Similarweb Ltd. (SMWB) experienced a 5.18% plummet in its stock price during the intraday trading session on Thursday, February 13, 2025. The decline in the company's shares appears to be driven by investors' reactions to its Q4 2024 earnings and guidance, as well as concerns over potential undervaluation.

According to the Q4 2024 earnings call transcript, Similarweb reported revenue growth of 16% year-over-year for the quarter and 15% for the full year 2024. However, the company acknowledged some softness in execution during Q4, attributing it to changes in management and low-performance issues that impacted sales efforts. Additionally, foreign exchange headwinds and challenges in ramping up new hires contributed to a relatively slower start to Q1 2025.

To address these challenges and capitalize on the growing demand for its digital data solutions, particularly in the generative AI space, Similarweb announced plans to increase investments in research and development, as well as its go-to-market teams. While this strategic move is expected to accelerate growth in the long run, it will likely impact the company's operating profits in the short term.