What happened
Shares of WalkMe (WKME 1.52%), a software development tools platform company, were falling this morning after the company reported a worse-than-expected loss in the first quarter. Investors were likely also responding to several negative notes about the stock from analysts today.
The tech stock was down by 25% as of 10:28 a.m. ET.
So what
WalkMe reported a loss of $0.27 per share in the first quarter, which was an improvement from the company's loss of $1.71 in the year-ago quarter, but was lower than analysts' average estimate of a loss of $0.23 per share.
Image source: Getty Images.
While earnings fell below expectations, WalkMe's sales of $56.8 million in the quarter actually came out ahead of Wall Street's expectation of $56.1 million.
But investors focused their attention on the company's losses and they also likely took their cue from several analysts' notes today.
KeyBanc downgraded the stock to sector weight from overweight today, and analysts at both Needham and BMO Capital lowered their price targets for WalkMe's stock.
Now what
Investors are increasingly impatient with technology stocks that aren't profitable right now.
The Federal Reserve has taken aim at sky-high inflation and is expected to continue raising the federal funds rate this year. That's caused worry among many investors, particularly in high-growth tech stocks, that an economic slowdown could be on the horizon.
With recession fears on many people's minds, WalkMe investors took the company's worse-than-expected loss as a sign to sell their shares today.
