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EXTR.US
id: 1315
Extreme Networks (EXTR) Backlog Issues Case
N.D. California
Court3:24-cv-05102
Case number07/27/2022
Class period Start01/30/2024
Class period End10/14/2024
Lead Plaintiff motion deadline- $EXTR stockholders filed a claim against Extreme Networks for hiding that its backlog fell faster than expected due to pandemic over-ordering.
- After the financial results on January 31, 2024, $EXTR dropped by over 60% from its peak.
- Extreme Networks investors can join this case to be notified about potential recovery.
Case Details:
In July 2022, Extreme reported steady revenue and a record backlog, predicting strong growth for FY23.
However, by January 25, 2023, the company announced CFO Thomas's departure and a drop in backlog to $542M, with updated clearance timelines.
By August 24, 2023, Extreme’s backlog had fallen to $267.3 million.
After this news, $EXTR fell by 9% the next day.
Then, on November 1, 2023, Extreme announced that slower backlog clearance would reduce revenue growth, predicting backlog levels of $75M to $100M by FY24's end.
On this news, $EXTR dropped by 13%.
Then, on January 31, 2024, Extreme reported weak 2Q24 results, with a 7% drop in revenue and a 37% drop in product revenue.
They noted that their backlog had normalized and planned to cut channel inventory, which would impact demand.
As a result, $EXTR dropped more than 60% from its peak.
Based on these events, $EXTR investors filed a claim against Extreme Networks, accusing the company of the following:
- Extreme’s backlog dropped faster than expected because clients over-ordered during the pandemic.
- The company misled investors about backlog growth and revenue, hiding a decline in actual demand and earnings.
Considering all the representations, investors suspect Extreme Networks hid that its backlog dropped faster than expected due to pandemic over-ordering, masking a decline in real demand.
Case Status
Lead Plaintiff Appointed
Alleged Offence
Mismanagement,
Misleading Statements,
Omissions
Suspected Party
Directors,
Management
Security Type
Stocks
Trade Direction
Long
Shock Event Date
07/27/2022
Filing date
08/13/2024
Lead Plaintiff Deadline
10/14/2024
Judge
Hon. Trina L. Thompson