NEW YORK, Aug. 07, 2024 (GLOBE NEWSWIRE) -- Pomerantz LLP announces that a class action lawsuit has been filed against 2U, Inc. (“2U” or the “Company”) (NASDAQ: TWOU). Such investors are advised to contact Danielle Peyton at newaction@pomlaw.com or 646-581-9980, (or 888.4-POMLAW), toll-free, Ext. 7980. Those who inquire by e-mail are encouraged to include their mailing address, telephone number, and the number of shares purchased.
The class action concerns whether 2U and certain of its officers and/or directors have engaged in securities fraud or other unlawful business practices.
You have until August 12, 2024, to ask the Court to appoint you as Lead Plaintiff for the class if you are a shareholder who purchased or otherwise acquired 2U securities during the Class Period. A copy of the Complaint can be obtained at www.pomerantzlaw.com.
[Click here for information about joining the class action]
On November 9, 2023, after the market closed, 2U announced that the Company and the University of Southern California (“USC”) would wind down their 15-year collaboration in the Company’s major programs, and that USC would pay approximately $40 million in connection with this exit. 2U also announced that it would recognize a total of $80 million in the fourth quarter related to partners seeking a negotiated exit from certain degree programs, which the Company euphemistically referred to as “portfolio management activities.” The Company disclosed these portfolio management activities would offset a 21% decrease in full course equivalent enrollment, which was primarily driven by “the impact of [its] transition to a new marketing framework in mid-2022.” The Company also revealed fiscal quarterly results, showing Degree Program revenue was flat year over year, that total revenue had decreased 1%, and that the Alternative Credential Segment revenue decreased 3%.
On this news, 2U’s stock price fell $40.50 per share, or 56.72%, to close at $30.90 per share on November 10, 2023.
Then, on February 12, 2024, after the market closed, 2U disclosed that due to the Company’s debt, “there is substantial doubt about its ability to continue as a going concern.” The Company further disclosed it recognized $88.0 million of revenue from portfolio management activities (i.e., fees negotiated for early partnership contract termination) in the year and it would assume another $10 million from such activities in the first quarter of 2024 and at least $15 million in full-year 2024. 2U also announced its full year revenue of $946 million, significantly missing the Company’s guidance of $965 million to $990 million, and revealed Degree Program Segment revenue, Alternative Credential Segment Revenue, and total revenue, all decreased 2% year over year. The Company also issued full year 2024 guidance, estimating revenue would continue to decline from $946 million, to $805 million to $815 million.
On this news, 2U’s stock price fell $16.34 per share, or 59.33%, to close at $27.55 per share on February 13, 2024.
Pomerantz LLP, with offices in New York, Chicago, Los Angeles, London, Paris, and Tel Aviv, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, Pomerantz pioneered the field of securities class actions. Today, more than 85 years later, Pomerantz continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered billions of dollars in damages awards on behalf of class members. See www.pomlaw.com.
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CONTACT:
Danielle Peyton
Pomerantz LLP
dpeyton@pomlaw.com
646-581-9980 ext. 7980
