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What changed in PINTEREST, INC.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of PINTEREST, INC.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+348 added−341 removedSource: 10-K (2025-02-06) vs 10-K (2024-02-08)

Top changes in PINTEREST, INC.'s 2024 10-K

348 paragraphs added · 341 removed · 277 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeOur auction system selects the best ad for each available ad impression, based on the likelihood of a desired action occurring and how much that action is worth to advertisers. The likelihood of the action occurring depends on a variety of factors, such as ad relevance and creative quality.
Biggest changeLower funnel revenue is billed when an advertiser optimizes an ad campaign around “performance” objectives like clicks ("CPC"), actions (“CPA”) or conversion events ("oCPM"), such as a checkout or add-to-cart. 8 Part I Our auction system selects the best ad for each available ad impression, based on the likelihood of a desired action occurring and how much that action is worth to advertisers.
Ad Auction The vast majority of our advertisers buy ads through an auction-based system. Our ad auction allows us to serve ads to users at relevant moments while optimizing business outcomes for advertisers. We offer ads across both upper and lower funnel.
Ad Auction The vast majority of our advertisers buy ads through an auction-based system. Our ad auction allows us to serve ads to users at relevant moments while optimizing business outcomes for advertisers. We offer ads across both the upper and lower funnel.
For additional information on risks relating to intellectual property, please see the sections titled “Risk Factors” and “—Legal Proceedings.” Government regulation We are subject to many U.S. federal and state and foreign laws and regulations that involve matters central to our business, including laws and regulations that involve data privacy and data protection, intellectual property (including copyright and patent laws), content regulation, rights of publicity, advertising, marketing, health and safety, competition, protection of minors, consumer protection, taxation, anti-bribery, anti-money laundering and corruption, economic or other trade prohibitions or sanctions or securities law compliance.
For additional information on risks relating to intellectual property, please see the sections titled “Risk Factors” and “—Legal Proceedings.” Government regulation We are subject to many U.S. federal and state and foreign laws and regulations that involve matters central to our business, including laws and regulations that involve data privacy and data protection, intellectual property (including copyright and patent laws), content moderation, rights of publicity, advertising, marketing, health and safety, competition, protection of minors, consumer protection, taxation, anti-bribery, anti-money laundering and corruption, economic or other trade prohibitions or sanctions or securities law compliance.
We are also dependent on third-party content, technology and intellectual property in connection with our business. We are presently involved in litigation related to our intellectual property, and expect to continue to face allegations from third parties, including our competitors and “non-practicing entities,” that we have infringed or otherwise violated their intellectual property rights.
We are also dependent on third-party content, technology and intellectual property in connection with our business. We are presently involved in intellectual property litigation and expect to continue to face allegations from third parties, including our competitors and “non-practicing entities,” that we have infringed or otherwise violated their intellectual property rights.
Item 1. Business Overview Pinterest is a visual search and discovery platform, positioned at the intersection of search, social, and commerce. We offer a unique and differentiated experience that enables people to go from inspiration to action all on one consumer internet property. Our primary service, Pinterest, can be accessed through our mobile application or the web.
Item 1. Business Overview Pinterest is a visual search and discovery platform, positioned at the intersection of search, social, and commerce. We offer a unique and differentiated experience that enables people to go from inspiration to action all on one consumer internet property. Pinterest can be accessed through our mobile application or the web.
Our Users and Our Platform 498 million monthly active users from around the world come to Pinterest to find new ideas, curate and refine their tastes, and turn those ideas into reality. Our platform particularly resonates with women, who comprise roughly two-thirds of our total user base.
Our Users and Our Platform 553 million monthly active users from around the world come to Pinterest to find new ideas, curate and refine their tastes, and turn those ideas into reality. Our platform particularly resonates with women, who comprise roughly two-thirds of our total user base.
The contents of our websites are not intended to be incorporated by reference into this Annual Report on Form 10-K or in any other report or document we file with the SEC, and any references to our websites are intended to be inactive textual references only. 13 Part I
The contents of our websites are not intended to be incorporated by reference into this Annual Report on Form 10-K or in any other report or document we file with the SEC, and any references to our websites are intended to be inactive textual references only. 12 Part I
Finally, we compete for talent to attract and retain highly talented individuals, particularly people with expertise in computer vision, artificial intelligence and machine learning. 10 Part I Intellectual property Our success is tied in part to our ability to protect our intellectual property and key technological innovations.
Finally, we compete for talent to attract and retain highly talented individuals, particularly people with expertise in computer vision, artificial intelligence and machine learning. Intellectual property Our success is tied in part to our ability to protect our intellectual property and key technological innovations.
For example, access to our service has been 11 Part I or is currently restricted in whole or in part in in certain countries. In addition, some countries have enacted laws that allow websites to be blocked for hosting certain types of content or may require websites to remove certain restricted content.
For example, access to our service has been or is currently restricted in whole or in part in certain countries. In addition, some countries have enacted laws that allow websites to be blocked for hosting certain types of content or may require websites to remove certain restricted content.
We also use paid marketing to grow and retain our user base, build brand awareness, and attract advertisers through business marketing and scaled education tools for optimizing campaigns on our platform. Our technology innovation We believe we have one of the largest image-rich data sets ever assembled.
In addition, we use paid marketing to grow and retain our user base, build brand awareness and attract advertisers through business marketing and scaled education tools for optimizing campaigns on our platform. Our technology innovation We believe we have one of the largest image-rich data sets ever assembled.
As of December 31, 2023, we had over 400 issued patents and pending patent applications in the United States and foreign countries relating to aspects of our actual or contemplated operations and technologies. We also had over 660 registered trademarks and trademark applications in the United States and foreign countries, including our “Pinterest” name and related logos.
As of December 31, 2024, we had approximately 400 issued patents and pending patent applications in the United States and foreign countries relating to aspects of our actual or contemplated operations and technologies. We also had over 660 registered trademarks and trademark applications in the United States and foreign countries, including our “Pinterest” name and related logos.
To promote emotional wellbeing, we offer free access to mental health and wellbeing tools like Lyra, Ginger, Calm and Cleo. 12 Part I Learning and development We help our employees create a career that is inspiring, impactful and ultimately time well spent. We have programs for open and ongoing conversation towards career growth goals both long term and short term.
To promote emotional wellbeing, we offer free access to mental health and wellbeing tools like Lyra, Calm and Cleo. Learning and development We help our employees create a career that is inspiring, impactful and ultimately time well spent. We have programs for open and ongoing conversation towards career growth goals both long term and short term.
To attract and retain great talent, we strive to create opportunities for our employees to grow and develop in their careers, supported by competitive compensation, benefits and health and wellness programs, and by programs that build connections between our employees and their communities. As of December 31, 2023, we had 4,014 full-time employees.
To attract and retain great talent, we strive to create opportunities for our employees to grow and develop in their careers, supported by competitive compensation, benefits and health and wellness programs, and by programs that build connections between our employees and their communities. As of December 31, 2024, we had 4,666 full-time employees.
We are committed to the health, safety and wellness of our employees. We provide our employees and their families with access to a variety of flexible and convenient health and wellness programs that support their physical and mental health by providing tools and resources to help them improve or maintain their health.
We provide our employees and their families with access to a variety of flexible and convenient health and wellness programs that support their physical and mental health by providing tools and resources to help them improve or maintain their health.
We rely on a variety of statutory and common-law frameworks and defenses relevant to the content available on our service, including the Digital Millennium Copyright Act (“DMCA”), the Communications Decency Act (“CDA”) and the fair-use doctrine in the United States, and the Electronic Commerce Directive in the European Union.
We rely on a variety of statutory and common-law frameworks and defenses relevant to the content available on our service, including the Digital Millennium Copyright Act (“DMCA”), the Communications Decency Act (“CDA”) and the fair-use doctrine in the United States, and the Digital Services Act (“DSA” ) and EU Directive on Copyright in the Digital Single Market ("EU Copyright Directive") in the European Union.
Many are larger and have significantly greater financial and human resources such as Amazon, Meta (including Facebook and Instagram), Google (including YouTube), Snap, TikTok and X (formerly known as Twitter), that offer users engaging content and commerce opportunities through similar technology or products to ours. We remain focused on emerging competition as well.
Competitors such as Amazon, Meta (including Facebook and Instagram), Google (including YouTube), Snap, Reddit, TikTok and X, many of which are larger and have significantly greater financial and human resources, offer users engaging content and commerce opportunities through similar technology or products to ours. We remain focused on emerging competition as well.
There are also a number of legislative proposals recently enacted or pending concerning content regulation, transparency, and access, as well as data protection that could affect us.
There are also a number of legislative proposals recently enacted or pending concerning content moderation, transparency, and access, as well as data 10 Part I protection that could affect us.
We are therefore subject to U.S. federal, state, local and foreign laws and regulations regarding data privacy and the collection, storage, sharing, use, processing, disclosure and protection of personal information and other data from users, employees or business partners, including the General Data Protection Regulation (“GDPR”) and the California Consumer Privacy Act (“CCPA”), including the California Privacy Rights Act (“CPRA”) and other state laws that may take effect in 2024.
We are therefore subject to U.S. federal, state, local and foreign laws and regulations regarding data privacy and the collection, storage, sharing, use, processing, disclosure and protection of personal information and other data from users, employees or business partners, including the General Data Protection Regulation (“GDPR”), the California Consumer Privacy Act, as amended by the California Privacy Rights Act (“CPA”), the Florida Digital Bill of Rights, and other state laws that may take effect in 2025.
Additionally, many of these formats are enabled with mobile deep links and/or direct link capabilities for a seamless, one-click handoff from ad to merchant product page. • Standard ad : A static image used to showcase content in a simple vertical image format. • Video ad : Used by advertisers to capture attention and tell a story with a visually engaging format. • Shopping ad : Used by advertisers who wish to promote specific products in their catalogs to reach users who are deciding what to buy. • Carousel ad : Multiple static images or videos in one carousel, used by advertisers to showcase more than one image or video at a time. • Collection ad : Used by advertisers to display products in action with a hybrid format that mixes lifestyle imagery and video with featured products. • Interactive ad : Used by advertisers to engage with their users through interactive formats.
Additionally, many of these formats are enabled with mobile deep links and/or direct link capabilities for a seamless, one-click handoff from an ad to the advertiser’s mobile app or webpage. • Standard ad : A static image used to showcase content in a simple vertical image format. • Video ad : Used by advertisers to capture attention and tell a story with a visually engaging format. • Shopping ad : Used by advertisers who wish to promote specific products in their catalogs to reach users who are deciding what to buy. • Carousel ad : Multiple static images or videos in one carousel, used by advertisers to showcase more than one image or video at a time. • Collection ad : Used by advertisers to display products in action with a hybrid format that mixes lifestyle imagery and video with featured products. • Interactive ad : Used by advertisers to engage with their users through interactive formats. • Premier Spotlight ad : Used by advertisers to showcase their latest product launch or seasonal moments with exclusive placements on the Pinterest Home Feed and search page.
Users interact with the platform in dynamic multi-session journeys to find inspiration, curate their latest look, plan their next project and shop from great brands. This happens at a massive scale, with billions of searches and saves per month. All of this allows us to use intent-based signals to show relevant and engaging content to our users.
Users interact with the platform in dynamic multi-session journeys to find inspiration, curate their latest look, plan their next project and shop from great brands. This happens at a massive scale, with billions of searches and saves per month.
In addition to salaries, these programs (which vary by country/region) include equity awards, a 401(k) Plan, healthcare and insurance benefits, health savings and flexible spending accounts, flexible paid time off, family leave, family care resources, flexible work schedules, employee assistance programs and charitable donation matching, among many others. We continue to review and update our compensation and benefits.
In addition to salaries, these programs (which vary by country/region) include equity awards, sales incentive programs for eligible employees, a 401(k) Plan with Company matching, healthcare and insurance benefits, health savings and flexible spending accounts, flexible paid time off, family leave and family care support, flexible work schedules, employee assistance programs and charitable donation matching, among many others.
We also have tools to help advertisers understand our contribution and drivers to conversion, and incremental impact. Advertisers can leverage our leading third-party measurement partners to validate Pinterest’s performance individually and across channels. Additionally, our API is integrated with other third -party partners to help increase adoption of our measurement tools.
Advertisers can leverage our leading third-party measurement partners to validate Pinterest’s performance individually and across channels. Additionally, our Conversions API is integrated with other third-party partners to help increase adoption of our measurement tools.
We face competition across almost every aspect of our business. We compete to attract, engage and retain users and their time and attention. We also compete with other platforms to attract, retain and grow our base of creators and publishers.
We face competition across almost every aspect of our business. We compete to attract, engage and retain users and their time and attention.
This inspiration-to-action journey maps clearly to the advertiser marketing funnel and helps brands to reach customers at every point in their discovery-to-purchase journey through digital ads. We believe users and advertisers intentionally choose Pinterest because of our efforts to create a positive and more brand safe environment.
The inspiration-to-action journey on Pinterest aligns with the advertiser marketing funnel, allowing us to help brands reach customers at every stage, from discovery to purchase, through digital ads. We believe users and advertisers intentionally choose Pinterest because of our efforts to create a positive and more brand safe environment.
For example, we enhanced our family leave benefits for birthing and adoptive parents effective January 1, 2022. Because every family is unique, we offer additional benefits to parents and caregivers with newborns in neonatal intensive care, adoptive parents and people experiencing miscarriage. To promote financial wellbeing, we offer money management education, financial planning and investment services.
Because every family is unique, we offer additional benefits to parents and caregivers with newborns in neonatal intensive care, adoptive parents and people experiencing miscarriage, and also offer fertility benefits globally. To promote financial wellbeing, we offer money management education, financial planning and investment services.
We also announced our flexible work model that provides employees the autonomy to live and work flexibly in the locations we have offices in, while prioritizing intentional in-person collaboration at our offices. We provide robust compensation and benefits programs to help meet the needs of our employees.
We also have a flexible work model that provides employees in roles that can be performed from anywhere the autonomy to live and work flexibly within their country or region, while prioritizing intentional in-person collaboration at our offices. We provide robust compensation and benefits programs to help meet the needs of our employees and their families.
Related Pins: Visual discovery on Pinterest also happens when a user taps on a Pin to learn more about an idea or image, and a feed of visually similar Pins is served beneath the tapped image. These related Pins help users springboard off a point of inspiration to explore deeper into an interest or narrow in on the perfect product.
Related Pins: Visual discovery on Pinterest also happens when a user taps on a Pin to learn more about an idea or image, and a feed of visually similar Pins is served beneath the tapped image.
We also compete for advertisers and advertising revenue across a variety of formats and goals, which depends on our ability to deliver compelling returns on investment.
We also compete with other platforms to attract, retain and grow our base of creators and publishers. 9 Part I We also compete for advertisers and advertising revenue across a variety of formats and goals, which depends on our ability to deliver compelling returns on investment.
For additional information, see the sections titled “Risk Factors” and “—Legal Proceedings.” Seasonality We have historically experienced seasonality in user growth, engagement and monetization on our platform. Historically, we have had lower engagement in the second calendar quarter and industry advertising spend tends to be strongest in the fourth quarter.
For additional information, see the sections titled “Risk Factors” and “—Legal Proceedings.” Seasonality We have historically experienced seasonality in monthly active user growth, monetization on our platform and free cash flow. Historically, we have had lower sequential user growth in the second calendar quarter.
