Businesses need images and video in order to create a digital presence on the internet and on mobile platforms, and Shutterstock (SSTK -2.21%) has aimed to deliver all things digital to its customers. Yet like many companies, Shutterstock has run into growth challenges as it gets bigger.

Coming into Monday's fourth-quarter financial report, Shutterstock investors were hoping to see solid double-digit percentage growth in the company's top and bottom lines. The digital-media specialist's numbers fell a bit short of those hopes, but Shutterstock still has high expectations for 2017 in its bid to become a platform for its users.

Let's take a closer look at Shutterstock to see how it did, and what it expects in the future.

Woman arranging pictures for use in digital portfolio.

Image source: Shutterstock.

Shutterstock looks a little fuzzy

Shutterstock's fourth-quarter financials didn't quite satisfy some of its investors' more ambitious wishes, even though they were generally solid. Revenue was up 12%, to $130.2 million, which was considerably slower than the consensus forecast among those following the stock for a 17% growth rate. Adjusted net income rose 9%, to $15.1 million, and that produced adjusted earnings of $0.42 per share. That was $0.03 less than what most investors were looking to see.

Looking more closely at the numbers, Shutterstock saw some of its key metrics slow somewhat. Paid downloads were up just 6%, to 42.1 million, which represented continued slowing from the company's most recent quarters. The company made up some ground by enhancing revenue per download, which climbed $0.16, to $3.02 per download. The pace of Shutterstock's efforts to expand its catalog of images accelerated, with 116.2 million images representing more than 60% growth since the end of 2015.

Nevertheless, the results capped what was an impressive year for Shutterstock. The company saw its sales climb 16%, with net income jumping by more than two-thirds from year-ago levels. Paid downloads for 2016 were up 14% from 2015 levels, and in addition to its image library, Shutterstock also expanded its video collection by more than two-thirds. The company now offers 6.2 million video clips that its customers can use for their business purposes.

Shutterstock gave more detail on some of its business sectors. Adverse foreign-currency impacts lessened during the quarter, offsetting gains in the number of customers the company served. On the expense side of the income statement, higher royalty costs and increased spending on marketing weighed on the bottom line somewhat, although the company continues to believe that investing in its business will pay off in the long run.

Shutterstock CEO Jon Oringer was happy with the results. "We made a tremendous amount of progress in 2016," the CEO said, pointing to better content, technological enhancements, international expansion, and broader media offerings.

What's in the picture for Shutterstock in 2017?

Shutterstock has aspirations to transform its business going forward. In Oringer's words, "Our focus and vision is to expand our business from a marketplace to a platform, and we are confident that this will mean accessing a larger addressable market, accelerating growth and increasing shareholder value."

Yet Shutterstock's outlook for 2017 wasn't quite as optimistic as investors had hoped. The company said that it expects revenue of between $545 million and $560 million, which would be less than the nearly $580 million that most of those following the stock have been looking to see. Operating income of $47 million to $52 million would likely represent a slowing of the pace of growth Shutterstock enjoyed in 2016.

Shutterstock investors can expect ongoing stock buybacks to help boost per-share earnings figures. The company repurchased 370,000 shares for about $17.8 million, and authorized an additional $100 million earlier this month to add to the previous authorization. This indicates Shutterstock sees value in its stock.

Shutterstock investors were very unhappy with the poor guidance, and the stock dropped 11% in pre-market trading following the announcement. Until it can demonstrate its ability to become a more dominant player in the image and video space, Shutterstock won't be able to convince all of its investors that it has reached its full potential.