Shares of Lear Corporation (LEA), a leading automotive seating and electrical systems supplier, plummeted 7.99% in pre-market trading on Friday, despite reporting better-than-expected second-quarter results. The sharp decline suggests that investors are focusing on concerns about the company's future performance rather than its current earnings.

For the second quarter of 2025, Lear reported adjusted earnings per share of $3.47, surpassing analysts' estimates of $3.28. However, this represents a decline from $3.60 in the same quarter last year. Net sales remained relatively flat at $6.03 billion, slightly above the $5.92 billion expected by analysts. Despite beating expectations, the year-over-year decline in adjusted earnings and flat sales growth may have contributed to investor unease.

The company's full-year 2025 guidance appears to be a significant factor in the stock's pre-market plunge. Lear expects net sales for the fiscal year to range between $22.47 billion and $23.07 billion. While this aligns with the FactSet estimate of $22.64 billion, investors may be interpreting these figures as signs of potential challenges in maintaining profitability and growth in the competitive automotive supplier market. The guidance, combined with the Q2 results showing declining profits despite beating estimates, has likely sparked concerns about Lear's ability to navigate ongoing challenges in the automotive industry, leading to the significant sell-off in pre-market trading.