In addition, pending legislations, including the implementation of the EU Directive on Copyright in the Digital Single Market ("EU Copyright Directive") in EU Member States have and may impose additional obligations or liability on us associated with content uploaded by users to our platform. We receive, process, store, use and share data, some of which contains personal information.
Additional new and pending legislation in the US and around the world may impose additional obligations or risk on us associated with content uploaded by users to our platform. We receive, process, store, use and share data, some of which contains personal information.
Saving content and creating boards are highly unique and beneficial to our ecosystem, as we utilize the signals from the curation to help serve users even more relevant content recommendations.
Users often move between these surfaces various times in a single session and across multiple sessions. Saving content and creating boards and collages are highly unique and beneficial to our ecosystem, as we utilize the signals from the curation to help serve users even more relevant content recommendations.
We did not experience typical seasonal trends in 2020 and 2021 due to the COVID-19 pandemic. In 2022, we started to return to typical seasonal trends. Talent management and development In order to fulfill our mission of bringing everyone the inspiration to create a life they love, we strive to attract and retain top talent.
Talent management and development In order to fulfill our mission of bringing everyone the inspiration to create a life they love, we strive to attract and retain top talent.
Inclusion and diversity We strive to create an inclusive and diverse workplace where employees are empowered to bring their whole, authentic selves to work every day. We seek for and respect diverse perspectives which we believe helps us create a more inclusive and diverse product. We seek inclusion and diversity at the highest level in our organization.
Inclusion and belonging We strive to create an inclusive workplace where employees are encouraged and empowered to bring their whole, authentic selves to work every day. We seek for and respect a wide range of experiences and perspectives across our Board of Directors, leadership and employee base, which we believe helps us create a more inclusive and global product.
We serve these advertisers in customized ways depending on their size, sophistication and objectives across the full funnel. The majority of our advertisers utilize our Ads Manager platform to initiate and manage their campaigns.
We serve these advertisers in customized ways depending on their size, sophistication and objectives across the full funnel. The majority of our advertisers utilize our Ads Manager platform to initiate and manage their campaigns. We also have a global sales force presence who work directly with advertisers and ad agencies to provide additional support through the campaign management cycle.
Upper funnel “brand” revenue is billed when an advertiser optimizes an ad campaign around “brand” objectives like impressions ("CPM") or video views ("CPV"). Lower funnel revenue is billed when an advertiser optimizes an ad campaign around “performance” objectives like clicks ("CPC"), actions (“CPA”) or conversion events ("oCPM") such as a checkout or add-to-cart.
Upper funnel “brand” revenue is billed when an advertiser optimizes an ad campaign around “brand” objectives like impressions ("CPM") or video views ("CPV").
Our related pins surface is powered by our recommendation models that use computer vision designed to identify products in the Pin, and show other relevant organic or ads content that the user might find valuable to their inspiration to action journey. 8 Part I Boards: Users save and organize Pins onto virtual “boards.” Boards often are labeled with topical categories like “Hawaiian vacation,” ”spring outfits” or “living room furniture,” and are a collection of Pins that help users organize the vast amount of visual content that they interact with on the platform.
Boards: Users save and organize Pins onto virtual “boards.” Boards often are labeled with topical categories like “Hawaiian vacation,” “spring outfits” or “living room furniture” and are a collection of Pins that help users organize the vast amount of visual content that they interact with on the platform.
Available information Our website is located at www.pinterest.com, and our investor relations website is located at http://investor.pinterestinc.com/.
Our Class A common stock is listed on the New York Stock Exchange under the symbol “PINS.” Available information Our website is located at www.pinterest.com, and our investor relations website is located at http://investor.pinterestinc.com/.
Measurement Measuring the effectiveness of digital ad spend is a high priority for our advertisers. Our first-party measurement solutions leverage tools like APIs and clean rooms which are designed to help advertisers recognize the value of an investment on our platform across a variety of objectives.
Our first-party measurement solutions, including our Conversions API and clean rooms, are designed to help advertisers recognize the value of an investment on our platform across a variety of objectives. We also have tools to help advertisers understand our contribution and drivers to conversion, and incremental impact.
Campaign Management Advertisers can set up campaigns, track results and improve performance over time through our Ads Manager or the Pinterest API. Advertisers can also buy our Premiere Spotlight ad format directly through a Pinterest relationship manager on a cost per day (“CPD”) basis.
The likelihood of the action occurring depends on a variety of factors, such as ad relevance and creative quality. Campaign Management For most campaigns, advertisers can manage set up, track results and improve performance over time through our Ads Manager or the Pinterest API.
Marketing We have historically grown our global user base with relatively low marketing costs given the strength of our global brand, the utility of our service and unpaid traffic from search engines.
In some geographies, we work with other third parties to support our sales efforts. Marketing We grow our global user base organically through the strength of our global brand, the utility of our service and unpaid traffic from search engines.
We acquire that content via a wide range of methods including product catalog uploads, direct publishing, and user curation. Content formats include images that allow you to click into an idea to learn more, videos that provide the steps of an idea, and products that brands and merchants upload from catalogs.
We acquire that content via a wide range of methods including product catalog uploads, direct publishing, and user curation.
Our principal executive offices are located at 651 Brannan Street, San Francisco, California 94107, and our telephone number is (415) 762-7100.
We also have workshops 11 Part I dedicated to learning new skills and developing an employee’s career. We set aside a dedicated personal learning and development budget for every employee. Corporate information Our principal executive offices are located at 651 Brannan Street, San Francisco, California 94107, and our telephone number is (415) 762-7100.
To help maximize performance, advertisers can target specific groups of users based on 9 Part I interests, demographics and search keywords. We are continuing to make significant investments in AI to automate our ads platform. As of the year-ended December 31, 2023, the vast majority of our revenue flowed through our AI-enabled automated bidding tool.
To help maximize performance, advertisers can target specific groups of users based on interests, demographics and search keywords. We continue to invest in AI to automate campaign set up and performance optimization for our advertisers. Measurement Measuring the effectiveness of digital ad spend is a high priority for our advertisers.
Amongst other initiatives and avenues for raising concerns, we have a third-party ombuds program intended to give every employee the opportunity to engage confidentially with neutral, trained professionals for independent support resolving conflicts in the workplace. Employee health, safety and benefits The success of our business is fundamentally tied to the well-being of our people.
Employee health, safety and benefits The success of our business is fundamentally tied to the well-being of our people. We are committed to the health, safety and wellness of our employees.
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On Pinterest, users interact with several surfaces, each of which offers distinct functionalities and experiences. Users often move between these surfaces various times in a single session, and across multiple sessions.
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The unique, first party, intent-based signal we receive from user actions on Pinterest helps power the AI based recommendation systems that we use to surface relevant and engaging content to our users. AI also plays a central role in how we drive value for our advertisers, who come to Pinterest to reach our users with high commercial intent.
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We also have a global sales force presence in 14 countries who work directly with advertisers and ad agencies to provide additional support through the campaign management cycle. In some geographies, we work with other third-parties to support our sales efforts.
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Content formats include images that allow you to click into an idea to learn more, videos that provide the steps of an idea, collages that allow users to piece together different images into one, and products that brands and merchants upload from catalogs. On Pinterest, users interact with several surfaces, each of which offers distinct functionalities and experiences.
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Our board of directors includes directors from various backgrounds, industries, skills and experience. Our board of twelve directors is composed of nine independent directors. Our board as well as our leadership team is diverse in terms of gender, race, skills, expertise and experience. We have published a diversity report annually since 2015 which we make publicly available on our website.
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These related Pins help users 7 Part I springboard off a point of inspiration to explore deeper into an interest or narrow in on the perfect product.
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We believe it is important to hold ourselves accountable to creating a diverse workforce. Our diversity report includes our current hiring goals, how we performed against the goals and our workforce demographic data.
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Our related pins surface is powered by our recommendation models that use computer vision designed to identify products in the Pin and show other relevant organic or ads content that the user might find valuable to their inspiration to action journey.
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We have also created employee resource groups that are aligned around dimensions of diversity, such as gender, ethnicity, sexual orientation or other shared attributes, which we believe help build community and enable equal opportunities for development.
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Industry advertising spend tends to be strongest in the fourth quarter resulting in higher revenue, and free cash flow is historically higher in the first quarter as we collect on the fourth quarter's higher revenue. We expect this seasonality to continue.
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We also have workshops dedicated to learning new skills and developing an employee’s career. We set aside a dedicated personal learning and development budget for every employee. Corporate information We were incorporated in Delaware in October 2008 as Cold Brew Labs Inc. In April 2012, we changed our name to Pinterest, Inc.
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We regularly review and update our compensation and benefits programs as needed to remain competitive with market compensation. For example, in 2022, we enhanced our family leave benefits for birthing and adoptive parents.
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We completed our initial public offering in April 2019 and our Class A common stock is listed on the New York Stock Exchange under the symbol “PINS.” Unless the context requires otherwise, the words “Pinterest,” “we,” “Company,” “us” and “our” refer to Pinterest, Inc. and our wholly owned subsidiaries.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

171 edited+34 added−40 removed220 unchanged
Biggest changeOur advertising revenue could be harmed by many other factors, including: • changes in the price of advertisements; • our inability to create new products that sustain or increase the value of our advertisements; • our inability to meet advertiser demand on our platform if we cannot increase the size and engagement of our user base; • if our partnerships for third party advertisement demand do not yield expected business impact; • our inability to find the right balance between brand and performance advertising and provide the right products and platform to support the pricing and demand needed for each of the advertisers and their advertising objectives; 14 Part I • changes in user demographics that make us less attractive to advertisers; • our inability to make our ads more relevant and effective; • any decision to serve contextually relevant advertisements when the price of relevant advertisements may be lower than other advertisements that we could show users that are less relevant; • the availability, accuracy and utility of our analytics and measurement solutions that demonstrate the value of our advertisements, or our ability to further improve such tools; • changes to our data privacy practices (including as a result of changes to laws or regulations or third-party policies) that affect the type or manner of advertising that we are able to provide; • our inability to collect and share data which new or existing advertisers find useful; • competitive developments or advertiser perception of the value of our products; • product changes or advertising inventory management decisions we make that change the type, size or frequency of advertisements on our platform; • users that upload content or take other actions that are deemed to be hostile, inappropriate, illicit, objectionable, illegal or otherwise not consistent with our advertisers’ brands; • the impact of invalid clicks or click fraud on our advertisements; • the failure of our advertising auction mechanism to target and price ads effectively; • difficulty and frustration from advertisers who may need to reformat or change their advertisements to comply with our guidelines or experience challenges uploading and conforming their advertisements with our system requirements; • the macroeconomic conditions and the status of the advertising industry, such as fear of recession, inflation, supply chain issues, and inventory and labor shortages, which could cause businesses to spend less on advertising and/or direct their advertising spend to larger companies that offer more traditional and widely accepted advertising products; • adverse publicity, whether or not accurate, relating to us or to social media platforms in general, may tarnish our reputation and erode advertisers’ confidence in our platform; and • the other risks and uncertainties described in this Annual Report on Form 10-K.
Biggest changeOur advertising revenue could be harmed by many other factors, including: • decreases in the number of our MAUs or our MAU growth rate; • decreases in our users’ engagement with us and the ads on our platform; • changes in the price of advertisements; 13 Part I • our inability to create new products that sustain or increase the value of our advertisements; • our inability to meet advertiser demand on our platform if we cannot increase the size and engagement of our user base; • if our partnerships for third-party advertisement demand do not yield expected business impact; • our inability to find the right balance between brand and performance advertising and provide the right products and platform to support the pricing and demand needed for each of the advertisers and their advertising objectives; • changes in user demographics that make us less attractive to advertisers; • our inability to make our ads more relevant and effective; • any decision to serve contextually relevant or less personalized advertisements; • the availability, accuracy and utility of our analytics and measurement solutions that demonstrate the value of our advertisements, or our ability to further improve such tools; • changes to our data privacy practices (including those relating to protecting the security and integrity of our platform, our use of artificial intelligence, as well those resulting from changes to laws, regulations, legal decisions, or third-party policies) that affect the type or manner of advertising that we are able to provide; • our inability to collect, process and share data which new or existing advertisers find useful; • competitive developments or advertiser perception of the value of our products; • product changes or advertising inventory management decisions we make that change the type, size or frequency of advertisements on our platform; • reductions of advertising due to users that upload content or take other actions that are deemed to be hostile, inappropriate, illicit, objectionable, illegal or otherwise not consistent with our advertisers’ brands; • the impact of invalid clicks or click fraud on our advertisements; • the failure of our advertising auction mechanism to target and price ads effectively; • decreases in user response rate to application notifications received from Pinterest, whether due to decreased user appreciation for notifications generally or changes in the manner notifications are delivered by mobile operating systems, which may decrease user engagement; • difficulty and frustration from advertisers who may need to reformat or change their advertisements to comply with our guidelines or experience challenges uploading and conforming their advertisements with our system requirements; • the macroeconomic conditions and the status of the advertising industry, such as fear of recession, inflation, the impact of tariffs, supply chain issues and inventory and labor shortages, which could cause businesses to spend less on advertising and/or direct their advertising spend to larger companies that offer more traditional and widely accepted advertising products; • restrictions placed on, or the relevance of, ads outside of the United States; • adverse publicity, whether or not accurate, relating to us or to social media platforms in general (including those relating to data security and protection), may tarnish our reputation and erode advertisers’ confidence in our platform; • laws that allow users to opt out of the use of personal data or restrict the use of personal data of teens, which may limit or prohibit us and our customers from targeting advertising to users, including teens; and • the other risks and uncertainties described in this Annual Report on Form 10-K.
In addition to the above, we believe that our ability to compete for users depends upon many factors both within and beyond our control, including: • the usefulness, novelty, performance and reliability of our platform compared to those of our competitors; • the timing and market acceptance of our products, including the developments and enhancements to those products, offered by us or our competitors; • our brand strength relative to our competitors; and • the other risks and uncertainties described in this Annual Report on Form 10-K.
In addition to the above, we believe that our ability to compete for users depends upon many factors both within and beyond our control, including: • the usefulness, novelty, performance and reliability of our platform compared to those of our competitors; • the timing and market acceptance of products, including the developments and enhancements to those products, offered by us or our competitors; • our brand strength relative to our competitors; and • the other risks and uncertainties described in this Annual Report on Form 10-K.
All these restrictions described above make it more difficult for us to provide the most relevant ads to our users, measure the effectiveness of, and to re-target and optimize, advertising on our platform. We have developed Pinterest API for Conversions and other measurement tools to address these restrictions, which are all designed to mitigate loss of conversion signal.
All these restrictions described above make it more difficult for us to provide the most relevant ads to our users, measure the effectiveness of, and to re-target and optimize, advertising on our platform. We have developed the Pinterest Conversions API and other measurement tools to address these restrictions, which are all designed to mitigate loss of conversion signal.
In addition, any resulting issued patents may have claims narrower than those in our patent applications. There can be no assurance that each of our trademark applications will result in the issuance of a trademark or that each resulting trademark registration will be able to be maintained.
In addition, any resulting issued patents may have claims narrower than those in our patent applications. There can be no assurance that each of our trademark registration applications will result in the issuance of a trademark or that each resulting trademark registration will be able to be maintained.
