| COMPANY |
The Beauty Health Company |
| COURT |
United States District Court for the Central District of California |
| CASE NUMBER |
23-cv-09733 |
| JUDGE |
The Hon. Sherilyn Peace Garnett |
| CLASS PERIOD |
May 10, 2022 through November 13, 202 |
| SECURITY TYPE |
Securities |
Beauty Health investors may receive additional information about the case by clicking the link "Submit Your Information" above. If you are a member of the class described below, you may no later than January 16, 2024 move the Court to serve as lead plaintiff of the class, if you so choose.
A class action lawsuit has been filed on behalf of those who purchased or acquired The Beauty Health Company (“Beauty Health”) (NASDAQ: SKIN) securities between May 10, 2022 and November 13, 2023, both dates inclusive (the “Class Period”).
Case Background:
Beauty Health is a health and beauty company that provides skin health experiences. As relevant here, Beauty Health’s flagship brand is HydraFacial™ and HydraFacial’s leading product is Syndeo, a data-connected hydradermabrasion machine.
On August 9, 2023, before the market opened, Beauty Health reported that second quarter 2023 gross margin was “unfavorably impacted” by a mix shift “toward lower-margin refurbished devices . . . as U.S. providers awaited Syndeo enhancements in the third quarter 2023 to improve our user experience.” Beauty Health also announced the “involuntary separation without cause” of its CFO. On this news, the price of Beauty Health common stock declined $0.41 per share, or more than 5.4%, from a close of $7.53 per share on August 8, 2023, to close at $7.12 per share on August 9, 2023.
Then, on November 13, 2023, after the market closed, Beauty Health announced its financial results for the third quarter 2023 and revealed “lower-than-expected U.S. revenue and $63.1 million in restructuring charges related to device upgrades of early generation Syndeo devices.” As a result, Beauty Health announced it “is revising its fiscal year 2023 net sales guidance to a range of $385 to $400 million, its fiscal year adjusted EBITDA margin guidance to a range of 5% to 6% and is suspending its long-term 2023 financial outlook.” Beauty Health further disclosed that its CEO would depart the company, effective November 19, 2023. On this news, the price of Beauty Health common stock declined $2.51 per share, or nearly 64.4%, from a close of $3.90 per share on November 13, 2023, to close at $1.39 per share on November 14, 2023.
The complaint alleges that, during the Class Period, Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the company’s business, operations, and prospects. Specifically, Defendants misrepresented and/or failed to disclose that: (1) Syndeo 1.0 and 2.0 devices had issues leading to “frequent treatment interruptions;” (2) as a result, Beauty Health incurred significant costs to develop enhancements; (3) despite the enhancements, providers continued to experience issues with the Syndeo devices; (4) as a result, Beauty Health would no longer market Syndeo 1.0 and 2.0 devices and incur significant inventory writedowns; (5) as a result, Beauty Health’s profitability would be adversely impacted; and (6) as a result of the foregoing, Defendants’ statements about the company’s business, operations, and prospects were materially false and misleading and/or lacked a reasonable basis at all relevant times.
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. Filling out the online form above 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.
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: Jonathan Naji, Esq. (484) 270-1453 or via e-mail at info@ktmc.com. 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.