Shares of Cognyte Software Ltd. (NASDAQ: CGNT) tumbled 9.27% in pre-market trading on Wednesday, despite the company reporting improved financial results for the first quarter of fiscal 2026. The sharp decline suggests that the results or outlook may have fallen short of market expectations.
Cognyte, a leader in investigative analytics solutions, announced a 15.5% year-over-year increase in revenue to $95.5 million for the quarter ended April 30, 2025. The company also reported a significant improvement in profitability, with GAAP operating income of $2.2 million, compared to an operating loss in the same period last year. Non-GAAP operating income more than quadrupled to $7.6 million, while Adjusted EBITDA more than doubled to $10.3 million.
Despite these improvements, investors appear to be focusing on the company's outlook for fiscal 2026. Cognyte projected revenue of $395 million at the midpoint for the full year, representing approximately 13% growth from the previous year. The company also forecasted Non-GAAP diluted earnings per share of $0.19 at the midpoint of its revenue outlook. While these figures represent growth, they may not have met the market's more optimistic expectations, potentially explaining the stock's pre-market plunge.
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