Pinterest is slashing jobs and office space as it switches focus to AI roles

By Tomi Kilgore

Stock dives toward a near three-year low as about 15% of Pinterest's employees could lose their jobs

Pinterest's stock drops after a disclosure that it plans to cut about 15% of its workforce, as it reallocates resources to AI-focused roles and products.

Pinterest disclosed Tuesday a restructuring that it said lead to "less than" 15% of its employees losing their jobs, as the company looks to prioritize AI-powered products.

With 4,666 employees as of the company's latest update, the layoffs could affect 700 people. It comes as the visual search and discovery company has been struggling with its advertising business.

The company (PINS) said in an 8-K filing with the Securities and Exchange Commission that the restructuring, which includes office-space reductions, was part of its plan to reallocate resources to roles focused on artificial intelligence and as it boosts AI-powered products and capabilities.

"Although the company is reducing its overall staffing levels with these actions in the near term, the company plans to reinvest in key development areas and strategic opportunities," the company said in a statement.

Pinterest said the restructuring, which is expected to be completed by the end of September 2026, will lead to charges to earnings of $35 million to $45 million.

Wedbush analyst Scott Devitt said the news of the layoffs confirms his concerns that Pinterest will face increased competition from AI-enabled platforms .

"As AI compresses the market of discovery and purchase on competing platforms, the value proposition of subscale players, such as Pinterest, erodes," Devitt wrote in a note to clients.

"In our view, [Pinterest] is at risk of losing market share as the digital advertising industry navigates this new period of transition," Devitt added.

The stock sank 9.6% on Tuesday to $23.41, its lowest closing price since May 2023.

The day after the company had reported third-quarter results on Nov. 4, the stock had plummeted 21.8%, its worst day in more than three years. That followed a disappointing revenue outlook for the crucial holiday quarter. The stock is trading 9.2% below where it closed that day.

The company isn't slated to report fourth-quarter results until mid-February.

Pinterest shares have tumbled 30.2% over the past 12 months, while the S&P 500 index SPX has advanced 16.2%.

-Tomi Kilgore

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01-27-26 1718ET