WGS Shareholder Alert: Investors With Losses May Seek to Lead the Class Action in GeneDx Holdings Corp. Securities Lawsuit - Contact Levi & Korsinsky

GeneDx Promised Fabric Genomics Would "Transform Static Data Into Recurring Revenue" and "Unlock Software-Based Revenue Streams" — Instead, Investors Got a $31.2 Million Write-Off and a 49% Stock Collapse

NEW YORK--(BUSINESS WIRE)--Levi & Korsinsky, LLP highlights the contrast between GeneDx Holdings Corp.'s (NASDAQ: WGS) promises to investors and the actual results of its Fabric Genomics acquisition. Shareholders who purchased WGS securities between April 16, 2025 and May 4, 2026 and suffered losses may be entitled to compensation. Find out if you can recover your investment losses or contact Joseph E. Levi, Esq. at [e-mail] or [phone].

On May 5, 2026, WGS shares closed at $34.51, down $33.42 per share (49.20%) from the prior close, after the Company revealed the full scope of Fabric's failure. The lead plaintiff deadline is August 3, 2026.

The Promise: A "Recurring Revenue" Engine

When GeneDx announced the Fabric Genomics acquisition on April 16, 2025, the Company projected multiple scalable revenue streams, software-driven margins, and a platform that would strengthen its competitive position across geographies. On the Q2 2025 earnings call, management described Fabric as on track with revenue and gross margin plans, called the collaboration "fantastic," and said there was "room to run" in reducing costs by combining the two companies' capabilities.

The Reality: A $31.2 Million Write-Off

On May 4, 2026, GeneDx disclosed that Fabric had failed to meet the goals management had repeatedly touted. The Company wrote down $31.2 million in goodwill and intangible assets tied to Fabric and admitted the platform was best suited only for international markets, not the broad domestic and global application previously described. Full-year revenue guidance dropped from $540-$555 million to $475-$490 million.

The Numbers: Promised vs. Actual

• Revenue guidance promised: $540-$555 million for 2026. Actual revised guidance: $475-$490 million, a reduction of approximately $65 million
• Fabric's projected role: "Recurring revenue-generating platform" driving growth through software margins. Actual outcome: $31.2 million impairment loss; limited to international markets only
• Adjusted gross margin trajectory: Rose from 45% (2023) to 74% (Q3 2025). Q1 2026 result: Declined to 69%
• Average reimbursement rate: Over $3,800 in Q3 2025. Q1 2026 result: Dropped to approximately $3,300, a decline of more than $500 per test
• Acquisition cost: $36.5 million in total consideration. Value retained: Near zero after the $31.2 million write-down

What the Lawsuit Alleges About the Gap

The securities action contends that defendants knew of, or recklessly disregarded, significant problems in Fabric's viability throughout the Class Period. The complaint asserts that repeated statements about Fabric's revenue potential, integration progress, and cost optimization benefits lacked a reasonable factual basis. When the truth emerged, investors who had purchased shares at artificially inflated prices suffered substantial losses.

"Companies that make specific promises to investors about future performance have an obligation to disclose known risks to those projections. The contrast between what GeneDx told the market about Fabric and what shareholders ultimately learned raises serious questions about the accuracy of those representations." -- Joseph E. Levi, Esq.

Calculate your potential recovery in the GeneDx securities action or call [phone].

LEAD PLAINTIFF DEADLINE: August 3, 2026

Levi & Korsinsky, LLP is a nationally recognized shareholder rights firm. Over the past 20 years, the firm has secured hundreds of millions of dollars for aggrieved shareholders. Ranked in ISS Top 50 for seven consecutive years.

Frequently Asked Questions About the WGS Lawsuit

Q: What specific misstatements does the WGS lawsuit allege? A: The complaint alleges GeneDx made materially false or misleading statements regarding the Fabric Genomics acquisition's potential to generate recurring software-based revenue, reduce costs, and drive growth. When the true state of Fabric's viability was revealed on May 4, 2026, the stock price declined sharply.

Q: How much did WGS stock drop? A: Shares fell approximately 49.20%, a decline of $33.42 per share, after the Company disclosed the $31.2 million Fabric impairment, reduced revenue guidance by $65 million, and admitted Fabric was suited only for international markets.

Q: What do WGS investors need to do right now? A: Gather brokerage records including purchase dates, share quantities, and prices paid. Contact Levi & Korsinsky for a free, no-obligation evaluation at [e-mail] or [phone]. No immediate action is required to remain eligible as a class member.

Q: What if I already sold my WGS shares — can I still recover losses? A: Yes. Eligibility is based on when you purchased, not whether you still hold them. Investors who bought during the class period and sold at a loss may still participate.

Q: Do I need to go to court or give testimony? A: No. The overwhelming majority of class members never appear in court or give depositions. You submit a claim form to receive your portion of recovery.

Q: What does it cost me to participate? A: Nothing. Securities class actions are handled on a pure contingency basis. No upfront fees, no retainer, no out-of-pocket costs.

Q: How long will the lawsuit take to resolve? A: Securities class actions typically take two to four years from initial filing to resolution.