What: Shares of Pure Storage (PSTG 1.54%), which develops and provides an enterprise data storage platform, fell about 18% on Thursday after the company reported first-quarter results and  Lundin Law announced in a press release it is investing claims against Pure Storage "concerning possible violations of federal securities laws."

Image source: Pure Storage.

So what: Pure Storage's first-quarter revenue and EPS were actually ahead of analyst expectations. On average, analysts expected the company to report revenue and adjusted EPS of about $137 million and a loss of $0.23, respectively. But actual revenue was $139.9 million and adjusted EPS came in at a loss of $0.22.

These results compare to revenue and adjusted EPS of $74.1 million and a loss of $0.26 in the year-ago quarter, respectively.

Pure Storage's guidance could be one reason for the market's pessimistic reaction. While management's guidance for second-quarter revenue in the range of $153 million to $157 million is in line with analyst expectations for second-quarter revenue of about $154 million, investors may have been hoping for an upside surprise; it's normal for investors in fast-growing companies like Pure Storage to expect the company to report results and guidance higher than analyst expectations.

Lundin Law's investigation, which asks "investors who purchased or otherwise acquired shares traceable to the Company's Initial Public Offering" last year to contact the firm, may also be a reason for stock's sell-off on Thursday.

Now what: Management was happy with the company's results, calling it a "strong quarter," and is optimistic about the business. Furthermore, Pure Storage CFO Tim Riitters specifically said the company continues "to expect to reach sustained positive cash flow by the second half of calendar year 2017."