EXTR Investors with Losses Encouraged to Contact the Firm

/EIN News/ -- SAN FRANCISCO, Aug. 26, 2024 (GLOBE NEWSWIRE) -- Hagens Berman urges Extreme Networks, Inc. (NASDAQ: EXTR) investors who suffered substantial losses to submit your losses now. The firm also encourages persons with knowledge who may assist the investigation to contact its attorneys.

Class Period: July 27, 2022 – Jan. 30, 2024
Lead Plaintiff Deadline: Oct. 15, 2024
Visit: www.hbsslaw.com/investor-fraud/extr
Contact the Firm Now: EXTR@hbsslaw.com
   844-916-0895

Extreme Networks, Inc. (EXTR) Securities Class Action:

Extreme Networks, Inc. is grappling with a severe inventory overhang and plummeting sales, in addition to a class-action lawsuit recently filed accusing the company of misleading investors about its financial health.

The network equipment provider booked a substantial $46.5 million inventory reserve in its fourth quarter of fiscal 2024 ending June 30, a clear indication of excessive raw materials and finished goods on hand. This charge coincided with a 29% year-over-year revenue decline to $256.7 million.

The earnings release comes on the heels of an investor suit alleging that Extreme painted a deceptively optimistic picture of robust organic growth, a sizable backlog, and market share gains. However, the lawsuit contends that this rosy outlook masked a deteriorating business environment. The company is accused of inflating revenue by overstating organic demand and relying heavily on backlog orders, while simultaneously downplaying the rapid erosion of that backlog.
The truth began to emerge in January 2023 with the departure of its CFO and a subsequent earnings report that revealed a decline in backlog and book-to-bill ratios. Despite these warning signs, management assured investors that the backlog would remain stable.

Subsequent disclosures painted a more dire picture. A staggering $245 million decline in backlog was reported in August 2023, followed by an acknowledgment of an "air pocket of demand" in November. In January 2024, the company slashed revenue forecasts, citing channel inventory issues and weaker-than-expected demand.

These events have sent Extreme’s share price plummeting, wiping out significant market capitalization and prompting prominent shareholder rights firm Hagens Berman to investigate potential securities fraud.

“Investors who relied on Extreme Networks’ positive statements about their business suffered significant losses. Our investigation seeks to uncover whether these losses were the result of securities fraud,” said Reed Kathrein, the Hagens Berman partner leading the investigation.

If you invested in Extreme Networks and have substantial losses, or have knowledge that may assist the firm’s investigation, submit your losses now »

If you’d like more information and answers to frequently asked questions about the Extreme Networks case and our investigation, read more »

Whistleblowers: Persons with non-public information regarding Extreme Networks should consider their options to help in the investigation or take advantage of the SEC Whistleblower program. Under the new program, whistleblowers who provide original information may receive rewards totaling up to 30 percent of any successful recovery made by the SEC. For more information, call Reed Kathrein at 844-916-0895 or email EXTR@hbsslaw.com.

About Hagens Berman
Hagens Berman is a global plaintiffs’ rights complex litigation firm focusing on corporate accountability. The firm is home to a robust practice and represents investors as well as whistleblowers, workers, consumers and others in cases achieving real results for those harmed by corporate negligence and other wrongdoings. Hagens Berman’s team has secured more than $2.9 billion in this area of law. More about the firm and its successes can be found at hbsslaw.com. Follow the firm for updates and news at @ClassActionLaw.

Contact:
Reed Kathrein, 844-916-0895

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