Law Offices of Howard G. Smith announces that a class action lawsuit has been filed on behalf of investors who purchased ZoomInfo Technologies Inc. (“ZoomInfo” or the “Company”) (NASDAQ: ZI) common stock between November 10, 2020 and August 5, 2024, inclusive (the “Class Period”). ZoomInfo investors have until November 4, 2024 to file a lead plaintiff motion.
Investors suffering losses on their ZoomInfo investments are encouraged to contact the Law Offices of Howard G. Smith to discuss their legal rights in this class action at 888-638-4847 or by email to howardsmith@howardsmithlaw.com.
On August 5, 2024, ZoomInfo released its second quarter 2024 financial results, missing revenue and earnings expectations, and lowering its full-year guidance for revenue, adjusted operating income, and free cash flow. Additionally, the Company revealed that it was incurring a $33 million charge related to non-payments by its customers, implementing a “new business risk model” to address elevated write-offs, and announced that its CFO and principal finance officer would be departing.
On this news, ZoomInfo’s stock price fell $1.79, or 10.3%, to close at $8.01 per share on August 6, 2024, thereby injuring investors.
The complaint filed in this class action alleges that throughout the Class Period, Defendants 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: (1) that ZoomInfo’s financial and operational results during the Class Period had been temporarily inflated by the ephemeral effects of the COVID-19 pandemic, which had pulled-forward demand for the Company’s database of digital contact information; (2) that material portions of ZoomInfo’s existing customer base were attempting to either substantially reduce their use of the Company’s product or abandon it altogether; (3) that ZoomInfo had used manipulative and coercive auto-renew policies and threats of litigation to force customers into remaining with the Company for an additional contractual term even though such customers did not want to; (4) that ZoomInfo’s coercive customer retention tactics had materially damaged the Company’s customer relationships, client franchise, and competitive advantages, and created a hidden demand cliff for customer contract renewals in future periods; (5) that ZoomInfo’s reported accounts receivable were materially comprised of debts owed by high-risk small business customers that had a high likelihood of non-payment and had been induced to transact with the Company through a credit program the Company implemented in 2022; (6) that ZoomInfo’s allowance for credit losses was materially inadequate and understated the risk of non-payments by the Company’s customers; and (7) as a result, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis at all relevant times.
If you purchased ZoomInfo securities, have information or would like to learn more about these claims, or have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Howard G. Smith, Esquire, of Law Offices of Howard G. Smith, 3070 Bristol Pike, Suite 112, Bensalem, Pennsylvania 19020, by telephone at (215) 638-4847 or by email to howardsmith@howardsmithlaw.com, or visit our website at www.howardsmithlaw.com.
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View source version on businesswire.com: https://www.businesswire.com/news/home/20240905939959/en/
Contacts
Law Offices of Howard G. Smith
Howard G. Smith, Esquire
215-638-4847
howardsmith@howardsmithlaw.com
www.howardsmithlaw.com
