NEW YORK, April 08, 2023 (GLOBE NEWSWIRE) — Pomerantz LLP is investigating claims on behalf of investors of Kornit Digital Ltd. (“Kornit” or the “Company”) (NASDAQ: KRNT). Investors in this category are encouraged to contact Robert S. Willoughby, [email protected], or 888-476-6529 ext. 7980.
Kornit, its officers and/or directors are being investigated for securities fraud and other illegal business practices.
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On March 28, 2022, Delta Apparel and Fanatics—two of Kornit’s major customers—announced that for months they had collaborated with one of Kornit’s principal competitors to develop a new digital printing technology that directly competed with products and services Kornit offered. Delta Apparel said that the technology had been installed in four of its existing digital printers and that plans were to expand. The utilization of this new, competing technology by Delta Apparel and Fanatics reflected widespread dissatisfaction of Kornit’s major customers with the Company’s product quality and customer service and meant that Kornit would likely lose revenue from two of its most important customers.
Kornit then reported that, despite reporting higher revenues than expected, it suffered a net loss in the first quarter of 2022 of $5.2million. This compares to a profit for the same period last year of $5.1million. The Company also issued revenue guidance for the second quarter of 2022 that was significantly below analysts’ expectations. Kornit attributed its disappointing guidance to a slowdown in orders from the Company’s customers in the e-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.
On this news, Kornit’s stock price fell $18.78 per share, or 33.3%, to close at $37.63 per share 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 attributed the substantial revenue miss to “a significantly slower pace of direct-to-garment (DTG) systems orders in the second quarter as compared to our prior expectations.”
On this news, Kornit’s stock price fell $8.10 per share, or 25.7%, to close at $23.46 per share on July 6, 2022.
The Pomerantz Firm has offices in New York City, Chicago, Los Angeles and London. It is recognized as one the top firms in the fields of antitrust and securities class litigation. The Pomerantz Firm was founded by Abraham L. Pomerantz who is known as the dean in class action law. It pioneered the field for securities class actions. Today, 80 years after his death, the Pomerantz Firm continues the tradition of fighting for victims of securities fraud and corporate misconduct. For class members, the Firm has won numerous multimillion-dollar damages. See www.pomerantzlaw.com.
CONTACT:
Robert S. Willoughby
Pomerantz LLP
888-476-6529 ext. 7980
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