To The Moon

Pinterest (PINS.US) has announced a plan to lay off "nearly 15%" of its workforce and reduce its office space, reallocating resources towards its artificial intelligence (AI) initiatives. According to a filing with the U.S. Securities and Exchange Commission, the content search and discovery platform anticipates these changes will result in pre-tax charges between $35 million and $45 million, with the restructuring expected to be completed by the end of the third quarter of fiscal year 2026. Based on a previous regulatory filing which showed Pinterest had 5,205 employees as of September 30, 2025, this round of layoffs is calculated to affect no more than 780 people. The filing also indicated that the San Francisco-based company intends to shift resources towards "AI-focused roles and teams that accelerate AI-powered applications," identifying AI-driven products as a core development priority. Following the announcement, Pinterest's stock price closed down nearly 10% on Tuesday. This move makes Pinterest the latest tech company to realign its business focus to capitalize on the AI product boom. Earlier this month, Meta Platforms, Inc. (META.US), the parent company of Instagram, also initiated layoffs within its Reality Labs division, shifting resources away from virtual reality products toward AI-powered wearable devices. Currently, AI has become a central strategic direction for technology platforms, with major companies making significant investments in AI infrastructure, such as data centers, to support a new generation of AI tools and services. Analysts Mandeep Singh and Robert Biggar stated in a Tuesday research note that Pinterest's restructuring "likely signals more aggressive investment in AI capabilities, which could pressure its gross margins." The analysts added that while investments in AI create near-term cost pressures, they have the potential to enhance the company's advertising pricing power—Pinterest still lags behind leading competitors like Meta Platforms, Inc. in direct response advertising. Wedbush analyst Scott Devitt believes Pinterest's announced layoffs are "consistent with our view that increasing consumer adoption of various AI-enabled competitive platforms and smart e-commerce tools is posing a growing threat to Pinterest." He also commented, "It is too early to tell if these actions will alleviate investor concerns, but our bias is to lower estimates." Pinterest is scheduled to release its fourth-quarter 2025 financial results on February 12, Eastern Time.