NEWTOWN, Pa., May 16, 2024 (GLOBE NEWSWIRE) -- Edelson Lechtzin LLP, a leading class action law firm, is investigating securities fraud claims on behalf of all investors of Sprout Social, Inc. (NASDAQ: SPT) between November 2, 2023, and May 2, 2024, inclusive (the “Class Period”).
Investors who purchased Sprout Social stock may move the U.S. District Court for the Northern District of Illinois to appoint them as a lead plaintiff, no later than July 12, 2024. Please contact Eric Lechtzin at 844-696-7492 or by e-mail at elechtzin@edelson-law.com to discuss your investment losses. A copy of the class action complaint can be viewed HERE.
Background on Sprout Social, Inc.
Headquartered in Chicago, Illinois, Sprout Social develops and operates a web-based social media management platform globally.
The Securities Fraud Claims
On August 3, 2023, Sprout Social announced its acquisition of Tagger Media, Inc., an influencer marketing and social intelligence platform utilized by enterprise brands and agencies. On September 27, 2023, Sprout Social announced at an investor event its plans to “accelerate our outbound marketing and sales efforts in the enterprise sector” with a focus on mid-market and enterprise leadership.
The Complaint alleges that throughout the Class Period, Defendants made materially false and/or misleading statements regarding the company’s business, operations, and prospects, including that: (i) the Company’s sales and revenue growth were not indicative of its growth as it transitioned to an enterprise sales cycle; (ii) Sprout Social faced integration challenges with its acquisition of Tagger; (iii) as a result, the company was “self-inducing sales headwinds” and would be forced to revise fiscal year 2024 revenue guidance.
On May 2, 2024, Sprout Social announced that it had missed its Q1 2024 revenue guidance and lowered its full-year 2024 revenue forecast by $20 million. CFO Joe Del Preto claimed, “We underestimated the magnitude of enterprise seasonality that now comes with our business mix, while also self-inducing sales execution headwinds during Q1…” Incoming CEO Ryan Barretto disclosed that strategic changes made in Q4 2023, which were executed in Q1 2024, caused disruptions. On this news, Sprout Social’s stock price fell $19.33, or 40.1%, to close at $28.82 on May 3, 2024, on unusually heavy trading volume.
For more information, please contact:
Marc H. Edelson, Esq.
Eric Lechtzin, Esq.
EDELSON LECHTZIN LLP
411 S. State Street, Suite N-300
Newtown, PA 18940
Phone: 844-696-7492 or 215-867-2399 ext. 1
Email: medelson@edelson-law.com
Email: elechtzin@edelson-law.com
Web: www.edelson-law.com
Edelson Lechtzin LLP is a leading class action law firm with offices in Pennsylvania and California. In addition to cases involving securities and investment fraud, our lawyers focus on class and collective litigation in cases alleging violations of the federal antitrust laws, employee benefit plans under ERISA, wage theft and unpaid overtime, consumer fraud, and dangerous and defective drugs and medical devices.
This press release may be considered Attorney Advertising in some jurisdictions. No class has been certified in this case, so you are not represented by counsel unless you retain one. You may select counsel of your choice. You may also remain an absent class member and do nothing at this point. Your ability to share in any potential future recovery is not dependent upon serving as lead plaintiff.
