Will Pinterest’s pivot pay off? Plus, Big Tech’s earnings stumbles, more tech layoffs, and a ‘historic’ $280 billion bill

Welcome back to LinkedIn News Tech Stack, your weekly digest of the tech news, moves, and trending conversations that take place on LinkedIn everyday. Click subscribe above to be notified of future editions and follow me on LinkedIn for other tech updates.

Have feedback or think something could be a fit? I’m all ears on any news about personnel moves, deals, fundraising announcements, layoffs, and tech workplace policy shifts. Is there a tech-related question that you’d like crowdsourced answers to? Send me an InMail.

Zooming In

A deep-dive into one big theme or news story every week.

The party’s over for Big Tech.

After meteoric growth during the pandemic, Snap, Twitter and Meta have reported disappointing earnings this season. And if that is any indication — it's going to be a rough ride for Pinterest when the company reports its earnings on Aug. 1.

Like its peers, Pinterest relies heavily on digital advertising for its revenue, which is under pressure as macroeconomic factors like inflation cause companies to tighten their marketing budgets at a level these companies hadn't anticipated while forecasting for the second quarter.?

But if Bill Watkins , Pinterest’s relatively new revenue chief, is jittery, he isn’t showing it.

“Whether it's board meetings or C-suite meetings on the client or agency side, everybody is staring at their spend and analyzing returns,” Watkins told me in New York this week. “But we spend less time looking at the stock price, and more time on leading and lagging indicators that tell us how we're progressing relative to our strategic investments and diversifying our revenue.”

Some of his optimism is tied to the platform’s recent pivot to video. While Pinterest has historically been a static image based-app, it began prioritizing video last year, and is betting on creators, shopping, and video as it charts its future. The company just hired YouTube’s Nadine Zylstra as global head of programming and originals as it makes a push into original content, and inked a multiyear deal to develop content with food publisher Tastemade.

The strategy, as he put it, is “expanding the inventory surface area on the platform,” which, until recently, has been limited to the app’s home-feed, but now includes efforts like Pinterest TV and the Watch Tab. (Remember Facebook circa 2017, anyone?)

Pinterest is also investing in augmented reality and artificial intelligence as it looks to build a competitive social commerce engine, never mind that the phenomenon hasn’t quite taken off the way some had anticipated. To that end, it recently acquired AI shopping platform The Yes, and brought on former StitchFix COO Julie Bornstein as its chief shopping officer.

“It’s in a nascent state, but I’m encouraged by all the reports that talk about the billions of dollars in anticipated revenue,” Watkins said. “To make it happen, you need content, creators, and commerce capabilities. We're investing in all those things.”

Pinterest, like other social media platforms, faces a declining user base due to TikTok’s skyrocketing popularity and the world reopening after the pandemic. That is exacerbated by some unique challenges of its own — an exodus of senior executives in recent months as well as growing interest and involvement from activist investor Elliott Management.??

In the face of all this, one thing is certain: Pinterest is desperately trying to turn a corner and make money. And it has Elliott Management breathing down its neck to make sure it does, which incidentally, also just bought a bigger stake in PayPal, the payments company that considered acquiring Pinterest for $45 billion in October.

“Elliott Management is incredibly aggressive — when they make an investment, they are looking to make radical change,” said Greg Kahn , CEO of strategic advisory firm GK Digital Ventures. “Pinterest is severely undervalued, and has underperformed on the advertising front for years, so we can bet that they are going to put some plans in place to effect some change.”

TechTok

Catch up on all the tech headlines you may have missed last week, and the conversations around them on LinkedIn.?

Meta sees first-ever revenue drop

Facebook parent Meta is at a crossroads. The company reported its first-ever decline in quarterly revenue during its second quarter results this week, and also issued a weak third-quarter forecast. Internally, CEO Mark Zuckerberg is said to be "setting a relentless pace," as Facebook morphs to better compete with TikTok, per The New York Times. He's also making a harder pivot away from bread-and-butter social networking to focus on the next phase of Meta: building the immersive world.

• Zuckerberg is turning the screws on staff, warning low-performing employees their days are numbered, per NYT, The Verge and Insider.
• Major tech companies are in the midst of an "unprecedented stress test" this week, per Forbes, as Meta and other power players report quarterly earnings during an unusually turbulent period across the industry.

Catch up with what’s going on with the social media giant here.

Meta’s not alone. Google's growth is also grinding slower.

Google parent Alphabet's second-quarter earnings also just missed analysts' expectations, with slower-than-usual growth in advertising spending weighing on the tech giant's bottom line. Marketers were largely tightening the purse strings, notes CNBC, because of inflation. Revenue was US$69.7 billion, compared with an expected $69.9 billion. Still, some observers were expecting a more pronounced decline, and the company's shares rose in after-hours trading. Competitors, including Twitter and Snap, have been hit much harder by softer advertising sales, Bloomberg notes.

• Google reported second-quarter earnings per share of $1.21 per share. Wall Street was expecting $1.28 per share.
• Facing competition from rival TikTok, YouTube saw the most "notable deceleration": Sales climbed 5%, compared to 84% during the same period in 2021.

Take a closer look at Google’s earnings here.

But, Apple and Amazon seem to be the outliers

Apple and Amazon have reported solid quarterly results — and optimistic forecasts moving forward — fueling investor confidence that the tech giants are well-positioned to weather the economic downturn. Apple outpaced Wall Street expectations on revenue and profit, while Amazon also beat expectations on revenue growth. Both firms issued encouraging outlooks and expect revenue to "accelerate" in the current quarter despite high inflation, supply chain constraints and other challenges.

