StepStone Group Inc. (STEP) shares plunged 5.81% in pre-market trading on Friday following the release of its second-quarter earnings report. The investment management firm's results fell short of analyst expectations, disappointing investors and triggering a sell-off.

According to the quarterly report, StepStone posted adjusted earnings of 40 cents per share, missing the mean analyst estimate of 43 cents. This represents a significant decline from the 48 cents per share reported in the same quarter last year. Despite the earnings miss, the company's revenue surged 104.6% to $364.29 million, substantially surpassing the Wall Street expectation of $238.45 million.

However, the company's bottom line raised concerns among investors. StepStone reported a quarterly loss of $38.42 million, with a reported EPS showing a loss of 49 cents. This stark contrast between adjusted and reported earnings, coupled with the overall decline in profitability, appears to have overshadowed the impressive revenue growth, leading to the sharp pre-market decline in stock price. The market's reaction suggests that investors are prioritizing profitability over top-line growth in the current economic environment.