Regal Rexnord Corporation (RRX) saw its stock price plummet 5.73% in after-hours trading on Wednesday, following the release of its third-quarter earnings report and a surprising announcement regarding its leadership. The sharp decline comes as investors digest a trio of concerning developments from the industrial manufacturing company.

The company reported third-quarter adjusted earnings per share of $2.51, falling short of analyst expectations which ranged from $2.54 to $2.57. While Regal Rexnord's sales of $1.497 billion slightly beat estimates of $1.495 billion, the earnings miss appears to have spooked investors. Adding to the concerns, the company narrowed and lowered its full-year 2025 adjusted EPS guidance to a range of $9.50 to $9.80, below the previous FactSet consensus estimate of $9.86.

In a separate announcement that likely contributed to the stock's decline, Regal Rexnord revealed that its Board of Directors has initiated a CEO succession process. Current CEO Louis Pinkham, who has led the company since April 2019, will remain in his position until a successor is identified. While the company highlighted Pinkham's achievements, including nearly doubling the company's total shareholder return during his tenure, the unexpected leadership transition has created uncertainty among investors. The combination of missed earnings, lowered guidance, and an impending CEO change appears to have triggered a significant sell-off in Regal Rexnord's stock during after-hours trading.