Edelson Lechtzin LLP, a leading class action law firm, is investigating securities fraud claims on behalf of investors of Cambium Networks Corporation common stock (NASDAQ: CMBM) between May 8, 2023, and January 18, 2024.
NEWTOWN, PA / ACCESSWIRE / June 17, 2024 / Edelson Lechtzin LLP, a leading class action law firm, is investigating securities fraud claims on behalf of investors of Cambium Networks Corporation common stock (NASDAQ:CMBM) between May 8, 2023, and January 18, 2024, inclusive (the "Class Period").
Investors who purchased Cambium stock may move the U.S. District Court for the Northern District of Illinois to appoint them as lead plaintiff no later than July 22, 2024. Please contact Edelson Lechtzin LLP to discuss your investment losses at 844-696-7492, or by e-mail at elechtzin@edelson-law.com. A copy of the class action complaint can be viewed HERE.
What is the Role of a Lead Plaintiff?
The lead plaintiff is a court-appointed representative of a class of purchasers of securities in a class action under the federal securities fraud laws. The lead plaintiff selects the attorneys who will represent the class in the lawsuit. Among other things, the lead plaintiff reviews the complaint, stays informed about the progress of the case, and if necessary, provides testimony at trial.
Background on Cambium Networks Corporation
Cambium, based in Rolling Meadows, Illinois, provides fixed wireless and Wi-Fi services to broadband service providers and enterprises for Internet access.
The Securities Fraud Claims
Throughout the Class Period, the Complaint alleges that Defendants made false and misleading statements about the Company's business, operations, and prospects. Specifically, Defendants failed to disclose that: (i) the company had excess inventory in its distribution channels; (ii) the company and its distributors were reasonably likely to offer aggressive discounts to reduce these high inventories; (iii) the company is expected to experience a decrease in revenue until the excess inventory is depleted; (iv) Cambium was likely to incur significant charges to write down excess and obsolete inventory; and (v) as a result of the foregoing, the company's fiscal 2023 revenue and earnings would be adversely affected.
After the market closed on August 1, 2024, Cambium reported a 23% sequential drop in second-quarter 2023 revenue, attributed to excess channel inventories leading to reduced demand for Enterprise products. Consequently, the company lowered its 2023 guidance, expecting a 7% to 11% year-over-year decline in revenue, and announced the immediate resignation of its CEO, Atul Bhatnagar. On this news, Cambium shares declined by $4.89 per share, or 30%, to close at $11.37 per share on August 2, 2023, on unusually heavy trading volume.
On October 4, 2023, Cambium announced that their preliminary third quarter 2023 revenue was expected to be between $40.0 million and $45.0 million lower than the previously expected $62.0 million to $70.0 million. This was attributed to a decrease in orders, an increase in stock rotations from distributors in the Enterprise business, and pressure from channel inventories. On this news, Cambium shares declined by $2.87 per share, or 36.2%, to close at $5.05 per share on October 5, 2023.
On January 18, 2024, Cambium announced that its estimated revenue for the fourth quarter of 2023 was approximately $40.0 million, down from the previous projection of $45.0-$50.0 million. This was due to aggressive discounts on Enterprise products to clear excess channel inventories. Additionally, the gross margin was expected to be below the lower end of the range because of increased excess and obsolete inventory reserves. Furthermore, Cambium's CEO was set to leave the company on February 2, 2024. On this news, the price of Cambium stock declined by $0.60 per share, or 12.40%, to close at $4.24 per share on January 19, 2024.
For more information, please contact:
Marc H. Edelson, Esq.
Eric Lechtzin, Esq.
EDELSON LECHTZIN LLP
411 S. State Street, Suite N-300
Newtown, PA 18940
Phone: 844-696-7492 or 215-867-2399 ext. 1
Email: medelson@edelson-law.com
Email: elechtzin@edelson-law.com
Web: www.edelson-law.com
Edelson Lechtzin LLP is a leading class action law firm with offices in Pennsylvania and California. In addition to cases involving securities and investment fraud, our lawyers focus on class and collective litigation in cases alleging violations of the federal antitrust laws, employee benefit plans under ERISA, wage theft and unpaid overtime, consumer fraud, and dangerous and defective drugs and medical devices.
This press release may be considered Attorney Advertising in some jurisdictions. No class has been certified in this case, so you are not represented by counsel unless you retain one. You may select counsel of your choice. You may also remain an absent class member and do nothing at this point. Your ability to share in any potential future recovery is not dependent upon serving as lead plaintiff.
SOURCE: Edelson Lechtzin LLP
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