Did you lose money in investments with Kornit Digital Ltd.? Visit Kornit Digital Ltd. Contact us for a Shareholder Class Action Lawsuit Peter Allocco at (212) 951-2030 or [email protected] to discuss your rights.
New York, New York – (Newsfile Corp. – March 23, 2023) – Bernstein Liebhard LLP is a nationally acclaimed investor right law firm. It reminds investors that the deadline for filing a lead plaintiff motion in a Securities Class Action lawsuit has been filed on behalf investors who bought or acquired ordinary shares of Kornit Digital Ltd. (“Kornit”) or the “Company”). KRNT Between February 17, 2021 and August 5, 2022, inclusive (the “Class Period”) The suit was filed in the United States District Court for the District of New Jersey. It alleges violations of the Securities Exchange Act of 1984.
Kornit is a manufacturer of industrial digital printing technology for textile, garment, and apparel industries. End-users can print direct-to fabric (“DTF”) or direct-to garment (“DTG”) using the Company’s digital printers. DTG printing allows designs and images to be printed directly on finished textiles, such as apparel and clothing. In DTF printing, large rolls of fabric pass through wide inkjet printers that print images and designs directly on to swaths of fabric that are then cut and sewn into a product, and can be used in the fashion and home décor industries. Kornit also manufactures and sells textile dyes and other supplies for its digital printers. Kornit provides technical support and customer service for its printers through customer support agreements.
Kornit repeatedly spoke out about the alleged competitive advantages it had and assured investors that they faced little competition in the DTG printing industry. Kornit claimed that its digital printing systems, consumables, such as inks for textiles, were in strong demand. It also offered services to customers to help manage their digital printers as well as to manage customer workflow. Kornit also assured investors that there was strong demand for its products and services, which would allow it to retain its existing customers and attract new ones. This would reduce the risk associated with a large portion of the Company’s revenues being concentrated in a few large customers.
Plaintiff claims that similar statements were made during the Class Period. Kornit and its senior executives were aware, or at least recklessly ignored, the fact that the Company’s digital printer business was plagued in quality control and customer service issues. These issues and deficiencies led Kornit’s to give market share away to competitors. This in turn resulted in a drop in Company revenue as customers switched to digital printing services elsewhere. Because of these false representations, Kornit ordinary shares were traded at artificially elevated prices throughout the Class Period.
Investors learned the truth about Kornit on March 28, 2022 when Fanatics (Delta Apparel) and Fanatics, two of Kornit’s most important customers, announced that they had for months collaborated with one Kornit’s principal competitors to develop a new technology for digital printing that directly competes with Kornit’s products and services. Delta Apparel said that it had installed the new technology in four existing digital printing facilities and was planning to expand. Fanatics and Delta Apparel used this competing technology to reflect the dissatisfaction expressed by Kornit’s major clients with its product quality and customer service. This meant that Kornit would lose revenue from two of the most important customers.
Kornit reported a net loss for its first quarter 2022. This was despite reporting revenue that was higher than expected. The Company issued revenue guidance for 2022, which was considerably below analysts’ expectations. Kornit said that the Company’s disappointing guidance was due to a slower pace of orders from customers in the electronic commerce segment. Kornit also acknowledged that for the past two quarters, it knew that Delta Apparel was one of its largest customers and had bought digital printing systems form a competitor to Kornit.
This news caused the Kornit ordinary share price to fall $18.78 per shares, or 33.3%, and close at $37.63 on May 11, 2022.
Kornit announced on July 5, 2022 that it would report significant revenue loss for the second quarter in 2022. Kornit forecasted that revenue for the second quarter would be between $56.4 million and $59.4 millions. This is far below the $85 million to $95 million revenue guidance the Company gave less than two months ago, in May 2022. Kornit said that the significant revenue loss was due to “a significantly slower pace in direct-to-garment orders (DTG) system orders in the second quarter compared to our previous expectations.”
This news caused the Kornit ordinary share price to fall $8.10 per share (or 25.7%) to close at $23.46 on July 6, 2022.
You must make a motion to the Court to become a lead plaintiff if you wish for your case to be heard by the Court. April 17, 2023. A lead plaintiff is an individual who represents other class members and acts as a mediator in the direction of litigation. However, your ability to share in any recovery does not require you to serve as a lead plaintiff. You can choose not to take any action and you could remain an absent member of the class.
If you Kornit shares were purchased or acquired. Kornit Digital Ltd. Contact Kornit Digital Ltd. Peter Allocco at (212) 951-2030 or [email protected].
Bernstein Liebhard LLP, has recovered more than $3.5 billion on behalf of its clients since 1993. Apart from representing investors, the Firm was retained by many of the country’s largest public and private pension funds to monitor and pursue litigation. The Firm’s success litigating hundreds upon lawsuits and classes actions earned it a place on The National Law Journal’s “Plaintiffs’ Hot List” thirteen times. The Firm is also listed in The Legal 500 ten consecutively.
ATTORNEY ADVERTISING. © 2022 Bernstein Liebhard LLP. Bernstein Liebhard LLP, 10 East 40th Street New York, New York 10016 (212) 779-1414 is the law firm responsible. Precedent results are not indicative of a similar outcome in future matters.
Contact Information:
Peter Allocco
Bernstein Liebhard LLP
https://www.bernlieb.com
(212) 951-2030
[email protected]
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