SAN DIEGO, Sept. 06, 2024 (GLOBE NEWSWIRE) — Robbins LLP informs investors that a shareholder filed a class action on behalf of all stockholders who purchased or otherwise acquired WEBTOON Entertainment Inc. (NASDAQ: WBTN) common stock in connection with the Company’s June 2024 initial public offering (“IPO”). Webtoon is an entertainment company focused on mobile webcomics and visual storytelling.
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The Allegations: Robbins LLP is Investigating Allegations that WEBTOON Entertainment Inc. (WBTN) Misled Investors in its Registration Statement Supporting its IPO
According to the complaint, Webtoon held its IPO on June 27, 2024, selling shares of common stock priced at $21.00 per share and raising net proceeds of approximately $308.5 million. Then, 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.
Plaintiff alleges that the Registration Statement was materially false and misleading and omitted to state: (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.
What Now: You may be eligible to participate in the class action against WEBTOON Entertainment Inc. Shareholders who want to serve as lead plaintiff for the class must submit their application to the court by November 4, 2024. A lead plaintiff is a representative party who acts on behalf of other class members in directing the litigation. You do not have to participate in the case to be eligible for a recovery. If you choose to take no action, you can remain an absent class member. For more information, click here.
All representation is on a contingency fee basis. Shareholders pay no fees or expenses.
About Robbins LLP: Some law firms issuing releases about this matter do not actually litigate securities class actions; Robbins LLP does. A recognized leader in shareholder rights litigation, the attorneys and staff of Robbins LLP have been dedicated to helping shareholders recover losses, improve corporate governance structures, and hold company executives accountable for their wrongdoing since 2002. Since our inception, we have obtained over $1 billion for shareholders.
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