There are numerous federal, state, local and foreign laws and regulations regarding matters central to our business, data privacy and the collection, storing, sharing, use, processing, disclosure and protection of personal information and other data from users, employees and business partners, the scope of which are regularly changing, subject to uncertain and differing interpretations and may be inconsistent among countries or conflict with other rules.
There are numerous federal, state, local and foreign laws and regulations regarding matters central to our business, data privacy and the collection, storing, sharing, use, processing, disclosure and protection of personal information and other data from users, employees and business partners, the scope of which are regularly changing, subject to uncertain and differing interpretations and may be inconsistent among countries or states or conflict with other rules.
These and other decisions we make related to data privacy, including with respect to the privacy-centric advertising performance measurement tools that we have developed and may develop in the future, may fall short of our users’ expectations, and even if we satisfy their expectations, the increase in media attention generally about online privacy and data protection may motivate users to take certain actions to protect their privacy.
These and other decisions we make related to data privacy, including with respect to the advertising performance measurement tools that we have developed and may develop in the future, may fall short of our users’ expectations, and even if we satisfy their expectations, the increase in media attention generally about online privacy and data protection may motivate users to take certain actions to protect their privacy.
Any other restriction, whether by law, regulation, policy (including third-party policies) or otherwise, on our ability to collect and share data that our advertisers find useful, our ability to use or benefit from tracking and measurement technologies, including cookies, or that further reduces our ability to measure the effectiveness of advertising on our platform would impede our ability to attract, grow and retain advertisers.
Any other restriction, whether by law, regulation, policy (including third-party policies) or otherwise, on our ability to collect, process and share data that our advertisers find useful, our ability to use or benefit from tracking and measurement technologies, including cookies, or that further reduces our ability to measure the effectiveness of advertising on our platform would impede our ability to attract, grow and retain advertisers.
In addition, third-party log-in providers may institute policies that restrict us from both communicating with users or identifying users. As a result of these actions, user growth, retention and engagement on our platform has been and could be adversely affected in the future, even if for a temporary period.
In addition, third-party log-in providers may institute policies that restrict us from both communicating with users or identifying users. As a result of these actions, user growth, retention and engagement on our platform has been and could be adversely affected in the future, even if only for a temporary period.
Any incidents where users’, creators', publishers', advertisers' or our information is accessed without authorization or is improperly used, or incidents that violate our privacy policy, terms of service or other policies, or the perception that an incident has occurred, could damage our brand and reputation, adversely impact our competitive position and result in significant costs.
Any incidents where personnel's, users’, creators', publishers', advertisers' or our information is accessed without authorization or is improperly used, or incidents that violate our privacy policy, terms of service or other policies, or the perception that an incident has occurred, could damage our brand and reputation, adversely impact our competitive position and result in significant costs.
Our amended and restated certificate of incorporation provides that, unless we consent in writing to the selection of an alternative forum, the sole and exclusive forum for (i) any derivative action or proceeding brought on our behalf, (ii) any 38 Part I action asserting a claim of breach of a fiduciary duty owed by any of our current or former directors, officers or other employees to us or our stockholders, (iii) any action arising pursuant to any provision of the DGCL, or as to which the DGCL confers jurisdiction on the Court of Chancery of the State of Delaware or (iv) any other action asserting a claim that is governed by the internal affairs doctrine shall be the Court of Chancery of the State of Delaware (or, if the Court of Chancery does not have jurisdiction, any state or federal district court in the state of Delaware), in all cases subject to the court’s having jurisdiction over indispensable parties named as defendants.
Our amended and restated certificate of incorporation provides that, unless we consent in writing to the selection of an alternative forum, the sole and exclusive forum for (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim of breach of a fiduciary duty owed by any of our current or former directors, officers or other employees to us or our stockholders, (iii) any action arising pursuant to any provision of the DGCL, or as to which the DGCL confers jurisdiction on the Court of Chancery of the State of Delaware or (iv) any other action asserting a claim that is governed by the internal affairs doctrine shall be the Court of Chancery of the State of Delaware (or, if the Court of Chancery does not have jurisdiction, any state or federal district court in the state of Delaware), in all cases subject to the court’s having jurisdiction over indispensable parties named as defendants.
Advertisers will not do, or continue to do, business with us if they do not believe that advertisements on our platform are effective in meeting their campaign goals, if we cannot measure the effectiveness of our advertising products or if they do not believe that their investment in advertising with us will generate a competitive return relative to other alternatives.
Advertisers will not do business with us if they do not believe that advertisements on our platform are effective in meeting their campaign goals, if we cannot measure the effectiveness of our advertising products or if they do not believe that their investment in advertising with us will generate a competitive return relative to other alternatives.
Factors that could cause fluctuations in the trading price of our Class A common stock include the following: • price and volume fluctuations in the overall stock market from time to time; • volatility in the trading prices and trading volumes of technology stocks; • changes in operating performance and stock market valuations of other technology companies generally, or those in our industry in particular; • sales, or anticipated sales, of shares of our Class A common stock by us or our stockholders, including when stockholders sell shares of our Class A common stock into the market to cover taxes due upon the settlement of RSUs or the exercise of stock options, or conversions, or anticipated conversions, of a substantial number of shares of our Class B common stock by our stockholders; • actions and investment positions taken by institutional and other stockholders, including activist investors; • failure by industry or securities analysts to maintain coverage of us, downgrade of our Class A common stock by analysts or provision of a more favorable recommendation of our competitors; • failure by analysts to regularly publish research reports or the publication of an unfavorable or inaccurate report about our business; • changes by external analysts to their financial and operating estimates for our company or our performance relative to third parties' estimates or the expectations; • forward-looking financial or operating information or financial projections we may provide to the public, any changes in that information or projections or our failure to meet projections; • any indebtedness we may incur in the future; • whether investors or securities analysts view our stock structure unfavorably, particularly our dual class structure and the significant voting control of holders of our Class B common stock; • announcements by us or our competitors of new products, features, services, technical innovations, acquisitions, strategic partnerships, joint ventures or capital commitments; • announcements by us or estimates by third parties of actual or anticipated changes in the size of our user base or level of engagement, or those of our competitors; • the public’s perception of the quality and accuracy of our key metrics on our user base and engagement; 36 Part I • the public’s reaction to our press releases, other public announcements and filings with the SEC; • rumors and market speculation involving us or other companies in our industry; • actual or anticipated fluctuations in our user growth, retention, engagement, revenue or other operating results; • actual or anticipated developments in our business, our competitors’ businesses or the competitive landscape generally; • litigation involving us, our industry, or both, or investigations by regulators and other third parties into our operations or those of our competitors; • developments or disputes concerning our intellectual property or other proprietary rights; • developments or disputes concerning our culture or other diversity, equity and inclusion practices and initiatives; • announced or completed acquisitions of businesses, products, services or technologies by us or our competitors; • existing, new and evolving regulations, both in the U.S. and internationally; • changes in accounting standards, policies, guidelines, interpretations or principles; • any significant changes in our management; • stakeholder dissatisfaction if we are unable to meet stakeholders' expectations and requirements or our publicly announced goals around environmentally friendly, ethical, socially conscious, and sustainable business practices or disclosures; • adoption and trading under a stock repurchase program; • if we are unable to address any workplace culture related issues (including to meet the goals we set in our Inclusion and Diversity Report that we publish periodically); • macroeconomic events that are beyond our control; and • general economic conditions and slow or negative growth of our markets.
Factors that could cause fluctuations in the trading price of our Class A common stock include the following: • price and volume fluctuations in the overall stock market from time to time; • volatility in the trading prices and trading volumes of technology stocks; • changes in operating performance and stock market valuations of other technology companies generally, or those in our industry in particular; • sales, or anticipated sales, of shares of our Class A common stock by us or our stockholders, including when stockholders sell shares of our Class A common stock into the market to cover taxes due upon the settlement of RSUs or the exercise of stock options, or conversions, or anticipated conversions, of a substantial number of shares of our Class B common stock by our stockholders; • actions and investment positions taken by institutional and other stockholders, including activist investors; • failure by industry or securities analysts to maintain coverage of us, downgrade of our Class A common stock by analysts or provision of a more favorable recommendation of our competitors; • failure by analysts to regularly publish research reports or the publication of an unfavorable or inaccurate report about our business; • changes by external analysts to their financial and operating estimates for our company or our performance relative to third parties' estimates or the expectations; • forward-looking financial or operating information or financial projections we may provide to the public, any changes in that information or projections or our failure to meet projections; • any indebtedness we may incur in the future; • whether investors or securities analysts view our stock structure unfavorably, particularly our dual class structure and the significant voting control of holders of our Class B common stock; • announcements by us or our competitors of new products, features, services, technical innovations, acquisitions, strategic partnerships, joint ventures or capital commitments; • announcements by us or estimates by third parties of actual or anticipated changes in the size of our user base or level of engagement, or those of our competitors; • the public’s perception of the quality and accuracy of our key metrics on our user base and engagement; • the public’s reaction to our press releases, other public announcements and filings with the SEC; • rumors and market speculation involving us or other companies in our industry; • actual or anticipated fluctuations in our user growth, retention, engagement, revenue or other operating results; • actual or anticipated developments in our business, our competitors’ businesses or the competitive landscape generally; • litigation involving us, our industry, or both, or investigations by regulators and other third parties into our operations or those of our competitors; • developments or disputes concerning our intellectual property or other proprietary rights; • developments or disputes concerning our culture or other inclusion practices and initiatives or the inability to address any workplace culture related issues; • announced or completed acquisitions of businesses, products, services or technologies by us or our competitors; • existing, new and evolving regulations, both in the U.S. and internationally; • changes in accounting standards, policies, guidelines, interpretations or principles; • any significant changes in our management; 36 Part I • stakeholder dissatisfaction if we are unable to meet stakeholders' expectations and requirements or our publicly announced goals around environmentally friendly, ethical, socially conscious, and sustainable business practices or disclosures; • adoption and trading under a stock repurchase program; • macroeconomic events that are beyond our control, including tariffs; and • general economic conditions and slow or negative growth of our markets.
We endeavor to keep divisive, disturbing or unsafe content off our platform. We do this by deactivating or limiting the distribution of certain types of content, even if this content would be permitted on other platforms, which could result in a decrease in user growth, retention or engagement.
We endeavor to keep divisive, disturbing or unsafe content off our platform by deactivating or limiting the distribution of certain types of content, even if this content would be permitted on other platforms, which could result in a decrease in user growth, retention or engagement.
In order to increase the number of advertisers and increase the portion of the advertising budget that our existing advertisers spend with us, we must invest in new tools and technology and/or expand our sales force, and there can be no assurance that those efforts will be successful.
To increase the number of advertisers and increase the portion of the advertising budget that our existing advertisers spend with us, we must invest in new tools and technology and/or expand our sales force, and there can be no assurance that those efforts will be successful.
Further, when our revenue, users or other operating results fall below the expectations of investors or securities analysts or below any guidance we may provide to the market, the price of our Class A common stock has declined and could likely decline in the future.
Further, when our revenue, users or operating results fall below the expectations of investors or securities analysts or below any guidance we may provide to the market, the price of our Class A common stock has declined and could likely decline in the future.
Public statements against us by consumer advocacy groups or others could also cause users to lose trust in us, which could result in declines in user growth, retention or engagement and have an adverse effect on our brand, reputation and business.
Public statements and complaints against us by consumer advocacy groups or others could also cause users to lose trust in us, which could result in declines in user growth, retention or engagement and have an adverse effect on our brand, reputation and business.
We are subject to GDPR which expands the rights of individuals to control how their personal data is processed, includes restrictions on the use of personal data of children, creates new regulatory and operational requirements for processing personal data (in particular in case of a data breach), increases requirements for security and confidentiality, restricts transfers of data outside of the European Economic Area and provides for significant penalties for non-compliance, including fines of up to 4% of global annual turnover for the preceding financial year or €20 million (whichever is higher) for the most serious infringements.
We are subject to GDPR which expands the rights of individuals to control how their personal data is processed, includes restrictions on the use of personal data of children, creates new regulatory and operational requirements for processing personal data (particularly in the case of a data breach), increases requirements for security and confidentiality, restricts transfers of data outside of the European Economic Area and provides for significant penalties for non-compliance, including fines of up to 4% of global annual turnover for the preceding financial year or €20 million (whichever is higher) for the most serious infringements.
We currently have Class B common stock that may be issued upon exercise of outstanding stock options or upon settlement of outstanding RSUs, shares of Class A common stock that may be issued upon settlement of outstanding RSUs or outstanding restricted stock awards ("RSAs"). For more information, see “Notes to Financial Statements”.
We currently have shares of Class B common stock that may be issued upon exercise of outstanding stock options and shares of Class A common stock that may be issued upon settlement of outstanding stock options, RSUs, or restricted stock awards ("RSAs"). For more information, see “Notes to Financial Statements”.
In addition, all shares of Class B common stock will automatically convert into shares of Class A common stock on (i) the seven-year anniversary of the closing date of our IPO, except with respect to shares of Class B common stock held by any holder that continues to beneficially own at least 50% of the number of shares of Class B common stock that such holder beneficially owned immediately prior to 35 Part I completion of our IPO, and (ii) a date that is between 90 to 540 days, as determined by the board of directors, after the death or permanent incapacity of Mr.
In addition, all shares of Class B common stock will automatically convert into shares of Class A common stock on (i) the seven-year anniversary of the closing date of our IPO, except with respect to shares of Class B common stock held by any holder that continues to beneficially own at least 50% of the number of shares of Class B common stock that such holder beneficially owned immediately prior to completion of our IPO, and (ii) a date that is between 90 to 540 days, as determined by the board of directors, after the death or permanent incapacity of Mr.
We believe that our ability to compete for advertisers depends upon many factors both within and beyond our control, including: • sales, marketing, customer service and support efforts; • first- and third-party data available to us relative to our competitors; • ease of use, performance, price and reliability of solutions developed either by us or our competitors; 18 Part I • the attractiveness and volume of our product and service offerings (including pricing and measurement tools) compared to those of our competitors; • the strength of our advertiser relationships and offerings compared to those of our competitors; • the ease with which our advertising products fit into existing advertiser budgets compared to those of our competitors; • positions or actions taken by us, users, advertisers or other third parties that may impact our brand and reputation or the desirability of advertising on online platforms in general; and • the other risks and uncertainties described in this Annual Report on Form 10-K.
We believe that our ability to compete for advertisers depends upon many factors both within and beyond our control, including: • sales, marketing, customer service and support efforts; • first- and third-party data available to us relative to our competitors; • ease of use, performance, price and reliability of solutions developed either by us or our competitors; • the attractiveness and volume of our product and service offerings (including pricing and measurement tools) compared to those of our competitors; • the strength of our advertiser relationships and offerings compared to those of our competitors; • the ease with which our advertising products fit into existing advertiser budgets compared to those of our competitors; • positions or actions taken by us, users, advertisers or other third parties that may impact our brand and reputation or the desirability of advertising on online platforms in general; and • the other risks and uncertainties described in this Annual Report on Form 10-K.
