RADNOR, Pa., July 02, 2019 (GLOBE NEWSWIRE) -- The law firm of Kessler Topaz Meltzer & Check, LLP announces that a securities fraud class action lawsuit has been filed in the United States District Court for the Northern District of California against Zuora, Inc. (NYSE: ZUO) (“Zuora”) on behalf of those who purchased or otherwise acquired Zuora securities between between April 12, 2018 and May 30, 2019, inclusive (the “Class Period”).
Important Deadline: Investors who purchased Zuora securities during the Class Period may, no later than August 13, 2019, seek to be appointed as a lead plaintiff representative of the class. For additional information or to learn how to participate in this litigation please visit www.ktmc.com/zuora-inc-securities-class-action.
According to the complaint, Zuora is a cloud-based subscription management platform. Its business consists of three components: Zuora Central Platform, a subscription management hub; order-to-revenue products; and an application marketplace. Its flagship products are Zuora RevPro (“RevPro”), a revenue recognition automation solution that enables customers to group transactions into revenue contracts and performance obligations, and Zuora Billing (“Billing”), which is designed for subscription billing.
The Class Period commences on April 12, 2018, when Zuora filed its Initial Public Offering Prospectus.
According to the complaint, on May 30, 2019, in connection with its first quarter 2020 financial results, Zuora lowered its fiscal 2020 revenue guidance to a range of $268 million to $278 million, from prior guidance of $289 million to $293.5 million. Zuora reported that the product integration for Billing and RevPro “is taking longer than expected” and that “the technical work to complete the integration is taking time as these are complex mission-critical systems.” As a result of the product integration delay, Zuora slowed down RevPro implementations. Zuora also reported certain sales execution problems that slowed down its ability to cross-sell its products, which “resulted in lower professional services and subscription revenue in the quarter.” Following this news, Zuora’s share price fell $5.91 per share, nearly 30%, to close at $13.99 per share on May 31, 2019.
The complaint alleges that, throughout the Class Period, the defendants failed to disclose to investors that: (1) Zuora would focus on implementing RevPro for new customers ahead of the deadline to comply with accounting standard ASC 606; (2) as a result, Zuora lacked adequate resources to integrate RevPro with the core business; (3) Zuora would focus on RevPro integration a year after the acquisition closed; (4) delays in integrating RevPro would materially impact the business; (5) the market for RevPro was limited to customers seeking to implement new accounting standards such as ASC 606; (6) after the deadline for ASC 606 compliance passed, demand for RevPro was reasonably likely to decline; and (7) as a result of the foregoing, the defendants’ positive statements about Zuora’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.
If you wish to discuss this securities fraud class action lawsuit or have any questions concerning this notice or your rights or interests with respect to this litigation, please contact Kessler Topaz Meltzer & Check (James Maro, Jr., Esq. or Adrienne Bell, Esq.) at (844) 887-9500 (toll free) or (610) 667–7706, or via e-mail at firstname.lastname@example.org.
Zuora investors may, no later than August 13, 2019, seek to be appointed as a lead plaintiff representative of the class through Kessler Topaz Meltzer & Check, or other counsel, or may choose to do nothing and remain an absent class member. A lead plaintiff is a representative party who acts on behalf of all class members in directing the litigation. In order to be appointed as a lead plaintiff, the Court must determine that the class member’s claim is typical of the claims of other class members, and that the class member will adequately represent the class. Your ability to share in any recovery is not affected by the decision of whether or not to serve as a lead plaintiff.
Kessler Topaz Meltzer & Check prosecutes class actions in state and federal courts throughout the country involving securities fraud, breaches of fiduciary duties and other violations of state and federal law. Kessler Topaz Meltzer & Check is a driving force behind corporate governance reform, and has recovered billions of dollars on behalf of institutional and individual investors from the United States and around the world. The firm represents investors, consumers and whistleblowers (private citizens who report fraudulent practices against the government and share in the recovery of government dollars). The complaint in this action was not filed by Kessler Topaz Meltzer & Check. For more information about Kessler Topaz Meltzer & Check, please visit www.ktmc.com.
Kessler Topaz Meltzer & Check, LLP
James Maro, Jr., Esq.
Adrienne Bell, Esq.
280 King of Prussia Road
Radnor, PA 19087
(844) 887-9500 (toll free)