Pinterest, Inc. shares tumbled 8.84% in pre-market trading, following the release of its second-quarter earnings report after Tuesday's close. Despite beating Wall Street estimates on both revenue and earnings, the social media platform's cautious third-quarter revenue outlook triggered a sharp sell-off among investors.

The company reported Q2 revenue of $1.18 billion, up 18% year-over-year, and adjusted earnings of $0.43 per share, surpassing analyst expectations. However, Pinterest guided third-quarter revenue to between $1.19 billion and $1.21 billion, implying growth of just 13% to 15% — a notable deceleration from the second quarter. The CFO noted that Q2 benefited from several non-recurring tailwinds, including World Cup-related advertising spend and the shift of Amazon Prime Day into the quarter, which will not repeat in Q3.

Adding to investor concerns, management flagged incremental pressure from Asia-based cross-border retailers facing regulatory actions in Europe, a headwind expected to persist in the current quarter. The company also faces intensifying competition from larger rivals such as Meta, Reddit, and Google, which recently revamped Google Images with AI-powered visual discovery features similar to Pinterest's core offering. The combination of slowing growth, one-time benefits rolling off, and a tougher competitive landscape overshadowed an otherwise solid quarter and record user growth.