These risks include: 19 Part I • political, social and economic instability, including armed conflict or hostilities, such as Russia's invasion of Ukraine and the war in the Middle East; • selective or inconsistent government regulatory action or enforcement; • fluctuations in currency exchange rates and restrictions on currency conversions; • higher levels of credit risk and payment fraud; • enhanced difficulties of integrating any foreign acquisitions; • reduced protection for intellectual property rights in some countries; • difficulties in staffing and managing global operations and the increased travel, infrastructure and legal and tax compliance costs associated with multiple international locations and subsidiaries; • different regulations and practices with respect to employee/employer relationships, existence of workers’ councils and labor unions, and other challenges caused by distance, language and cultural differences, making it harder to do business in certain international jurisdictions; • increasing labor costs due to high wage inflation in certain international jurisdictions; • compliance with statutory requirements relating to our equity; • regulations that might add difficulties in repatriating cash earned outside the United States and otherwise prevent us from freely moving cash; • import and export controls and restrictions and changes in trade regulations, including sanctions; • compliance with the U.S.
These risks include: • political, social and economic instability, including armed conflict or hostilities, such as Russia's invasion of Ukraine and the war in the Middle East; • selective or inconsistent government regulatory action or enforcement; • fluctuations in currency exchange rates and restrictions on currency conversions; • higher levels of credit risk and payment fraud; • enhanced difficulties of integrating any foreign acquisitions; • reduced protection for intellectual property rights in some countries; • difficulties in staffing and managing global operations and the increased travel, infrastructure and legal and tax compliance costs associated with multiple international locations and subsidiaries; • different regulations and practices with respect to employee/employer relationships, existence of workers’ councils and labor unions, and other challenges caused by distance, language and cultural differences, making it harder to do business in certain international jurisdictions; • increasing labor costs due to high wage inflation in certain international jurisdictions; • compliance with statutory requirements relating to our equity; • regulations that might add difficulties in repatriating cash earned outside the United States and otherwise prevent us from freely moving cash; • import and export controls and restrictions and changes in trade regulations, including sanctions or increased or new tariffs; • compliance with the U.S.
Bribery Act and similar laws in other jurisdictions; • compliance with laws governing supply chains and related business operations; • compliance with environmental, social and governance (ESG) laws and with GDPR and similar data privacy and data protection laws; • compliance with laws that might restrict content or advertising, require us to provide user information, including confidential information, to local authorities or add significant requirements that make it difficult to operate in that jurisdiction; • macroeconomic conditions, such as inflation and labor shortage which had an impact on the pace of our global expansion; • compliance with multiple tax jurisdictions and management of tax impact of global operations; and • the other risks and uncertainties described in this Annual Report on Form 10-K.
Bribery Act and similar laws in other jurisdictions; • compliance with laws governing supply chains and related business operations; • compliance with environmental, social and governance (ESG) laws and with GDPR and similar data privacy and data protection laws; • compliance with laws that might restrict content or advertising (such as laws intended to protect teens), require us to provide user information, including confidential information, to local authorities or add significant requirements that make it difficult to operate in that jurisdiction; • macroeconomic conditions, such as inflation and labor shortage which had an impact on the pace of our global expansion; • compliance with multiple tax jurisdictions and management of tax impact of global operations; and • the other risks and uncertainties described in this Annual Report on Form 10-K.
We rely heavily on our ability to collect and share data and metrics for our advertisers to help new and existing advertisers understand the performance of advertising campaigns.
We rely heavily on our ability to collect, process and share data and metrics for our advertisers to help new and existing advertisers understand the performance of advertising campaigns.
A substantial portion of our revenue is derived from a small number of advertisers and is currently concentrated in certain verticals, particularly CPG and retail. We either contract directly with advertisers or with advertising agencies on behalf of advertisers. Many of these advertising agencies are owned by large media corporations that exercise varying degrees of control over the agencies.
A substantial portion of our revenue is derived from a small number of advertisers and is currently concentrated in certain verticals, particularly CPG and retail. We either contract directly with advertisers or with advertising agencies on behalf of advertisers, many of which are owned by large media corporations that exercise varying degrees of control over the agencies.
Any failure or perceived failure by us to comply with our privacy policies, data privacy-related obligations to users or other third parties, or our data privacy-related legal obligations, or any compromise of security that results in the unauthorized release or transfer of personally identifiable information or other user data, or other failure to comply with these laws and 24 Part I regulations, or regulatory scrutiny, can result in governmental enforcement actions or litigation that could expose our business to substantial financial penalties, or other monetary or non-monetary relief, negative publicity, loss of confidence in our products, decline in user or advertiser growth or damage to our brand and reputation.
Any failure or perceived failure by us to comply with our privacy policies, data privacy-related obligations to users or other third parties, or our data privacy-related legal obligations, or any compromise of security that results in the unauthorized release or transfer of personally identifiable information or other user data, or other failure to comply with these laws and regulations, or regulatory scrutiny, can result in governmental enforcement actions or litigation that could expose our business to substantial financial penalties, or other monetary or non-monetary relief, negative publicity, loss of confidence in our products, decline in user or advertiser growth or damage to our brand and reputation.
In addition, our brand, identity and reputation may be adversely affected by perceptions of social media platforms in general, including perceptions resulting from factors unrelated to the company’s actions or the content or actions of users, such as the boycott of Facebook and X (formerly Twitter) by some advertisers or allegations of the impact of social media on the mental health of users.
In addition, our brand, identity and reputation may be adversely affected by perceptions of social media platforms in general, including perceptions resulting from factors unrelated to the company’s actions or the content or actions of users, such as the boycott of Facebook and X by some advertisers or allegations of the impact of social media on the mental health of users.
Governmental authorities outside the United States have restricted, and may in the future seek to restrict access to our platform if they consider us to be in violation of their laws or for other reasons. For example, access to our service has been 29 Part I or is currently restricted in whole or in part in certain countries.
Governmental authorities outside the United States have restricted, and may in the future seek to restrict access to our platform if they consider us to be in violation of their laws or for other reasons. For example, access to our service has been or is currently restricted in whole or in part in certain countries.
Our brand and reputation can also be negatively affected by the content or actions of our users that are deemed to be hostile or inappropriate to other users, by the actions of our users acting under false or inauthentic identities, by the use of our products or services to disseminate information that is deemed to be misleading, or by the use of our platform for illicit, illegal or objectionable ends.
Our brand and reputation can also be negatively affected by the content or actions of our users that are deemed to be harmful or inappropriate to other users, by the actions of our users acting under false or inauthentic identities, by the use of our products or services to disseminate information that is deemed to be misleading, or by the use of our platform for illicit, illegal or objectionable ends.
If any of the events described above occur, our information or users’, creators', publishers' or advertisers' information could be accessed or disclosed improperly.
If any of the events described above occur, our information or personnel's, users', creators', publishers' or advertisers' information could be accessed or disclosed improperly.
Additionally, even if not prohibited by data privacy laws and regulations, we may elect not to collect certain types of data if we believe doing so would be inconsistent with our users’ expectations, if the source is unreliable or for any other reason.
Additionally, even if not prohibited by data privacy laws, regulations, and legal decisions, we may elect not to collect certain types of data if we believe doing so would be inconsistent with our users’ expectations, if the source is unreliable or for any other reason.
In addition, new content and new or different forms of content we distribute may not have as much relevancy signal for optimal distribution of the pins as prior content and forms of content that have been saved repeatedly on our platform, which may result in lower users engagement with such content.
In addition, new content and new or different forms of content we distribute may not have as much relevancy signal for optimal distribution of the Pins as prior content and forms of content that have been saved repeatedly on our platform, which may result in lower user engagement with such content.
We have filed various applications for certain aspects of our intellectual property in the United States and other countries, and we currently hold issued patents in multiple jurisdictions. Further, there can be no assurance that each of our patent applications will result in the issuance of a patent.
We have filed various applications for certain aspects of our intellectual property in the United States and other countries, and we currently hold issued patents in multiple jurisdictions. However, there can be no assurance that each of our patent applications will result in the issuance of a patent.
Our status as a Delaware corporation and the anti-takeover provisions of the Delaware General Corporation Law (the “DGCL”) may discourage, delay or prevent a change in control by prohibiting us from engaging in a business combination with an interested stockholder for a period of three years after the person becomes an interested stockholder, even if a change of control would be beneficial to our existing stockholders.
Our status as a Delaware corporation and the anti-takeover provisions of the Delaware General Corporation Law (the “DGCL”) may discourage, delay or prevent a change in control by prohibiting us from engaging in a business combination 37 Part I with an interested stockholder for a period of three years after the person becomes an interested stockholder, even if a change of control would be beneficial to our existing stockholders.
We compete with large, established companies and companies that offer widely used products, such as Amazon, Meta (including Instagram), Google (including YouTube), Snap, TikTok and X (formerly Twitter), which provide their users with a variety of online products, services, content (including video), and offerings, and advertising offerings, including web search engines, social networks and other means of discovering, using or acquiring goods and services.
We compete with large, established companies and companies that offer widely used products, such as Amazon, Meta (including Instagram), Google (including YouTube), Snap, Reddit, TikTok and X, which provide their users with a variety of online products, services, content (including video), and other offerings, and advertising offerings, including web search engines, social networks and other means of discovering, using or acquiring goods and services.
If we are unable to meet employees and potential employees' expectations, we may experience difficulties attracting and retaining personnel.
If we are unable to meet employees' and potential employees' expectations, we may experience difficulties attracting and retaining personnel.
They may not need to rely on third-party data, including data provided by advertisers, in order to effectively target the campaigns of advertisers, which could make their advertising products more attractive to advertisers than ours as third-party data becomes less available to us, whether because of regulatory changes, privacy concerns or other reasons.
They may not need to rely on third-party data, including data provided by advertisers, in order to effectively target the campaigns of advertisers, 17 Part I which could make their advertising products more attractive to advertisers than ours as third-party data becomes less available to us, whether because of regulatory changes, privacy concerns or other reasons.
However, there is no guarantee that advertisers will use this technology or future technologies that we develop, or that these technologies will otherwise be effective to improve conversion visibility and enable the use of 23 Part I conversion data for retargeting in future advertising campaigns. Advertisers may also prioritize integrations with larger platforms due to larger spend concentration.
However, there is no guarantee that advertisers will use this technology or future technologies that we develop, or that these technologies will otherwise be effective to improve conversion visibility and enable the use of conversion data for retargeting in future advertising campaigns. Advertisers may also prioritize integrations with larger platforms due to larger spend concentration.
Any proceedings, claims or inquiries involving us, whether successful or not, can be time consuming, result in costly litigation, unfavorable outcomes, high indemnification expenses, increased costs of business, may require us to change our business practices or products, require significant amount of management’s time, may harm our reputation or otherwise harm our business and future financial results.
Any proceedings, claims or inquiries involving us, whether successful or not, can be time consuming, result in costly litigation, unfavorable outcomes, high indemnification expenses, increased costs of business, may require us to change our business practices or products, product offerings and features, require significant amount of management’s time, may harm our reputation or otherwise harm our business and future financial results.
Any of the foregoing could disrupt our ability to offer our products and harm our business, revenue and financial results. The interpretation and application of U.S. tax legislations or other changes in U.S. or non-U.S. taxation of our operations could harm our business, revenue and financial results.
Any of the foregoing could disrupt our ability to offer our products and harm our business, revenue and financial results. The interpretation and application of U.S. tax legislation or other changes in U.S. or non-U.S. taxation of our operations could harm our business, revenue and financial results.
Such conditions have resulted in or may result in, among other things, an adverse impact on the ability and willingness of companies to spend on advertising, volatility in our stock price, and an adverse impact on the financial condition of the institutions with whom we hold deposits or the credit quality of the issuers of our cash equivalents and marketable securities.
Such conditions have resulted in or may result in, among other things, an adverse impact on the ability and willingness of companies to spend on advertising, volatility in our stock price, and an 34 Part I adverse impact on the financial condition of the institutions with whom we hold deposits or the credit quality of the issuers of our cash equivalents and marketable securities.
Advancements in technology such as AI and machine learning are changing the way people work by automating tasks, enhancing communication, and improving decision-making processes, and our business may be harmed or we may face competitive disadvantage if we are slow to adopt these new technologies.
Advancements in technology such as AI and machine learning are changing the way people work by automating tasks, enhancing communication, and improving decision-making processes, and our business may be harmed or we may face 19 Part I competitive disadvantage if we are slow to adopt these new technologies.
For these and other reasons, our users may elect not to allow data sharing. This could impact our ability to deliver relevant content aligned with users’ personal taste and interests.
For these and other reasons, our users may elect not to allow data sharing or use. This could impact our ability to deliver relevant content aligned with users’ personal taste and interests.
In addition, third parties have in the past and may in the future may attempt to induce our employees, users, creators, publishers, advertisers or vendors to disclose information to gain access to our data, advertisers' data or users’ data.
In addition, third parties have in the past and may in the future attempt to induce our personnel, users, creators, publishers, advertisers or vendors to disclose information to gain access to our data, advertisers' data or users’ data.
We may launch our advertising platform in countries where we do not have sales staffing in place, where market perception of our service and ad platform may be low or where our audience size in a given market may be low relative to advertiser expectations, all or any of which could limit our ability to monetize those countries.
We may launch our advertising platform in countries where we do not have sales staffing 18 Part I in place, where market perception of our service and ad platform may be low or where our audience size in a given market may be low relative to advertiser expectations, all or any of which could limit our ability to monetize those countries.
If AWS increases pricing terms, terminates or seeks to terminate our contractual relationship, establishes more favorable relationships with our competitors, or changes or interprets its terms of service or policies in a manner that is unfavorable, those actions could harm our business, revenue and financial results.
If AWS increases pricing terms, terminates or seeks to terminate our 27 Part I contractual relationship, establishes more favorable relationships with our competitors, or changes or interprets its terms of service or policies in a manner that is unfavorable, those actions could harm our business, revenue and financial results.
Additionally, our current and future patents, trademarks and other intellectual property or other proprietary rights may be contested, circumvented or found unenforceable or invalid. 30 Part I Third parties may knowingly or unknowingly infringe or challenge our proprietary rights. Effective intellectual property protection may not be available in every country in which we operate or intend to operate our business.
Additionally, our current and future patents, trademarks and other intellectual property or other proprietary rights may be contested, circumvented or found unenforceable or invalid. Third parties may knowingly or unknowingly infringe or challenge our proprietary rights. Effective intellectual property protection may not be available in every country in which we operate or intend to operate our business.
Our operating results depend on numerous factors, many of which are outside of our control, including: • our ability to generate revenue from our platform; • our ability to improve or maintain gross margins; • the number and relevancy of advertisements shown to users; • the relevancy of content shown to users; • the manner in which users engage with different products, where certain products may cause us to generate less revenue; • downward pressure on the pricing of our advertisements; • the timing, cost and mix of new and existing marketing and promotional efforts as we grow and expand our operations to remain competitive; • fluctuations (seasonal or otherwise) in spending by our advertisers and platform usage and engagement by users, each of which may change as our product offerings and business evolves; • seasonal fluctuations in engagement on our platform, including our historical experience of lower engagement in our second quarter; • fluctuations in spending by our advertisers and platform usage and engagement by users due to macroeconomic conditions, such as the stress in the banking industry and current inflationary environment; • seasonal fluctuations in internet usage generally; • the success of technologies designed to block the display of ads; • development and introduction of new product offerings by us or our competitors; • existing, new and evolving regulations, both in the U.S. and internationally; • the ability of our third-party providers to scale effectively and provide the necessary technical infrastructure for our service on a timely basis; • system failures, disruptions, breaches of security or data privacy or internet downtime, whether on our service or on those of third parties; 32 Part I • the inaccessibility of our service due to third-party actions; • changes in measurement of our metrics; • costs associated with the technical infrastructure used to operate our business, including hosting services; • fluctuations in the amount of share-based compensation expense; • fluctuations, caused by stock price volatility, in the amount we spend to fund tax withholding and remittance obligations related to the vesting and settlement of restricted stock units ("RSUs") as we continue to net settle such RSUs; and • our ability to anticipate and adapt to the changing internet business or macroeconomic conditions; and the other risks and uncertainties described in this Annual Report on Form 10-K.
