Robbins LLP: InvenSense, Inc. (INVN) Misled Shareholders According to a Recently Filed Class Action
Robbins LLP announces that an investor of InvenSense, Inc. (NYSE: INVN) has filed a federal securities fraud class action complaint in the U.S. District Court for the Northern District of California. The complaint alleges that the company and certain of its officers and directors violated the Securities Exchange Act of 1934 between July 29, 2014 and October 28, 2014. InvenSense designs, develops, markets, and sells Micro-Electro-Mechanical Systems sensors for consumer electronics.
InvenSense Is Accused of Misleading Investors
According to the complaint, shares of InvenSense declined $5.40 per share, or 25%, to close at $16.08 per share on October 29, 2014, following the release of disappointing financial results for the second quarter ended September 28, 2014. Specifically, despite having previously issued strong sales guidance, InvenSense reported a net loss of $6.868 million. Further, InvenSense reported disappointing GAAP gross margins of only 35% and non-GAAP gross margins of 37%, compared to 47% for GAAP gross margins and 50% for non-GAAP gross margins, for the first quarter of 2015. The complaint further notes that the company knew but failed to disclose to the public that the following facts would negatively impact its financial performance: (i) its contracts with major retailers were made at low price points that would negatively impact the company’s profitability; (ii) InvenSense was experiencing manufacturing inefficiencies; and (iii) InvenSense had a large stockpile of old inventory that needed to be written off due to lack of demand.
InvenSense Shareholders Have Legal Options
Concerned shareholders who would like more information about their rights and potential remedies can contact attorney Darnell R. Donahue at (800) 350-6003, or you can complete the form below and we will contact you directly.