By Daniel Shvartsman

Vimeo (NASDAQ:) Shares fell more than 27% following a revenue increase by the video-software provider, but unimpressive guidance to investors.

Vimeo, which was spun out of InterActiveCorp (NASDAQ:) in May, of $100.1M in Q3, its first $100M revenue quarter and 33% above last year’s numbers. Gross margin reached 75% while earnings were -$.07/share. The free cash flow came to $9.3M. This was mainly due to accounting for share-based pay.

“Vimeo delivered its first $100 million revenue quarter as the need for video at work grows,” said Anjali Sud, Chief Executive Officer of Vimeo, in the press release. “More than 6,000 enterprise customers can now use our all-in-one software solution to leverage the power of professional-quality video.”

The shares were sold despite what seems to have been muted guidance. The shares have sold off on what appears to be muted guidance. reported in Barron’s, the company’s CFO, Narayan Menon, guided to around 25% revenue growth in Q4 and stated 30% revenue growth in 2022 was unlikely. This was a decrease in analyst expectations and is a reminder about the difficulty for tech companies and software providers to achieve pandemic acceleration growth.

Vimeo’s shares are trading at around $25.5/share, leaving them at an Enterprise value/sales multiple of 11.9x for this calendar year, and depending on the growth for next year, likely somewhere between 9 and 10x sales.