Shares in Snap Inc. plunged in after-hours trading today after the company missed analysts’ predictions on revenue in its quarterly earnings report.

For the quarter ended Dec. 31, Snap reported revenue of $561 million versus the $563 million expected by analysts. The lower-than-expected figure was also reflected in average revenue per user, which came in at $2.58 versus the $2.62 forecast. While missing expectations, revenue rose 44% over a year ago.

Daily active users came in at 218 million, ahead of analysts’ average prediction of 215 million, up 17% year-over-year.

The company’s net loss rose from a year ago by $49 million, to $241 million, while earnings before interest, taxes, depreciation and amortization came in at $42 million, compared with a loss of $50 million in the same quarter of 2018. Profit per share came in at 3 cents versus a penny predicted by analysts.

For the full year, Snap’s revenue rose 45%, to $1.7 billion, and it had a net loss of $1 billion, an 18% improvement. Diluted net loss per share came in at 75 cents, compared with 97 cents in 2018.

Looking forward, Snap provided revenue guidance for the first quarter of between $450 million to $470 million and it forecast an adjusted loss of $70 million to $90 million.

“In 2019 we saw momentum across the board. We grew our community by 31 million daily active users, accelerated our revenue growth, and progressed towards profitability by improving full-year Adjusted EBITDA by 65% year-over-year,” Snap Chief Executive Officer Evan Spiegel said in a statement. “The strength in our core business gives us confidence in our long term growth and profitability and we’re excited to build on these results in 2020 and beyond.”

Investors were not happy with the news. Snap’s share price dropped as much as 14% in after-hours trading, settling slightly to fall 10.5% as of 8 p.m EST. CNN Business noted that “any indication of weakness, even a slight miss on revenue, may be enough to make investors jittery” at a time of increasing competition in the social media market.

Still, at least some analysts weren’t quite as negative as investors.

“We would categorize 4Q19 as more of a miss vs. expectations rather than anything fundamentally different about the business,” Michael Levine of Pivotal Research Group wrote in a note to clients. “Tone around leaning in was clear from both the conference call and call back – that everything is continuing to move in the right direction.”

Photo: Pixabay