Why Symbotic Stock Is Plummeting Today

Symbotic (NASDAQ: SYM) stock is sinking in Tuesday's trading following the recent release of the company's quarterly results. The robotics specialist's share price was down 21.2% as of 10:45 a.m. ET, according to data from S&P Global Market Intelligence .

Symbotic published results for the third quarter of its fiscal year after the market closed yesterday, delivering mixed results. While the company posted sales for the period that beat the market's expectations, earnings for the period came in worse than expected.

Symbotic's Q3 sales beat isn't impressing investors

Symbotic posted a loss of $0.02 per share on sales of $491.86 million in fiscal Q3 -- a period that wrapped June 29. For comparison, the average analyst estimate had expected the business to post a breakeven quarter on revenue of $463.81 million.

Even though Symbotic has a major technology and services deal with Walmart , the recent quarterly report is raising questions about the robotics specialist's growth and margins picture. Revenue still increased 57.7% year over year last quarter, but it looks like future performance could be uneven. While the unexpected loss in fiscal Q3 is raising concerns about the company's margins and abilities to shift into delivering consistent profitability, the company's forward sales guidance may be an even bigger factor in today's sell-off.

Symbotic's guidance raises a red flag

For the fourth quarter of its current fiscal year, Symbotic is guiding for sales to be between $455 million and $475 million. Non-GAAP (adjusted) earnings before interest, taxes, deprecation, and amortization ( EBITDA ) are projected to be between $28 million and $32 million.

While the company's midpoint guidance still suggests that sales will increase roughly 19% year over year, that would represent a dramatic deceleration compared to recent growth rates. At the midpoint, management's Q4 target also suggests that sales will decline roughly 5.5% on a sequential quarterly basis. With margins recently coming in lower than expected and guidance for sales to actually take a step back on a sequential basis, it's not surprising that Symbotic stock is getting hit hard today.

Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Walmart. The Motley Fool has a disclosure policy .