Published - June 29, 2022 @ 12:08 PM (EET)
Shares of Pinterest Inc. (NYSE:PINS) climbed more than 5% in late trading Tuesday after the social media company said its longtime CEO and co-founder Ben Silbermann is stepping down from his role effective Wednesday.
Silbermann, who served as Pinterest's CEO since its inception in 2010, will transition to a newly created position, executive chairman of the board.
Previously in charge of Google's (NASDAQ:GOOGL) commerce business, Bill Ready is taking over the helm. Ready served as president of Google since 2020, less than three years, and prior to Google, Ready served in various leadership roles at Paypal.
Ready will receive an annual salary of $400,000 and be eligible for a stock option award to buy about 8.6 million Class A shares.
"The decision is driven by what I think is best for Pinterest," said Silbermann in an interview with The Wall Street Journal. He says that Ready is "a builder who deeply understands commerce and payments...I'm confident he's going to be an outstanding CEO."
WHY IT MATTERS
Pinterest shares have been experiencing the same pressures this year as other social networking stocks, which thrived during the initial stages of the pandemic when people were spending more time at home.
In the first quarter of 2022, the company reported monthly active users of 433 million, down from the 478 million in the year-ago period.
Though the company reported its first full-year profit and revenues increasing year-over-year, reaching $2 billion in February, the user decline has concerned investors.
Historically, Pinterest has struggled with its fan base, which appeals mostly to women and specifically to moms. Secondly, the company hasn't quite figured out how to make money.
Shares of Pinterest are down 45.8% year to date and are off nearly 76% from 52-week highs.
"In our next chapter, we are focused on helping Pinners buy, try and act on all the great ideas they see. Bill is a great leader for this transition." - Ben Silbermann.
