Case Summary

Expensify

NASDAQ: EXFY

Case Details

  • Wilhite v. Expensify, Inc. et al.
  • Class Period:November 11, 2021 - November 29, 2023
  • Date Filed:November 29, 2023
  • Jurisdiction:U.S. District Court, District of Oregon
  • Docket Number: 3:23-cv-01784
  • Lead Plaintiff Deadline: January 29, 2024
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Overview

A class action lawsuit has been filed against Expensify, Inc., (“Expensify”, “EXFY” or the “Company”) (NASDAQ: EXFY) and certain of the Company’s top executive officers alleging that they violated the federal securities laws.  The lawsuit seeks to represent all persons and entities who purchased or otherwise acquired Expensify common stock pursuant and/or traceable to the Offering Documents issued in connection with the Company’s initial public offering conducted on or about November 11, 2021 (the “Class Period”).

Expensify provides a cloud-based expense management software platform to individuals, small businesses, and corporations in the U.S. and internationally. The Company’s platform purportedly enables users to manage corporate cards, pay bills, generate invoices, collect payments, and book travel, and Expensify offers track and submit plans for individuals.

The lawsuit alleges that on October 15, 2021, Expensify filed a registration statement on Form S-1 with the SEC in connection with the IPO, which, after several amendments, was declared effective by the SEC on November 9, 2021 (the “Registration Statement”). On or about November 11, 2021, pursuant to the Offering Documents, Expensify conducted its IPO, selling 9.73 million shares priced at $27.00 per share. On November 12, 2021, Expensify filed a prospectus on Form 424B4 with the SEC in connection with the IPO, which incorporated and formed part of the Registration Statement (the “Prospectus” and, together with the Registration Statement, the “Offering Documents”). The Offering Documents were negligently prepared and, as a result, contained untrue statements of material fact or omitted to state other facts necessary to make the statements made not misleading and was not prepared in accordance with the rules and regulations governing their preparation.

Specifically, the Offering Documents made false and/or misleading statements and/or failed to disclose that: (1) Expensify’s revenue growth was highly susceptible to structural and macroeconomic headwinds; (2) as a result, the Company overstated the efficacy of its business model and the likelihood it would meet the long-term growth projections touted in the Offering Documents; (3) accordingly, the Company’s post-IPO financial position and/or business prospects were overstated; and (4) as a result, Defendants’ statements about the Company’s business, operations, and prospects were materially false and misleading and/or lacked a reasonable basis at all relevant times.

On June 12, 2023, Morgan Stanley downgraded Expensify to Underweight from Equal-weight, citing structural headwinds and the Company’s risk-reward profile. On this news, Expensify’s stock price fell $0.45 per share, or 6.28%, to close at $6.72 per share on June 12, 2023. Then, on August 8, 2023, Expensify issued a press release announcing its second quarter 2023 financial and operating results. Among other items, Expensify reported GAAP EPS of -$0.14, missing consensus estimate of -$0.07, and revenue of $38.9 million, which likewise missed the consensus estimate of $41.5 million. Expensify also withdrew its previously issued revenue growth guidance. Following Expensify’s disclosures, JMP Securities downgraded the Company to Market Perform from Market Outperform. On this news, Expensify’s stock price fell $1.69 per share, or 28.55%, to close at $4.23 per share on August 9, 2023.

Finally, after the market closed on November 7, 2023, Expensify issued a press release announcing third quarter 2023 financial and operating results that once again missed consensus estimates amid macroeconomic headwinds. Among other items, Expensify reported a Q3 GAAP loss of $0.21 per share and a 14.1% year-over-year revenue decline. On this news, Expensify’s stock price fell $1.07 per share, or 36.89%, to close at $1.83 per share on November 8, 2023. As of the time that the lawsuit was filed, Expensify’s securities continue to trade below the $27 per share Offering price, damaging investors. As a result of Defendants’ wrongful acts and omissions, and the precipitous decline in the market value of Expensify’s securities, Plaintiff and other Class members have suffered significant losses and damages.

*            *            *

If you purchased or otherwise acquired Expensify common stock pursuant and/or traceable to the Offering Documents issued in connection with the Company’s initial public offering conducted on or about November 11, 2021, inclusive, and suffered substantial losses, 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 Expensify lawsuit is January 29, 2024.

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