Shares of Rollins Inc. (ROL), the leading pest control services provider, plummeted by over 5% in early trading on Wednesday after the company reported mixed third-quarter results that raised concerns about its profitability and margin management.

While Rollins exceeded revenue expectations, posting a 9% year-over-year increase to $916 million, driven by strong demand and growth across its commercial and termite services segments, the company's earnings per share (EPS) fell short of analyst estimates. The reported EPS of $0.28 missed the consensus forecast of $0.30, despite a 7.7% increase from the prior year.

The earnings miss can be attributed to margin pressures stemming from rising costs and increased investments in acquisitions, technology, and expansion efforts. Despite the topline growth, Rollins experienced slight declines in its operating and EBITDA margins, with the adjusted EBITDA margin contracting by 80 basis points year-over-year.