Company: Arlo Technologies, Inc.
Class Period: August 6, 2018 — December 3, 2018
Court: U.S.D.C. – Northern District of California
Kaskela Law LLC announces that a shareholder class action lawsuit has been filed against Arlo Technologies, Inc. (“Arlo” or the “Company”) (NYSE: ARLO) on behalf of investors who purchased or acquired Arlo’s common stock in connection with and following the Company’s August 2018 initial public offering (“IPO”) of common stock.
On or around August 6, 2018, Arlo completed its IPO of common stock, selling over 11.7 million shares of stock to investors at $16.00 per share.
Less than four months later, on December 3, 2018, Arlo disclosed a delay in the timing of shipments of its “new flagship” wire-free security camera system, Arlo Ultra. As a result of the Ultra shipment delay, Arlo also updated its fourth quarter 2018 financial guidance to report that it expected “fourth quarter 2018 net revenue to be in the range of $125 million to $130 million, non-GAAP gross margin to be approximately 10%, and non-GAAP operating loss to be approximately 20% of revenue.” Following this news, shares of the Company’s stock fell $2.75 per share, or over 22% in value, to close on December 3, 2018 at $9.28 per share.
Among other things, the shareholder class action complaint alleges that defendants made false and misleading statements and failed to disclose to investors that: (i) there was a flaw and/or quality issue with Arlo’s newly designed battery for its Ultra camera systems; (ii) this flaw and/or quality issue with the Ultra battery could result in a shipping delay of Arlo’s Ultra product; (iii) such a shipping delay endangered Arlo’s chances of launching the Ultra product in time for the crucial holiday season; (iv) such a shipping delay would allow Arlo’s competitors to capitalize on the Ultra product’s missed launch, thereby increasing their own market share; and (v) Arlo’s consumers had been experiencing battery drain issues and other battery-related issues in connection with recent firmware updates.
Current and former Arlo shareholders are encouraged to contact Kaskela Law LLC at (484) 258 – 1585 or (888) 715 – 1740, or by completing the information form on this page, to learn how to participate in this action and/or to discuss their legal rights and options.