Pomerantz LLP was appointed Lead Counsel in a class action lawsuit against Aerohive Networks, Inc. (“Aerohive” or the “Company”) and certain of its officers. The class action, filed in United States District Court, for the Northern District of California, and docketed under 18-cv-00544, is on behalf of a class consisting of investors who purchased or otherwise acquired Aerohive securities, seeking to recover compensable damages caused by defendants’ violations of the Securities Exchange Act of 1934.
Aerohive supplies wireless infrastructure equipment. The Company designs cooperative control wireless architecture, cloud-enabled network management, routing, and virtual private network solutions. Aerohive serves the healthcare, education, manufacturing, distribution, and retail industries throughout the United States.
The complaint alleges that throughout the Class Period, defendants made materially false and misleading statements regarding the Company’s business, operational and compliance policies. Specifically, defendants made false and/or misleading statements and/or failed to disclose that: (i) Aerohive had uncovered sales execution issues at the Company at the end of the third quarter of 2017; (ii) consequently, Aerohive’s revenue guidance for the fourth quarter of 2017 was overstated; and (iii) as a result, Aerohive’s public statements were materially false and misleading at all relevant times.
On January 16, 2018, post-market, Aerohive issued a press release entitled “Aerohive Networks Announces Preliminary Fourth Quarter 2017 Financial Results,” revealing that it “expects net revenue for the fourth quarter to be approximately $37 million, which is below the Company’s previously stated guidance of $40 million to $42 million.” Aerohive attributed the reduced guidance to “underlying sales execution issues” uncovered at the end of the third quarter.
On this news, Aerohive’s share price fell $1.63, or 28.6%, to close at $4.07 on January 17, 2018, damaging investors.