Our operating results depend on numerous factors, many of which are outside of our control, including: • our ability to generate revenue from our platform; • our ability to improve or maintain gross margins; • our ability to maintain operating margins, cash used in operating activities and free cash flow; • the number and relevancy of advertisements shown to users; • the relevancy of content shown to users; • the manner in which users engage with different products, where certain products may cause us to generate less revenue; • downward pressure on the pricing of our advertisements; • the timing, cost and mix of new and existing marketing and promotional efforts as we grow and expand our operations to remain competitive; • fluctuations (seasonal or otherwise) in spending by our advertisers and platform usage and engagement by users, each of which may change as our product offerings and business evolves; • seasonal fluctuations in engagement on our platform, including our historical experience of lower engagement in our second quarter; • fluctuations in spending by our advertisers and platform usage and engagement by users due to macroeconomic conditions, such as the stress in the banking industry, inflation or new or increased tariffs; • seasonal fluctuations in internet usage generally; • the success of technologies designed to block the display of ads; • development and introduction of new product offerings by us or our competitors; • the enforcement of our advertising policies, including the removal of ads and advertisers from our platform; • existing, new and evolving regulations, both in the U.S. and internationally; • the ability of our third-party providers to scale effectively and provide the necessary technical infrastructure for our service on a timely basis; 32 Part I • system failures, disruptions, breaches of security or data privacy or internet downtime, whether on our service or on those of third parties; • the inaccessibility of our service due to third-party actions; • changes in measurement of our metrics; • costs associated with the technical infrastructure used to operate our business, including hosting services; • fluctuations in the amount of share-based compensation expense; • fluctuations, caused by stock price volatility, in the amount we spend to fund tax withholding and remittance obligations related to the vesting and settlement of restricted stock units ("RSUs") as we continue to net settle such RSUs; and • our ability to anticipate and adapt to the changing internet business or macroeconomic conditions; and the other risks and uncertainties described in this Annual Report on Form 10-K.
Any scrutiny, inquiry, investigation or action, including regarding our data 21 Part I privacy, copyright, content, employment or other practices, workplace culture, charitable giving, product changes, product quality, litigation or regulatory action or regarding the actions of our employees, users or advertisers or other issues, may harm our brand and reputation.
Any scrutiny, inquiry, investigation or action, including regarding our data privacy, copyright, content, employment or other practices, workplace culture, charitable giving, product changes, product quality, litigation or regulatory action or regarding the actions of our employees, users or advertisers or other issues, may harm our brand and reputation.
This risk may increase as we develop and increase the use of certain products or product features, such as video and live streaming content, for which identifying such content is challenging.
This risk may increase as we develop and increase the use of certain products or product features, such as video content, for which identifying such content is challenging.
We also may fail to respond expeditiously to the sharing of illegal, illicit or objectionable content on our platform or objectionable practices by advertisers, or to otherwise address user or advertiser concerns, which could erode confidence in our brand and damage our reputation.
We also may fail to respond expeditiously to the sharing of illegal, illicit or objectionable content on our platform or objectionable practices by advertisers, or to otherwise address user or advertiser concerns, 20 Part I which could erode confidence in our brand and damage our reputation.
Many of these competitors have longer operating histories, significantly greater financial, technical, research, marketing and other resources and larger user bases than we do.
Several of these competitors have longer operating histories, significantly greater financial, technical, research, marketing and other resources and larger user bases than we do.
As such, it is not possible to predict all of the risks related to the use of AI, and developments in regulatory frameworks governing the use of AI and in related stakeholder expectations may adversely affect our ability to develop and use AI or subject us to liability.
As such, it is not possible to predict all of the risks related to 21 Part I the use of AI, and developments in regulatory frameworks governing the use of AI and in related stakeholder expectations may adversely affect our ability to develop and use AI or subject us to liability.
Even if we were able to obtain new financing, it may not be on commercially reasonable terms or on terms that are acceptable to us. Additionally, our revolving credit facility utilizes SOFR or various alternative methods set forth in our revolving credit facility to calculate the amount of accrued interest on any borrowings.
Even if we were able to obtain new financing, it may not be on commercially reasonable terms or on terms that are acceptable to us. Additionally, our revolving credit facility utilizes a Secured Overnight Financing Rate ("SOFR") or various alternative methods set forth in our revolving credit facility to calculate the amount of accrued interest on any borrowings.
Further changes to the U.S. or non-U.S. taxation of our operations may increase our worldwide effective tax rate, result in additional taxes or other costs or have other material consequences, which could harm our business, revenue and financial results. 31 Part I Risks Relating to Our Financial Statements and Performance We have a limited operating history with the current scale of our business, and, as a result, our past results may not be indicative of future operating performance.
Further changes to the U.S. or non-U.S. taxation of our operations may increase our worldwide effective tax rate, resulting in additional taxes or other costs or have other material consequences. 31 Part I Risks Relating to Our Financial Statements and Performance We have a limited operating history with the current scale of our business, and, as a result, our past results may not be indicative of future operating performance.
Under the agreement with AWS, in return for negotiated concessions, we currently are required to maintain a substantial majority of our monthly usage of certain compute, storage, data transfer and other services on AWS.
Under our long-term agreement with AWS, in return for negotiated concessions, we currently are required to maintain a substantial majority of our monthly usage of certain compute, storage, data transfer and other services on AWS.
These frameworks and defenses may limit but do not necessarily eliminate, our potential liability for caching, hosting, listing or linking to third-party content that may include materials that infringe copyrights.
These frameworks and defenses may limit but do not necessarily eliminate, our potential liability for caching, hosting, listing or linking to third-party content that may include materials that infringe copyrights or are otherwise unlawful.
We may acquire other businesses, talent or technology, which could require significant management attention, disrupt our business, dilute stockholder value and harm our business, revenue and financial results. As part of our business strategy, we have made and intend to make acquisitions to add specialized employees and complementary companies, products or technologies.
We may acquire other businesses, talent or technology, which could require significant management attention, disrupt our business and dilute stockholder value. As part of our business strategy, we have made and intend to make acquisitions to add specialized employees and complementary companies, products or technologies.
These actions grow our users due to signups of new users and increase retention and engagement of existing users. 26 Part I Our ability to maintain and increase the number of users directed to our platform from search engines is not within our control.
These actions grow our users due to signups of new users and increase retention and engagement of existing users. Our ability to maintain and increase the number of users directed to our platform from search engines is not within our control.
We are currently involved in and have been subject to actual and threatened litigation with respect to third-party patents, trademarks, copyrights and other intellectual property, and may continue to be subject to intellectual property litigation and threats thereof.
We are currently involved in, have been subject to, and expect to be subject in the future to actual and threatened litigation with respect to third-party patents, trademarks, copyrights and other intellectual property, and may continue to be subject to intellectual property litigation and threats thereof.
Such changes include limiting the use of first-party and third-party cookies and related tracking technologies, such as mobile advertising identifiers, and other changes that limit our ability to collect information that allows us to attribute user actions on advertisers’ websites to the effectiveness of advertising campaigns run on our platform.
Such changes include, limiting the use of cookies and related tracking technologies, such as mobile advertising identifiers, and other changes that limit our ability to collect or use information that allows us to attribute user actions on advertisers’ websites to the effectiveness of advertising campaigns run on our platform.
In the future we may acquire additional patents or patent portfolios, license patents from third parties or agree to license the use of our patents to third parties, which could require significant cash expenditures.
In the future we may acquire additional patents or patent portfolios, license patents from third parties or agree to license the use of our patents to third parties, which could 30 Part I require significant cash expenditures.
We face significant competition to attract, retain and engage users and for their time and attention. We compete with consumer internet companies that are either tools (search, e-commerce, creator tools) or media (newsfeeds, video, social networks).
We may be unable to compete effectively for users. We face significant competition to attract, retain and engage users and for their time and attention. We compete with consumer internet companies that are either tools (search, e-commerce, creator tools) or media (newsfeeds, video, social networks).
We may need to notify government authorities or affected users regarding security incidents, and government authorities or affected users, creators, publishers or advertisers could initiate legal or regulatory action against us over those incidents, which could cause us to incur significant expense and liability or result in orders or consent decrees forcing us to modify our business practices.
We may be required or choose to notify government authorities or affected personnel or users regarding security incidents, and government authorities or affected personnel, users, creators, publishers or advertisers could initiate legal or regulatory action against us over those incidents, which could cause us to incur significant expense and liability or result in orders or consent decrees forcing us to modify our business practices.
Our efforts to protect our internal data or the information that users, creators, publishers and advertisers and other partners have shared with us may be unsuccessful due to the actions of third parties, software bugs or other technical malfunctions, cyberattacks, employee error or malfeasance, hacking, ransomware, viruses or other factors.
Our efforts to protect our internal data or the information that users, creators, publishers and advertisers and other partners have shared with us may be unsuccessful due to the actions of third parties, software bugs, misconfigurations, vulnerabilities or other technical malfunctions, cybersecurity attacks, employee error or malfeasance, hacking, ransomware, viruses or other factors.
As our user, content creator and advertiser base and the volume and types of information shared on our service continue to grow, we will need an increasing amount of technology infrastructure, including network capacity and computing power, to continue to satisfy the needs of users, content creators and advertisers, which could increase our costs.
As our user, content and advertiser base, sophistication of our machine learning models and the volume and types of information shared on our service continue to grow, we will need an increasing amount of technology infrastructure, including network capacity and computing power, to continue to satisfy the needs of users, content creators and advertisers, which could increase our costs.
We expect that our ability to identify and respond to this content in a consistently applied manner and on a timely basis or at all may decrease as the number of users grows, as the amount of content on the platform increases or as we expand our product and service offerings, such as video and live streaming content.
We expect that our ability to enforce our policies against this content in a consistently applied manner and on a timely basis or at all may decrease as the number of users grows, as the amount of content on the platform increases or as we expand our product and service offerings, such as video and live streaming content.
If a third-party gains unauthorized access to our platform, they may, among other things, post malicious spam and other content on our platform using a user’s, creator's, publishers' or advertiser’s account, that could negatively affect our products and our business. 22 Part I Some third parties, including advertisers and vendors, store information that we share with them on their networks.
If a third-party gains unauthorized access to our platform, they may, among other things, post malicious spam and other content on our platform using a user’s, creator's, publishers' or advertiser’s account, which could negatively affect our platform, reputation, and business. Some third parties, including advertisers and vendors, store information that we share with them on their networks.
We are currently involved in, and may in the future be involved in, actual and threatened legal proceedings, including class action lawsuits, claims, investigations and government inquiries arising in the ordinary course of our business, including intellectual property, data privacy and data protection, privacy and other torts, illegal or objectionable content, consumer protection, securities, stockholder derivative claims, employment, governance, workplace culture, contractual rights, civil rights infringement, false or misleading advertising, or other legal claims relating to content or information that is provided to us or published or made available on our platform.
We are currently involved in, and may in the future be involved in, actual and threatened legal proceedings, including class action lawsuits, mass arbitrations, claims, investigations and government inquiries arising in the ordinary course of our business, including intellectual property, data privacy and data protection, privacy and other torts, illegal or objectionable content, consumer protection, AI, safety, law enforcement, civil rights, the use of our platform for illegal purposes, securities, stockholder derivative claims, employment, governance, workplace culture, contractual rights, civil rights infringement, false or misleading advertising, or other legal claims relating to content or information that is provided to us or published or made available on our platform.
Many of these competitors also have access to larger volumes of data and 17 Part I platforms that are used on a more frequent basis than ours, which may enable them to better understand their user base and develop and deliver more relevant content.
Several of these competitors also have access to larger volumes of data and platforms that are used on a more frequent basis than ours, which may enable them to better understand their user base and develop and deliver more relevant content.
We rely on software, technologies and related services from third parties, and problems in their use, access or performance could increase our costs and harm our business, revenue and financial results. We rely on software, technologies and related services from third parties to operate critical functions of our business.
We rely on software, technologies and related services from third parties, and problems in their use, access or performance could increase our costs. We rely on software, technologies and related services from third parties to operate critical functions of our business.
In addition to the other information set forth in this Annual Report, you should carefully consider the risks and uncertainties described below, together with all of the other information in this Annual Report on Form 10-K, including the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and related notes, before deciding to invest in our Class A common stock.
In addition to the other information set forth in this Annual Report, you should carefully consider the risks and uncertainties described below, together with all of the other information in this Annual Report on Form 10-K, including the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and related notes, before making an investment decision with respect to our Class A common stock.
The GDPR, CCPA, CPRA and other such laws and regulations impose new and burdensome obligations, and include substantial uncertainty as to their interpretation, and we are subject to challenges in addressing their requirements, which could result in fines or penalties, lead us to change our data privacy policies and practices, how our product currently operates, and limit our ability to deliver personalized advertising. by, for example, requiring users to opt-in to personalized advertising.
The GDPR, U.S. state privacy laws, youth social media laws, and other such laws and regulations impose new and burdensome obligations, and include substantial uncertainty as to their interpretation, and we are subject to challenges in addressing their requirements, which could result in fines or penalties, lead us to change our data privacy policies and practices, how our product currently operates, and limit our ability to deliver personalized advertising by, for example, requiring users to opt-in to personalized advertising.
If additional prohibitions or restrictions are imposed on our platform, or if our competitors are able to successfully penetrate new geographic markets or capture a greater share of existing geographic markets that we cannot access or where we face other restrictions, our user growth, retention and engagement may be adversely affected, and our business, revenue and financial results could be harmed.
If additional prohibitions or restrictions are imposed on our platform, or if our competitors are able to successfully penetrate new geographic markets or capture a greater share of existing geographic markets that we cannot access or where we face other restrictions, our user growth, retention and engagement may be adversely affected.
AI technologies, including generative AI, may create content that is factually inaccurate or flawed. Such content may expose us to brand or reputational harm and/or legal liability. It is also uncertain how various laws related to online services, intermediary liability, and other issues will apply to content generated by AI.
AI technologies, including generative AI, may create content that is factually inaccurate or flawed, or otherwise unlawful, harmful or policy-violating. Such content may expose us to brand or reputational harm and/or legal liability. It is also uncertain how various laws related to online services, intermediary liability, copyright and other issues will apply to content generated by AI.
When that occurs, we have in the past and expect to experience in the future, declines or de-indexing in the organic search ranking of certain Pinterest search results or negatively impacted by the format in which our search results appear, leading to a decrease in traffic to our platform, new user signups and existing user retention and engagement.
