Shares of Cellebrite (NASDAQ: CLBT) tumbled more than 20% on Tuesday after the digital forensics company lowered its full-year guidance and reported second-quarter revenue below expectations.
The company, which provides data extraction and analytics tools for law enforcement and corporate investigations, posted adjusted revenue of $65.1 million for the quarter ended June 30, missing the consensus estimate of $67.2 million among analysts polled by Refinitiv. Net loss widened to $19.8 million from $12.3 million a year earlier, reflecting higher operating costs and investment in research and development.
Cellebrite also revised its full-year revenue guidance to a range of $260 million to $270 million, down from its prior forecast of $280 million to $300 million. The company cited slower-than-expected adoption of its cloud-based solutions and macroeconomic headwinds as key factors behind the downward revision. Adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) were projected to decline to a range of $20 million to $30 million, compared with the prior outlook of $40 million to $50 million.
Analysts at Jefferies downgraded the stock to Hold from Buy, citing the weaker outlook and elevated valuation risks. The firm maintained a price target of $4.50, below the current trading level. Competitors in the digital forensics space, including Magnet Forensics and Cellebrite’s peers, have also faced scrutiny over growth sustainability amid tightening corporate budgets.
The stock, which had surged earlier in the year on optimism around AI-driven forensics tools, has now erased most of its gains for 2024. Shares were down 22.5% at $3.85 in midday trading, extending losses from Monday’s close.
