Microsoft Reportedly Mulled Acquisition Of $51 Billion Pinterest

Microsoft was in talks with $51 billion Pinterest for a possible acquisition deal, but the discussions are currently on hold, Financial Times reported on Thursday (Feb. 11), citing sources.

The discussions were part of Microsoft’s strategy to snap up social platforms with engaged communities that could operate parallel to its cloud, one of the sources told FT.

Pinterest is a social media community where people curate their own virtual corkboards with lifestyle ideas — recipes, hairstyles, décor, and more. It has experienced a pandemic-fueled surge in popularity, with 459 million members and a 600 percent increase in market value since the virus took hold in March. In contrast, Microsoft, valued at $1.83 trillion, saw an 80 percent increase from a pandemic low.

The deal would have been Microsoft’s biggest acquisition to date — and President Joe Biden’s first big tech mega-merger to consider. Microsoft mostly falls under the antitrust radar because it largely does business with corporate and government entities.

Microsoft had previously looked into the acquisition of the Chinese social video platform TikTok, but Oracle stepped in and put the kibosh on the deal. Over the years, Microsoft has scooped up several prominent companies, including LinkedIn for $26 billion in 2016, GitHub and Minecraft, FT reported.

Pinterest went public in 2019 at $19 a share and raised $1.43 billion at a $10 billion valuation. It started trading on the New York Stock Exchange April 18, 2019. It had 82 million regular users, about 80 percent of which are a powerful demographic — American mothers.

Pinterest is also taking advantage of the social commerce trend, integrating augmented reality features like virtual try-on tools and teaming up with Shopify to expand the availability of merchandise. 

In October, Pinterest saw a revenue surge as advertisers turned their attention away from Facebook and started spending advertising dollars on the social curation site. Pinterest’s third-quarter 2020 revenue was up 58 percent year over year to $443 million. Global monthly active users (MAUs) hit 442 million, a 37 percent year-over-year increase.