Lawsuit filed for Investors who lost money with shares of Extreme Networks, Inc. (NASDAQ: EXTR)

An investor, who purchased shares of Extreme Networks, Inc. (NASDAQ: EXTR), filed a lawsuit over alleged violations of Federal Securities Laws by Extreme Networks, Inc. in connection with certain allegedly false and misleading statements.

Investors who purchased shares of Extreme Networks, Inc. (NASDAQ: EXTR) have certain options and for certain investors are short and strict deadlines running. Deadline: October 15, 2024. NASDAQ: EXTR investors should contact the Shareholders Foundation at mail@shareholdersfoundation.com or call +1(858) 779 - 1554.

Morrisville, NC based Extreme Networks, Inc. provides software-driven networking solutions worldwide. It designs, develops, and manufactures wired, wireless, and software-defined wide area-network infrastructure equipment.

Extreme Networks, Inc reported that its Total Revenue rose from over $1.11 billion for the 12 months period that ended on June 30, 2022, to over $1.31 billion for the 12 months period that ended on June 30, 2023, and that its Net Income over those respective time periods increasdedf from $44.27 million to $78.07 million.

On January 25, 2023, Extreme Networks, Inc. announced the resignation of Rémi Thomas, Extreme Networks' CFO, and also revealed that compared to the first quarter of 2023, Extreme Networks' 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.

Then, on August 24, 2023, Extreme Networks, Inc. disclosed 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, according to the Extreme Networks class action lawsuit.

Thereafter, on November 1, 2023, Extreme Networks, Inc. further revealed that working through its backlog was resulting in an "air pocket of demand" among end customers that resulted in "more tempered" revenue growth outlook of "mid-to-high single digits" for fiscal year 2024, and that Extreme Networks was now expecting normalized backlog of between $75 million to $100 million "by the end of Q4 fiscal '24," according to the Extreme Networks class action lawsuit.

Next, the Extreme Networks class action lawsuit alleges that on January 8, 2024 Extreme Networks provided a business update lowering its second quarter of 2024 and long-term revenue outlooks.

Finally, on January 31, 2024, Extreme Networks, Inc. disclosed: that its revenues for the second quarter of 2024 were $296.4 million, down 7% year-over-year; that it had generated just $186.6 million in product revenue, a decline of 37% year-over-year; that its product backlog had already normalized during the quarter; and that Extreme Networks 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 "[d]emand . . . be[ing] masked by inventory flowing out of the channel," according to the complaint. Rather than increasing revenues as previously represented, Extreme Networks also provided new guidance that revealed Extreme Networks was in fact on track to suffer lower revenues in fiscal year 2024 and, in a related earnings call, defendant Edward B. Meyercord III, Extreme Networks' President and CEO, acknowledged that Extreme Networks' "baseline business" was on track to achieve only about $1.1 billion in annual revenues, according to the Extreme Networks class action lawsuit.

Shares of Extreme Networks, Inc. (NASDAQ: EXTR) declined from $32.73 per share on August 10, 2023, to $10.58 per share on April 12, 2024.

The plaintiff claims that between July 27, 2022 and January 30, 2024, the defendants made false and/or misleading statements and/or failed to disclose that, among other things, Extreme Networks was suffering from adverse client demand trends as its clients had ordered more product from Extreme Networks than needed in the wake of the COVID-19 pandemic and that Extreme Networks was increasingly offsetting these adverse organic demand trends with the fulfillment of backlog orders in a manner that materially exceeded the proportion represented to investors.

Those who purchased shares of Extreme Networks, Inc. (NASDAQ: EXTR) have certain options and should contact the Shareholders Foundation.

Contact:
Michael Daniels
Shareholders Foundation, Inc.
3111 Camino Del Rio North
Suite 423
San Diego, CA 92108
Tel: +1-(858)-779-1554
E-Mail: mail@shareholdersfoundation.com

About Shareholders Foundation, Inc.
The Shareholders Foundation, Inc. is a professional portfolio monitoring and settlement claim filing service, and an investor advocacy group, which does research related to shareholder issues and informs investors of securities lawsuits, settlements, judgments, and other legal related news to the stock/financial market. Shareholders Foundation, Inc. is in contact with a large number of shareholders and offers help, support, and assistance for every shareholder. The Shareholders Foundation, Inc. is not a law firm. Referenced cases, investigations, and/or settlements are not filed/initiated/reached and/or are not related to Shareholders Foundation. The information is provided as a public service. It is not intended as legal advice and should not be relied upon.

This release was published on openPR.