NEW YORK, Feb. 28, 2024 (GLOBE NEWSWIRE) — Pomerantz LLP announces that a class action lawsuit has been filed against Lantronix, Inc. (“Lantronix” or the “Company”) (NASDAQ: LTRX) and certain officers. The class action, filed in the United States District Court for the Central District of California, and docketed under 24-cv-00385, is on behalf of a class consisting of all persons and entities other than Defendants that purchased or otherwise acquired Lantronix securities between May 11, 2023 and February 8, 2024, both dates inclusive (the “Class Period”), seeking to recover damages caused by Defendants’ violations of the federal securities laws and to pursue remedies under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Rule 10b-5 promulgated thereunder, against the Company and certain of its top officials.
If you are a shareholder who purchased or otherwise acquired Lantronix securities during the Class Period, you have until April 23, 2024 to ask the Court to appoint you as Lead Plaintiff for the class. A copy of the Complaint can be obtained at www.pomerantzlaw.com. To discuss this action, contact Danielle Peyton at newaction@pomlaw.com or 646-581-9980 (or 888.4-POMLAW), toll-free, Ext. 7980. Those who inquire by e-mail are encouraged to include their mailing address, telephone number, and the number of shares purchased.
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Lantronix is a global industrial and enterprise internet of things (“IoT”) provider of solutions that purportedly target high growth applications in specific verticals such as smart grids, intelligent transportation, smart cities, and artificial intelligence data centers. The Company organizes its products and solutions into three product lines: (i) Embedded IoT Solutions, (ii) IoT System Solutions, and (iii) Software & Services. The Company’s sales channels are comprised of distributors, resellers, and direct sales to larger original equipment manufacturers and end users, as well as through its ecommerce site.
In May 2023, Lantronix forecasted that it would achieve revenue in a range of $175 million to $185 million, as well as non-GAAP earnings-per-share (“EPS”) in a range of $0.50 to $0.60 per share, for its fiscal year 2024 results. Defendants repeatedly assured investors and analysts throughout the Class Period that this guidance for fiscal year 2024 remained unchanged, despite knowing that Lantronix’s customers were experiencing elevated levels of inventory for IoT products, and that embedded IOT revenues expected from a customer design win were pushed out to the next fiscal year.
The Complaint alleges that, throughout the Class Period, Defendants made materially false and misleading statements regarding the Company’s business, operations, and prospects. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) Lantronix overstated demand and/or its visibility into demand for its IoT products; (ii) Lantronix’s customers were reducing elevated levels of inventory of IoT products, thereby causing a general slowdown in the Company’s business; (iii) certain of Lantronix’s embedded IOT revenues expected from a customer design win were delayed to the next fiscal year; (iv) as a result of all the foregoing, Lantronix anticipated lower sales for its embedded IOT solutions for fiscal year 2024; (v) accordingly, Lantronix was unlikely to meet its own previously issued guidance for fiscal year 2024; and (vi) as a result, the Company’s public statements were materially false and/or misleading at all relevant times.
On February 8, 2024, Lantronix issued a press release announcing its financial results for the second quarter of its fiscal year 2024. Therein, the Company negatively revised its fiscal year 2024 guidance, advising that “[f]or fiscal year 2024, the company [now] expects revenue in a range of $155 million to $165 million”—versus the previously provided range of $175 million to $185 million—“and non-GAAP EPS in a range of $0.35 to $0.45 per share”—versus the previously provided range of $0.50 to $0.60 per share. On a call with investors and analysts to discuss these results, Company management revealed that “[t]he change in our annual guidance is primarily due to lower expected sales for our embedded IOT solutions as a result of two factors”, namely, “[a] general slowdown in our broad-based channel business as customers work through their inventories, and an embedded compute design win in video applications that was slated for revenue in the second half of fiscal 2024 that pushed into fiscal 2025.”
Following these disclosures, Lantronix’s stock price fell $1.89 per share, or 32.53%, to close at $3.92 per share on February 9, 2024.
Pomerantz LLP, with offices in New York, Chicago, Los Angeles, London, Paris, and Tel Aviv, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, Pomerantz pioneered the field of securities class actions. Today, more than 85 years later, Pomerantz continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered billions of dollars in damages awards on behalf of class members. See www.pomlaw.com.
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CONTACT:
Danielle Peyton
Pomerantz LLP
dpeyton@pomlaw.com
646-581-9980 ext. 7980
