Shutterstock, Inc. (NYSE:SSTK) has been caught in a debate surrounding the impact of artificial intelligence (AI) on its business model. Despite strong financial performance and exciting deals like acquiring GIPHY, the company’s stock has been stagnant, hovering in the $40-$50 range.
The company, known for its vast library of images and videos, went public in 2012 at $22 per share. Over the years, Shutterstock has seen its revenue grow significantly, reaching over $800 million in 2022. However, concerns about the rise of AI have kept investors on edge, leading to a lack of momentum in the stock price.
In response to the uncertainty, Shutterstock adjusted its earnings outlook for 2023, projecting earnings per share between $4.00-$4.10. The company also made strategic acquisitions like Backgrid Celebrity News Network to expand its content offerings, aiming to reach a revenue goal of $1.2 billion by 2027.
However, the market remains cautious, with investors wary of the potential threats that AI could pose to Shutterstock’s business. The company’s stock valuation, once considered reasonable, has come under scrutiny as growth has slowed, and user numbers have declined.
Looking ahead to 2024, Shutterstock forecasts flat sales but expects earnings per share to range between $4.15-$4.30. The company continues to navigate the evolving landscape of AI and its impact on the digital content industry, striving to find a balance between innovation and market stability.
In conclusion, Shutterstock remains a battleground stock, with mixed opinions on its future prospects. While the company’s solid financial performance and strategic acquisitions demonstrate resilience, the looming threat of AI disruption casts a shadow of uncertainty over its long-term growth potential. Investors are advised to approach with caution and monitor developments closely.
