CHPT - Gainey McKenna & Egleston Announces A Class Action Lawsuit Has Been Filed Against ChargePoint Holdings Inc. (CHPT)
NEW YORK, Nov. 30, 2023 (GLOBE NEWSWIRE) -- Gainey McKenna & Egleston announces that a securities class action lawsuit has been filed in the United States District Court for the Northern District of California on behalf of all persons or entities who purchased or otherwise acquired ChargePoint Holdings Inc. (“ChargePoint” or the “Company”) (NYSE: CHPT) securities between June 1, 2023 and November 16, 2023, inclusive (the “Class Period”).
The Complaint alleges that Defendants failed to disclose to investors: (i) the Company was experiencing higher component costs and supply overruns for first generation DC charging products; (ii) that, as a result, the Company was likely to incur impairment charges; (iii) that, as a result of the foregoing, the Company’s profitability would be adversely impacted; and (iv) 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.
On September 6, 2023, after the market closed, ChargePoint reported its second quarter fiscal year 2024 financial results, including an “$28.0 million, or 19 percentage point, inventory impairment charge.” The Company stated the “inventory impairment charge was taken to address legacy supply chain-related costs and supply overruns on a particular DC product.” As a result, the Company reported a second quarter GAAP gross margin of 1%, down from 17% in the prior year’s same quarter. On this news, the Company’s share price fell $0.77, or 11%, to close at $6.29 per share on September 7, 2023, on unusually heavy trading volume.
Then, on November 16, 2023, after the market closed, ChargePoint released preliminary financial results for the third quarter of fiscal year 2024, which would include an “additional non-cash inventory impairment charge” in the amount of $42 million “related to product transitions and to better align inventory with current demand.” As a result, the Company expected to report “GAAP gross margin of negative 23% to negative 21%.” The Company also reported revenue had fallen to “$108 million to $113 million, as compared to $150 to $165 million as previously expected.” Moreover, ChargePoint’s Chief Executive Officer and Chief Financial Officer were both replaced, effective immediately. On this news, the Company’s share price fell $1.11, or 35%, to close at $2.02 per share on November 17, 2023, on unusually heavy trading volume.
Investors who purchased or otherwise acquired shares of ChargePoint should contact the Firm prior to the January 29, 2024 lead plaintiff motion deadline. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. If you wish to discuss your rights or interests regarding this class action, please contact Thomas J. McKenna, Esq. or Gregory M. Egleston, Esq. of Gainey McKenna & Egleston at (212) 983-1300, or via e-mail at tjmckenna@gme-law.com or gegleston@gme-law.com .
Please visit our website at http://www.gme-law.com for more information about the firm.