SAN DIEGO, July 15, 2024 (GLOBE NEWSWIRE) — Robbins LLP reminds investors that a shareholder has filed a class action lawsuit on behalf of individuals and entities who purchased or otherwise acquired common stock of Direct Digital Holdings, Inc. (NASDAQ: DRCT) between April 17, 2023 and March 25, 2024. Direct Digital is an end-to-end, full-service programmatic advertising platform that provides advertising technology, data-driven campaign optimization and other solutions for markets on both the buy- and sell-side of the digital advertising ecosystem.
For more information, submit a form, email Attorney Aaron Dumas, Jr., or call us at (800) 350-6003.
The accusations: Robbins LLP is investigating allegations that Direct Digital Holdings, Inc. (DRCT) misled investors about its financial prospects
According to the complaint, during the Class Period, Defendants failed to disclose that: (1) the Company’s transition to a “cookieless” advertising environment was accelerated and would impact revenue in 2024; (2) the Company’s alternatives to third-party cookies, including planned investments in AI and machine learning to build on first-party data sources, would not be viable alternatives to third-party cookies and similar tracking technologies; (3) the Company did not have adequate solutions to address Google’s impending elimination of third-party cookies; and (4) based on the foregoing, Defendants lacked a reasonable basis for their positive statements regarding the effectiveness of Direct Digital’s platform and related financial results, growth and prospects.
The lawsuit further alleges that on March 26, 2024, Direct Digital announced that it missed fourth quarter 2023 revenue estimates, citing lower than expected demand, a delay in the release of beta testing to Tier 1 publishers, and proactive efforts by Direct Digital to accelerate the transition to a “cookieless” advertising platform. Defendant Walker also announced that in the fourth quarter of 2023, it “became clearer” that the cookie deprecation would begin in the first quarter of 2024, and that “our team has proactively begun the transition away from cookies for media transactions.” On this news, the price of Direct Digital’s common stock declined $10.47 per share, or approximately 39%, from $26.51 per share on March 26, 2024 to $16.04 on March 27, 2024.
Then, on April 2, 2024, Direct Digital announced that a material weakness had been identified in its “review of internal control over financial reporting as of December 31, 2023.” Following this news, Direct Digital’s share price fell $1.31, or 10.4%, from $14.82 on April 1, 2024, to $12.82 per share on April 2, 2024, further injuring investors.
What now: You may be eligible to participate in the Direct Digital Holdings, Inc. class action lawsuit. Shareholders who wish to serve as lead plaintiff for the class action lawsuit must file their motions with the Court by July 22, 2024. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. You do not have to participate in the case to be eligible to receive compensation. If you choose not to take action, you may remain an absent class member. For more information, click here Here.
Representation is on a contingency basis. Shareholders pay neither fees nor expenses.
About Robbins LLP: Some law firms issuing press releases on this matter do not litigate securities class actions; Robbins LLP does. As a recognized leader in shareholder litigation, the attorneys and staff of Robbins LLP have been dedicated to helping shareholders recover losses, improve corporate governance structures and hold corporate executives accountable for wrongdoing since 2002. Since our founding, we have recovered over $1 billion for shareholders.
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