Shares of Service Corporation International (SCI) tumbled 6.13% in after-hours trading on Wednesday, despite the company reporting better-than-expected first-quarter results for 2025. The sharp decline suggests that investors may have found the company's outlook less impressive than anticipated.

Service Corporation reported Q1 revenue of $1,074.2 million, surpassing the IBES estimate of $1,060 million. The company's adjusted earnings per share (EPS) came in at $0.96, beating the expected $0.91. Net income for the quarter stood at $142.9 million, also exceeding the estimated $132.3 million. Operating income was reported at $251.7 million, compared to the projected $239.2 million.

Despite these strong results, the stock's significant drop might be attributed to the company's 2025 guidance. Service Corporation confirmed its EPS outlook for the year, excluding special items, at $3.70 to $4.00. This range may have fallen short of market expectations, potentially explaining the negative reaction in the stock price. Investors often look beyond current results to future projections when valuing stocks, and any perceived weakness in outlook can lead to selling pressure.