Shares of KE Holdings Inc. (NYSE: BEKE), a leading integrated online and offline platform for housing transactions and services in China, tumbled 5.54% in pre-market trading on Thursday. This sharp decline comes despite the company reporting robust first-quarter financial results that surpassed analyst expectations.

KE Holdings announced its Q1 2025 unaudited financial results before the market opened, revealing significant year-over-year growth. The company's net revenues surged 42.4% to RMB23.3 billion (US$3.2 billion), exceeding the FactSet analyst consensus of RMB22.63 billion. Net income saw an impressive 97.9% increase to RMB855 million (US$118 million). Adjusted earnings per American Depositary Share (ADS) reached RMB1.19 (US$0.16), slightly above the RMB1.18 reported in the same period last year and surpassing the FactSet estimate of RMB0.98.

The pre-market plunge, despite these positive results, suggests that investors may have had even higher expectations or are focusing on other aspects of the company's performance and outlook. Factors such as future guidance, market conditions in China's real estate sector, or broader economic concerns could be influencing investor sentiment. As the trading day progresses, it will be interesting to see if the stock recovers based on the strong fundamental performance or if other factors continue to weigh on investor confidence in KE Holdings.