea-3281: “Yes. I used to hang around on Pinterest. But not anymore.”

Reddit thread: Pinterest is getting worse, there’s too many ads. (link)

Scared-Advance-6231: “Literally every second to third post I see is advertisements or posts I’ve seen at least 3 times already. I always block them but that doesn’t help.”
WhatevUsayStnCldStvA: “It’s basically unusable for me now. I used to love it, like back in 2015. I can’t do it now.”

Reddit thread: Tired of the ads.. (link)

Lone_wolf1580: “I remember when ads didn’t take up the whole damn page. Because of them, I don’t go on Pinterest as much as I used to.”

Reddit thread: Ads… (link)

Loversdesire: “But the app has become practically unusable. The amount of ads is SHOCKING. I literally can barely see the photos in my feed anymore—it’s so infuriating. I’m close to giving up on Pinterest altogether.”
Elexandros: “I get the same amount of ads per page as I do pins. It’s beyond aggravating.”

Reddit thread: what’s with the excessive amount of ads recently?? (link)

Sssspicey: “I was scrolling on mobile and noticed how there are 2 ads between every pin. it seems so unnecessary.”
Thetravelbeautyblog: “The ads are very annoying especially when I click on them by mistake! I thought it was just for the q4 but it’s continued well into January [2024] too”
Marievaldov20: “I noticed this last thanksgiving-ish [2023]. One ad was a picture of a really cute outfit but not realizing it was just an ad I thought “how cute! I’ll save it to my board for inspo” but NOPE NO CAN DO IT WAS AN EFFING AD”

Reddit thread: Pinterest is becoming useless and its frustrating (link)

Force-Due: “Pinterest is becoming useless and its frustrating” “Stop trying to keep up with tiktok and everyone else. You are a glorified photo gallery with a nice search function. (Which you are also slowly ruining)…”
Elexandros: “I’ve noticed that recently my Pinterest has no idea what my interests are, despite being on it for over a decade. It’s increasingly frustrating, which sucks because that’s my main inspo source.”
Aspae-Inun: “It’s literally unusable for me at this point which is so disappointing.”

Reddit thread: suddenly my search results yields 99% unrelated ads (link)

Reddit thread: Pinterest is really becoming unusable. (link)

Crescenttmoons: “Pinterest is really becoming unusable. (…) I had my account of 5 years with 100k followers get permanently suspended for seemingly no reason. It was one of their new bots that kept reporting. the last one that got reported by a bot was of an edit of Ariana Grande that my friend made. and that was their “final straw” before deleting my account.”
Revle77: “I am beginning to think they are using an AI to police the accounts like Chat GPT and it hasn’t been trained very well”
Phenomenal_kat_: “They had so many good features that they just kept taking away one by one over the years, in the guise of “improving our experience.”
AmazingCranberry8122: “Majority of feed is Ads”
Dewystars: “If I select hide pin -> irrelevant to me for each ad, eventually it gives up on trying to feed them to me and allows me a few minutes of peaceful scrolling. But inevitably they will be back”

Reddit thread: Are people annoyed by ads on places like Pinterest, reddit, IMDB, etc. (link)

PlutoGB08: “So I frequent Pinterest and reddit, but I am so annoyed by the many ads that take up the space”
[deleted account]: “I don’t see too many ads on reddit. Pinterest on the other hand, has some really sketchy ads though.”

Reddit thread: Pinterest excessive irrelevant pins (link)

Davidgopaint: “however no matter what i do (including filtering saying i dont wish to see this) within 10minutes or a simple relog, i will get images of scantily clad women in bikinis showing up; i have 0 images of these saved….”
[deleted user]: “I keep getting ads for that stuff too but I’m used to it lol. It’s sick and there is nothing you can do about it 😔”

Reddit thread: I used to love this app. (link)

Rasberry_cat55: “Now it is almost completely unbearable due to excessive ads. Half the content is just ads. Some ads take up large portions of the screen or they play videos while I’m trying to view other pins (…) I’m glad you guys get me. I feel like I don’t people who use Pinterest a lot anymore”
Crescenttmoons: “i posted something about how unusable the app is now. i understand. i hear you. the app sucks now”
Phenomenal_Kat_: “Yes!!! I mean I know ads generate revenue but good lord. Literally half of the visible pins are ads. And why bother following anyone? I can’t see their pins in my feed anyway. 😡”

Reddit thread: Pinterest ads YES or NO?! (link)

Arthor: “Their ads look almost identical to search content, so you will get cheap clicks but no conversions (compared to alternatives)”
Crayolacrayonwax: “It’s not that great, you get better conversion from Facebook”
Notpitching: “I had no success. A ton of traffic but almost no conversions.”

