Sprinklr (CXM) shares fell more than 25% in early pre-market trading after the company reported Q3 results and offered an outlook.

For Q3, Srinklr reported an adjusted EPS of 12 cents on revenue of $186.3 million, topping the analyst consensus for earnings per share of 7 cents on revenue of $180.4 million. Subscription revenue increased 22% year-over-year to $170.5 million.

“We had another solid quarter across the board with record levels of profitability supported by strength in our Sprinklr Service product suite. We're committed to helping customers achieve productivity gains across their front office through leveraging generative AI, turning vast amounts of unstructured data into actionable insights, and unifying their customer-facing teams that result in superior customer experiences,” said Ragy Thomas, Founder and CEO at Sprinklr.

For this quarter, the company sees adjusted EPS between 8 cents and 9 cents on revenue of $188.5 million. Analysts were looking for 8 cents in adjusted EPS on sales of $188.3 million.

The company raised its full-year forecast to $726.5 million, from the prior $720 million, and above the consensus of $720.5 million. Adjusted EPS is seen in the range of 36 cents to 37 cents, up from the previous range of 30-31 cents.

However, shares sank after the management said it expects sales growth to be about 2.5% quarter-over-quarter each quarter, or 10% for FY25. The Street was looking for as much as 17% in FY25 growth.

As a result, analysts lowered the rating to Neutral, citing “limited near-term growth.”

The new guidance “will likely weigh on the pace of margin expansion and FCF generation compared to previous expectations, and given the tough macro plus pending headwinds around the renewal cycle, we have limited visibility and confidence into when and how quickly the company might reaccelerate topline growth,” analysts said.

Analysts cut the price target by $2 to $16 per share on Neutral-rated CXM stock.

“It’s difficult to assess the root cause this early, but we believe CXM’s relatively premium priced products could be facing some outsized budgetary pressure,” analysts said.