SHAREHOLDER ALERT: Robbins LLP Announces That Vroom, Inc. (VRM) is Being Sued for Misleading Shareholders

SAN DIEGO & NEW YORK--(BUSINESS WIRE)--Shareholder rights law firm Robbins LLP announces that a purchaser of Vroom, Inc. (NASDAQ: VRM) filed a class action complaint against the Company and its officers and directors for alleged violations of the Securities Exchange Act of 1934 between November 11, 2020 and March 3, 2021. Vroom operates an end-to-end ecommerce platform that sells fully reconditioned vehicles.

If you suffered a loss due to Vroom, Inc.'s misconduct, click here.

Vroom, Inc. (VRM) Misled Investors About its Ability to Meet Demand for its Vehicles

Vroom announced its third quarter 2020 financial results on November 11, 2020. The Company stated that it "expect[ed] another quarter of significant year-over-year growth in ecommerce unit sales and revenue for Q4 2020 and continued strength in total ecommerce gross profit per unit." On a conference call the same day, Vroom's CEO stressed that demand was strong and noted that the Company was "ramp[ing] up our sales support in anticipation of continued escalating sales growth in the New Year."

On March 3, 2021, Vroom announced its fourth quarter and full year 2020 financial results. The Company reported that fourth quarter "Ecommerce Vehicle gross profit per unit decreased 13.1% to $878, driven primarily by lower sales margins, partially offset by improvements in inbound logistics and reconditioning costs per unit." Vroom also reported that its "[n]et loss increased 41.9% to $60.7 million." Contrary to its statements just months prior that it could scale growth to meet the demand for product, the Company explained, "due to the constraints in sales personnel and sales support personnel, we were unable to convert and process the sales associated with that demand. The result is that our inventory aged. That aged inventory need to be discounted to move through our retail channels or liquidated in our wholesale channels." On this news, the Company's stock price fell $12.29 per share, or 27.9%, to close at $31.61 per share on March 4, 2021.

If you purchased shares of Vroom, Inc. (VRM) between November 11, 2020 and March 3, 2021, you have until May 21, 2021, to ask the court to appoint you lead plaintiff for the class.

All representation is on a contingency fee basis. Shareholders pay no fees or expenses.

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