Reddit thread: I HATE the pinterest algorithm (link, 358 upvotes)

[deleted user]: “And I’m seeing things on my feed I don’t want to see more. Like scantily clad women. I don’t look at lingerie or swimsuits so idk why they are showing up?”
HolidayReject: “I’ve been on this website for about a decade now (I’m 23 too!) And it has been increasingly worse in the last couple years to the point where I sometimes wish I was still in high school just so I could get the old Pinterest back”
Rixie_Pie: “I just checked, and I had to hide over 40 pins. The were back to back from the top of the feed. Horrible.”

Reddit thread: Ads (link)

Sad_Potat_07: “Mobile Pinterest is literally unuseable at this point with all the ads. Every single pin is some sort of ad. And maybe I’ll get a couple actual pins, but they’re surrounded by annoying ads.”
lone_wolf1580: “All I know is the bombarding of ads on Pinterest made me lose interest in spending hours on Pinterest to the point I deleted the app from my phone.”
madison_lynn19: “I report the super dumb ads as irrelevant! Try it out. Won’t fix the bombardment but your feed won’t look so ridiculous. Feels like we’re going back to 2012 with some of these ads that are SO bad!”
Genymede: “I’m getting tired of the sheer amount of ads too. I love writing, and I use pinterest to visualize my characters, certain plot points, worlds, cultures, etc. I’ve been going off because every 1-2 pin has 4-5 ads surrounding it on top of the single giant ad in the middle of it all. If I do go on, I bail out several minutes later. I hate the fact that ads are ruining pinterest.”
ALyttleH: “It’s so bad! It used to be that you could delete an ad and you wouldn’t see it again. Thats certainly not the case anymore! Between that and showing me things I’ve already pinned, it’s becoming useless. In fact now I don’t use the app to search because it brings up the same crap! I go to Google and search then it takes me to new pins. 🤷🏽‍♀️”

Reddit thread: ( Link )

Illustrious-Trip-749: “why is pinterest just ads now!!”
[deleted user]: “They keep making the rest of the app awful”
Xebrev: “it looks so empty with an ad blocker on”

Reddit thread: Why is pinterest just ads now!! (link)

Elexandros: “I had four ads to just one pin”
GatecityYank: “It’s really overwhelming and frustrating (…) It has been this way for a while now (…) Revenue from advertisements is prioritized over the user experience”
Sarahoyoga: “I’ve recently stopped using Pinterest for this reason. (ads)”
JackRiverArt: “at this point there’s only 4 types of pins that I see on there.” “ads, pins that I’ve seen over and over again for years atp, pins that seem interesting but are either scams or ads, AI “art”.”

Reddit thread: Increased Amount of Ads on Pinterest? (link)

Gh0stue12: “40-50% of the items on my home page are adverts and it is driving me insane! (…) The video ads have been especially frustrating and distracting, especially when there are multiple playing on screen at once.”
Lone_wolf1580: “Due to the bombarding of ads on Pinterest, I went from scrolling through pins for hours to scrolling through pins for less than 5 seconds and then closing the apps.”
[deleted user]: “yes, ive honestly been using it less and i used it ALOT. no reason for me to continue using, pinterest doesn’t care for the user experience in every way, only the money making aspects of the operation.”
Unclefudley: “On the app I get three adds for every one pin.”
Rain_in_numbers: “yep, it got so significantly worse recently”
Cybrobot: “It enrages me. Cool you want to make money awesome well it ain’t from me good bye. They’re gonna lose users left and right.”

Overall, we believe Pinterest’s value proposition is just too weak, and eroding at an alarming rate. The Pins are mostly images that can be found elsewhere on the internet as well (e.g. using Google). This sets Pinterest apart negatively in comparison with the successfully monetized social media services by Meta, Facebook and Instagram, as well as Alphabet’s YouTube, which provide large proportions of proprietary content.

