Aerohive Networks, Inc. (HIVE) Intentionally Overstated its Financials to the Detriment of Shareholders
According a federal securities class action complaint filed by investors, Aerohive Networks, Inc. publicly made false and misleading statements about its revenue guidance for the fourth quarter of 2017. In January 2017, Aerohive announced major changes to its sales organization and strategy, which were designed to improve the pace and execution of company sales, thereby driving revenue and profitability. Throughout 2017, Aerohive assured investors that the company was on track and that the changes were working. On November 1, 2017, Aerohive's Chief Financial Officer assured investors that the company was "in a much better position to more accurately forecast our revenue" and that Aerohive was "currently expecting Q4 revenue in the range of $40 to $42 million." Contrary to these predictions, on January 16, 2018, Aerohive announced net revenue below the Company's previously stated guidance. On this news, the stock fell over 28%.
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