Tuesday is turning out to be a disastrous one for ChannelAdvisor (NYSE: ECOM) and its investors.

ChannelAdvisor warned investors after the markets closed Monday that it will miss its revenue guidance for the fourth quarter, and the news triggered  a huge selloff in the ecommerce service provider’s stock.

Shares plunged more than 50 percent to as low as $9.03 after closing Monday at above $21. However, shares did rally back above $10 around 10 a.m.

Trading has been extremely heavy at nearly 4 million shares, 10 times the daily average. 

CEO Scot Wingo blames shift in business to large customers who receive discounts.

“We are disappointed that the fourth quarter did not meet our guidance,” Wingo said in a detailed explanation.

“We saw an unusual shift of gross merchandise volume (GMV) to larger customers this holiday season at the expense of smaller customers.

“Because larger customers enjoy volume discounts in the form of lower take rates, this shift translated to lower variable subscription revenue, even though overall GMV increased 31% year over year for the fourth quarter.”

ChannelAdvisor had forecast revenue between $25.6-$26.1 million for the last quarter of 2014 but now says it expects $23.7 million based on preliminary results.

In his statement, Wingo said the shift in business cost ChannelAdvisor a big drop on revenue for smaller customers, more than offsetting a surge in revenue for larger, fixed-subscription customers.

 “This resulted in fixed subscription revenue for the fourth quarter growing approximately 27% while variable subscription revenue decreased approximately 5% compared to a year ago,” Wingo said.

He did try to reassure investors, however.

“Despite this, we believe our fundamental value proposition, position in the market, and opportunities for continued growth remain intact. As fixed subscriptions grow as a percentage of overall revenue, we expect our overall visibility to improve as we look to continued growth in 2015.

“I want to emphasize that these financial results are preliminary and subject to change based on the completion of our normal quarter-end review process,” he added.

“We will provide additional financial details and customary metrics on our quarterly earnings call scheduled for February 5.”

Despite his statement, shares fell sharply percent in after-hours trading.

Shares had closed at $21.15 Monday, down 60 cents or 2.8 percent.

ChannelAdvisor went public in 2013. Its shares were already trading sharply lower than its 52-week high of $49.90 before Monday’s report.