Acuity Brands Inc. (AYI) shares plunged 6.63% in pre-market trading on Friday, as investors reacted to the company's second-quarter fiscal 2025 results and growing concerns over the impact of new tariffs on its business.

The lighting and building management solutions provider reported Q2 revenues of $1,006.30 million, falling short of the Zacks Consensus Estimate of $1,022.63 million. This revenue miss, coupled with uncertainty surrounding recently announced tariffs, appears to have spooked investors.

During the earnings call, Acuity's management addressed the tariff issue, with CEO Neil Ashe stating, "We approach tariffs as the equivalent of a supply shock, and our financial priorities are, first, to manage the dollar impact, and second, to manage the margin impact." The company has already taken pricing actions in response to tariffs that were in place through the end of March and plans to continue adjusting prices as the tariff policy evolves.

Adding to the pressure on Acuity's stock, Morgan Stanley analyst Christopher Snyder lowered the firm's price target on Acuity Brands to $335 from $370, although maintaining an Overweight rating. This adjustment reflects growing concerns about the company's near-term outlook in light of the challenging macroeconomic environment and tariff-related uncertainties.

Despite the current headwinds, Acuity's management remains confident in the company's strategic positioning. Ashe emphasized the strength of their diversified global supply chain and the company's ability to adapt to market changes. However, investors appear to be taking a cautious stance as they assess the potential impact of tariffs on Acuity's business model and future growth prospects.