The social media platform Pinterest revealed Tuesday that Elliott Investment Management will purchase $1 billion worth of new stock in the company, a move that positions the investment firm to claim the top shareholder spot.
The announcement sent Pinterest stock climbing almost 9% in early trading, boosted further by news of a massive $3.5 billion program to repurchase company shares.
According to Pinterest, funds from Elliott’s investment will fuel the newly announced share buyback initiative.
The investment firm Elliott, known worldwide for its activist approach to investing, already held Pinterest’s third-largest ownership position at 4.8%, valued at approximately $725 million as of December, based on LSEG data.
“We have been steadfast supporters of Pinterest since we first invested in 2022, and have strong conviction in the company’s trajectory,” said Marc Steinberg, partner at Elliott, who is also on Pinterest’s board of directors.
The image-sharing company has intensified its focus on expanding its user base while taking advantage of artificial intelligence-powered shopping features that are gaining popularity. Pinterest reported 619 million users at the end of December.
Despite the company’s artificial intelligence initiatives driving user numbers to unprecedented levels, Pinterest continues to face challenges convincing Wall Street that these technological advances can translate into increased advertising dollars, especially while competing against larger platforms including Meta’s Instagram and Facebook.
