Yes, this is because you are running a Functional Testing VSE and the tps received is more then 10tps.
There should not be any loss of requests, they are queued inside the vse and only processed at a rate of 10 tps.
If this is a virtual service where you have added or manipulated steps inside the virtual service model then doublecheck if all the “wait times” for all the steps are still at 0. If the processing of a request is (artificially) delayed due too wait times then you reach the 10 tps even faster.
Cheers,
Danny