SAN DIEGO & BEDFORD, Mass.--(BUSINESS WIRE)--Shareholder rights law firm Robbins LLP announces that a purchaser of iRobot Corp. (NASDAQ: IRBT) filed a class action complaint against the company for alleged violations of the Securities Exchange Act of 1934 between November 21, 2016 and October 22, 2019. iRobot designs, builds, and sells robots for the consumer market worldwide.
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iRobot Corp. (IRBT) Accused of Channel-Stuffing
According to the complaint, by October 2017, iRobot had completed its acquisition of Sales on Demand Corporation and Robopolis SAS for a total of $159 million, touting their ability to accelerate the growth of iRobot's business and maintain its segment leadership. Following the acquisitions, on February 7, 2018, iRobot reported "record" revenue for the fourth quarter and full-year 2017, and informed investors the Company expected to "cross the billion-dollar revenue threshold" in 2018. iRobot continued to affirm these positive representations and reported increasing year-over-year revenue growth throughout the relevant period. However, iRobot failed to disclose that the Company had engaged in channel-stuffing, resulting in artificially boosted sales. iRobot's true revenue was revealed on April 23, 2019, when the Company announced shockingly disappointing quarterly revenues below analyst expectations. Then, on July 24, 2019, the Company cut its full-year earnings forecast. Finally, on October 22, 2019, iRobot cut its high end of its revenue expectations for the year and rolled back price increases due to a "suboptimal" customer response. Following these disclosures, iRobot's stock price fell a total of $81.51, or 62%, to close at $49.06 and has yet to recover.
iRobot Corp. (IRBT) Shareholders Have Legal Options
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