The law firm of Kirby McInerney LLP announces that a class action lawsuit has been filed in the U.S. District Court for Southern District of New York on behalf of those who acquired Xerox Holdings Corporation (“Xerox” or the “Company”) (NASDAQ:XRX) securities during the period of January 25, 2024 to October 28, 2024, inclusive (“the Class Period”). Investors have until January 21, 2025, to apply to the Court to be appointed as lead plaintiff in the lawsuit.
[Click here to learn more about the class action]
In October 2023, Xerox introduced an organizational overhaul, which it dubbed the “Reinvention”. Then, on January 3, 2024, the Company announced the next stage of its “operating model evolution” which included shifting to a “business unit operating model,” consolidating groups under a “Global Business Services organization,” and a layoff of 15% of the Company’s workforce.
On April 23, 2024, the effects of the Company’s Reinvention began to emerge, when the Company revealed that for second quarter 2024, quarterly revenue was down 12.4% year-over-year and equipment sales declined 25.8 year-over-year. The Company admitted, in part, “geographic simplification” had driven the year-over-year decline. The Company also partially disclosed that the Reinvention plan had been “initially disruptive to sales operations” but assured investors it was “seeing the benefits of the new business unit-led operating model in equipment order momentum.” On this news, Xerox shares declined by $1.66 per share, or approximately 10.1%, from $16.42 per share on April 22, 2024, to close at $14.76 on April 23, 2024.
On October 29, 2024, Xerox released its third quarter 2024 financial results, missing consensus estimates and lowering guidance and attributing the performance to “the delayed global launch of two new products and lower-than-expected improvements in sales force productivity” and “to a lesser extent, delays in the implementation of certain cost reduction initiatives to 2025.” On this news, Xerox shares declined by $1.79 per share, or approximately 17.4%, from $10.28 per share on October 28, 2024, to close at $8.49 on October 29, 2024.
The complaint alleges that, throughout the Class Period, Defendants made numerous materially false and misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants failed to disclose to investors: (1) that, after a large workforce reduction, the Company’s salesforce was reorganized with new territory assignments and account coverage; (2) that, as a result, the Company’s salesforce productivity was disrupted; (3) that, as a result, the Company had a lower rate of sell-through of older products; (4) that the difficulties in flushing out old product would delay the launch of key products; (5) that, as a result, Xerox was likely to experience lower sales and revenue; and (6) that, as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.
If you purchased or otherwise acquired Xerox securities, have information, or would like to learn more about this investigation, please contact Thomas W. Elrod of Kirby McInerney LLP by email at investigations@kmllp.com, or by filling out this CONTACT FORM, to discuss your rights or interests with respect to these matters without any cost to you.
Kirby McInerney LLP is a New York-based plaintiffs’ law firm concentrating in securities, antitrust, whistleblower, and consumer litigation. The firm’s efforts on behalf of shareholders in securities litigation have resulted in recoveries totaling billions of dollars. Additional information about the firm can be found at Kirby McInerney LLP’s website.
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