Zepp Health Corporation (NYSE: ZEPP) saw its stock plummet 5.56% in trading on Tuesday, despite reporting robust revenue growth for the third quarter of 2025. The sharp decline suggests investors may have concerns about the company's profitability and future outlook.

The wearable technology company announced unaudited financial results for Q3 2025, with revenue reaching $75.8 million, representing a significant 78.5% year-over-year increase. Zepp Health also reported an improved gross margin of 38.2% for the quarter. However, the company still recorded a net loss attributable to Zepp Health of $1.6 million, albeit narrower than the $13.3 million loss in the same period last year.

While Zepp Health showed progress towards profitability, with adjusted operating income reaching breakeven at $0.4 million, investors may be focusing on the company's guidance for the fourth quarter. Zepp Health expects Q4 2025 revenue to be between $82.0 million and $86.0 million, representing a year-over-year increase of 38% to 45%. This projection, while still indicating strong growth, may have fallen short of some analysts' expectations, potentially contributing to the stock's decline.