BENSALEM, Pa.--(BUSINESS WIRE)--Law Offices of Howard G. Smith reminds investors of the upcoming November 4, 2024 deadline to file a lead plaintiff motion in the case filed on behalf of investors who purchased WEBTOON Entertainment Inc. (“Webtoon” or the “Company”) (NASDAQ: WBTN) common stock pursuant and/or traceable to the registration statement and prospectus (collectively, the “Registration Statement”) issued in connection with the Company’s June 2024 initial public offering (“IPO” or the “Offering”).
Investors suffering losses on their Webtoon investments are encouraged to contact the Law Offices of Howard G. Smith to discuss their legal rights in this class action at (215) 638-4847 or by email to howardsmith@howardsmithlaw.com.
On June 27, 2024, Webtoon conducted its IPO, selling 16,371,549 shares of common stock at $21.00 per share.
On August 8, 2024, after the market closed, Webtoon announced its financial results for second quarter 2024, which had ended just days after the IPO closed. The Company reported revenue of $321 million, which represented total revenue growth of only 0.1%. The Company further revealed advertising revenue declined 3.6% and IP Adaptations revenue declined 3.7%. The Company revealed its revenue and revenue growth had been “offset by the Company’s significant exposure to weaker foreign currencies.” Webtoon also reported a quarterly net loss of $76.6 million, or 70 cents.
On this news, Webtoon’s stock fell $7.88 or 38.2%, to close at $12.75 per share on August 9, 2024, on unusually heavy trading volume. By the commencement of this action, Webtoon stock has traded as low as $12.45 per share, a more than 40% decline from the $21.00 per share IPO price.
The complaint filed in this class action alleges that the Registration Statement 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 the Company experienced a deceleration in advertising revenue growth; (2) that the Company experienced a deceleration in IP adaptations revenue; (3) that the Company experienced exposure to weaker foreign currencies which offset revenue growth; (4) that, as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.
If you purchased or otherwise acquired Webtoon common stock pursuant and/or traceable to the IPO, you may move the Court no later than November 4, 2024 to ask the Court to appoint you as lead plaintiff if you meet certain legal requirements. To be a member of the class action you need not take any action at this time; you may retain counsel of your choice or take no action and remain an absent member of the class action. If you wish to learn more about this class action, or if you 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, toll-free at (888) 638-4847, or by email to howardsmith@howardsmithlaw.com, or visit our website at www.howardsmithlaw.com.
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