Investing.com -- Two Wall Street brokerages downgraded HubSpot after the marketing software company’s first-quarter results, while solid on headline numbers, revealed a murkier path to the growth reacceleration and provided guidance that fell short of analyst expectations.

The print sent shares tumbling more than 24% in Friday premarket trading.

William Blair cut its rating to Market Perform from Outperform, while Cantor Fitzgerald moved to Neutral from Overweight and slashed its price target to $200 from $325.

HubSpot reported first-quarter revenue of $881 million, up 23% year-over-year and ahead of consensus, with constant-currency growth of 18% topping guidance of 16%. Operating margin came in at 17.8%, 100 basis points above estimates.

"However, after factoring in $4mn of lower FX benefit from when guidance was originally set, the company only flowed through about two-thirds of the 1Q beat into FY26 revenue guidance, which now significantly impairs the ability to accelerate to the high-teens/~20% CC growth for the year that many investors were anticipating," Cantor analysts said.

This is partly due to a slow start to the second quarter. HubSpot spent about a week in April retraining its sales force following updates to its Spring Spotlight product launch, a disruption that weighed on early momentum.

"Mgmt. outlined elongating sales cycles caused by several factors, most of which we view as self-inflicted choices made with a longer-term positive outcomes expected, but are likely to weigh on growth for the next few quarters," the analysts wrote.

William Blair flagged concerns around net new annual recurring revenue (ARR), noting that its growth was slower than revenue growth in the first quarter, leaving the company with little room for error in the back half of the year.

The broker also pointed to a slowdown in constant-currency billings growth to 17% from 19% the prior quarter, continued pressure on upgrades and cross-selling, and potentially longer sales cycles tied to pricing changes for its AI agents.

The analysts stressed that the downgrades were not a verdict on HubSpot’s AI positioning. William Blair noted that gross retention remains in the high 80s and that AI credit consumption grew 67% sequentially, with uptake across its Customer Agent, Prospecting Agent, and Data Agent tools.

"This is not a downgrade on HubSpot being an ’AI loser,’" the brokerage wrote.

Still, the elevated uncertainty "is likely to put HubSpot in the penalty box and keep shares rangebound until more meaningful growth acceleration becomes evident," it said.