Marimba managed to top Street estimates in its first quarter, but the stock fell 9 3/16, or 33 percent, to 20 1/16 Wednesday.
In the quarter, the Internet software developer posted a loss of a penny a share on sales of $10.6 million.
Analysts were expecting a loss of 2 cents a share.
However, investors backed away from the stock Wednesday, possibly concerned about sales growth through the rest of the year.
While CS First Boston analyst Wendell Laidley reiterated his "buy" recommendation on the stock while raising his fiscal 2000 and 2001 estimates, he also cut his 12-month price target from $63 to $41 a share.
"While we believe the core business is healthy, additional revenue growth is likely to come through expansion of the product line through the Timbale product suite and developing new and existing indirect channels," he said in a research note.
Laidley raised his fiscal 2000 revenue estimate to $51.6 million from $49.6 million while boosting his profit estimate from 3 cents a share to 4 cents a share. He upped his fiscal 2001 revenue estimate to $73.1 million from $70.4 million.
Including amortization costs of $336,000, Marimba.com lost $659,000, or 3 cents a share, in its first quarter.
First-quarter license sales were $8.1 million, up 79 percent from $4.5 million a year ago. Service sales rose to $2.5 million, up 55 percent from $1.6 million for the same quarter last year.
The company also announced that CFO Fred Gerson, will resign in order to pursue personal interests. Succeeding Gerson will be Ken Owyang, Marimba's vice president of finance and corporate controller, who joined the company in 1997.
First Call consensus expects it to earn 6 cents a share in the fiscal year.
Its shares peaked at 74 3/8 in May before falling to a low of 21 earlier this month.
All eight analysts following the stock rate it a "buy."