The Trade Desk (TTD) stock plummeted 26.6% in pre-market trading on Thursday, February 13th, following the company's disappointing fourth-quarter earnings report and weak first-quarter guidance.

For Q4 2024, The Trade Desk reported revenue of $741 million, missing analyst expectations of $758.9 million. While its adjusted earnings per share of $0.59 beat estimates of $0.57, the revenue miss overshadowed the earnings beat.

Furthermore, the digital advertising software company provided weak guidance for the first quarter of 2025. It projected Q1 revenue of at least $575 million, lower than the analyst consensus estimate of $582 million. This disappointing guidance compounded investor concerns about the company's growth prospects.

The revenue miss and lackluster guidance came as a surprise, as The Trade Desk had consistently exceeded its own expectations for 32 consecutive quarters until Q4 2024. CEO Jeff Green attributed the shortfall to "a series of small execution missteps" while simultaneously preparing the company for future growth opportunities.

In response, The Trade Desk is undergoing a major reorganization and implementing strategic changes to better position itself for emerging trends like the shift to connected TV and streaming advertising. The company is focusing on enhancing its product development processes, expanding brand relationships, and investing in areas like artificial intelligence to drive long-term growth.