Cellebrite (CLBT) shares tumbled 5.07% in pre-market trading on Wednesday following the release of its first-quarter 2025 financial results. The digital intelligence solutions provider reported mixed earnings, with revenue falling short of expectations and a reduction in its full-year 2025 revenue targets.

For Q1 2025, Cellebrite posted revenue of $107.55 million, missing the analyst consensus estimate of $109.36 million. While the company's adjusted earnings per share of $0.10 beat expectations of $0.08, net income came in at $17.4 million, below the estimated $20.2 million. Despite these mixed results, Cellebrite reported strong Annual Recurring Revenue (ARR) growth of 23% year-over-year, reaching $408.0 million.

The pre-market sell-off appears to be largely driven by Cellebrite's decision to lower its full-year 2025 revenue expectations. CFO Dana Gerner cited the persistent challenging U.S. Federal spending environment and anticipated lower one-time professional services revenue from the U.S. Federal vertical as reasons for the adjustment. This outlook revision, combined with the Q1 revenue miss, seems to have overshadowed the company's strong ARR growth and better-than-expected adjusted EBITDA performance, leading to negative sentiment among investors in early trading.