SHAREHOLDER ALERT: Robbins LLP Announces that ContextLogic Inc. (WISH) is Being Sued for Misleading Shareholders

SAN DIEGO & SAN FRANCISCO--(BUSINESS WIRE)--Shareholder rights law firm Robbins LLP announces that a class action has been filed on behalf of all purchasers of ContextLogic Inc. (NASDAQ: WISH) pursuant to the Company's December 16, 2020 initial public offering ("IPO"), for remedies under the Securities Act of 1933, and open-market purchasers of ContextLogic common stock between December 16, 2020 and May 12, 2021, for remedies under the Securities Exchange Act of 1934. ContextLogic is a global mobile ecommerce company that operates the Wish platform to connect its value-conscious user base to merchants.

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

ContextLogic Inc. (WISH) Made Misstatements Regarding Key Metrics in its IPO Registration Statement

According to the complaint, on December 16, 2020, ContextLogic completed its IPO, selling 46 million shares of Class A common stock at $24 per share, raising more than $1 billion. ContextLogic touted in its IPO Registration Statement that it had 108 million monthly active users ("MAUs") as of September 30, 2020, and emphasized the materiality of its metrics to investors by stating: "We view the number of MAUs as key driver of revenue growth as well as a key indicator of user engagement and awareness of our brand."

However, on March 8, 2021, when ContextLogic reported its fourth quarter and fiscal year 2020 financial results for the period ended December 31, 2020 (“4Q20” and “FY20”), it disclosed that in reality, by the time of its December 2020 IPO, its MAUs had already “declined 10% YoY during Q4 to 104 million, primarily in some emerging markets outside of Europe and North America where Wish temporarily de-emphasized advertising and customer acquisition as the company worked through logistics challenges it faced earlier in the year.” On this news, the market price of ContextLogic common stock declined on March 8, closing down more than 10% to $15.94 per share. Yet, the Company reiterated its continued strong demand and provided first quarter 2021 (“1Q21”) sales guidance of $735 to $750 million, representing year over-year growth of 67% to 70%.

Then on May 12, 2020, ContextLogic announced 1Q21 financial results for the interim period ended March 31, 2021, disclosing that its MAUs had declined another 7% to just 101 million. The Company’s forward sales guidance also fell short, with its second quarter 2021 (“2Q21”) revenue guidance of just $715 million to $730 million coming in significantly less than the $759 million the market had been led to expect and far less than the guidance of $735 to $750 million provided for 1Q21. On this news, the market price of ContextLogic common stock declined $3.36 per share, or 29%, to close at $8.11 per share on May 13, 2021.

If you purchased shares of ContextLogic Inc. (WISH) pursuant to the Company's IPO or between December 16, 2020 and May 12, 2021, you have until July 16, 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.

Contact us to learn more:
Lauren Levi
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