Investigations
Five9, Inc.
Overview
Overview
- Deadline:
- Feb 3, 2025
| Company Name: | Company Name: Five9, Inc. |
| Stock Symbol: | Stock Symbol: FIVN |
Five9, Inc. (NASDAQ: FIVN): BFA filed a class action lawsuit for violations of the federal securities laws against Five9, Inc. (“Five9” or the “Company”) and certain of the Company’s senior executives. The complaint asserts claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 on behalf of investors in Five9 securities, including call options. The case is pending in the U.S. District Court for the Northern District of California and is captioned Lucid Alternative Fund, LP v. Five9, Inc., et al., No. 24-cv-8725.
Why was Five9 Sued for Securities Fraud?
Five9 provides cloud-based contact center software enabling its clients to manage multi-channel customer interactions through its Virtual Contact Center platform.
The complaint alleges that Five9 misrepresented the purported strength of the Company’s net new business bookings and visibility into its installed customer base. During the Class Period, Five9 stated its “net new business” experienced “very strong bookings momentum,” was “knocking down some of the largest enterprise brands,” and was “strong irrespective of the macro” environment. Five9 also touted its visibility into its installed customers base, representing that the Company had “enough information in terms of our existing customers that are going live” such that Five9 would experience a positive inflection in its dollar based retention rate (“DBRR”) in the second half of the year.
These statements were materially false and misleading. In truth, Five9’s net new business was not “strong irrespective of the macro” and was, in fact, hampered by macroeconomic issues such as constrained and scrutinized customer budgets. What’s more, Five9 was in the midst of a challenging bookings quarter due, in part, to sales execution and efficiency issues, and the Company was not seeing “very strong bookings momentum.” And Five9 did not have “enough information in terms of [its] existing customers that are going live” such that the Company’s statements that it would see a positive inflection in its DBRR lacked a reasonable basis.
The Stock Declines as the Truth is Revealed
On August 8, 2024, Five9 released its second quarter 2024 financial results. The Company cut its annual revenue guidance and stated that it was “no longer assuming” a DBRR inflection in the second half of the year. The Company revealed it “had a challenging bookings quarter” due to “constrained and scrutinized” customer budgets and was taking remedial action to address sales execution issues. On this news, the price of Five9 stock declined over 26%, from $42.47 per share on August 8, 2024 to $31.22 per share on August 9, 2024.
What are my Rights?
If you purchased or otherwise acquired Five9 securities, including call options, you may ask the Court no later than February 3, 2025, which is the first business day after 60 days from the date of the publication of notice of pendency, to appoint you as Lead Plaintiff through counsel of your choice. To be a member of the Class, you need not take any action at this time. The ability to share in any potential future recovery is not dependent on serving as Lead Plaintiff.
If you wish to discuss this action or have any questions concerning your rights or interests, please contact:
Ross Shikowitz
ross@bfalaw.com
212-789-3619
About Bleichmar Fonti & Auld LLP
BFA is a leading international law firm representing plaintiffs in securities class actions and shareholder litigation. It was named among the Top 5 plaintiff law firms by ISS SCAS in 2023 and its attorneys have been named Titans of the Plaintiffs’ Bar by Law360 and SuperLawyers by Thompson Reuters. Among its recent notable successes, BFA recovered over $900 million in value from Tesla, Inc.’s Board of Directors (pending court approval), as well as $420 million from Teva Pharmaceutical Ind. Ltd.
Attorney advertising. Past results do not guarantee future outcomes.
Why was Five9 Sued for Securities Fraud?
Five9 provides cloud-based contact center software enabling its clients to manage multi-channel customer interactions through its Virtual Contact Center platform.
The complaint alleges that Five9 misrepresented the purported strength of the Company’s net new business bookings and visibility into its installed customer base. During the Class Period, Five9 stated its “net new business” experienced “very strong bookings momentum,” was “knocking down some of the largest enterprise brands,” and was “strong irrespective of the macro” environment. Five9 also touted its visibility into its installed customers base, representing that the Company had “enough information in terms of our existing customers that are going live” such that Five9 would experience a positive inflection in its dollar based retention rate (“DBRR”) in the second half of the year.
These statements were materially false and misleading. In truth, Five9’s net new business was not “strong irrespective of the macro” and was, in fact, hampered by macroeconomic issues such as constrained and scrutinized customer budgets. What’s more, Five9 was in the midst of a challenging bookings quarter due, in part, to sales execution and efficiency issues, and the Company was not seeing “very strong bookings momentum.” And Five9 did not have “enough information in terms of [its] existing customers that are going live” such that the Company’s statements that it would see a positive inflection in its DBRR lacked a reasonable basis.
The Stock Declines as the Truth is Revealed
On August 8, 2024, Five9 released its second quarter 2024 financial results. The Company cut its annual revenue guidance and stated that it was “no longer assuming” a DBRR inflection in the second half of the year. The Company revealed it “had a challenging bookings quarter” due to “constrained and scrutinized” customer budgets and was taking remedial action to address sales execution issues. On this news, the price of Five9 stock declined over 26%, from $42.47 per share on August 8, 2024 to $31.22 per share on August 9, 2024.
What are my Rights?
If you purchased or otherwise acquired Five9 securities, including call options, you may ask the Court no later than February 3, 2025, which is the first business day after 60 days from the date of the publication of notice of pendency, to appoint you as Lead Plaintiff through counsel of your choice. To be a member of the Class, you need not take any action at this time. The ability to share in any potential future recovery is not dependent on serving as Lead Plaintiff.
If you wish to discuss this action or have any questions concerning your rights or interests, please contact:
Ross Shikowitz
ross@bfalaw.com
212-789-3619
About Bleichmar Fonti & Auld LLP
BFA is a leading international law firm representing plaintiffs in securities class actions and shareholder litigation. It was named among the Top 5 plaintiff law firms by ISS SCAS in 2023 and its attorneys have been named Titans of the Plaintiffs’ Bar by Law360 and SuperLawyers by Thompson Reuters. Among its recent notable successes, BFA recovered over $900 million in value from Tesla, Inc.’s Board of Directors (pending court approval), as well as $420 million from Teva Pharmaceutical Ind. Ltd.
Attorney advertising. Past results do not guarantee future outcomes.