When that occurs, we have in the past and expect to experience in the future, declines or de-indexing in the organic search ranking of certain Pinterest search results or negative impacts due to the format in which our search results appear, leading to a decrease in traffic to our platform, new user signups and existing user retention and engagement.
Because of the 20-to-1 voting ratio between our Class B and Class A common stock, the holders of our outstanding Class B hold approximately 74.5% of the voting power of our outstanding capital stock as of December 31, 2023.
Because of the 20-to-1 voting ratio between our Class B and Class A common stock, the holders of our outstanding Class B hold approximately 73.5% of the voting power of our outstanding capital stock as of December 31, 2024.
Although we have experienced rapid growth and demand for our product in our initial years, we have not seen the same level of rapid growth more recently and cannot assure you that our business will grow at these same rates or at all.
Although we experienced rapid growth in our initial years, we have not seen the same level of rapid growth more recently and cannot assure you that our business will grow at those same rates or at all.
Adverse global economic and financial conditions could harm our business and financial condition. 34 Part I Adverse global economic and financial events, such as the epidemics, pandemics and other public health emergencies, Russia’s invasion of Ukraine, the war in the Middle East, recession or fears of recession, inflation, fluctuation in foreign exchange rate, supply chain issues, and inventory and labor shortages, have caused, and could in the future, continue to cause disruptions and volatility in global financial markets.
Adverse global economic and financial events, such as epidemics, pandemics and other public health emergencies, Russia’s invasion of Ukraine, the war in the Middle East, recession or fears of recession, inflation, fluctuation in foreign exchange rate, supply chain issues, and inventory and labor shortages, have caused, and could in the future, continue to cause disruptions and volatility in global financial markets.
When these online application stores or search engines’ methodologies and policies are modified or enforced in ways we do not anticipate, or when our search results page rankings decline for other reasons, traffic to our platform or user growth, retention and engagement has declined and could decline in the future, any of which could harm our business, revenue and financial results.
When these online application stores or search engines’ methodologies and policies are modified or enforced in ways we do not anticipate, or when our search results page rankings decline for other reasons, traffic to our platform or user growth, retention and engagement has declined and could decline in the future.
As of December 31, 2023, we had 5,870,385,588 shares of authorized but unissued Class A common stock that are currently not reserved for issuance under our equity incentive plans or charitable giving program. We may issue all of these shares of Class A common stock without any action or approval by our stockholders, subject to certain exceptions.
As of December 31, 2024, we had 5,852,600,274 shares of authorized but unissued Class A common stock that are currently not reserved for issuance under our equity incentive plans or charitable giving program. We may issue all of these shares of Class A common stock without any action or approval by our stockholders, subject to certain exceptions.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeFor example, we conduct risk-based penetration and vulnerability testing and ongoing risk assessments, including due diligence on our key technology vendors and other contractors and suppliers. We also conduct employee trainings on cyber and information security, among other topics.
Biggest changeFor example, we conduct risk-based penetration and vulnerability testing and ongoing risk assessments, including due diligence prior to engagement on and ongoing risk-based periodic audits of our key technology vendors and other contractors and suppliers. We also conduct employee trainings on cyber and information security, among other topics.
Our Chief Security Officer, who reports directly to the Chief Technology Officer and has over 25 years of experience managing information technology and cybersecurity matters, including more than five years at Pinterest, together with our Privacy and Data Protection Team, are responsible for assessing and managing cybersecurity risks.
Our Chief Security Officer, who reports directly to the Chief Technology Officer and has over 25 years of experience managing information technology and cybersecurity matters, including more than six years at Pinterest, together with our Privacy and Data Protection Team, are responsible for assessing and managing cybersecurity risks.
We consider cybersecurity, along with other significant risks that we face, within our overall enterprise risk management framework. In the last fiscal year, we have not identified any prior cybersecurity incidents that have materially affected us, but we face certain ongoing risks from cybersecurity threats that, if realized, are reasonably likely to materially affect us.
We consider cybersecurity, along with other significant risks that we face, within our overall enterprise risk management framework. Since the beginning of the last fiscal year, we have not identified any prior cybersecurity incidents that have materially affected us, but we face certain ongoing risks from cybersecurity threats that, if realized, are reasonably likely to materially affect us.
The Board also receives periodic updates from management and the Audit and Risk Committee on cybersecurity risks.
The Board also receives periodic updates from management and the Audit and Risk Committee on cybersecurity risks. 39 Part I
Added
Our cybersecurity program is informed in part by industry standards and best practice, such as the National Institute of Standards and Technology (“NIST”) Cybersecurity Framework.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeItem 2. Properties Facilities Our corporate headquarters is located in San Francisco, California, where we occupy approximately 120,000 square feet of leased office space, excluding leases we have ceased to use. As of December 31, 2023, we maintained offices in various 40 Part I locations in the United States and internationally totaling approximately 506,000 square feet.
Biggest changeItem 2. Properties Facilities Our corporate headquarters is located in San Francisco, California, where we occupy approximately 120,000 square feet of leased office space, excluding leases we have ceased to use. As of December 31, 2024, we maintained offices in various locations in the United States and internationally totaling approximately 501,000 square feet.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeThis risk is enhanced in certain jurisdictions outside of the United States where our protection from liability for content published on our platform by third parties may be unclear and where we may be less protected under local laws than we are in the United States.
Biggest changeThis risk is enhanced in certain jurisdictions outside of the U.S. where our protection from liability for content published on our platform by third parties may be unclear and where we may be less protected under local laws than we are in the U.S.
Regardless of the final outcome, however, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources, harm to our reputation and brand, and other factors. Item 4 - Mine safety disclosures Not applicable. 41 Part II
Regardless of the final outcome, however, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources, harm to our reputation and brand and other factors. Item 4 - Mine safety disclosures Not applicable. 40 Part II
For information on certain litigation we are involved in, see "Legal Matters" in Note 7 of the accompanying notes to our consolidated financial statements, which is incorporated herein by reference.
For information on certain litigation we are involved in, see "Legal matters" in Note 6 of the accompanying notes to our consolidated financial statements, which is incorporated herein by reference.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe value of the common stock was based on the closing price of our Class A common stock on the vesting date. 42 Part II On September 16, 2023, our board of directors authorized a new stock repurchase program of up to $1.0 billion of our Class A common stock.
Biggest change(3) On November 5, 2024, our board of directors authorized a new stock repurchase program of up to $2.0 billion of our Class A common stock, replacing our September 2023 stock repurchase program. Refer to Note 8 to our consolidated financial statements for further information on our stock repurchase program.
The following graph shows a comparison of the cumulative total return for our Class A common stock, the Standard & Poor's 500 Stock Index (S&P 500 Index) and the Dow Jones Internet Composite Index (DJINET Composite Index).
The following graph shows a comparison of the cumulative total return for our Class A common stock, the Standard & Poor's 500 Stock Index (S&P 500 Index), the Dow Jones Internet Composite Index (DJINET Composite Index) and the Nasdaq CTA Internet Index (QNET Index) for the five years ended December 31, 2024.
Purchases of equity securities by issuer The following table shows information about our purchases of equity securities that are registered pursuant to Section 12 of the Securities Exchange Act of 1934 for the three months ended December 31, 2023: Period Total number of shares purchased (1) Average price paid per share Total number of shares purchased as part of publicly announced plans or programs Approximate dollar value of shares that may yet be purchased under publicly announced plans or programs October 1 - October 31, 2023 28,976 $ 25.96 — — November 1 - November 30, 2023 17,942 $ 32.13 — — December 1 - December 31, 2023 87,425 $ 37.12 — — Total 134,343 — — (1) We withheld shares from employees to satisfy tax withholding obligations on release of restricted stock awards.
Purchases of equity securities by issuer The following table shows information about our purchases of equity securities that are registered pursuant to Section 12 of the Securities Exchange Act of 1934 for the three months ended December 31, 2024: Period Total number of shares purchased (1) Average price paid per share (2) Total number of shares purchased as part of publicly announced plans or programs (3) Approximate dollar value of shares that may yet be purchased under publicly announced plans or programs October 1 - October 31, 2024 29,615 $ 33.18 — 2,000,000,000 November 1 - November 30, 2024 936,780 $ 28.83 936,780 1,972,990,331 December 1 - December 31, 2024 2,293,882 $ 31.91 2,293,882 1,899,801,819 Total 3,260,277 3,230,662 (1) We withheld shares from employees to satisfy tax withholding obligations on release of restricted stock awards.
Holders of record As of February 2, 2024, there were 130 stockholders of record of our Class A common stock and 49 stoc kholders of record of our Class B common stock.
Holders of record As of January 31, 2025, there were 115 stockholders of record of our Class A common stock and 43 stoc kholders of record of our Class B common stock.
The graph uses the closing market price on April 18, 2019 of $24.40 per share as the initial value of our common stock. The stock price performance of the following graph is not necessarily indicative of future stock price performance. Item 6. [Reserved] Not applicable. 43 Part II
The graph assumes $100 was invested in our Class A common stock and in each index on the last trading day for the year ended December 31, 2019 and assumes the reinvestment of all dividends. The stock price performance of the following graph is not necessarily indicative of future stock price performance. Item 6. [Reserved] Not applicable. 42 Part II
Removed
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.
Added
The value of the common stock was based on the closing price of our Class A common stock on the vesting date. 41 Part II (2) Average price paid per share includes costs associated with repurchases.
Removed
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.
Added
We have historically used the DJINET Composite Index for purposes of the stock performance graph. This year, we determined the QNET Index is more relevant because it is aligned with our peer group and also serves as the performance benchmark for some of our executive compensation.
Removed
As of December 31, 2023, $1.0 billion remains available for repurchases under the stock repurchase program.
Added
We have included both the DJINET Composite Index and the QNET Index for this transitional year but will not include the DJINET Composite Index in future years.
Removed
An investment of $100 and reinvestment of all dividends is assumed to have been made in our Class A common stock and in each index on April 18, 2019, the date our Class A common stock began trading on the NYSE, and its relative performance is tracked through December 31, 2023.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeThe following table presents a reconciliation of net income (loss), the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted EBITDA (in thousands): Year Ended December 31, 2023 2022 2021 Net income (loss) $ (35,610) $ (96,047) $ 316,438 Depreciation and amortization 21,509 46,489 27,500 Share-based compensation 647,860 497,123 415,382 Interest (income) expense, net (105,439) (30,235) (3,075) Other (income) expense, net (3,799) 14,502 8,291 Provision for income taxes 19,170 10,103 4,533 Restructuring charges 126,882 — — Non-cash charitable contributions 12,890 — 45,300 Adjusted EBITDA $ 683,463 $ 441,935 $ 814,369 50 Part II Components of results of operations Revenue.
Biggest changeBecause of these limitations, you should consider these non-GAAP financial measures alongside other financial performance measures, and our other financial results presented in accordance with GAAP. 48 Part II Adjusted EBITDA The following table presents a reconciliation of net income (loss), the most directly comparable financial measure calculated and presented in accordance with GAAP, to Adjusted EBITDA (in thousands): Year Ended December 31, 2024 2023 2022 Net income (loss) $ 1,862,106 $ (35,610) $ (96,047) Depreciation and amortization 21,266 21,509 46,489 Share-based compensation 765,795 647,860 497,123 Payroll tax expense related to share-based compensation (1) 30,787 24,131 19,488 Interest (income) expense, net (127,003) (105,439) (30,235) Other (income) expense, net 19,215 (3,799) 14,502 Provision for (benefit from) income taxes (2) (1,574,501) 19,170 10,103 Legal settlement (3) 34,650 — — Restructuring charges — 126,882 — Non-cash charitable contributions — 12,890 — Adjusted EBITDA $ 1,032,315 $ 707,594 $ 461,423 (1) Beginning in the fourth quarter of 2024, we are excluding payroll tax expense related to share-based compensation from Adjusted EBITDA because these taxes are variable due to our stock price and other factors outside our control and therefore are not reflective of our ongoing business operations or the underlying trends in our business.
We define a 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.
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 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.
The November 2024 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.
Quarterly monthly active users (in millions) Note: U.S. and Canada, Europe and Rest of World may not sum to Global due to rounding. Europe includes Russia and Turkey for our reporting of Revenue, MAUs and ARPU by geographic region. 45 Part II A portion of our MAUs visit Pinterest on a weekly basis.
Quarterly monthly active users (in millions) Note: U.S. and Canada, Europe and Rest of World may not sum to Global due to rounding. Europe includes Russia and Turkey for our reporting of Revenue, MAUs and ARPU by geographic region. 44 Part II A portion of our MAUs visit Pinterest on a weekly basis.
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.
Under the November 2024 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.
A discussion regarding our financial condition and results of operations for the year ended December 31, 2022 compared to the year ended December 31, 2021 is included under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2022.
A discussion regarding our financial condition and results of operations for the year ended December 31, 2023 compared to the year ended December 31, 2022 is included under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2023.
Interest and other income (expense), net consists primarily of interest earned on our cash equivalents and marketable securities and foreign currency exchange gains and losses. Provision for income taxes. Provision for income taxes consists primarily of income taxes in foreign jurisdictions and U.S. federal and state income taxes. Adjusted EBITDA.
Interest and other income (expense), net consists primarily of interest earned on our cash equivalents and marketable securities and foreign currency exchange gains and losses. 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 EBITDA.
Interest on any borrowings under the 2022 revolving credit facility accrues at either an adjusted term Secured Overnight Financing Rate ("SOFR") plus 0.10% and a margin of 1.50% or at an alternative base rate plus a margin of 0.50%, at our election, and we are required to pay an annual commitment fee that accrues at 0.15% per annum on the unused portion of the aggregate commitments under the 2022 revolving credit facility.
Interest on any borrowings under the 2022 revolving credit facility accrues at either an adjusted term SOFR plus 0.10% and a margin of 1.50% or at an alternative base rate plus a margin of 0.50%, at our election, and we are required to pay an annual commitment fee that accrues at 0.15% per annum on the unused portion of the aggregate commitments under the 2022 revolving credit facility.
The obligations under the 2022 revolving credit facility are secured by liens on substantially all of our domestic assets, including certain domestic intellectual property assets. Our total borrowing capacity under the revolving credit facility is $500.0 million as of December 31, 2023.
The obligations under the 2022 revolving credit facility are secured by liens on substantially all of our domestic assets, including certain domestic intellectual property assets. Our total borrowing capacity under the revolving credit facility is $500.0 million as of December 31, 2024.
Investing activities 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.
Investing activities Cash flows from investing activities consist of capital expenditures for improvements to new and existing office spaces. 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 cash requirements.
We have not issued any letters of credit and are in compliance with all covenants under the 2022 revolving credit facility as of December 31, 2023.
We have not issued any letters of credit and are in compliance with all covenants under the 2022 revolving credit facility as of December 31, 2024.
A discussion regarding our financial condition and results of operations for the year ended December 31, 2023 compared to the year ended December 31, 2022 is presented below.
A discussion regarding our financial condition and results of operations for the year ended December 31, 2024 compared to the year ended December 31, 2023 is presented below.
U.S. and Canada, Europe and Rest of World may not sum to Global and quarterly amounts may not sum to annual due to rounding. 47 Part II Average Revenue per User (“ARPU”). We measure monetization of our platform through our ARPU metric.
U.S. and Canada, Europe and Rest of World may not sum to Global and quarterly amounts may not sum to annual due to rounding. 46 Part II Average Revenue per User. We measure monetization of our platform through our ARPU metric.
