NEW YORK–(BUSINESS WIRE)–#Action–Bragar Eagel & Squire, P.C., a nationally recognized stockholder rights law firm, announces that a class action lawsuit has been filed against Yext, Inc. (“Yext” or the “Company”) (NYSE: YEXT) in the United States District Court for the Southern District of New York on behalf of all persons and entities who purchased or otherwise acquired Yext securities between March 4, 2021 and March 8, 2022, both dates inclusive (the “Class Period”). Investors have until August 16, 2022 to apply to the Court to be appointed as lead plaintiff in the lawsuit.
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Yext organizes a business’ facts to provide answers to consumer questions online. The Company operates yext platform, a cloud-based platform that allows its customers to, among other things, provide answers to consumer questions, control facts about their business and the content of their landing pages, and manage their consumer reviews. Yext’s website describes its service as “a modern, AI-powered Answers Platform that understands natural language so that when people ask questions about a business online they get direct answers – not links.”
As COVID-19 resurged throughout 2021, Yext consistently assured investors that pandemic-related impacts on the Company’s business were limited as the Company adapted to lockdowns and improved efficiencies in its sales and other operations.
On March 8, 2022, Yext issued a press release announcing its fourth quarter (“Q4”) and FY fiscal 2022 results. Among other items, Yext reported Q4 fiscal 2022 revenue of $100.9 million, falling short of consensus estimates by $140,000; first quarter (“Q1”) fiscal 2023 revenue outlook of $96.3 million to $97.3 million, versus consensus estimates of $103.79 million; Q1 fiscal 2023 non-GAAP net loss per share outlook of $0.08 to $0.07, versus consensus estimates of $0.05; FY fiscal 2023 revenue outlook of $403.3 million to $407.3 million, versus consensus estimates of $444.71 million; and FY fiscal 2023 non-GAAP net loss per share outlook of $0.19 to $0.17, versus consensus estimates of $0.09. The Company further disclosed the departure of its CEO and CFO.
That same day, on a conference call to discuss Yext’s Q4 and FY fiscal 2022 results, the Company’s incoming CEO, Michael Walrath (“Walrath”), addressed the Company’s disappointing financial results, revealing, inter alia, that “we have seen fragmentation in our interactions with customers and our ability to deliver premium service and support” and that, “[i]n hindsight, it is clear we were too focused on building sales capacity and not focused enough on other functions that drive productivity, particularly sales enablement, training, client success and services.” Walrath also disclosed that “we saw a really significant disruption in our business” such as “in Q4, 50% — over 50% of our in-person events were canceled because of the Omicron surges[,]” while opining that Yext could “[a]bsolutely” improve its “sales motion so that it’s more efficient during disruptions like that[.]”
Following that call, a Truist Securities analyst lowered the firm’s rating on Yext to hold from buy and slashed its price target to $6 from $17, noting, among other things, that key performing indicators showed an “unexpected slowdown” in Q4, guidance for fiscal 2023 shows no near-term turn around, and that “planned changes under new management (in go-to-market strategy, sales organization) carry execution risks and the timing for a meaningful and sustainable revival in growth is unclear[.]”
Following these disclosures, Yext’s stock price fell $.055 per share, or 9.29%, to close at $5.37 per share on March 9, 2022.
The complaint alleges that, throughout the Class Period, Defendants made materially false and misleading statements regarding the Company’s business, operations, and prospects. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) Yext’s revenue and earnings were significantly deteriorating because of, inter alia, poor sales execution and performance, as well as COVID-19 related disruptions; (ii) accordingly, Yext was unlikely to meet consensus estimates for its full year (“FY”) fiscal 2022 financial results and fiscal 2023 outlook; and (iii) as a result, the Company’s public statements were materially false and misleading at all relevant times.
If you purchased or otherwise acquired Yext shares and suffered a loss, are a long-term stockholder, have information, would like to learn more about these claims, or have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Brandon Walker or Melissa Fortunato by email at email@example.com, telephone at (212) 355-4648, or by filling out this contact form. There is no cost or obligation to you.
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Bragar Eagel & Squire, P.C. is a nationally recognized law firm with offices in New York, California, and South Carolina. The firm represents individual and institutional investors in commercial, securities, derivative, and other complex litigation in state and federal courts across the country. For more information about the firm, please visit www.bespc.com. Attorney advertising. Prior results do not guarantee similar outcomes.