Recent analyses by Similarweb (link; retrieved in July 2024) show that the Russian search engine Yandex is spuriously the biggest referrer to Pinterest.com.

Source: Analysis results for pinterest.com by pro.similarweb.com

This is surprising because Yandex only has 1.32% of the global market share among search engines.

Source: Global Search Engine Market, source: yaguara.co (link)

We tested some random search queries in March 2024 and counted the links to a Pinterest site among the top 20 image search results:

Query	Google	Bing	YANDEX	Yahoo!	DuckDuckGo
“living room”	0	0	10	0	0
“pork chops”	0	0	4	0	0
“здоровая еда” (healthy meal)	0	0	2	0	1
“spicy baguette”	0	1	3	1	1
“elefant” (elephant)	0	0	4	0	0
“car”	0	0	2	0	0
“Hochzeitskleid” (wedding dress)	0	4	11	3	2
“garage”	0	4	7	2	3
“old camera”	1	4	2	5	5
“vampire”	0	1	7	6	8
“knitted projects”	1	1	10	1	1
“traffic”	0	0	2	0	0
“puppies”	1	0	2	1	1

* We excluded Baidu from the analysis because Baidu does not reveal image sources

Yandex massively pushes links to Pinterest in their image search. This is particularly surprising for searches like “traffic”, “car” or “elefant” where only Yandex shows Pinterest results, because Pinterest is designed as a platform for creative ideas and not an image warehousing site. That is why we believe Yandex is artificially pushing Pinterest results for some reason. The whole success story of Pinterest in Russia might be fully explained by Yandex, which has a search engine market share of over 71% in Russia. (link)

Russia is the only market where Pinterest is as strong as the best competitors. SEMrush’s organic data for desktop browser is the only traffic estimate available for the Russian market.

Google Trends also shows interest in Pinterest in Russia close to its peak.

AppMagic also reports Pinterest is currently the 23^rd most downloaded app in Russia, which is at an all-time high

Pinterest does not disclose any deal to push traffic from Yandex. In its 2021 10-K, Pinterest mentions that “we depend in part on internet search engines, such as Bing, Google, Yahoo! and Yandex, to direct a significant amount of traffic to our service.” Interestingly, Pinterest mentions Yandex as the only non-US search service but remains silent about any specific deals. Remind that Russia’s advertising market is tiny with only $7B in total volume.

The current ad spam strategy is not surprising against the background of Pinterest’s appointment of a new CEO in 2022. Following the appointment, Pinterest announced a strategy focused on “expanding our advertiser solutions” (2022, Q4, earnings presentation, p. 7) The Observer summarizes: “Pinterest CEO Bill Ready Impresses Investors with New Advertising Strategy.” (link)

The growth story behind this strategy is alleged growth in the Gen Z demographics:

Gen Z was the fastest growing demographic on the platform, and grew double digits year over year. Gen Z sessions grew much faster year over year than sessions from older demographics.
Nearly half of all new videos pinned in Q4 were from Gen Z users.

(2022, Q4, earnings presentation, p. 6)

Given our findings about web traffic statistics, we can be almost sure that most of this alleged growth in the Gen Z demographics happens outside of Western markets and is of low value to advertisers. This hypothesis is also supported by the fact that in Pinterest’s biggest market of active users, India and other large non-Western markets with Pinterest being active, the demographic profile is much more heavily weighted towards Gen Z than in the West, as shown below.

Source: PopulationPyramid.net

The focus on Gen Z by Ready is a preparation for excusing further short-term issues in profitability. An industry expert we interviewed explained:

“I actually don’t know if Gen Z is the most valuable conversation to be having for the next two to three years. I say this because at the end of the day you have to think of seeing Gen Z behavior play out versus who is the actual high value user? Who is the user who actually is the most monetizable and that is not Gen Z because Gen Z does not have purchasing power? The most valuable person who would click through to their site or actually use their link to shop is not a Gen Z person, it is actually a millennial.”

In the next few earnings calls, Ready prepared the ground to tell investors that profitability will come with Gen Z maturing and entering the workforce—this is the unspoken part—in India, Indonesia, and the Philippines.

