NEW YORK, May 27, 2023 /PRNewswire/ -- Faruqi & Faruqi, LLP, a leading national securities law firm, is investigating potential claims against Nutanix, Inc. ("Nutanix" or the "Company") (NASDAQ: NTNX) and reminds investors of the June 13, 2023 deadline to seek the role of lead plaintiff in a federal securities class action that has been filed against the Company.
If you suffered losses exceeding $100,000 investing in Nutanix stock or options between September 21, 2021 and March 6, 2023, both dates inclusive (the "Class Period") and would like to discuss your legal rights, call Faruqi & Faruqi partner Josh Wilson directly at 877-247-4292 or 212-983-9330 (Ext. 1310). You may also click here for additional information: www.faruqilaw.com/NTNX.
There is no cost or obligation to you.
Faruqi & Faruqi is a leading minority and Woman-owned national securities law firm with offices in New York, Pennsylvania, California and Georgia.
Nutanix purports to provide a leading enterprise cloud platform, the Nutanix Cloud Platform, that consists of software solutions and cloud services that power its customers' enterprise infrastructure.
In operating its cloud platform, Nutanix often utilizes software supplied by third-party providers. Indeed, the Company has stated that one if its "principal competitive factors" is "product interoperability with third-party applications, infrastructure software, infrastructure systems and platforms and public clouds." Accordingly, Nutanix will pay software vendors a reduced cost to provide the Company with "evaluation software," which Nutanix will use only for internal evaluation purposes in order to determine whether it will ultimately purchase the software for business use. If the Company elects to purchase the software, the vendor will charge Nutanix the full cost to implement the product in standard business usage, as opposed to merely a reduced evaluation cost.
The complaint alleges that throughout the Class Period, Defendants made materially false and misleading statements regarding the Company's business, operations, and prospects. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) the Company maintained deficient internal controls relating to its use of licensed software and expense management; (ii) as a result of these deficiencies, the Company improperly used third-party evaluation software for business purposes over a multi-year period; (iii) investigation and remediation of the foregoing?i.e., by paying vendors the full cost to use their software for business purposes?would cause the Company to incur significant expenses; and (iv) as a result, the Company's public statements were materially false and misleading at all relevant times.
On March 6, 2023, Nutanix issued a press release reporting selected preliminary second quarter fiscal 2023 financial results. Among other items, Nutanix reported that "Company management discovered that certain evaluation software from one of its third-party providers was instead used for interoperability testing, validation and customer proofs of concept over a multi-year period[,]" and that "it is likely that additional costs would be incurred to address the additional use of the software." Furthermore, due to an ongoing Audit Committee investigation into the matter, Nutanix stated that "it does not expect to be able to [timely] file its Quarterly Report on Form 10-Q for the quarter ended January 31, 2023[.]"
That same day, Nutanix hosted an earnings call with investors and analysts to discuss the Company's fiscal Q2 2023 results (the "Q2 2023 Earnings Call"). During the Q&A portion of the Q2 2023 Earnings Call, when asked to clarify why using evaluation software for interoperability testing, validation, and customer proofs of concept would incur additional expenses, Nutanix's Chief Executive Officer Rajiv Ramaswami explained that the Company would be required to pay the cost of using the software beyond the scope of its intended evaluation usage.
On this news, Nutanix's stock price fell $2.27 per share, or 7.89%, to close at $26.50 per share on March 7, 2023.
Then, on March 16, 2023, Nutanix issued a press release announcing that, on March 15, 2023, "the Company received a standard notification letter from Nasdaq stating that, because the Company has not yet filed its Quarterly Report on Form 10-Q for the quarter ended January 31, 2023, the Company is not in compliance with Nasdaq Listing Rule 5250(c)(1), which requires timely filing of all required periodic financial reports with the [Securities and Exchange Commission]."
Faruqi & Faruqi, LLP also encourages anyone with information regarding Nutanix's conduct to contact the firm, including whistleblowers, former employees, shareholders and others.
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