Shares of Pinterest surged 18% in extended trading after the company released its first-quarter results, surpassing analyst expectations and showing significant revenue growth, the highest since 2021.

In comparison to LSEG analyst estimates, Pinterest reported earnings per share of 20 cents adjusted, exceeding the expected 13 cents, and revenue of $740 million, higher than the projected $700 million.

The revenue for the quarter saw a 23% increase from the previous year, reaching $602.6 million. The company’s net loss decreased to $24.8 million, or a 4 cent loss per share, from $208.6 million, or a 31 cent loss per share, year over year.

With 518 million global monthly active users (MAUs) in the first quarter, a 12% rise from the previous year, Pinterest outperformed the anticipated 504.9 million MAUs by Wall Street estimates. Generation Z is identified as the fastest-growing and most engaged demographic on the platform.

During the period, the company’s average revenue per user stood at $1.46, surpassing the expected $1.40 per user by StreetAccount. CEO Bill Ready highlighted the success in driving better returns for advertisers through investments in AI technology and enhancing shopping experiences.

In a statement, Ready emphasized the company’s strategic direction, focusing on developing products and experiences that cater to user demands, resulting in improved product-market alignment.

After a challenging 2022 with reduced advertising spending due to high inflation levels, digital advertising entities like Pinterest are experiencing growth once again. Meta, Snap, and Google parent Alphabet all recently reported first-quarter results exceeding revenue predictions.

Looking ahead to the second quarter, Pinterest anticipates revenue between $835 million and $850 million, signaling a growth rate of 18% to 20% year over year, surpassing analyst expectations of $827 million.