NEW YORK, NY / ACCESSWIRE / February 26, 2019 / Bronstein, Gewirtz & Grossman, LLC reminds investors that a class action lawsuit has been filed against Arlo Technologies, Inc. (''Arlo'' or the ''Company'') (NYSE: ARLO) and certain of its officers, on behalf of shareholders who purchased or otherwise acquired Arlocommon stock pursuant and/or traceable to Arlo's August 3, 2018 initial public offering (the ''IPO'' or the ''Offering''). Such investors are encouraged to join this case by visiting the firm's site: www.bgandg.com/arlo.
This class action seeks to recover damages against Defendants for alleged violations of the federal securities laws under the Securities Exchange Act of 1933.
On August 6, 2018, Arlo filed its prospectus for its upcoming IPO with the SEC, which forms part of the Registration Statement. Arlo sold 11,747,250 shares of common stock at $16.00 per share in its IPO, for proceeds of approximately $167.4 million, net of underwriting discounts and commissions, purportedly to be used for general corporate purposes.
Arlo was a wholly-owned subsidiary of NETGEAR, Inc. (''NETGEAR'') before the IPO. NETGEAR offers products enabling networking, broadband access, and network connectivity. NETGEAR owned approximately 84.2% of the shares of Arlo's outstanding common stock after the IPO.
On November 30, 2018, Arlo announced its ''flagship wire-free security camera system'' called Arlo Ultra (''Ultra''). The Company touted a ''newly designed rechargeable battery'' that would purportedly enable the Ultra product to provide 4K Ultra HD resolution with high dynamic range, color night vision, and advanced image processing.
The Complaint alleges that Defendants made materially false and misleading statements and/or failed to disclose that: (1) there was a flaw and/or quality issue with Arlo's newly designed battery for its Ultra camera systems; (2) this flaw and/or quality issue with the Ultra battery could result in a shipping delay of Arlo's Ultra product; (3) such a shipping delay endangered Arlo's chances of launching the Ultra product in time for the crucial holiday season; (4) such a shipping delay would allow Arlo's competitors to capitalize on the Ultra product’s missed launch, thereby increasing their own market share; (5) Arlo's consumers had been experiencing battery drain issues and other battery-related issues in connection with recent firmware updates; (6) because of the foregoing, Arlo's fourth quarter 2018 results and consumer base would be negatively impacted; and (7) as a result, Arlo's Registration Statement was materially false and misleading at all relevant times.
On December 3, 2018, Arlo reported a delay in shipments of Ultra, citing ''a quality issue with the battery from one of its suppliers'' that was discovered during the product's final testing phase. As a result of the delay, Ultra also lowered its fourth-quarter 2018 financial guidance, advising investors that it anticipated ''net revenue to be in the range of $125 million to $130 million, non-GAAP gross margin to be approximately 10%, and non-GAAP operating loss to be approximately 20% of revenue.'' Following this news, Arlo stock dropped $2.75 per share, or 22.86%, to close at $9.28 on December 3, 2018.
A class action lawsuit has already been filed. If you wish to review a copy of the Complaint you can visit the firm's site: www.bgandg.com/arlo or you may contact Peretz Bronstein, Esq. or his Investor Relations Analyst, Yael Hurwitz of Bronstein, Gewirtz & Grossman, LLC at 212-697-6484. If you suffered a loss in Arlo you have until March 25, 2019 to request that the Court appoint you as lead plaintiff. Your ability to share in any recovery doesn't require that you serve as a lead plaintiff.
Bronstein, Gewirtz & Grossman, LLC is a corporate litigation boutique. Our primary expertise is the aggressive pursuit of litigation claims on behalf of our clients. In addition to representing institutions and other investor plaintiffs in class action security litigation, the firm's expertise includes general corporate and commercial litigation, as well as securities arbitration. Attorney advertising. Prior results do not guarantee similar outcomes.
Bronstein, Gewirtz & Grossman, LLC
Peretz Bronstein or Yael Hurwitz
212-697-6484 | [email protected]
SOURCE: Bronstein, Gewirtz & Grossman, LLC