SailPoint Tops Earnings Expectations. Why the Cybersecurity Stock Is Tumbling.

The cybersecurity company’s third-quarter guidance disappointed investors. (Michael Nagle/Bloomberg)

SailPoint was falling sharply Tuesday after the cybersecurity company beat quarterly earnings expectations but issued a dim outlook for the current third quarter.

The company posted adjusted earnings of 7 cents a share for the second quarter, beating Wall Street’s call for 4 cents. Revenue totaled $264.4 million, up 33% from last year and better than the $243.2 million analysts had estimated.

SailPoint’s guidance for the third quarter disappointed investors, however. The company anticipates revenue of $269 million to $271 million, below Wall Street expectations of $277 million. Adjusted earnings are expected at between 5 cents and 6 cents a share, compared to analysts’ estimates for 7 cents.

SailPoint was falling 13% to $19.56 in premarket trading Tuesday. The company closed Monday just off its February initial public offering price of $23 a share.

SailPoint has had difficulty posting consistent profits over its 20-year history, though the company has now broken even on an adjusted basis for two consecutive quarters.

Write to Nate Wolf at nate.wolf@barrons.com