Last Thursday LinkedIn (NYSE:LNKD) reported its fourth quarter and year-end 2015 results. Though LinkedIn CEO Jeff Weiner called it a “strong quarter” and a “successful year of growth and innovation,” investors didn’t agree. In fact, LinkedIn stock took a nosedive the following morning, with share prices dropping more than 40%, reducing the company’s value by $10 billion, according to CNBC.

In its earnings statementlast week, the professional social media platform reported total Q4 revenue of $862 million, representing 34% growth, and non-GAAP earnings per share of $0.94, both above analyst projections of $858 million and $0.78 earnings per share, respectively. Revenue highlights include:

• Talent Solutions revenue, including Learning and Development:
  • Q4 revenue: $535 million, a 45% increase year-over-year
  • 2015 revenue: $1,877 million, a 41% increase year-over-year
• Marketing Solutions revenue
  • Q4 revenue: $183 million, a 20% increase year-over-year
  • 2015 revenue: $581 million, a 28% increase year-over-year
• Premium Subscriptions revenue
  • Q4 revenue: $144 million, a 19% increase year-over-year
  • 2015 revenue: $532 million, a 22% increase year-over-year

LinkedIn also reported that, in Q4 of 2015, cumulative members grew to 414 million, unique visiting members grew 7% to an average of 100 million per month, and member page views grew 26%. Mobile grew three times faster than overall member activity, and now represents 57% of all traffic to LinkedIn.

So with solid performance across the board, why did the stock plummet so drastically? James Cakmak commented on CNBC’s “Power Lunch” last Friday:

“What we saw was weaknesses in the model, inability to sustain the online, self-service growth, and really, the ability to drive new product growth [was] not as robust as we had thought,” said Cakmak.

The drop in LinkedIn stock is also due to the shift in first quarter projections. According to CNBC, Wall Street analysts had projected revenue of $868.3 million and earnings of $0.75 per share, but LinkedIn’s own projections are at $820 million for revenue and earnings of $0.55 per share, a sizable disparity.

The shift may also be due, in part, to LinkedIn’s announcement that it is shutting down its ad network 12 months after it started. That change could cost LinkedIn $50 million in revenue, reported Ad Age.

“While initial demand was solid, the product required more resources than anticipated to scale,” said LinkedIn CFO Steve Sordello said in the company’s earnings statement.

Insider Take:

Though revenue and membership continue to grow, LinkedIn sustained a $164.7 million net loss for the year, compared to a $3 million profit last year. No company can sustain those kinds of losses and expect to survive, especially when it is discontinuing product lines that generate $50 million annually.

LinkedIn has what seem to be three successful product lines, and it has some good ideas, but it needs to get through this rough patch and be nimbler in the future, ditching bad ideas more quickly and investing in those with promise.