LendingTree (NASDAQ: TREE) saw its shares plummet 13.16% in after-hours trading on Thursday following the release of its first-quarter 2025 earnings report. The sharp decline came as the company's revenue fell short of analyst expectations and its second-quarter guidance failed to impress investors.

For the first quarter, LendingTree reported revenue of $239.7 million, missing the IBES estimate of $244.9 million by 2.14%. This revenue figure, however, represents a significant 42.85% increase compared to the same period last year. Despite the revenue miss, the company's adjusted earnings per share (EPS) of $0.99 handily beat the analyst consensus of $0.65, marking a 52.31% surprise to the upside and a 41.43% year-over-year increase.

The market's negative reaction appears to be driven by two main factors. First, the revenue shortfall suggests that LendingTree's growth may be slowing down more than anticipated. Second, the company's outlook for the second quarter failed to alleviate investor concerns. LendingTree provided Q2 revenue guidance in the range of $241 million to $248 million, which at its midpoint falls short of the current IBES estimate of $248.5 million. This outlook indicates that the company may continue to face challenges in meeting market expectations in the near term, despite its strong bottom-line performance in Q1.