Shares of Samsara, Inc. (NYSE: IOT) tumbled 10.62% in pre-market trading on Friday, following the release of its first-quarter fiscal year 2026 financial results. Despite reporting better-than-expected earnings and revenue for the quarter, the company's forward guidance appears to have fallen short of investor expectations, triggering a significant sell-off.

For the first quarter, Samsara reported adjusted earnings per share of $0.11, surpassing the analyst estimate of $0.06. Revenue came in at $366.9 million, beating expectations of $351.4 million. The company's Q1 adjusted gross margin was strong at 79%, with an adjusted operating margin of 14%. However, Samsara's outlook for the second quarter and full fiscal year 2026 seems to have disappointed investors, despite being raised from previous estimates.

The primary concern for investors appears to be the company's decelerating growth trajectory. For Q2, Samsara expects revenue between $371-373 million, representing a year-over-year growth of 24%, a significant deceleration from the 31% growth seen in Q1. The full-year guidance projects revenue of $1.547-$1.555 billion, which also implies a continued slowdown in the latter half of the year. This moderation in growth, coupled with high investor expectations following the stock's recent outperformance, likely contributed to the sharp decline in share price during pre-market trading.