Fastly, Inc.

On May 1, 2024, Fastly released its first quarter 2024 financial results, missing consensus estimates of revenue by $0.35 million. The Company also lowered its full year revenue guidance. The Company explained that it was experiencing material contract repricing in its top customers.

On this news, Fastly’s stock price fell $4.14, or 32%, to close at $8.79 per share on May 2, 2024, thereby injuring investors.

The complaint filed in this class action alleges that throughout the Class Period, Defendants 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 that: (1) contrary to its representations to investors, Fastly was in fact experiencing a significant deceleration in growth among its largest customers and was losing the increased market share it had gained as a result of the 2023 CDN consolidation trend; (2) the foregoing issues were likely to have a material negative impact on the Company’s revenue growth; (3) accordingly, the Company was unlikely to meet its own previously issued revenue guidance for FY 2024; (4) as a result, the Company’s financial position and/or prospects were overstated; and (5) as a result, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis at all relevant times.