Quarterly average revenue per user For the year ended December 31, 2023, global ARPU was $6.44, which represents an increase of 1% compared to the year ended December 31, 2022.
Quarterly average revenue per user For the year ended December 31, 2024, global ARPU was $6.94, which represents an increase of 8% compared to the year ended December 31, 2023.
The following table sets forth our consolidated statements of operations data (as a percentage of revenue): Year Ended December 31, 2023 2022 2021 Revenue 100 % 100 % 100 % Costs and expenses: Cost of revenue 23 24 21 Research and development 35 34 30 Sales and marketing 30 33 25 General and administrative 17 12 12 Total costs and expenses 104 104 87 Income (loss) from operations (4) (4) 13 Interest income (expense), net 3 1 — Other income (expense), net — (1) — Income (loss) before provision for income taxes (1) (3) 12 Provision for income taxes 1 — — Net income (loss) (1 %) (3 %) 12 % 52 Part II Years Ended December 31, 2023 and 2022 Revenue Year Ended December 31, 2023 2022 % change (in thousands) Revenue $ 3,055,071 $ 2,802,574 9% 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.
The following table sets forth our consolidated statements of operations data (as a percentage of revenue): Year Ended December 31, 2024 2023 2022 Revenue 100 % 100 % 100 % Costs and expenses: Cost of revenue 21 23 24 Research and development 34 35 34 Sales and marketing 28 30 33 General and administrative 13 17 12 Total costs and expenses 95 104 104 Income (loss) from operations 5 (4) (4) Interest income (expense), net 3 3 1 Other income (expense), net (1) — (1) Income (loss) before provision for (benefit from) income taxes 8 (1) (3) Provision for (benefit from) income taxes (43) 1 — Net income (loss) 51 % (1 %) (3 %) 52 Part II Years Ended December 31, 2024 and 2023 Revenue Year Ended December 31, 2024 2023 % change (in thousands) Revenue $ 3,646,166 $ 3,055,071 19% Revenue for the year ended December 31, 2024 increased by $591.1 million compared to the year ended December 31, 2023, primarily due to growth in demand from our consideration and conversion objectives.
As of December 31, 2023, the proportion of WAUs to MAUs, which has stayed relatively consistent over time, was 61%. As of December 31, 2023, global MAUs increased compared to December 31, 2022 primarily due to our investments in relevance and personalization beginning in the second quarter of 2022. 46 Part II Trends in monetization metrics Revenue.
As of December 31, 2024, the proportion of WAUs to MAUs, which has stayed relatively consistent over time, was 62%. As of December 31, 2024, global MAUs increased compared to December 31, 2023, primarily due to our ongoing investments in relevance and personalization. 45 Part II Trends in monetization metrics Revenue.
We believe Adjusted EBITDA helps identify underlying trends in our business that could otherwise be masked by the effect of the income and expenses that it excludes.
We believe Adjusted EBITDA helps identify underlying trends in our business that could otherwise be masked by the effect of the income and expenses that it excludes. We use constant currency revenue to evaluate our operating and financial results.
We refer to such estimates and judgments, discussed further below, as critical accounting policies and estimates. 56 Part II Refer to Note 1 to our consolidated financial statements for further information on our other significant accounting policies. Revenue recognition We generate revenue by delivering ads on our website and mobile application.
Refer to Note 1 to our consolidated financial statements for further information on our other significant accounting policies. Revenue recognition We generate revenue by delivering ads on our website and mobile application.
Research and d evelopment Year Ended December 31, 2023 2022 % change (in thousands) Research and development $ 1,068,416 $ 948,980 13% Percentage of revenue 35 % 34 % Research and development for the year ended December 31, 2023 increased by $119.4 million compared to the year ended December 31, 2022.
Research and d evelopment Year Ended December 31, 2024 2023 % change (in thousands) Research and development $ 1,240,564 $ 1,068,416 16% Percentage of revenue 34 % 35 % Research and development for the year ended December 31, 2024 increased by $172.1 million compared to the year ended December 31, 2023.
Our material cash requirements include our $1,754.6 million commitment with Amazon Web Services, for which we are not subject to annual purchase commitments, and our $241.0 million of operating lease obligations, of which $42.9 million is due within the next 12 months. 55 Part II On September 16, 2023, our board of directors authorized a new stock repurchase program of up to $1.0 billion of our Class A common stock.
Our material cash requirements include our $1,110.2 million commitment with Amazon Web Services, for which we are not subject to annual purchase commitments, and our $225.8 million of operating lease obligations, of which $41.3 million is due within the next 12 months. 55 Part II On February 2, 2023, our board of directors authorized a stock repurchase program of up to $500.0 million of our Class A common stock, which we completed in the second quarter of 2023.
We are presenting Adjusted EBITDA to assist investors in seeing our operating results through the eyes of management and because we believe that this measure provides an additional tool for investors to use in comparing our core business operating results over multiple periods with other companies in our industry.
We present these non-GAAP financial measures to assist investors in seeing our operating results through the eyes of management and because we believe that these measures provide an additional tool for investors to use in comparing our core business operating results over multiple periods with other companies in our industry.
For the years ended December 31, 2023 and 2022, our net cash flows were as follows (in thousands): Year Ended December 31, 2023 2022 Net cash provided by (used in): Operating activities $ 612,961 $ 469,202 Investing activities $ (36,993) $ (128,245) Financing activities $ (826,763) $ (148,927) Operating activities 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 charitable contributions and changes in our operating assets and liabilities.
For the years ended December 31, 2024 and 2023, our net cash flows and free cash flow were as follows (in thousands): Year Ended December 31, 2024 2023 Net cash provided by (used in): Operating activities $ 964,594 $ 612,961 Investing activities $ (221,017) $ (36,993) Financing activities $ (968,319) $ (826,763) Free cash flow $ 939,988 $ 604,898 Operating activities 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, deferred income taxes, non-cash charitable contributions, net amortization of investment premium and discount, non-cash restructuring charges and changes in our operating assets and liabilities.
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. 51 Part II Results of operations The following tables set forth our consolidated statements of operations data (in thousands): Year Ended December 31, 2023 2022 2021 Revenue $ 3,055,071 $ 2,802,574 $ 2,578,027 Costs and expenses (1) : Cost of revenue 688,760 678,597 529,320 Research and development 1,068,416 948,980 780,264 Sales and marketing 911,166 933,133 641,279 General and administrative 512,407 343,541 300,977 Total costs and expenses 3,180,749 2,904,251 2,251,840 Income (loss) from operations (125,678) (101,677) 326,187 Interest income (expense), net 105,439 30,235 3,075 Other income (expense), net 3,799 (14,502) (8,291) Income (loss) before provision for income taxes (16,440) (85,944) 320,971 Provision for income taxes 19,170 10,103 4,533 Net income (loss) $ (35,610) $ (96,047) $ 316,438 Adjusted EBITDA (2) $ 683,463 $ 441,935 $ 814,369 (1) Includes share-based compensation expense as follows (in thousands): Year Ended December 31, 2023 2022 2021 Cost of revenue $ 11,117 $ 7,629 $ 7,438 Research and development 422,964 324,161 309,715 Sales and marketing 96,798 99,467 52,691 General and administrative 116,981 65,866 45,538 Total share-based compensation $ 647,860 $ 497,123 $ 415,382 (2) 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.
See “Non-GAAP Financial Measures” 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. 51 Part II Results of operations The following tables set forth our consolidated statements of operations data (in thousands): Year Ended December 31, 2024 2023 2022 Revenue $ 3,646,166 $ 3,055,071 $ 2,802,574 Costs and expenses (1) : Cost of revenue 750,355 688,760 678,597 Research and development 1,240,564 1,068,416 948,980 Sales and marketing 1,011,772 911,166 933,133 General and administrative 463,658 512,407 343,541 Total costs and expenses 3,466,349 3,180,749 2,904,251 Income (loss) from operations 179,817 (125,678) (101,677) Interest income (expense), net 127,003 105,439 30,235 Other income (expense), net (19,215) 3,799 (14,502) Income (loss) before provision for (benefit from) income taxes 287,605 (16,440) (85,944) Provision for (benefit from) income taxes (1,574,501) 19,170 10,103 Net income (loss) $ 1,862,106 $ (35,610) $ (96,047) Adjusted EBITDA (2) $ 1,032,315 $ 707,594 $ 461,423 (1) Includes share-based compensation expense as follows (in thousands): Year Ended December 31, 2024 2023 2022 Cost of revenue $ 14,836 $ 11,117 $ 7,629 Research and development 497,442 422,964 324,161 Sales and marketing 122,149 96,798 99,467 General and administrative 131,368 116,981 65,866 Total share-based compensation $ 765,795 $ 647,860 $ 497,123 (2) See “Non-GAAP Financial Measures” 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.
We also believe Adjusted EBITDA provides useful information about our operating results, enhances the overall understanding of our past performance and future prospects, and allows for greater transparency with respect to key metrics we use for financial and operational decision-making.
We present these non-GAAP financial measures because we believe they provide useful information about our operating results, enhance the overall understanding of our past performance and future prospects, and allow for greater transparency with respect to key metrics we use for financial and operational decision-making.
For the year ended December 31, 2023 compared to the year ended December 31, 2022, revenue based on our estimate of the geographic location of our users increased by 6% in the U.S. and Canada to $2,447.3 million, Europe revenue increased by 21% to $483.4 million and Rest of World revenue increased by 31% to $124.4 million.
For the year ended December 31, 2024 compared to the year ended December 31, 2023, revenue based on our estimate of the geographic location of our users increased by 18% in the U.S. and Canada to $2,884.0 million, Europe revenue increased by 23% to $593.2 million and Rest of World revenue increased by 36% to $168.9 million.
Cost of r evenue Year Ended December 31, 2023 2022 % change (in thousands) Cost of revenue $ 688,760 $ 678,597 1% Percentage of revenue 23 % 24 % Cost of revenue for the year ended December 31, 2023 increased by $10.2 million compared to the year ended December 31, 2022.
Cost of r evenue Year Ended December 31, 2024 2023 % change (in thousands) Cost of revenue $ 750,355 $ 688,760 9% Percentage of revenue 21 % 23 % Cost of revenue for the year ended December 31, 2024 increased by $61.6 million compared to the year ended December 31, 2023.
For example, Adjusted EBITDA excludes: • certain recurring, non-cash charges such as depreciation of fixed assets and amortization of acquired intangible assets, although these assets may have to be replaced in the future; and • share-based compensation expense, which has been, and will continue to be for the foreseeable future, a significant recurring expense and an important part of our compensation strategy.
For example, • Adjusted EBITDA excludes: • certain recurring, non-cash charges such as depreciation of fixed assets and amortization of acquired intangible assets, although these assets may have to be replaced in the future; and • share-based compensation expense and related payroll tax expense, which have been and will continue to be for the foreseeable future, significant recurring expenses and an important part of our compensation strategy. • Constant currency revenue excludes the effect of changes in foreign currency exchange rates, which have an actual effect on our operating results; and • Free cash flow does not reflect our future contractual commitments arising from purchases of property and equipment.
Net cash used in financing activities increased by $677.8 million for the year ended December 31, 2023 compared to the year ended December 31, 2022 primarily due to the $500.0 million repurchase of Class A common stock during the year ended December 31, 2023, as well as our transition to net settling the tax remittances on release of RSUs and RSAs in the second quarter of 2022.
Net cash used in financing activities increased by $141.6 million for the year ended December 31, 2024 compared to the year ended December 31, 2023 primarily due to an 56 Part II increase in cash paid for repurchases of our Class A common stock and an increase in tax remittances on release of RSUs and RSAs due to an increase in our stock price.
Net cash used in investing activities decreased by $91.3 million for the year ended December 31, 2023 compared to the year ended December 31, 2022 due to the acquisition of The Yes in the second quarter of 2022, and a decrease in purchases of property and equipment and intangible assets, offset by an increase in net purchases of marketable securities.
Net cash used in investing activities decreased by $184.0 million for the year ended December 31, 2024 compared to the year ended December 31, 2023 primarily due to an increase in net purchases of marketable securities.
General and a dministrative Year Ended December 31, 2023 2022 % change (in thousands) General and administrative $ 512,407 $ 343,541 49% Percentage of revenue 17 % 12 % General and administrative for the year ended December 31, 2023 increased by $168.9 million compared to the year ended December 31, 2022.
General and Administrative Year Ended December 31, 2024 2023 % change (in thousands) General and administrative $ 463,658 $ 512,407 (10%) Percentage of revenue 13 % 17 % General and administrative for the year ended December 31, 2024 decreased by $48.7 million compared to the year ended December 31, 2023.
Our primary uses of cash are personnel-related costs and the cost of hosting our website and mobile application. As of December 31, 2023, we had $2,511.1 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.
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 December 31, 2024, $156.6 million of our cash and cash equivalents was held by our foreign subsidiaries.
The increase was primarily due to a $98.8 million increase in share-based compensation expense and a 13% increase in personnel expenses, partially offset by a $17.1 million decrease in allocated facilities costs and lower outsourced services costs. 53 Part II Sales and marketing Year Ended December 31, 2023 2022 % change (in thousands) Sales and marketing $ 911,166 $ 933,133 (2%) Percentage of revenue 30 % 33 % Sales and marketing for the year ended December 31, 2023 decreased by $22.0 million compared to the year ended December 31, 2022.
The increase was primarily due to a 19% increase in personnel expenses due to higher headcount and a $74.5 million increase in share-based compensation expense. 53 Part II Sales and marketing Year Ended December 31, 2024 2023 % change (in thousands) Sales and marketing $ 1,011,772 $ 911,166 11% Percentage of revenue 28 % 30 % Sales and marketing for the year ended December 31, 2024 increased by $100.6 million compared to the year ended December 31, 2023.
The increase was primarily due to higher absolute hosting costs due to higher compute utilization offset by infrastructure efficiency initiatives.
The increase was primarily due to increased users and engagement offset by infrastructure efficiency initiatives.
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. The number of advertisements served increased by 31% while the price of advertisements decreased by 17% as compared to the year ended December 31, 2022.
Revenue on a constant currency basis increased by 19% compared to 2023. Revenue growth was primarily driven by an 8% increase in ARPU supported by an 11% increase in average MAUs for the year ended December 31, 2024 compared to the year ended December 31, 2023.
Critical accounting policies and estimates We prepare our consolidated financial statements in accordance with GAAP. Preparing our consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expenses as well as related disclosures.
Preparing our consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expenses as well as related disclosures. Because these estimates and judgments may change from period to period, actual results could differ materially, which may negatively affect our financial condition or results of operations.
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 income taxes, restructuring charges and non-cash charitable contributions.
We define Adjusted EBITDA as net income (loss) adjusted to exclude depreciation and amortization expense, share-based compensation expense, payroll tax expense related to share-based compensation, 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.
Overview of 2023 results Our key financial and operating results as of and for the year ended December 31, 2023 are as follows: • Revenue was $3,055.1 million, an increase of 9% compared to 2022. • Monthly active users ("MAUs") were 498 million, an increase of 11% compared to December 31, 2022. • Share-based compensation expense was $647.9 million, an increase of $150.7 million compared to 2022. • Total costs and expenses were $3,180.7 million, including $126.9 million of restructuring charges . • Loss from operations was $125.7 million. • Net loss was $35.6 million. • Adjusted EBITDA was $683.5 million. • Cash, cash equivalents and marketable securities were $2,511.1 million. • Headcount was 4,014 .
