Case Summary

Cambium Networks

NASDAQ: CMBM

Case Details

  • Hamby v. Cambium Networks Corporation et al.
  • Class Period:May 8, 2023 - January 18, 2024
  • Date Filed:May 22, 2024
  • Jurisdiction:U.S. District Court, Northern District of Illinois
  • Docket Number: 1:24-cv-04240
  • Lead Plaintiff Deadline: July 22, 2024
Days Left to
Seek Plaintiff
27

Overview

A class action lawsuit has been filed against Cambium Networks Corporation (“Cambium” or the “Company”) (NASDAQ: CMBM) and certain of the Company’s current and former senior executive officers alleging violations of the federal securities laws.  The Cambium lawsuit is brought on behalf of all persons and entities who purchased or otherwise acquired Cambium securities between May 8, 2023, and January 18, 2024, both dates inclusive (the “Class Period”).  Investors have until July 22, 2024, to seek appointment as lead plaintiff of the Cambium class action lawsuit.

Cambium, together with its subsidiaries, engages in the design, development, and manufacture of wireless broadband and Wi-Fi networking infrastructure solutions.  The Company’s products are used in broadband access, public safety, defense communications networks, and Wi-Fi access applications.  Its product lines fall under three broad, interrelated categories: (1) fixed wireless broadband, which includes point-to-point and point-to-multipoint architectures; (2) Enterprise networking; and (3) Subscription and Services.  Cambium sells its products primarily through its network of approximately 160 distributors who sell to other channel partners.

The Cambium class action lawsuit alleges that on August 1, 2023, after the market closed, Cambium reported that the second quarter 2023 revenue fell 23% sequentially due to higher channel inventories that resulted in lower demand for Enterprise products.  As a result, the Company reduced its fiscal 2023 guidance, now expecting revenue to decline 7% to 11% year-over-year.  The Company also announced that the Company’s Chief Executive Officer, Atul Bhatnagar, would step down immediately.  On this news, the price of Cambium shares declined by $4.89 per share, or 30.07%, to close at $11.37 per share on August 2, 2023, on unusually heavy trading volume.

Thereafter, on October 4, 2023, after the market closed, Cambium announced its preliminary third quarter 2023 revenue between $40.0-$45.0 million compared to the previous outlook of $62.0-$70.0 million.  The Company attributed the shortfall, in part, to a decrease in orders and an increase in stock rotations from distributors in the Enterprise business and pressure from channel inventories.  On this news, the price of Cambium shares declined by $2.87 per share, or 36.2%, to close at $5.05 per share on October 5, 2023, on unusually heavy trading volume.

Then, on January 18, 2024, after the market closed, Cambium revealed that preliminary fourth quarter 2023 revenue was expected to be approximately $40.0 million compared to the previous outlook of $45.0-$50.0.  The Company attributed the revenue shortfall to offering aggressive Enterprise product discounts to clear excess channel inventories.  The Company further revealed gross margin will also be below the low end of the range due to increased excess and obsolete inventory reserves.  Moreover, the Company’s Chief Financial Officer would depart Cambium on February 2, 2024.  On this news, the price of Cambium shares declined by $0.60 per share, or 12.40%, to close at $4.24 per share on January 19, 2024, on unusually heavy trading volume.

As alleged in the Cambium class action lawsuit, Defendants, throughout the Class Period, made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects.  Specifically, Defendants failed to disclose to investors that: (1) there was a buildup of inventory in the Company’s distribution channels; (2) the Company and its distributors were reasonably likely to offer aggressive discounts to reduce the high channel inventories; (3) the Company’s revenue would decline sequentially until the excess channel inventory was sold through; (4) Cambium was likely to incur significant charges to write down excess and obsolete inventory; (5) as a result of the foregoing, the Company’s fiscal 2023 revenue and earnings would be adversely affected; and (6) as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.

*          *          *

If you purchased or otherwise acquired Cambium securities between May 8, 2023, and January 18, 2024, both dates inclusive, and you wish to serve as lead plaintiff in this lawsuit, we encourage you to submit your information to DiCello Levitt LLP via the form on this page. 

You can also contact DiCello Levitt partner Brian O’Mara by calling (888) 287-9005 or at investors@dicellolevitt.com. 

The deadline to apply to the Court to serve as a lead plaintiff in the Cambium lawsuit is July 22, 2024.

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