NEW YORK, June 20, 2024 (GLOBE NEWSWIRE) — Bleichmar Fonti & Auld LLP (“BFA”) announces that it has filed a class action lawsuit for violations of the federal securities laws against UiPath, Inc. (“UiPath” or the “Company”) and certain officers of the Company. The lawsuit asserts claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 on behalf of investors in UiPath securities between December 1, 2023 and the close of trading on May 29, 2024 (the “Class Period”). The case is pending in the U.S. District Court for the Southern District of New York and is captioned Zack Steiner v. UiPath, Inc.No. 1:24-cv-4702.
If you have suffered a loss on your UiPath investments and would like to discuss this, Please send your information to https://www.bfalaw.com/cases-investigations/uipath-inc-investigation.
You may also contact Ross Shikowitz, Esq., at 212-789-3619 or via email at [email protected].
Why was UiPath sued for securities fraud?
UiPath provides business automation software, specifically a suite of automation tools based on robotic process automation (“RPA”) and artificial intelligence (“AI”), that enable its customers to automate repetitive business tasks normally performed by humans. As AI technology has evolved in recent years, UiPath has sought to expand its offerings with AI-powered products that work in conjunction with its RPA tools.
On September 27, 2022, after a period of stagnant growth and declining demand for its products, the Company announced a turnaround strategy to accelerate growth. The turnaround strategy included rebranding UiPath as an AI-powered business automation platform and revamping the Company’s go-to-market sales strategy. The sales strategy overhaul included several aspects, such as: (1) prioritizing the sale of UiPath’s product platform over allowing customers to select individual product offerings; and (2) increasing sales resources for the Company’s largest customers and focusing sales efforts on the customer’s executive levels.
The lawsuit alleges that throughout the Class Period, defendants made materially false and misleading statements about the success of UiPath’s turnaround strategy. For example, defendants claimed that the company “is executing on this strategy and we are seeing the results in terms of business and customer quality,” they claimed that “our strategic investments in innovation and our go-to-market ecosystem position us well for continued momentum,” and that “since the implementation of the turnaround strategy, there is no doubt that there has been better execution.”
These statements were materially false and misleading. In fact, UiPath’s turnaround strategy had failed. Wasted investments and inconsistent execution hampered the company’s revised go-to-market strategy. In addition, UiPath’s AI-powered Business Automation Platform caused customer “confusion” and failed to scale sufficiently. As a result, UiPath had significant difficulty winning and/or extending large, multi-year contracts.
On May 29, 2024, UiPath announced the sudden departure of CEO Robert Enslin. On the same day, UiPath reported disappointing financial results for Q1 2025 and significantly lowered its fiscal 2025 revenue forecast by 10%, or $150 million. The company attributed the poor results and forecasts to several factors related to its failed turnaround strategy, including an inadequate “execution strategy to scale” the company’s AI-powered growth products “to reach their full potential” and that AI had “caused a little confusion among our customers.” UiPath also described how the “investments we made to re-accelerate growth have fallen short of our expectations (and) made us less flexible in responding to customer needs” while we experienced “contract execution challenges on large deals.”
This news caused UiPath’s stock price to fall by $6.23 per share, or more than 34%, from $18.30 per share on May 29, 2024 to $12.07 per share on May 30, 2024, causing significant harm to investors.
What are my rights?
If you purchased or otherwise acquired UiPath securities between December 1, 2023 and the close of trading on May 29, 2024, you may ask the Court to appoint you as lead plaintiff through counsel of your choice no later than August 19, 2024, the first business day after 60 days from the date of publication of this notice. You do not need to take any action at this time to be a class member. Your ability to share in any potential future relief is not dependent on serving as lead plaintiff.
Submit your information here: https://www.bfalaw.com/cases-investigations/uipath-inc-investigation
Why BFA Law?
Bleichmar Fonti & Auld LLP is a leading international law firm representing plaintiffs in class actions and shareholder litigation. It was named a Top 5 Plaintiffs Firm for 2023 by ISS SCAS and its lawyers have been named Titans of the Plaintiffs’ Bar by Law360 and SuperLawyers by Thompson Reuters. Recent notable successes include BFA recovering over $900 million in value from the board of Tesla, Inc. (subject to court approval), as well as $420 million from Teva Pharmaceutical Ind. Ltd.
