A shareholder class action lawsuit has been filed against Arrival (NASDAQ: ARVL) on behalf of investors who purchased shares of the company’s securities between November 18, 2020 and November 19, 2021, inclusive (the “Class Period”).
According to the complaint, on November 8, 2021, Arrival announced the company’s financial results for the third quarter of 2021, including a loss of €26 million (compared to a loss of €22 million during the same quarter a year earlier), and adjusted EBITDA loss for the quarter of €40 million (compared to a loss of €18 million in the third quarter of 2020). The Company also pulled its 2022 revenue goals and significantly scaled back its long-term projections, pushing its production and sales timeline into later time periods. Following this news, Arrival’s shares fell $4.33 per share, or 24% in value, to close at $13.46 on November 10, 2021, on unusually heavy trading volume.
The complaint alleges that during the Class Period the defendants issued a series of false and misleading statements to investors and/or failed to disclose that: (i) the Company would record a substantially greater net loss and adjusted EBITDA loss in the third quarter of 2021 compared to the third quarter of 2020; (ii) the Company would experience far greater capital and operational expense to operate and deploy its microfactories and manufacture EV vehicles than it had disclosed; (iii) the Company would not capitalize on or achieve profitability or provide meaningful revenue in the time periods disclosed; (iv) the Company would not achieve its disclosed production and sales volumes; and (v) the Company would not meet the disclosed production rollout deadlines.
The case is currently in the pre-motion to dismiss stage of litigation.