SEMrush Holdings, Inc. (SEMR) stock is experiencing a significant pre-market plunge of 13.11% on Thursday, following the release of its first-quarter 2025 financial results. This sharp decline comes on the heels of a 6.46% drop in after-hours trading on Wednesday, indicating investors' continued negative reaction to the company's mixed performance.
The digital marketing software company reported Q1 revenue of $105.02 million, surpassing analyst expectations of $104.36 million and marking a robust 22% year-over-year growth. However, SEMrush's earnings per share (EPS) of $0.01 fell short of the $0.02 estimate, which appears to be the primary driver behind the stock's downward movement. The company's net income for the quarter stood at $655,000, while it reported a slight operating loss of $74,000.
Despite the earnings miss, SEMrush has maintained its full-year guidance, projecting revenue between $448 million and $453 million. The company also provided a Q2 revenue outlook of $108.2 million to $109.2 million. However, the market's severe reaction suggests that investors are more focused on the company's profitability concerns rather than its strong revenue growth. The continued sell-off in pre-market trading indicates that shareholders may be reassessing the company's valuation in light of its earnings performance and potential challenges in achieving anticipated profit levels.
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.