NEW YORK, NY / ACCESSWIRE / August 22, 2024 / Pomerantz LLP announces that a class action lawsuit has been filed against Extreme Networks, Inc. ("Extreme" or the "Company") (NASDAQ:EXTR). Such investors are advised to contact Danielle Peyton at newaction@pomlaw.com or 646-581-9980, (or 888.4-POMLAW), toll-free, Ext. 7980. Those who inquire by e-mail are encouraged to include their mailing address, telephone number, and the number of shares purchased.
The class action concerns whether Extreme and certain of its officers and/or directors have engaged in securities fraud or other unlawful business practices.
You have until October 15, 2024, to ask the Court to appoint you as Lead Plaintiff for the class if you are a shareholder who purchased or otherwise acquired Extreme securities during the Class Period. A copy of the Complaint can be obtained at www.pomerantzlaw.com.
[Click here for information about joining the class action]
On January 25, 2023, Extreme announced the resignation of Chief Financial Officer ("CFO") Rémi Thomas, effective February 16, 2023. That same day, Extreme reported its financial results for the second quarter of its fiscal year ("FY") 2023. Among other items, Extreme revealed that, compared to the prior quarter, the Company's backlog had fallen to $542 million its Product Book to Bill Ratio had fallen from 1.3x to 0.9x and its Service Book to Bill Ratio had fallen from 1.4x to 1.2x. On a related earnings call, Extreme executives also shortened the timeline for backlog normalization.
On this news, Extreme's stock price fell $2.81 per share, or 14.55%, to close at $16.50 per share on January 25, 2023.
On August 24, 2023, Extreme filed its annual report for FY 2023 with the U.S. Securities and Exchange Commission, disclosing that its backlog stood at just $267.3 million, revealing a roughly $245 million decline year-over-year and a $275.7 million decline during the prior six months.
On this news, Extreme's stock price fell $2.52 per share, or 9.1%, to close at $25.16 per share on August 25, 2023.
On January 8, 2024, Extreme issued a press release that provided a business update, advising that "second quarter revenues are now expected to be approximately $294 to $297 million, compared to the prior outlook of $312 to $327 million." The Company attributed its revised guidance to "industry headwinds of channel digestion and elongated sales cycles."
On this news, Extreme's stock price fell $1.29 per share, or 7.36%, to close at $16.23 per share on January 9, 2024.
Then, on January 31, 2024, Extreme reported disappointing financial results and operational trends for the second quarter of FY 2024. Extreme disclosed that its revenues for the quarter were $296.4 million, down 7% year-over-year, and that it had generated just $186.6 million in product revenue, a decline of 37% year-over-year. Extreme further revealed that its product backlog had already normalized during the quarter and that the Company made the "conscious decision to put channel digestion behind [it] in the March quarter," leading to a "$40 million to $50 million reduction in channel inventory in the third quarter" that would result in "demand . . . being masked by inventory flowing out of the channel." Rather than increasing revenues as previously represented, Extreme provided new guidance that revealed the Company was in fact on track to suffer lower revenues in FY 2024.
On this news, Extreme's stock price fell $4.05 per share, or 24.34%, over the following three trading sessions, to close at $12.59 per share on February 2, 2024.
Pomerantz LLP, with offices in New York, Chicago, Los Angeles, London, Paris, and Tel Aviv, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, Pomerantz pioneered the field of securities class actions. Today, more than 85 years later, Pomerantz continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered billions of dollars in damages awards on behalf of class members. See www.pomlaw.com.
Attorney advertising. Prior results do not guarantee similar outcomes.
SOURCE: Pomerantz LLP
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