Overview of 2024 results Our key financial and operating results as of and for the year ended December 31, 2024 are as follows: • Revenue was $3,646.2 million, an increase of 19% on a reported and constant currency basis compared to 2023. • Monthly active users ("MAUs") were 553 million, an increase of 11% compared to December 31, 2023. • Share-based compensation expense was $765.8 million, an increase of $117.9 million compared to 2023. • Income from operations was $179.8 million, an increase of $305.5 million compared to 2023. • Net income was $1,862.1 million and Adjusted EBITDA was $1,032.3 million. • Net cash provided by operating activities was $964.6 million and free cash flow was $940.0 million. • Cash, cash equivalents and marketable securities were $2,512.9 million. • Headcount was 4,666 . 43 Part II Trends in user metrics Monthly Active Users.
The increase was primarily due to $119.4 million of restructuring charges, a $51.1 million increase in share-based compensation expense, $12.9 million in non-cash charitable contributions and a 8% increase in personnel expenses, offset by lower allocated facilities costs.
The decrease was primarily due to $119.4 million of restructuring charges in 2023, offset by a $34.7 million legal settlement, net of insurance proceeds, a $14.9 million increase in non income-based taxes and a $14.4 million increase in share-based compensation.
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. Liquidity and capital resources We finance our operations primarily through payments received from our customers.
Adjusted EBITDA was $1,032.3 million for the year ended December 31, 2024, compared to $707.6 million for the year ended December 31, 2023, due to the factors described above. See “Non-GAAP Financial Measures” 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.
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 income taxes, restructuring charges and non-cash charitable contributions. We use Adjusted EBITDA to evaluate our operating results and for financial and operational decision-making purposes.
We define Adjusted EBITDA as net income (loss) adjusted to exclude depreciation and amortization expense, share-based compensation expense, payroll tax expense related to share-based compensation, 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.
For the year ended December 31, 2023, U.S. and Canada ARPU was $25.52, an increase of 5%, Europe ARPU was $3.73, an increase of 15%, and Rest of World ARPU was $0.50, an increase of 17% compared to the year ended December 31, 2022. 48 Part II We use MAUs and ARPU to assess the growth and health of the overall business and believe that these metrics best reflect our ability to attract, retain, engage and monetize our users, and thereby drive revenue. 49 Part II Non-GAAP financial measure To supplement our consolidated financial statements presented in accordance with GAAP, we consider Adjusted EBITDA, a financial measure which is not based on any standardized methodology prescribed by GAAP.
We use MAUs and ARPU to assess the growth and health of the overall business and believe that these metrics best reflect our ability to attract, retain, engage and monetize our users, and thereby drive revenue. 47 Part II Non-GAAP financial measures To supplement our consolidated financial statements presented in accordance with generally accepted accounting principles in the United States ("GAAP"), we consider certain non-GAAP financial measures, as described below.
Because these estimates and judgments may change from period to period, actual results could differ materially, which may negatively affect our financial condition or results of operations. We base our estimates and judgments on historical experience and various other assumptions that we consider reasonable, and we evaluate these estimates and judgments on an ongoing basis.
We base our estimates and judgments on historical experience and various other assumptions that we consider reasonable, and we evaluate these estimates and judgments on an ongoing basis. We refer to such estimates and judgments, discussed further below, as critical accounting policies and estimates.
Net cash provided by operating activities increased by $143.8 million for the year ended December 31, 2023 compared to the year ended December 31, 2022, primarily due to decrease in our net income (loss) after adjusting reconciling items offset by an increase in collections of accounts receivable.
Net cash provided by operating activities increased by $351.6 million for the year ended December 31, 2024 compared to the year ended December 31, 2023 primarily due to an increase in our net income as adjusted for certain non-cash items, including the release of our valuation allowance on our U.S. federal and state, excluding California, deferred tax assets; and an increase in our accrued expenses and other liabilities due to timing of payments to vendors; offset by an increase in accounts receivable.
Other i ncome ( e xpense), n et Year Ended December 31, 2023 2022 % change (in thousands) Interest income (expense), net $ 105,439 $ 30,235 249% Other income (expense), net 3,799 (14,502) 126% Interest and other income (expense), net $ 109,238 $ 15,733 594% Interest and other income (expense), net for the year ended December 31, 2023 increased by $93.5 million compared to the year ended December 31, 2022, primarily due to higher returns on our marketable securities as a result of higher interest rates and foreign currency exchange gains.
Other income ( e xpense), n et Year Ended December 31, 2024 2023 % change (in thousands) Interest income (expense), net $ 127,003 $ 105,439 20% Other income (expense), net (19,215) 3,799 606% Interest and other income (expense), net $ 107,788 $ 109,238 (1%) Interest and other income (expense), net for the year ended December 31, 2024 decreased by $1.5 million compared to the year ended December 31, 2023.
However, our definition of Adjusted EBITDA may not be the same as similarly titled measures used by other companies. Adjusted EBITDA should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP.
Adjusted EBITDA, constant currency revenue and free cash flow should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. There are a number of limitations related to the use of these non-GAAP financial measures rather than net income (loss), revenue and net cash provided by operations, the nearest GAAP equivalents.
We recognize revenue only after satisfying our contractual performance obligations. We occasionally offer customers free ad inventory.
We recognize revenue only after satisfying our contractual performance obligations. Income Taxes We account for income taxes using the asset and liability method.
Removed
Macroeconomic conditions, such as inflation, supply chain issues, changes in foreign currency exchange rates, competition from other platforms and other risks and uncertainties have impacted, and all or some of these factors may continue to impact, advertiser demand, user growth, user engagement, and our business, operations and financial results. See "Risk Factors" and "Note About Forward-Looking Statements” for additional details.
Added
For the year ended December 31, 2024, U.S. and Canada ARPU was $29.15, an increase of 14%, Europe ARPU was $4.24, an increase of 14%, and Rest of World ARPU was $0.59, an increase of 18% compared to the year ended December 31, 2023.
Removed
Restructuring In March 2023, we initiated a restructuring plan (the "Plan") intended to support our corporate strategy, improve efficiency and position our business in light of the ongoing macroeconomic environment. This included a workforce reduction of approximately 4% and a plan to sublease or abandon certain leased office spaces. The Plan was completed in the third quarter of 2023.
Added
We use Adjusted EBITDA to evaluate our operating results and for financial and operational decision-making purposes.
Removed
Refer to Note 13 to our consolidated financial statements for further information on our restructuring charges. 44 Part II Trends in user metrics Monthly Active Users.
Added
We calculate constant currency revenue by translating our current period revenue using the corresponding prior period’s monthly exchange rates for currencies other than the U.S. dollar. We believe constant currency revenue provides useful information to investors because it excludes the effects of foreign currency volatility that are not indicative of our core operating results.
Removed
There are a number of limitations related to the use of Adjusted EBITDA rather than net income (loss), the nearest GAAP equivalent.
Added
We present free cash flow because we believe it provides useful information to investors about the amount of cash generated from operations, after purchases of property and equipment, that can be used to strengthen our balance sheet or invest in our business among other things.
Removed
Because of these limitations, you should consider Adjusted EBITDA alongside other financial performance measures, including net income (loss) and our other financial results presented in accordance with GAAP.
Added
We define free cash flow as net cash provided by operating activities less purchases of property and equipment. Free cash flow is not intended to represent our residual cash flow available for discretionary expenditures.
Removed
The decrease was primarily due to a $21.4 million decrease in marketing expenses, a $15.0 million decrease in amortization of acquired intangible assets, and an $11.1 million decrease due to severance and related payments resulting from the departure of certain key employee of The Yes Platform, Inc.
Added
In addition, these non-GAAP financial measures are not based on any standardized methodology prescribed by GAAP, and may differ from similarly titled measures used by other companies (if used at all), which reduces their usefulness as comparative measures.
Removed
(“The Yes”) in 2022, offset by a $17.0 million increase in outsourced services costs and a 1% increase in personnel expenses.
Added
Accordingly, although payroll tax expense related to share-based compensation is a cash expense that we will continue to incur in the future, we believe excluding this expense provides investors with a better understanding of the performance of our core business and serves as a tool for investors to use in comparing our core business operating results over multiple periods with other companies in our industry.
Removed
Provision for i ncome t axes Year Ended December 31, 2023 2022 % change (in thousands) Provision for income taxes $ 19,170 $ 10,103 90% Provision for income taxes was primarily due to income generated in U.S. federal, state and certain foreign jurisdictions, and includes the effects of the capitalization and amortization of research and development expenses as required by the 2017 Tax Cuts and Jobs Act, for each of the periods presented. 54 Part II Net income (loss) and adjusted EBITDA Year Ended December 31, 2023 2022 % change (in thousands) Net income (loss) $ (35,610) $ (96,047) 63% Adjusted EBITDA $ 683,463 $ 441,935 55% Net income (loss) for the year ended December 31, 2023 was $(35.6) million, as compared to $(96.0) million for the year ended December 31, 2022.
Added
Prior period amounts have been restated to conform to this presentation. (2) Provision for (benefit from) income taxes includes $1,597.0 million related to the release of our valuation allowance on our U.S. federal and state, excluding California, deferred tax assets during the fourth quarter of 2024. Refer to Note 10 to our consolidated financial statements for further information.
Removed
Adjusted EBITDA was $683.5 million for the year ended December 31, 2023, as compared to $441.9 million for the year ended December 31, 2022, due to the factors described above.
Added
(3) On November 1, 2024, we reached a settlement to resolve pending litigation relating to allegations concerning the early development of Pinterest.
Removed
As of December 31, 2023, $130.1 million of our cash and cash equivalents was held by our foreign subsidiaries.
Added
We recorded legal settlement expense of $34.7 million, net of insurance proceeds, for the year ended December 31, 2024, which we have excluded from Adjusted EBITDA because it is non-recurring and not reflective of our ongoing business operations or the underlying trends in our business.
Removed
As of December 31, 2023, $1.0 billion remains available for repurchases under the stock repurchase program.
Added
Constant currency revenue The following table presents revenue and period-over-period changes on an as reported and constant currency basis (in thousands, except percentages): Year Ended December 31, % Change 2024 2023 As Reported Constant Currency (1) Revenue $ 3,646,166 $ 3,055,071 19% 19% (1) On a constant currency basis, revenue for the year ended December 31, 2024 was $3,649.0 million due to a $2.8 million unfavorable impact of changes in foreign exchange rates. 49 Part II Free cash flow The following table presents a reconciliation of net cash flows provided by operating activities, the most directly comparable financial measure calculated and presented in accordance with GAAP, to free cash flow (in thousands): Year Ended December 31, 2024 2023 2022 Reconciliation of free cash flow Net cash provided by operating activities $ 964,594 $ 612,961 $ 469,202 Less: Purchases of property and equipment (24,606) (8,063) (28,984) Free cash flow $ 939,988 $ 604,898 $ 440,218 50 Part II Components of results of operations Revenue.
Removed
When contracts with our customers contain multiple performance obligations, we allocate the overall transaction price, which is the amount of consideration to which we expect to be entitled in exchange for promised goods or services, to each of the distinct performance obligations based on their relative standalone selling prices.
Added
The number of advertisements served increased by 39% while the price of advertisements decreased by 14% compared to the year ended December 31, 2023.
Removed
We generally determine standalone selling prices based on the effective price charged per contracted click, impression or view, and we do not disclose the value of unsatisfied performance obligations because the original expected duration of our contracts is generally less than one year. 57 Part II
Added
The increase was primarily due to an 8% increase in personnel expenses due to higher headcount, a $28.4 million increase in marketing expenses, a $25.4 million increase in share-based compensation expense and a $16.8 million increase in outsourced services costs.
Added
The decrease was primarily due to higher foreign currency exchange losses offset by returns on our cash equivalents and marketable securities as a result of higher interest rates and higher invested balances.
Added
Provision for (benefit from) income taxes Year Ended December 31, 2024 2023 % change (in thousands) Provision for (benefit from) income taxes $ (1,574,501) $ 19,170 NM NM = Not meaningful The benefit from income taxes for the year ended December 31, 2024 was $1,574.5 million, as compared to a provision for income taxes of $19.2 million for the year ended December 31, 2023.
Added
The increase in tax benefit during the year ended December 31, 2024 was primarily due to the release of our valuation allowance on our U.S. federal and state, excluding California, deferred tax assets.
Added
Refer to Note 10 to our consolidated financial statements for further information. 54 Part II Net income (loss) and adjusted EBITDA Year Ended December 31, 2024 2023 % change (in thousands) Net income (loss) $ 1,862,106 $ (35,610) NM Adjusted EBITDA $ 1,032,315 $ 707,594 46% NM = Not meaningful Net income for the year ended December 31, 2024 was $1,862.1 million, compared to a net loss of $35.6 million for the year ended December 31, 2023.
Added
Liquidity and capital resources 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 December 31, 2024, we had $2,512.9 million in cash, cash equivalents and marketable securities.
Added
Under the program, we repurchased and retired 21,215,663 shares of our Class A common stock for an aggregate purchase price of $500.0 million at an average price per share of $23.57. 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").
Added
In November 2024, our board of directors authorized a new stock repurchase program of up to $2.0 billion of our Class A common stock (the "November 2024 program") and canceled the September 2023 program under which $500.0 million had remained available for repurchase.
Added
During the year ended December 31, 2024, we repurchased and retired 19,125,363 shares of our Class A common stock for an aggregate purchase price of $600.2 million at an average price per share of $31.38 under the September 2023 and November 2024 programs. As of December 31, 2024, $1,899.8 million remained available for repurchases under the November 2024 program.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeA hypothetical 100 basis point increase in interest rates would have decreased the market value of our cash equivalents and marketable securities by $6.6 million and $5.2 million as of December 31, 2023 and 2022, respectively. 58 Part II
Biggest changeA hypothetical 100 basis point increase in interest rates would have decreased the market value of our cash equivalents and marketable securities by $8.5 million and $6.6 million as of December 31, 2024 and 2023, respectively. 58 Part II
We have not engaged in hedging activities relating to our foreign currency exchange risk, although we may do so in the future. We do not believe a 10% increase or decrease in the relative value of the U.S. dollar would have materially affected our consolidated financial statements as of and for the years ended December 31, 2023, 2022 and 2021.
We have not engaged in hedging activities relating to our foreign currency exchange risk, although we may do so in the future. We do not believe a 10% increase or decrease in the relative value of the U.S. dollar would have materially affected our consolidated financial statements as of and for the years ended December 31, 2024, 2023 and 2022.
Interest rate risk As of December 31, 2023, we held cash, cash equivalents and marketable securities of $2,511.1 million. Our cash equivalents and marketable securities primarily consist of short-duration fixed income securities, including government and investment-grade corporate debt securities and money market funds, and our investment policy is meant to preserve capital and maintain liquidity.
Interest rate risk As of December 31, 2024, we held cash, cash equivalents and marketable securities of $2,512.9 million. Our cash equivalents and marketable securities primarily consist of short-duration fixed income securities, including government and investment-grade corporate debt securities and money market funds, and our investment policy is meant to preserve capital and maintain liquidity.

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