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New York, New York – (Newsfile Corp. – March 9, 2023) — Bernstein Liebhard LLP is a well-respected investor rights law firm that reminds investors about the deadline for filing a lead plaintiff motion to a securities class-action lawsuit on behalf investors who bought or acquired ordinary shares of Kornit Digital Ltd. (“Kornit”) or “Company”). KRNT There are between February 17, 2021, and July 5, 2022– inclusive (the “Class Period”) It was brought to the United States District Court for the District of New Jersey. The suit alleges that the Securities Exchange Act of 1934 has been violated.
Kornit is a manufacturer of industrial digital printing solutions for the apparel, textile and garment industries. End-users can print direct to fabric (“DTF”) or direct-to garment (“DTG”) using the Company’s inkjet printers. Design and images are directly printed onto textiles using DTG printing. In DTF printing, large rolls of fabric pass through wide inkjet printers that print images and designs directly on to swaths of fabric that are then cut and sewn into a product, and can be used in the fashion and home décor industries. Kornit produces and sells textile dyes and other products for digital printers. Kornit provides technical support for printers and customer assistance through customer support agreements.
Kornit repeatedly emphasized the company’s technology as a competitive advantage and promised investors that there was virtually no other DTG printer manufacturer. Kornit claimed there was strong demand in the market for its DTG printing technology, including consumable products such as textilesinks. It also stated that its services were available to customers who needed them to operate and maintain digital printers. Kornit assured investors that it would be able to keep its existing customers and draw new ones because of the strong demand. It also said that this would minimize the potential risks of a large portion of the Company’s revenue being concentrated with small customers.
These and other statements were made during the Class Period, Plaintiff claims. Kornit and its top executives had no idea, or worse, were recklessly unaware, of the Company’s severe quality control and service problems in digital printing. These problems and shortcomings caused Kornit’s market share to be ceded to other competitors. This resulted in a decline in revenue for the Company as its customers moved elsewhere to get their digital printing needs met. These misrepresentations led to Kornit’s ordinary shares trading at artificially high prices during the Class Period.
The truth was revealed to investors by Delta Apparel, Fanatics and Kornit on March 28th 2022. They announced that they had been working with one of Kornit’s main competitors for several months to create a digital printing technology directly competing with the products and services Kornit provided. Delta Apparel said that four of the company’s digital printers had been equipped with this technology and it was planning to add more. Fanatics and Delta Apparel both used the new technology in a rival fashion. It was a reflection of the general dissatisfaction among Kornit’s customers regarding the company’s customer service and product quality. Kornit could lose sales from two of its largest customers.
Kornit posted a net loss for its first quarter in 2022. This was despite reporting revenue that exceeded expectations. It had a profit $5.1 million over the previous year. In addition, revenue guidance was issued by the company for its second quarter 2022. This result was substantially below analysts’ expectations. Kornit blamed the Company’s disappointing guidance on a slower pace of orders from its customers in the electronic commerce segment. Kornit also acknowledged that for the last two quarters it knew that Delta Apparel was one of the Company’s largest customers and had bought digital printing equipment from Kornit.
The price of Kornit’s ordinary shares dropped $18.78 or 33.3% to $37.63 per Share on May 11, 2022.
Kornit then announced that the company would have a significant revenue shortfall for the second quarter 2022 on July 5, 2022 after the markets closed. Kornit expects revenue to range between $56.4million and $59.4million for the quarter. This is significantly lower than the revenue guidance that Kornit provided in May 2022, when it was providing $85 million to $95 millions. Kornit said that the significant revenue loss was due to “a substantially slower pace in direct-to-garment orders (DTG),” compared with previous expectations.
This news caused the Kornit average share price to fall $8.10, or 25.7%, and close at $23.46 on July 6, 2022.
To serve as the lead plaintiff you need to move the Court before April 17, 2023. Lead plaintiffs are representatives who act on behalf of class members and direct the litigation. You don’t have to be a lead plaintiff in order to participate in any recovery. You can choose not to act and you could remain an absent member of the class.
You can also find out more about our products. Kornit shares were purchased and/or acquired. Kornit Digital Ltd. You can contact Kornit Digital Ltd. for a Shareholder Class Action Lawsuit Peter Allocco at (212) 951-2030 or [email protected].
Bernstein Liebhard LLP, has obtained over $3.5 Billion for clients since 1993. The Firm represents individual investors and has also been retained by the nation’s largest pension funds to oversee their assets and to pursue litigation for them. The Firm’s success in defending hundreds of cases and class actions has earned it a spot on The National Law Journal’s “Plaintiffs’ Hot List” 13 times, and a listing in The Legal 500 10 consecutive years.
ATTORNEY ADVERTISING. © 2022 Bernstein Liebhard LLP. Bernstein Liebhard LLP is the law firm that created this advertisement. The past results don’t guarantee or predict the outcome of any future case.
Get in touch with us:
Peter Allocco
Bernstein Liebhard LLP
https://www.bernlieb.com
(212) 951-2030
[email protected]
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