Shares of Scotts Miracle-Gro Company (SMG) plummeted 5.07% in pre-market trading on Wednesday following the release of its fiscal second-quarter earnings report. While the company's adjusted earnings per share beat estimates, investors seemed to focus on the disappointing revenue figures and ongoing challenges in its Hawthorne segment.

The lawn and garden products company reported Q2 sales of $1.42 billion, falling short of the $1.49 billion analysts had expected. This represents a 7% decrease from the same period last year. The company's U.S. consumer business, which accounts for the majority of its revenue, saw a 5% decline due to a colder and slower start to the lawn and garden season. More concerning to investors was the performance of the Hawthorne Gardening business, which caters to cannabis growers. This segment experienced a staggering 51% drop in sales, coming in at just $32.7 million.

Adding to the negative sentiment, Scotts Miracle-Gro announced it would no longer provide full-year revenue guidance for its troubled Hawthorne segment, citing continuing uncertainty in the cannabis industry. This decision, coupled with the significant sales decline, may have heightened investor concerns about the company's growth prospects in this once-promising market. Despite reaffirming guidance for other segments and reporting improved gross margins, the market's reaction suggests that revenue growth and the future of the Hawthorne business remain key focuses for investors.