Shares of Quotient Technology (QUOT) lost a lot of ground on Thursday morning, trading down by 11% as of 11:30 a.m. ET, compared to a 0.1% decline in the S&P 500. The slide followed the marketing specialist's fourth-quarter earnings release.
Investors have been disappointed with the last few reports from Quotient Technology, which offers consumer packaged goods companies a platform that helps them market to their customers. The Q4 release was no different, even though it contained some good news about the business.
Quotient's sales rose by just 3%, a sharp slowdown compared to previous quarters. In its letter to shareholders, management said that the sluggish results were driven by supply chain challenges that convinced many packaged food companies to pull back on promotions.
Nevertheless, it was jarring to see the company's sales gains stall after soaring by nearly 50% in Q2 and 12% in Q3. Quotient is still booking net losses as well.
Quotient is projecting improving finances through most of 2022 as it cuts costs. Investors can follow its gross profit margin for signs that this strategy is helping boost efficiency.
But revenues will take more than a year to recover from the hit they took with the loss of Albertsons -- North America's No. 2 supermarket chain operator -- as a customer. Revenue will likely land between $330 million and $345 million this year, management projects, compared to $521 million in 2021.
That outlook has rattled growth-focused investors who were hoping that Quotient would quickly return to setting sales records. Instead, the company will be focusing on shoring up its finances in 2022 while it works to find more major customers in the online coupon space.