In December 2022 Pinterest promised to their investors to “execute on our strategy to increase engagement with users”. (link) The quote is part of a press release that announces a “long-term cooperation agreement with Elliott Investment Management L.P.” (“Elliott”), an experienced activist investment firm with a fund larger than $50B that also invested in Twitter, eBay (link) and Etsy. (link) This is Elliott’s statement on taking a sizeable stake in Pinterest in August 2022:

“Pinterest is a highly strategic business with significant potential for growth, and our conviction in the value-creation opportunity at Pinterest today has led us to become the Company’s largest investor. As the market-leading platform at the intersection of social media, search and commerce, Pinterest occupies a unique position in the advertising and shopping ecosystems, and CEO Bill Ready is the right leader to oversee Pinterest’s next phase of growth. We commend Ben Silbermann and the Board on the leadership transition, and we look forward to continuing our collaborative work with Ben, Bill and the Board as they drive toward realizing Pinterest’s full potential.” (link)

Elliot did not directly mention the size of their initial investment, but in July 2022 Reuters reported that Elliot had a “more than 9% stake” in Pinterest. (link) Thus, Elliot held over 52 million shares back then, held in vehicles not further specified. The “long-term cooperation” was announced in December 2022. The cooperation agreement (Form 8-K EX-10.1, December 6, 2022) defines a “Minimum Ownership Threshold” of at least 4.3% (§1.g). According to the latest 13F filings, Elliot currently holds 28 million Pinterest shares, or 4.7% of all 595 million shares outstanding. (link) Thus, Elliott today only holds about the bare minimum in Pinterest shares to keep their appointed director on the board. We see this as a vote of distrust by Elliott in Ready, who failed to deliver the promised growth.

Needless to say that in more recent interviews like this one (link) from March 2023, Bill Ready touts some “AI optimization” strategy to justify the stabilized ad revenue. Not missing in the buzzword mix is the fight “against toxicity in social media” in a very recent Financial Times interview in February 2024. (link)

A former high-ranking insider we interviewed summarized his impression about Ready’s strategy:

“The CEO has now been in seat for two years over six quarters now which is also typically for how long investors in the market will have patience with a new CEO trying out a few different approaches and metrics. At some point—right about now—if you think of other companies when the market starts saying, what is the one continuous trend of behavior that has actually been persisted over multiple quarters versus you’ve tried a few things and you know, now there are no more excuses. So what I have personally been surprised by is seeing the CEO Ready come in, seeing the stock price go from 25ish to 35ish, because that is a significant growth, which I do not fully find that corresponding value in the metrics.”

According to many Glassdoor posts, Pinterest is a terribly managed company with a “toxic culture and management” and “incapable of taking the great opportunities”. We find a much larger proportion of such statements in Pinterest’s Glassdoor reviews than for other companies. (link)

In July 2024, Cyber Security News reports a “potential data leak that could affect millions of users“ (link). While we are aware of competitors having similar issues, we see this news as an indicator that operational excellence in matters of data security is seemingly no particular strength of Pinterest.

Recent insider transactions are a powerful point of confirmation for our negative outlook on Pinterest. All recent insider transactions are aggressive sales even at valuations deep in the $20s. The only exception is CEO Bill Ready, who had to buy shares after becoming CEO as part of his employment and awards agreement in June 2022.

Since 2020, insiders have sold over 25.4 million shares, worth over one billion USD in total. The following table shows all insider transactions in chronological order back to 2020 (source: SEC filings via Finviz.com).

It is worth noting that Co-Founders Evan Sharpe and Benjamin Silbermann, as well as former CEO Todd Morgenfeld sold all their Pinterest shares.

Pinterest filed their S-1 for the IPO in March 2019. Pinterest’s entire C-suite left Pinterest, with the two co-founders being the only exception. This points to significant disagreements between the owners and the executive team, and we consider this to be a typical red flag for a company with bad business morale.

Source: Pinterest, S-1, March 2019. Leaving date by us from LinkedIn profile.

After 2019 the high rotation in the C-Suite continued.

