Pinterest, Inc.

Ladies and gentlemen, thank you for standing by, and welcome to the Pinterest second quarter earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 on your telephone keypad. Please be advised that today's conference is being recorded, and if you require any assistance, please press star 0 for the operator. Thank you. It is now my pleasure to turn the call over to Ms. Jane Penner, Head of Investor Relations for Pinterest. Ms. Penner, the floor is yours.

Good afternoon, and thank you for joining us. Welcome to Pinterest's earnings call for the second quarter ended June 30, 2021. I'm Jane Penner, Head of Investor Relations for Pinterest. Joining me today on the call are Ben Silberman, Pinterest President and CEO, and Todd Morgenfeld, our Chief Financial Officer and Head of Business Operations. Now I'll cover the safe harbor. Some of the statements that we make today regarding our performance, operations, and outlook, including the impact of the COVID-19 pandemic, may be considered forward-looking, and such statements involve a number of risks and uncertainties that could cause actual results to differ materially. In addition, our results, trends, and outlook for Q3 2021 are preliminary and are not an indication of future performance. We are making these forward-looking statements based on information available to us as of today, and we disclaim any duty to update them later unless required by law. For more information, please refer to the risk factors discussed in our most recent forms 10Q and 10K filed with the SEC and available on the Industrial Relations section of our website. During this call, we will present both GAAP and non-GAAP financial measures. A reconciliation of non-GAAP to GAAP measures is included in today's earnings press release and letter to shareholders, which are distributed and available to the public through our investor relations website located at investor.pinterestinc.com. And now I'll turn the call over to Ben.

Thank you, Jane. Hi, everyone. Thank you for joining the call today. I'm going to talk for a few minutes, and then Todd will follow up with some additional insight, and then we'll open up for questions. Earlier today, we released our latest shareholder letter. As you've seen, we grew revenue faster than expected, and at the same time, we saw a decrease in engagement as stay-at-home orders eased around the world. I want to discuss each in turn. Starting with revenue, revenue increased 125% year-over-year to $613 million. We saw more and more advertisers here in the U.S. and increasingly across the globe recognize the value we offer in connecting them with people planning for their lives. It's a clear signal that our investments in shopping, automation, and tools are working, and we plan to continue investing to make it easier for advertisers to scale and reach new customers on Pinterest. On the user growth front, we grew globally monthly active users 9% year over year, And I'm sure there are questions about this, so I thought I'd take a few of the obvious ones head on. The first question is, what happened with user behavior? As we all know, the pandemic was an unprecedented and unique global event. In past earnings calls, we talked about how stay-at-home orders significantly increased usage of Pinterest. And for the past year, we've highlighted how people came to Pinterest for inspiration to reinvent their lives during such a difficult time. Now, as the world opens up, we're seeing the similar effect in the opposite direction. That impacted our growth, particularly because some of the core use cases we see on our platform are less common in 2021 than they were a year ago. That shift in behavior in Q2 impacted engagements. Which brings me to the second question, what users did this impact the most? Well, most of the difference between what we guided and what we're reporting are people who came to Pinterest from the web versus from mobile apps. These users tended to be, on average, less engaged and generated less revenue than people who came directly to Pinterest. In contrast, in Q2, monthly active users on our mobile apps grew in the U.S. year over year and internationally by more than 20%. We're continuing to closely monitor pinner engagements. So later, Todd will talk you through more about what we've learned a few weeks into our current quarter. While we navigate the current volatility caused by COVID, we remain focused on building for the long term. Pinterest is at the beginning of a fundamental transition, going from a place to browse, save, and organize inspiring images to the place to connect with inspiring people, sharing their passions and lifestyle expertise in the form of rich, interactive videos. We're doing this in a number of ways. First, Idea Pins are our first publishing tool, enabling creators to share ideas with lasting value. Second, the Creator Code is our initiative to make sure Pinterest remains a positive and supportive environment. And third, we'll be adding new features to help creators foster a community. We intend to go beyond likes and comments, and we'll build tools that let people share their creations, ask and answer questions, and offer encouragement and share tips. We're still early in this transition, but those early results are positive. The number of idea pins created daily has grown more than sevenfold since the beginning of the year. More and more, creators are publishing ideas and opening up new worlds on Pinterest on everything from outfit ideas, school activities, workout routines, and vacation ideas. And idea pins are resonating with our fastest growing audience, Gen Z. This audience grew double digits year over year. We plan to continue to execute on this strategy with more product launches, like product tagging, which came out this week to help reward creators for their work and give pinners another way to go from inspiration to purchase, to later this year when we make it possible for all pinners to create idea pins, as well as many more capabilities. For us, these aren't just a series of one-off moves. Rather, they add up to a larger vision on how we intend to pursue our mission. And that's to do something we believe Pinterest is uniquely positioned to do, to tie together the lifestyle of inspiration you've seen on TV with the positivity and enjoyment that comes with being part of the community of shared interests with the utility that comes from great planning and shopping tools. Creators are an important building block fulfilling our mission of giving everyone the inspiration to create a life they love. Now, I'd like to turn it over to Todd for his thoughts.