Shares of Ibotta Inc (IBTA) are set for a sharp decline in pre-market trading, plummeting 15.06% following the release of disappointing third-quarter financial results and weak fourth-quarter guidance. The digital promotions network operator's after-hours performance on Wednesday has carried over into Thursday's pre-market session, reflecting investor concerns about the company's growth trajectory and profitability.

Ibotta's Q3 report revealed a significant year-over-year decline in revenue and profitability. Total revenue fell 16% to $83.3 million, with redemption revenue, a key metric for the company, dropping 15% to $72.1 million. Despite an increase in the number of redeemers on the Ibotta Performance Network, the average number of redemptions per redeemer declined, impacting overall revenue. The company's adjusted EBITDA margin contracted sharply to 20% from 37% in the same quarter last year, raising profitability concerns among investors.

Adding to the negative sentiment, several analysts have downgraded their outlook on Ibotta. Goldman Sachs maintained its Sell rating while lowering the price target to $23 from $26. Similarly, Bank of America reduced its price target to $22 from $24, keeping an Underperform rating. These analyst actions, combined with Ibotta's weak Q4 guidance projecting a further 16% year-over-year revenue decline at the midpoint and an adjusted EBITDA margin of just 13%, have contributed to the stock's pre-market plunge as investors reassess the company's near-term prospects.