iRobot investors may receive additional information about the case by clicking the link "Submit Your Information" above.
iRobot is a global consumer robot company that designs and builds robots to assist with household tasks and has sold more than 25 million robots worldwide. iRobot’s most popular product line is its autonomous robotic vacuum cleaners, which iRobot first introduced with the Roomba Vacuuming Robot in 2002. iRobot’s products, including the Roomba line, purport to feature proprietary technologies and advanced concepts in cleaning, mapping, and navigation.
The Class Period commences on November 21, 2016, when iRobot announced it would acquire the iRobot-related distribution business of privately-held, Tokyo-based Sales on Demand Corporation. In a press release that day, iRobot said the acquisition would “better enable iRobot to maintain its leadership position and accelerate the growth of its business in Japan through direct control of pre- and post-sales market activities including sales, marketing, branding, channel relationships and customer service.”
On April 23, 2019, after the close of trading, iRobot surprised the market when it announced that quarterly revenues were below analyst expectations and also revealed surging inventory levels. Specifically, iRobot reported days in inventory (“DII”) of 140 for the three months ended March 30, 2019, compared to DII of 101 for the three months ended March 31, 2018. Inventory also rose to $181 million as of March 30, 2019, up from $112 million in April 2018. Following this news, iRobot’s stock price fell from $130.57 per share on April 23, 2019, to $100.42 per share on April 24, 2019, a decline of over 23% in one trading day.
On July 23, 2019, after the close of trading, iRobot cut its full-year earnings forecast. Specifically, fiscal year 2019 revenue guidance was lowered from a range between $1.28 billion and $1.31 billion, to a range between $1.2 billion and $1.25 billion, and earnings per share guidance was lowered from a range between $3.15 and $3.40 to a range between $2.40 and $3.15. Following this news, iRobot’s stock price fell from $89.63 per share on July 23, 2019, to $74.51 per share on July 24, 2019, a decline of nearly 17% in one trading day.
On October 22, 2019, after the close of trading, iRobot issued a press release reporting third quarter 2019 financial results. iRobot cut the high end of its revenue expectations for the year, from $1.25 billion to $1.21 billion, and said it rolled back price increases after a “suboptimal” customer response. iRobot reported increased inventory levels once again, with third quarter 2019 ending inventory of $248 million or 149 DII compared to the $161 million or 113 DII a year prior. Following this news, iRobot’s stock price fell from $54.03 per share on October 22, 2019, to $49.06 per share on October 23, 2019, a decline of over 9% in one trading day.
The complaint alleges that, throughout the Class Period, iRobot reported explosive, double-digit revenue growth, which it attributed to increasing demand for its Roomba products, expanded gross margin due to distributor acquisitions, greater brand awareness and technological innovation. In reality, iRobot was engaging in channel-stuffing in order to inflate its sales and revenues figures, and had acquired two of its largest distributors in order to facilitate and conceal this deceptive practice. As a result of these misrepresentations, iRobot shares traded at artificially inflated prices throughout the Class Period.
If you are a member of the class described above, you may no later than December 23, 2019 move the Court to serve as lead plaintiff of the class, if you so choose.
A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member’s claim is typical of the claims of other class members, and that the class member will adequately represent the class. Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. Returning the attached form or communicating with any counsel is not necessary to participate or share in any recovery achieved in this case. Any member of the purported class may move the court to serve as a lead plaintiff through counsel of his/her choice, or may choose to do nothing and remain an inactive class member.
Kessler Topaz Meltzer & Check, LLP has filed a complaint in this matter (see “View Complaint” above to read full complaint). If you wish to discuss this action or have any questions concerning this notice or your rights or interests with respect to these matters, please contact Kessler Topaz Meltzer & Check, LLP toll free at 1-844-887-9500 or 1-610-667-7706, or via e-mail at firstname.lastname@example.org. If you would like additional information about the suit, please click on the link "Submit Your Information" above and fill out the form as promptly as possible.
Kessler Topaz Meltzer & Check, LLP
James Maro, Esq. or Adrienne Bell, Esq.
280 King of Prussia Road
Radnor, PA 19087
1-844-887-9500 (toll free) or 1-610-667-7706
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