Revenue during the quarter went up marginally by 2.40 percent to $561.23 million from $548.08 million in the previous year period. Gross margin for the quarter expanded 74 basis points over the previous year period to 59.01 percent. Total expenses were 72.60 percent of quarterly revenues, down from 74.10 percent for the same period last year. This has led to an improvement of 150 basis points in operating margin to 27.40 percent.

Operating income for the quarter was $153.79 million, compared with $141.95 million in the previous year period.

However, the adjusted operating income for the quarter stood at $158.83 million compared to $170.57 million in the prior year period. At the same time, adjusted operating margin contracted 282 basis points in the quarter to 28.30 percent from 31.12 percent in the last year period.

"We're proud of our 2016 delivery against key initiatives, particularly Shutterfly Business Solutions, mobile, and product range expansion, as well as our continued progress on Operating Income, which more than doubled year-over-year," said Christopher North, president and chief executive officer of Shutterfly. "At the same time, Consumer growth came towards the low end of our guidance, and Adjusted EBITDA slightly below guidance, as Shutterfly-brand growth was offset by revenue declines in the Tiny Prints, Wedding Paper Divas, MyPublisher, and BorrowLenses brands."

For the first-quarter 2017, Shutterfly, Inc. forecasts revenue to be in the range of $185 million to $190 million. The company forecasts operating loss to be in the range of $48 million to $45.50 million. The company expects diluted loss per share to be in the range of $1 to $0.95. 

For financial year 2017, Shutterfly, Inc. forecasts revenue to be in the range of $1,135 million to $1,165 million. The company forecasts operating income to be in the range of $48.50 million to $68.50 million. The company expects diluted earnings per share to be in the range of $0.45 to $0.80.

The company has spent $64.40 million cash to meet investing activities during the year as against cash outgo of $33.12 million in the last year. It has incurred net capital expenditure of $75.43 million on net basis during the year, up 0.07 percent or $0.06 million from year ago.

The company has spent $128.66 million cash to carry out financing activities during the year as against cash outgo of $223.60 million in the last year period.

Cash and cash equivalents stood at $289.22 million as on Dec. 31, 2016, up 0.12 percent or $0.36 million from $288.86 million on Dec. 31, 2015.

Debt moves up
Shutterfly, Inc. has witnessed an increase in total debt over the last one year. It stood at $278.79 million as on Dec. 31, 2016, up 5.46 percent or $14.43 million from $264.36 million on Dec. 31, 2015. Shutterfly has witnessed an increase in long-term debt over the last one year. It stood at $278.79 million as on Dec. 31, 2016, up 5.46 percent or $14.43 million from $264.36 million on Dec. 31, 2015. Total debt was 23.32 percent of total assets as on Dec. 31, 2016, compared with 21.87 percent on Dec. 31, 2015. Debt to equity ratio was at 0.50 as on Dec. 31, 2016, up from 0.44 as on Dec. 31, 2015. Interest coverage ratio improved to 25.80 for the quarter from 25.06 for the same period last year.