SentinelOne, Inc. (S) saw its shares plummet 10.93% in after-hours trading on Wednesday following the release of its first-quarter fiscal year 2026 financial results and a reduced annual revenue forecast. The cybersecurity company's stock price decline reflects investor concerns about its growth prospects in the face of economic uncertainty.

While SentinelOne reported Q1 revenue of $229 million, slightly beating the analyst estimate of $228.3 million, the company's decision to cut its annual revenue forecast was the primary driver of the stock's decline. SentinelOne now expects revenue between $996 million and $1 billion for the fiscal year, down from its previous projection of $1.01 billion to $1.012 billion. Additionally, the company's Q2 revenue guidance of $242 million fell short of analyst expectations of $244.9 million.

The revised forecast suggests that businesses are becoming more cautious with their spending on cybersecurity solutions amid economic uncertainties. Despite maintaining a strong gross margin of 75% (79% on an adjusted basis) and reporting $1.2 billion in cash and investments, the lowered growth expectations have clearly rattled investors. As companies continue to navigate through economic challenges, SentinelOne's performance will be closely watched as an indicator of the broader cybersecurity market's health. In response to the situation, the company's board has authorized a $200 million share buyback program, which may be aimed at supporting the stock price.