Pinterest CEO Bill Ready has revealed how the company has integrated AI into its user experience and advertising business, leveraging machine learning models to enhance content discovery, improve ad performance, and drive engagement.
The impact of Pinterest’s AI investments extends to international growth. In 2024, the company expanded its demand partnerships with Amazon Ads and Google, while also launching reseller programs in 30 new markets. As a result, revenue growth in the Rest of World markets accelerated throughout the year.
Pinterest’s AI-driven strategy contributed to a record-breaking Q4 performance, with global monthly active users reaching 553 million, an 11 percent year-over-year increase. User growth was strong across all regions, with U.S. and Canada MAUs reaching 101 million (4 percent growth), Europe MAUs at 145 million (7 percent growth), and Rest of World MAUs at 307 million (15 percent growth).
Pinterest’s revenue for Q4 was $1.154 billion, an 18 percent increase, reflecting the success of AI-powered monetization and engagement strategies.
Pinterest’s AI strategy
Central to Pinterest’s AI strategy is its Taste Graph, which maps relationships between user actions, pins, searches, boards, and products. By analyzing hundreds of billions of first-party user actions, Pinterest refines its AI recommendation engines, leading to more personalized content suggestions and higher engagement.
In 2024, Pinterest made significant progress in incorporating user history into its recommendation algorithms, increasing the context window on user actions such as saves and clicks by over 30 times. This enhancement resulted in a 250-basis-point increase in saves and a 150-basis-point increase in outbound clicks across the platform. Despite processing a vastly larger volume of signals, the company achieved this milestone with only a fractional increase in infrastructure spending, showcasing the efficiency of its AI-driven approach.
“Our strategy is paying off. People are coming to Pinterest more often, the platform has never been more actionable, and our lower funnel focus is driving results for users and advertisers,” Pinterest CEO Bill Ready said in the company’s earnings report.
AI also plays a critical role in Pinterest’s monetization efforts. The company’s AI-powered whole-page optimization system enables dynamic ad placements based on user intent, increasing ad load when users are ready to shop and reducing it when they are in a discovery phase. This approach has led to more relevant ad placements and improved conversion rates. Over the past two years, AI-driven relevance for top ad slots in search results has more than doubled, ensuring that ads align closely with user interests.
Internally, Pinterest has adopted AI tools to enhance employee productivity, particularly within its engineering team. AI-powered coding assistance tools are used by the majority of Pinterest engineers, accounting for 15 percent of the current codebase. This AI integration streamlines software development, accelerates coding processes, and improves overall code quality.
One of the standout AI-driven innovations in Pinterest’s ad ecosystem is Performance+, an advanced lower-funnel ad product designed to optimize campaign performance and efficiency. Performance+ leverages AI to automate the campaign setup process, enabling advertisers to achieve better results with less manual intervention. The impact of these AI-powered initiatives is evident in Pinterest’s business performance, with Q4 showing a 90 percent increase in clicks to advertisers, even after lapping the initial launch of direct link in late 2023.
AI has also been instrumental in improving shopping experiences on Pinterest. During the 2024 holiday season, Pinterest successfully positioned itself as a shopping destination, with users engaging more actively in curated gift guides. Click-through rates for products featured in these guides were over 40 percent higher than the average product pin. Additionally, Pinterest achieved its highest-ever weekly active to monthly active user ratio of 62 percent, demonstrating that AI-driven enhancements are encouraging users to return more frequently.
Beyond monetization and engagement, Pinterest uses AI to foster a positive and inclusive platform. AI-driven search refinements, such as body type, skin tone, and hair pattern filters, allow users to see themselves represented in search results. Users who utilize these features save, on average, 75 percent more pins than those who do not, indicating that AI-driven personalization enhances user satisfaction and retention.
Looking ahead to 2025, Pinterest plans to continue leveraging AI to expand ad load, enhance shopping features, and drive further growth in user engagement and monetization. With AI at the core of its strategy, Pinterest aims to solidify its position as a leading platform for inspiration, shopping, and advertising.
Rajani Baburajan
