Select Medical (SEM) shares plunged 9.62% in pre-market trading on Friday following the release of its disappointing first-quarter earnings report and reduced annual revenue guidance. The healthcare company's performance fell short of analyst expectations, sparking concerns among investors.

According to the report released late Thursday, Select Medical posted Q1 earnings from continuing operations of $0.44 per diluted share, up from $0.33 a year earlier but below the $0.46 expected by analysts polled by FactSet. Revenue for the quarter ended March 31 came in at $1.35 billion, missing the $1.39 billion forecast and only slightly higher than the $1.32 billion reported in the same period last year.

Adding to investor worries, Select Medical trimmed its annual revenue guidance for 2025 to a range of $5.3 billion to $5.5 billion, down from its previous forecast of $5.4 billion to $5.6 billion. This reduction puts the company's outlook below the $5.46 billion expected by analysts. Despite the lowered revenue outlook, Select Medical reaffirmed its 2025 earnings guidance of $1.09 to $1.19 per diluted share, which is in line with analysts' expectations of $1.12. However, this reassurance did little to alleviate concerns, as evidenced by the significant pre-market sell-off.