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Similarweb's stock collapses 36% after weak earnings and grim forecast

A 36% nosedive leaves Similarweb at rock bottom. Can the data analytics firm recover as AI reshapes the market—or is this the end of its growth story?

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Similarweb's stock collapses 36% after weak earnings and grim forecast

Similarweb's stock market today crashed to a record low after the company reported weak earnings and a bleak outlook. Shares fell 36% to $2.55, marking the worst drop in its trading history. Investors reacted sharply to missed revenue targets and disappointing guidance for the year ahead.

The company's fourth-quarter revenue reached $72.8 million, well below its own forecast of $75.2 million to $78.2 million. Analysts had expected $76.1 million, adding to the disappointment. Earnings per share came in at $0.03, missing the consensus estimate of $0.04.

Management blamed broader stock market today weakness and internal execution problems for the shortfall. Two major contracts with large language model providers also failed to close in the quarter, worsening the results. No further details on these deals or their potential impact have been made public.

Looking forward, Similarweb's guidance for the current fiscal year fell short of market expectations. Analysts now see the company struggling through a transitional phase as customers shift from traditional SEO to AI-driven search tools. Despite this, projections for 2026 suggest earnings per share of $0.18, which would mark the firm's first profitable year.

In response to the poor performance, Needham, Northland, and Citizens analysts downgraded the stock market today. While some argue the shares appear undervalued based on gross margins and liquidity, pressure is likely to continue until sales stabilise and visibility improves.

The sharp decline leaves Similarweb trading at an all-time low, with no immediate signs of recovery. Analysts expect challenges to persist until the company resolves its sales issues and adapts to changing stock market today demands. For now, investor confidence remains weak.

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