SAN FRANCISCO--(BUSINESS WIRE)--The law firm of Lieff Cabraser Heimann & Bernstein, LLP announces that class action litigation has been filed on behalf of investors who purchased or otherwise acquired the common stock of ContextLogic Inc. (“ContextLogic” or the “Company”) (NASDAQ: WISH) between December 16, 2020 and May 12, 2021, inclusive (the “Class Period”), including investors who purchased or otherwise acquired ContextLogic common stock in connection with ContextLogic’s December 16, 2020 initial public offering (“IPO”).
If you purchased or otherwise acquired ContextLogic common stock during the Class Period, you may move the Court for appointment as lead plaintiff by no later than July 16, 2021. A lead plaintiff is a representative party who acts on behalf of other class members in directing the litigation. Your share of any recovery in the actions will not be affected by your decision of whether to seek appointment as lead plaintiff. You may retain Lieff Cabraser, or other attorneys, as your counsel in the action.
ContextLogic investors who wish to learn more about the litigation and how to seek appointment as lead plaintiff should click here or contact Sharon M. Lee of Lieff Cabraser toll-free at 1-800-541-7358.
Background on the ContextLogic Securities Class Litigation
ContextLogic, headquartered in San Francisco, California, is a global mobile e-commerce company that operates the Wish platform that connects its value-conscious user base to merchants. Wish generates revenue by charging merchants a commission on sales made in its marketplace. On December 16, 2020, ContextLogic completed its IPO by issuing and selling more than 46 million shares of its Class A common stock at $24 per share, raising more than $1.1 billion in proceeds.
The action alleges that throughout the Class Period, defendants made materially false and misleading statements and omissions about the strength of ContextLogic’s business operations and financial prospects by overstating its then-present monthly active users (“MAUs”) and MAU growth trends. For example, in its IPO registration statement, declared effective on December 15, 2020, ContextLogic reported it had 108 million MAUs as of September 30, 2020, and emphasized sustained MAU growth from just 21 million MAUs since 2015. ContextLogic also underscored the importance of this performance metric by claiming that “[w]e 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.”
On March 8, 2021, ContextLogic reported disappointing results for the fourth quarter and full year 2020 and revealing that its MAUs had “declined 10% YoY during Q4 to 104 million.” On this news, ContextLogic’s stock price fell $1.83 per share, or more than 10%, from its closing price of $17.77 on March 5, 2021, to close at $15.94 on March 8, 2021, on unusually high trading volume. That same day, the Company issued Q1 sales guidance of $735-750 million (representing year-over-year growth of 67-70%), based on continued strong demand for its Wish platform.
On May 12, 2021, ContextLogic revealed that its MAUs had declined another 7% to 101 million during Q1. In addition, the Company issued disappointing revenue guidance for the second quarter 2021. On this news, ContextLogic’s stock price fell $3.36 per share, or approximately 29%, from its closing price of $11.47 on May 12, 2021, to close at $8.11 per share on May 13, 2021, on unusually high trading volume.
About Lieff Cabraser
Lieff Cabraser Heimann & Bernstein, LLP, with offices in San Francisco, New York, and Nashville, is a nationally recognized law firm committed to advancing the rights of investors and promoting corporate responsibility.
The National Law Journal has recognized Lieff Cabraser as one of the nation’s top plaintiffs’ law firms for fourteen years. In compiling the list, the National Law Journal examines recent verdicts and settlements and looked for firms “representing the best qualities of the plaintiffs’ bar and that demonstrated unusual dedication and creativity.” Law360 has selected Lieff Cabraser as one of the Top 50 law firms nationwide for litigation, highlighting our firm’s “laser focus” and noting that our firm routinely finds itself “facing off against some of the largest and strongest defense law firms in the world.” Benchmark Litigation has named Lieff Cabraser one of the “Top 10 Plaintiffs’ Firms in America.”
For more information about Lieff Cabraser and the firm’s representation of investors, please visit https://www.lieffcabraser.com/.
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