PINS Pinterest, Inc.

Risks

• Our ecosystem of Pinners and advertisers depends on our ability to attract, retain and engage our user base. If we fail to add new Pinners or retain current Pinners, or if Pinners engage less with us, our business, revenue and financial results could be harmed.
• If we are not able to continue to provide content that is useful and relevant to Pinners’ personal taste and interests, Pinner growth, retention or engagement could decline, which could result in the loss of advertisers and revenue.
• If we do not develop successful new products or improve existing ones, our business may suffer. We may also invest in new products that fail to attract or retain users or generate revenue.
• Our business depends on a strong brand and reputation, and if we are unable to maintain and enhance our brand and reputation, our ability to expand our user and advertiser base will be impaired and our business, revenue and financial results could be harmed.
• If our security is compromised, or Pinners or advertisers believe our security has been compromised, Pinners and advertisers may use our service less or may stop using our service altogether, which could harm our business, revenue and financial results.
• We depend in part on internet search engines to direct traffic and refer new users to our service. If search engines’ methodologies and policies are modified or enforced in ways we do not anticipate, or if our search results page rankings decline for other reasons, traffic to our service or user growth, retention or engagement could decline, any of which could harm our business, revenue and financial results.
• We allow users to authenticate with our service through third-party login providers (such as Facebook Login or Google Sign-in). If these third parties discontinue these tools or experience a breach or outage in their platform or web browser developers make changes that restrict the use of these tools, user growth or engagement could decline, and our business, revenue and financial results could be harmed.
• If we are unable to compete effectively for users, our business, revenue and financial results could be harmed.
• If we are unable to compete effectively for advertisers, our business, revenue and financial results could be harmed.
• We are in the early stages of our monetization efforts and there is no assurance we will be able to scale our business for future growth.
• We generate substantially all of our revenue from advertising. The failure to attract new advertisers, the loss of advertisers or a reduction in how much they spend could harm our business, revenue and financial results.
• Our ability to generate revenue depends on the development of tools to accurately measure the effectiveness of advertisements on our platform.
• We may not be able to develop effective products and tools for advertisers.
• We may not succeed in further expanding and monetizing our platform internationally.
• We plan to continue expanding our Pinner and advertiser base globally, where we have limited operating experience and may be subject to increased business and economic risks that could harm our business, revenue and financial results.
• We cannot assure you that we will effectively manage the growth of our business.
• We have a limited operating history and, as a result, our past results may not be indicative of future operating performance.
• We have incurred operating losses in the past, anticipate increasing our operating expenses, expect to incur operating losses in the future and may never achieve or maintain profitability.
• We may make decisions consistent with our mission and values that may reduce our short- or medium-term operating results.
• Our operating results are likely to fluctuate from quarter to quarter, which makes them difficult to predict.
• We may need additional capital, and we cannot be sure that additional financing will be available.
• We receive, process, store, use and share data, some of which contains personal information, which subjects us to complex and evolving governmental regulation and other legal obligations related to data privacy, data protection and other matters, which are subject to change and uncertain interpretation.
• Pinner metrics and other estimates are subject to inherent challenges in measurement, and real or perceived inaccuracies in those metrics could harm our business, revenue and financial results.
• Technologies have been developed that can block the display of our ads, which could harm our business, revenue and financial results.
• We depend on Amazon Web Services for the vast majority of our compute, storage, data transfer and other services. Any disruption of, degradation in or interference with our use of Amazon Web Services could negatively affect our operations and harm our business, revenue and financial results.
• We must effectively operate with mobile operating systems, web browsers, networks, regulations and standards, which we do not control. Changes in our products or to those mobile operating systems, web browsers, networks, regulations or standards may harm Pinner retention, growth and engagement.
• We rely on software, technologies and related services from other parties, and problems in their use, access or performance could increase our costs and harm our business, revenue and financial results.
• Our business depends on our ability to maintain and scale our technology infrastructure.
• Any significant disruptions in the availability or speed of our systems could result in a loss of Pinners and advertisers.
• The loss of one or more of our key personnel, or our failure to attract and retain other highly qualified personnel in the future, could harm our business, revenue and financial results.
• Action by governments to restrict access to our service or certain of our products in their countries could harm our business, revenue and financial results.
• We may be liable as a result of content or information that is published or made available on our service.
• We could become involved in legal disputes involving intellectual property claims or other disputes that are expensive to support, and if resolved adversely, could harm our business, revenue and financial results.
• If we are unable to protect our intellectual property, the value of our brand and other intangible assets may be diminished, and our business, revenue and financial results could be harmed.
• Our use of “open source” software could subject us to possible litigation or could prevent us from offering products that include open source software or require us to obtain licenses on unfavorable terms.
• We may acquire other businesses, which could require significant management attention, disrupt our business, dilute stockholder value and harm our business, revenue and financial results.
• If we default on our credit obligations, our operations may be interrupted and our business, revenue and financial results could be harmed.
• The interpretation and application of recent U.S. tax legislation or other changes in U.S. or non-U.S. taxation of our operations could harm our business, revenue and financial results.
• We may have greater than anticipated tax liabilities, which could harm our business, revenue and financial results.
• Our ability to use or benefit from our net operating loss carryforwards and certain other tax attributes may be limited.
• Our financial results may be adversely affected by changes in accounting principles generally accepted in the United States.
• The dual class structure of our common stock has the effect of concentrating voting control with those stockholders who held our capital stock prior to the completion of our IPO, including our co-founders, executive officers, employees and directors, their affiliates, and all of our other existing stockholders (including those unaffiliated with any of our co-founders, executive officers, employees or directors). This will limit or preclude your ability to influence corporate matters.
• Our dual class structure may depress the trading price of our Class A common stock.
• An active trading market for our Class A common stock may not be sustained.
• The trading price of our Class A common stock may be volatile, and you could lose all or part of your investment.
• Future offerings of debt or equity securities by us or existing shareholders may adversely affect the market price of our Class A common stock.
• Additional stock issuances, including in connection with settlement of equity awards, could result in significant dilution to our stockholders.
• We have broad discretion over the use of the net proceeds from our IPO and we may not use them effectively.
• Delaware law and provisions in our amended and restated certificate of incorporation and amended and restated bylaws could make a merger, tender offer or proxy contest difficult, thereby depressing the market price of our Class A common stock.
• Our amended and restated certificate of incorporation designates a state or federal court located within the State of Delaware as the exclusive forum for substantially all disputes between us and our stockholders, which could limit our stockholders’ ability to choose the judicial forum for disputes with us or our directors, officers or employees.
• Our Class A common stock market price and trading volume could decline if securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business.
• We do not intend to pay cash dividends for the foreseeable future.
• We are an emerging growth company, and any decision on our part to comply only with certain reduced reporting and disclosure requirements applicable to emerging growth companies could make our Class A common stock less attractive to investors.
• The requirements of being a public company have and may continue to strain our resources, divert management’s attention and may result in more litigation.