Gainey McKenna & Egleston Announces A Class Action Lawsuit Has Been Filed Against Netflix, Inc. (NFLX)
NEW YORK, May 04, 2022 (GLOBE NEWSWIRE) -- Gainey McKenna & Egleston announces that a class action lawsuit has been filed against Netflix, Inc. (“Netflix” or the “Company”) (NASDAQ: NFLX) in the United States District Court for the Northern District of California on behalf of investors who purchased Netflix stock between October 19, 2021 and April 19, 2022, inclusive (the “Class Period”).On January 20, 2022, Netflix reported that it “slightly over-forecasted paid net adds in Q4,” adding 8.3 million subscribers compared to the 8.5 million forecast. The Company also stated that, despite “healthy” retention and engagement, it only expected to add 2.5 million net subscribers during first quarter 2022, below the 4.0 million net adds in the prior year period. On this news, the Company’s stock price fell $110.75, or 21.7%, to close at $397.50 per share on January 21, 2022, on unusually heavy trading volume.
Then, on April 19, 2022, Netflix reported that it lost 200,000 subscribers during the first quarter of 2022, compared to prior guidance expecting the Company to add 2.5 million net subscribers. The Company cited the slowing revenue growth to four factors, including account sharing with an estimated 100 million additional households and competition with other streaming services. On this news, the Company’s share price fell $122.42, or over 35%, to close at $226.19 per share on April 20, 2022, on unusually heavy trading volume.
The Complaint alleges that Defendants failed to disclose to investors: (1) that Netflix was exhibiting slower acquisition growth due to, among other things, account sharing by customers and increased competition from other streaming services; (2) that the Company was experiencing difficulties retaining customers; (3) that, as a result of the foregoing, the Company was losing subscribers on a net basis; (4) that, as a result, the Company’s financial results were being adversely affected; and (5) that, as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects were materially false and/or misleading and/or lacked a reasonable basis.
Investors who purchased or otherwise acquired shares of Netflix should contact the Firm* prior to the July 5, 2022 *lead plaintiff motion deadline. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. If you wish to discuss your rights or interests regarding this class action, please contact Thomas J. McKenna, Esq. or Gregory M. Egleston, Esq. of Gainey McKenna & Egleston at (212) 983-1300, or via e-mail at tjmckenna@gme-law.com or gegleston@gme-law.com.
Please visit our website at http://www.gme-law.com for more information about the firm.