Join the conversation here.

Gen Z is rejecting older social media

It may be surprising to hear that of all Americans on social media, the ones losing interest are the youngest. Gen Z, or those between ages 4 and 24, are using less of every app — except TikTok — and are the only group to see recent declines. They're avoiding older, noisier, more public networks in favor of connecting through a variety of smaller applications, including Twitch, Discord and BeReal, per Axios. Gen Z is also drawn to algorithms (like TikTok’s) that don’t just bear down on their interests but occasionally throw in something new.

To join in the conversation on how this is spurring other platforms to react, click here.

TikTok boon? Not for creators

Sure, TikTok is everyone’s current favorite. But don’t count creators in that group, just as yet. Becoming "TikTok famous" might seem easier than ever, but achieving celebrity on the app rarely translates into a big payday, reports The Information. Part of the problem is the sheer number of creators with large followings battling for attention and the revenue that flows from it: More than 39,000 TikTok accounts have at least 1 million followers, far more than on YouTube or Instagram. Then there's the fact that TikTok's algorithm is built around novelty, blasting attention-grabbing videos to users almost at random. That makes it difficult for influencers to build communities of loyal viewers.

• Creators earn about $1,674 on average a month on TikTok, compared to $4,118 on YouTube and $3,853 on Instagram, according to a 2021 survey.

To dive deeper into creators’ experiences on the platform, click here.

The latest on layoffs: Companies making cuts

Announcements of layoffs, hiring freezes and rescinded job offers have roiled the tech industry and startup community for several months. But now, the cuts have started to reach companies across multiple sectors as executives worry about a possible recession and weigh "all manner of adverse near-term effects on their businesses," Puck writes. But despite mounting signs of economic trouble, CNBC notes that overall employer demand for workers “remains extremely high” and that layoffs are "near historical lows."

• This year's layoffs have ushered in a new trend, reports The Wall Street Journal: announcing a job loss on social media. The reason is twofold — to share about the experience and also to network with recruiters.
• Some tips for navigating your career during uncertain times can be found here.

Tech firms that have announced recent layoffs include:

• E-commerce platform Shopify laying off about 1,000 employees, 10% of its workforce, and tech startup Clearco cutting an unspecified number of staff.
• Layoffs at New York City-based visual collaboration platform InVision, announced in a LinkedIn post.
• Wearable-tech maker Whoop, which is laying off 15% of its 630-person workforce, and rowing-tech company Hydrow cutting 35% of its staff.

See the full list of companies going through layoffs here, and join the conversation here.

The Senate and the House passes $280 billion chip bill

The Senate and the House have both passed a $280 billion bill that will subsidize chip manufacturing in the U.S., after nearly two years of an international semiconductor shortage. The "historic bill" allocates funds for computer chip companies to produce, research and develop semiconductors, which are used in everything from cars and computers to missile launchers. The legislation is now headed to the desk of President Joe Biden, and if signed into law, will give American producers a leg up against international competitors that currently dominate the semiconductor industry.

To learn more about what it could means for the industry, click here.

Movers & Shakers

Here’s keeping tabs on key executives on the move and other big pivots in the industry.

• Meta has named its current CFO David Wehner as its first-ever chief strategy officer, and promoted Susan Li to become its new CFO.
• Paul Merolla , co-founder of Elon Musk-backed brain implant startup Neuralink, has left the company.
• DJ Paoni , the president of SAP North America, is retiring from the enterprise company after 26 years.?
• Apoorva Mehta , Instacart’s founder and executive chairman, announced that he will step down from the board once the company goes public.
• Jay Carney , Amazon’s head of PR and policy is leaving the company to join Airbnb as its head of policy and communications.
• Camille Stewart Gloster, Esq a Google executive, has been named a deputy national cyber director by The White House’s Office of the National Cyber Director.
• Google fired Blake Lemoine , the engineer who said he believed that an AI-driven chatterbot had become sentient, Big Technology’s Alex Kantrowitz reported.
• Blackstone has hired Arielle Gross Samuels , the global head of Meta’s ESG business, as the new global head of marketing on its corporate affairs team.
• While other venture capitalists pull back, art auction house Christie’s is launching a crypto-focused venture capital arm.

This Week in Tech

A weekly advent calendar of tech history from the archives.

On July 25, 2008, The FCC approved the merger of the satellite radio companies Sirius and XM, creating the radio behemoth we know as SiriusXM today.

ICYMI

Here are other top tech stories of the week from LinkedIn and beyond.

• Google is once again delaying its plan to kill off third-party tracking cookies in its Chrome browser at least until 2024.
• As the VC market slows down, startups are looking at alternative financing as a path to funding.
• Instagram head Adam Mosseri released a video where he responded to Kylie Jenner and Kim Kardashian’s criticism around Instagram trying to become more like TikTok.
• Climate-tech funding may have come down from 2021’s historical highs, but early-stage climate startups still have a fair shot.

Lastly, last week, LinkedIn announced the launch of the second U.S. Creator Accelerator Program: Technology & Innovation! As part of LinkedIn’s continued $25 million investment in creators, we are introducing a 6-week program designed to support creators who are passionate about technology & innovation. Like our previous cohorts, we want to help creators amplify their voice and grow their community through coaching, opportunities to be featured on LinkedIn channels and a financial grant of up to $12,000. Learn more about the program and apply before Aug. 10, 2022.

Thanks for reading. Please share Tech Stack if you like it! And if you have any news tips, find me on InMail or Signal on 646-702-253