Farfetch Limited (FTCH) Sued for Concealing Weak Demand in US, China – Hagens Berman – Farfetch (NYSE:FTCH)
SAN FRANCISCO, Dec. 05, 2023 – Hagens Berman, a global plaintiffs’ rights complex litigation law firm, is urging Farfetch Limited (FTCH) investors who suffered significant losses to come forward and submit their losses. The firm has initiated litigation against Farfetch, alleging that the company concealed weak demand in the United States and China.
The lawsuit centers around Farfetch’s statements regarding its gross merchandise value (GMV), a key metric that the company claims closely correlates with its revenue, the strength of its U.S. and China business, and its partnership with Reebok. The complaint states that Farfetch made false and misleading statements and failed to disclose several key issues.
According to the complaint, Farfetch failed to disclose a significant growth slowdown in the U.S. and China, as well as onboarding challenges that impacted the launch of its partnership with Reebok. The company also allegedly downplayed supply chain and inventory management challenges, while overstating its ability to handle these issues effectively. As a result, Farfetch’s revenue and GMV growth were significantly affected, and the company was unlikely to meet market expectations for its Q2 2023 financial results and FY 2023 revenue guidance.
The truth came to light on Aug. 17, 2023, when Farfetch reported dismal Q2 2023 financial results and slashed its FY 2023 revenue guidance. The company not only missed market revenue consensus estimates by approximately $78 million but also lowered its FY revenue guidance by around $400 million. Farfetch attributed these disappointing results to major growth slowdowns in the U.S. and China, onboarding challenges related to the Reebok partnership, and inventory and shipping issues.
The impact on Farfetch’s stock price was significant. On Aug. 18, 2023, shares of Farfetch plummeted approximately 45%, wiping out over $700 million of shareholder value. The news also prompted multiple analysts to downgrade the stock.
Reed Kathrein, a partner at Hagens Berman, emphasized the firm’s focus on investors’ losses and investigating whether senior management concealed Farfetch’s growth and partnership problems.
We’re focused on investors’ losses and investigating whether senior management hid Farfetch’s growth and partnership problems, said Kathrein.
If you are an investor who suffered substantial losses as a result of Farfetch’s alleged misconduct or possess any knowledge that may assist in the investigation, Hagens Berman encourages you to submit your losses promptly.
Hagens Berman is a global plaintiffs’ rights complex litigation law firm known for its extensive securities litigation practice. The firm stands up for investors, whistleblowers, workers, consumers, and others harmed by corporate negligence and fraud. For more information about the firm and its successes, visit hbsslaw.com.
Whistleblowers with non-public information about Farfetch may also consider their options to help in the investigation or take advantage of the SEC Whistleblower program. Under this program, whistleblowers who provide original information may be eligible for rewards of up to 30% of any successful recovery made by the SEC.
For more information about the Farfetch case and Hagens Berman’s investigation, please contact Reed Kathrein at 844-916-0895 or via email at FTCH@hbsslaw.com.
About Hagens Berman:
Hagens Berman is a global plaintiffs’ rights complex litigation law firm that prioritizes corporate accountability through class-action law. The firm has a strong securities litigation practice, representing a wide range of clients, including investors, whistleblowers, workers, and consumers. With a track record of achieving significant results for those harmed by corporate negligence and fraud, Hagens Berman is committed to holding corporations accountable. Stay updated with the firm’s news and updates by following @ClassActionLaw.
Disclaimer: The information provided in this article is for informational purposes only and should not be construed as legal or investment advice. The mentioned law firm is not affiliated with our news agency. Please consult with a legal professional or financial advisor regarding your specific situation.
