Shares of Krystal Biotech Inc. (KRYS) tumbled 13.73% in pre-market trading on Tuesday following the release of its first-quarter 2025 financial results, which fell short of analyst expectations.

The gene therapy company reported earnings per share of $1.20, missing the analyst consensus estimate of $1.32 by 9.09%. While this represents a 160.87% increase from the same period last year, investors were clearly hoping for stronger performance. Revenue for the quarter came in at $88.18 million, falling short of the expected $96.24 million by 8.37%. Despite the 94.88% year-over-year growth in sales, the market's reaction suggests disappointment with the pace of expansion.

The company's flagship product, VYJUVEK, generated $88.2 million in net revenue for the quarter. While this shows continued adoption of the treatment for dystrophic epidermolysis bullosa, it appears the growth rate may be slowing. Krystal Biotech also highlighted progress in its pipeline, including developments in cystic fibrosis and alpha-1 antitrypsin deficiency treatments, but these advancements were overshadowed by the earnings miss. The sharp stock decline indicates that investors may be recalibrating their growth expectations for the company in the near term.