On June 29, Skillz’s stock was at $22.16. Nevertheless, since then it has only but declining. Today, the price is expected to be at $17.65, which results in a 20% loss. Johnson Fistel, LLP is investigating potential claims on Skillz’s behalf against some of its officers and directors. A class-action lawsuit was recently filed against the Company in federal court on behalf of buyers of Skillz securities from December 16, 2020, and April 19, 2021 (the “Period”).
The filled complaint submitted alleges that Defendants made materially false and misleading statements and did not disclose that: statements regarding certain Skillz business operations, performance metrics, and final ratings, including but not limited to Skillz’s ability to attract new end users, future profitability, the declining popularity of hosted games, which accounted for 88% of revenue, and company valuation. For example, one of the Company’s objectively unrealistic promises included the unsubstantiated claim that the Company was valued at $ 3.5 billion based on revenue projections of over $ 550 million for 2022.
However, the company did not inform investors that game downloads, which account for most of its revenue, have been declining since at least November 2020. The company’s prospects for achieving this scale of revenue were far from realistic given its size. market share, reliance on third-party app stores, declining downloads of the most popular games, and most importantly, the huge amount of incentive bonus payments that Skillz regularly provides to its gamer customers – a fact that has misled investors.
Finance and Entertainment Reporter
Richard is a bottle of wine – the older the sweeter. He has already found the sweetest hobby in writing entertainment and finance news for Own Snap. Readers get the updated posts regularly from him searching for real-time news.