According to the law firm press release, on May 6, 2014, FireEye announced its first quarter results, surprising investors and analysts. The Company’s $24.3 million in product revenue fell meaningfully short of analysts’ estimates of $31 million and reflected a move away from FireEye’s organic software business and towards service-oriented offerings which lacked the same potential for profitability. In reaction to these disclosures, FireEye closed at $28.65, down $8.48 per share. This 23% decline represented a market capitalization loss of over $1.25 billion.
The Complaint alleges the Company’s stock continued its precipitous decline, plummeting to close at a low of $25.76 on October 10, 2014, down 73.1% from its Class Period high of $95.63 on March 5, 2014. Notwithstanding the Company’s declining product revenue and the marked turn away from its organic software business, Defendants continuously touted FireEye’s organic and acquired growth as reasons for optimism and promising future results. Finally, on November 4, 2014, after the market closed for trading, the Company released disappointing third quarter results that missed analysts’ expectations, and further revealed the Company’s virtual abandonment of its core software product business model, resulting in a quarterly loss of $0.51 per share.
On May 1, 2015, the Court issued an Order appointing lead plaintiffs and approving lead counsel. Lead Plaintiffs filed a consolidated complaint on June 29.
On November 14, 2016, the Court issued an Order granting Defendants' Motion to Dismiss with leave to amend.