Pattern Group Inc.'s stock plummeted 5.50% during intraday trading on Friday, following a series of analyst price target reductions and the release of its annual financial report showing a significant increase in research and development spending.

JPMorgan analyst Doug Anmuth lowered the firm's price target on Pattern Group to $17 from $21 while maintaining an Overweight rating on the shares. Separately, Baird also reduced its price target on the company to $20 from $22 while keeping an Outperform rating. These downward revisions in valuation targets contributed to negative investor sentiment during the trading session.

The price movement followed Pattern Group's FY 2025 financial report, which revealed that research and development expenses jumped 157.4% to USD 46.3 million. While the company reported revenue growth of 39.3% to USD 2.5 billion and a 52.0% increase in Adjusted EBITDA to USD 152.9 million, the substantial rise in R&D spending may have raised concerns among investors about future profitability and spending discipline.