What happened

Commercial landscaping-company BrightView Holdings (BV 2.12%) forecast revenue for the current quarter that fell short of analyst expectations, and the stock is getting a trimming as a result. The company posted decent results, but shares of BrightView fell by as much as 33% on Tuesday.

So what

BrightView is a consolidator in the commercial landscaping sector, acquiring a tree-care company in Virginia and a resort-maintenance company in Hawaii in the last few weeks alone. The company lost money in its most recent quarter but actually did a lot better than what analysts were expecting.

On Tuesday morning, BrightView reported a fiscal first-quarter loss of $0.01 per share on revenue of $655.9 million, topping analyst expectations for a $0.09 per-share loss on sales of $625 million.

"We are pleased to start fiscal 2023 with a strong first quarter, underpinned by robust organic revenue growth across both segments, acquisition benefits, disciplined cost management and a steadfast focus on executing our growth strategy to continue to drive momentum in our business," CEO Andrew Masterman said in a statement.

Total revenue was up 10.8% year over year, including about 5.5% organic growth and the rest via acquisitions. Landscape maintenance remains the company's largest source of revenue, but Brightview's development operation, which includes assisting in project planning and construction, grew by 12.7% year over year and accounted for $174.4 million in total revenue in the quarter.

Now what

BrightView doesn't see growth in the current quarter and forecast total fiscal second-quarter revenue of between $610 million and $650 million. That's considerably less than the $700 million analyst consensus.

The company isn't free-cash-flow positive, and its net cash used by operations increased in the December quarter, due to a decrease in cash provided by unbilled and deferred revenue, coupled with an increase in cash used by accounts receivable. BrightView could use the cash, as it has more than $1.4 billion in debt on its balance sheet.

Landscaping is seen as a relatively defensive business during a downturn, but in this tough operating environment, investors appear to be in no mood to give the benefit of the doubt. Shares of BrightView have now lost nearly 70% of their value since the company's 2018 debut and appear to lack a catalyst to quickly rebound from here.