Confluent, Inc. (CFLT) saw its shares tumble 5.5% in after-hours trading on Wednesday, despite reporting first-quarter earnings that surpassed analyst expectations. The cloud-based data streaming platform provider delivered strong results but failed to excite investors, possibly due to concerns about future growth or valuation.

For the first quarter of 2025, Confluent reported revenue of $271.1 million, beating the IBES estimate of $264.6 million. The company's adjusted earnings per share came in at $0.08, also surpassing the expected $0.07. Additionally, Confluent's adjusted operating income reached $11.6 million, significantly higher than the estimated $8.39 million, with an adjusted operating margin of 4.3%.

Despite these positive results, the after-hours stock drop suggests that investors may be focusing on other factors. The company provided full-year guidance, projecting an adjusted EPS of $0.36 and an adjusted operating margin of 6%. While these figures represent improvement, they may not have met the market's lofty expectations for a high-growth tech company. The sharp decline could also indicate that some investors believe the stock's current valuation may be stretched, even with the strong quarterly performance. As the market digests this information, it will be crucial to watch for any analyst updates or further guidance from Confluent in the coming days to better understand the factors driving this unexpected stock movement.