The law firm of Lieff Cabraser Heimann & Bernstein, LLP announces that class action litigation has been filed on behalf of investors who purchased or otherwise acquired shares of Cerence Inc. (“Cerence” or the “Company”) common stock (Nasdaq: CRNC) between February 8, 2021 and February 4, 2022, inclusive (the “Class Period”).
If you purchased or otherwise acquired Cerence common stock during the Class Period, you may move the Court for appointment as lead plaintiff in the action by no later than April 26, 2022.
A lead plaintiff is a representative party who acts on behalf of other class members in directing the litigation. Your share of any recovery in the actions will not be affected by your decision of whether to seek appointment as lead plaintiff. You may retain Lieff Cabraser, or other attorneys, as your counsel in the action.
Cerence investors who wish to learn more about the litigation and how to seek appointment as lead plaintiff should click here, or text or email investorinfo@lchb.com, or call Sharon M. Lee of Lieff Cabraser at 1-800-541-7358.
Background on the Cerence Securities Class Litigation
Cerence, headquartered in Burlington, Massachusetts, builds artificial intelligence-powered virtual assistants primarily for the automotive market. The Company was created on October 1, 2019, as a tax-free spinoff from Nuance Communications, Inc. Throughout the Class Period, Cerence emphasized its positive guidance for fiscal 2024, when the restrictions in its use of Nuance’s intellectual property rights and data are slated to end.
The action alleges that, throughout the Class Period, defendants made false and misleading statements and failed to disclose that: (1) demand for Cerence’s software licenses was negatively impacted by the global shortage in semiconductor devices which caused a decline in auto-manufacturing; (2) the Company was “pulling forward” or “pre-banking” license sales to mask these issues; and (3) as a result of the foregoing, Cerence’s positive guidance for fiscal years 2022 and 2024 lacked any reasonable basis in fact.
On November 22, 2021, the Company released its results for the fiscal fourth quarter and full-year 2021, which included fiscal year 2022 guidance well below analysts’ expectations. At that time, the Company maintained its position of a fiscal year 2024 guidance of $700 million. On this news, the price of Cerence common stock fell 20% from its closing price of $104.06 on November 19, 2021 to $82.59 the next trading day, November 22, 2021, on unusually high trading volume. Cerence’s stock price continued to fall the following day, closing at $78.27 on November 23, 2021, also on elevated trading volume.
On December 15, 2021, the Company announced that its CEO Sanjay Dhawan had resigned the day prior. On the news, the price of Cerence common stock fell an additional 11%, from its closing price of $78.08, to close at $69.20 on December 15, 2021, on very high trading volume.
On February 7, 2022, the Company announced its financial results for the first fiscal quarter of 2022 and the surprise retirement of CFO Mark Gallenberger, effective March 11, 2022. During a conference call with analysts that day, Cerence’s new CEO, Stefan Ortmanns, revealed that “the conversion from bookings to revenue will take longer than expected” and that the Company was withdrawing its 2024 target financial model. On this news, the price of Cerence common stock fell by more than 30%, from its closing price of $63.58 on February 4, 2022, to close at $43.61 on February 7, 2022, on extremely elevated trading volume.
About Lieff Cabraser
Lieff Cabraser Heimann & Bernstein, LLP, with offices in San Francisco, New York, and Nashville, and Munich, is an internationally-recognized law firm committed to advancing the rights of investors and promoting corporate responsibility. The National Law Journal has recognized Lieff Cabraser as one of the nation’s top plaintiffs’ law firms for fourteen years. Law360 has selected Lieff Cabraser as one of the Top 50 law firms nationwide for litigation, highlighting our firm’s “laser focus” and noting that our firm routinely finds itself “facing off against some of the largest and strongest defense law firms in the world.” Benchmark Litigation has named Lieff Cabraser one of the “Top 10 Plaintiffs’ Firms in America.”
For more information about Lieff Cabraser and the firm’s representation of investors, please visit https://www.lieffcabraser.com/.
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