GitLab, Inc. (GTLB) saw its shares plunge 5.01% in intraday trading, continuing a downward trend that has persisted throughout the week. The software development solutions provider's stock has been under pressure despite reporting better-than-expected first-quarter results, as investors focus on the company's disappointing guidance for the current quarter.

While GitLab's Q1 performance showed promise, with total revenue increasing by almost 27% year-over-year to $214.5 million and non-GAAP net income surging more than sixfold to $29.4 million, both surpassing analyst estimates, the company's outlook for Q2 fell short of expectations. GitLab projected revenue between $226 million and $227 million for the second quarter, slightly below the average analyst forecast, raising concerns about the company's growth trajectory.

Adding to the negative sentiment, several analysts have reduced their price targets for GitLab following the earnings report. Notably, Goldman Sachs downgraded the stock from "buy" to "neutral" with a price target of $50 per share. The series of analyst actions, combined with the lukewarm guidance, has contributed to the significant sell-off in GitLab's shares, overshadowing the company's otherwise solid Q1 performance.