Name	Position	Term	Comment
Christine Deputy	Chief People Officer	Jun 2021 -Feb 2024	Shows herself still as Pinterest CPO on her LinkedIn (retrieved in Mar 12, 2024) According to Pinterest’s webpage, Deputy was replaced by Doniel Sutton in Feb 2024. Bloomberg shows Deputy as “Former CPO, Pinterest”.
Naveen Gavini	Chief Product Officer	Apr 2020 – Sept 2023	According to his LinkedIn, he worked for Pinterest for over 11 years before leaving in Sept 2023
Jon Kaplan	Chief Revenue Officer	Feb 2016 – Mar 2022	Source: Kaplan’s LinkedIn page

Pinterest might still look financially decent and on track in 2024 Q2, but it will become increasingly difficult to gloss over the fundamental problems. Pinterest has no convincing strategy for ever becoming as profitable as its equity price implies.

We saw that Pinterest’s user engagement in the West is rapidly declining due to alienating its user base with ad spam. However, Pinterest grew revenue in the latest quarters, and might see a respectable business year 2024, financially.

We see the more relevant question not in how long Pinterest can keep up or slightly grow its revenue but rather in how much bottom-line earnings the company can realize over its remaining lifetime. The strong signals:

(1) Pinterest’s users in the most valuable markets are reducing engagements;

(2) Pinterest increases the monetization depth by a de-facto ad spam strategy;

(3) Pinterest has a substantial disadvantage in user data and ad inventory to match the right ads to the right user, in comparison to Meta’s and Alphabet’s services;

(4) Pinterest loses traffic due to increased competition by other growing services, in particular TikTok and Instagram;

(5) Pinterest is already compelled to offer ever-lower junk-level ad pricing to its customers;

(6) Pinterest is growing user engagements almost exclusively in low-value markets in low-income countries.

Pinterest’s CEO Bill Ready “see[s] Pinterest significantly undermonetized across the board but the most undermonetized internationally”. (2023 Q4 earnings call) We can simply counter that Grizzly’s empirical study shows the exact opposite is true: users leave Pinterest due to over-monetization: too many ads, and too annoying (video) ads. We can address Ready’s remark on international under-monetization with a simple comparison to Meta’s services indicating how small revenue from non-Western international markets is for a competitor well-matured in international expansion.

⁽¹⁾ 2023 FY reporting (Pinterest, Inc.’s 2024 A1 10-K)

⁽²⁾ 2023 FY reporting (Meta Platform Inc.’s 2024 10-K)

If Pinterest manages to fully monetize the non-Western markets with the same success that Meta had, then the international growth potential for Pinterest’s revenue in the Rest of the World is only 33.6%-points of its current total revenue. However, we believe Meta is better positioned in smaller regional markets than Pinterest because the leverage effects from better user data and larger ad inventory are even more relevant in regional markets. This also explains why Pinterest has a much lower revenue contribution from Europe than Meta, despite selling ads in Europe prior to 2020.

Source: Pinterest’s 10-Ks

Pinterest generates its revenue from ad sales. As documented in this report, we do not expect any further real long-term growth in ad revenue, but rather a stagnant picture in which competitors have the potential to grow significantly.

In 2023, Pinterest spent $1,980M on Research and Development together with Sales and Marketing. Assuming, in the best of all worlds for Pinterest, Pinterest can cut these costs by 50%, adjusting for inflation, going forward If it can realize 2023 inflation adjusted revenue generation for the following years, this would realize $0.87 inflation adjusted annual income per share (total shares outstanding: 595.21M). With a fair profit/earnings ratio at 12x for a company with stable revenue for the years to come but without much growth potential and adding the shareholder’s equity ($3.144B), we see Pinterest’s share price at $16, which is our most generously optimistic case.

However, we very clearly observed a rapid decline in user engagement in 2024 from all our data sources, continuing after Q1. We consider the chances nil for mid-term or long-term profitability that would justify a price over $20. Also, we don’t see any high extra liquidation value from Pinterest’s brands or intellectual property. Only sophisticated acquirers with extra industry leverage, like Meta, might be capable of adding a brand premium to this price. However, all insiders we talked to imply a low probability of any Pinterest takeover by a bigger player. Thus, we would only be willing to purchase Pinterest’s stock at a share price not much above the shareholder’s equity, which results in a fair share price of not much more than $5.28.

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