Key Takeaways:
PROCEPT BioRobotics faces a securities fraud class action after its shares fell more than 18 percent on undisclosed excess handpiece inventory.
Kahn Swick & Foti, whose partners include former Louisiana Attorney General Charles C. Foti Jr., said investors who bought the company's shares between Feb. 28, 2024 and Feb. 25, 2026 have until Sept. 22 to file lead plaintiff applications. The case, Operating Engineers Construction Industry and Miscellaneous Pension Fund v. PROCEPT BioRobotics Corporation, No. 26-cv-07691, is pending in the U.S. District Court for the Northern District of California.
The complaint alleges PROCEPT and certain executives failed to disclose that handpiece sales materially exceeded procedures in every quarter since the first fiscal quarter of 2023, a differential that grew over time and produced cumulative excess field inventory of more than 10,000 units. On Feb. 25, the company disclosed that quarterly U.S. handpiece unit sales fell to 9,400 in the fourth quarter from 13,225 in the third, a sequential decline of nearly 30 percent, and that it missed annual revenue guidance by tens of millions of dollars.
The disclosure sent shares down from $27.84 on Feb. 25 to $22.69 on Feb. 27, a decline of more than 18 percent over two trading days on above-average volume. PROCEPT, a commercial-stage medical technology company focused on treating benign prostatic hyperplasia, sells an Aquablation therapy system that uses a single-use handpiece disposed of after each procedure. Handpiece sales are a core revenue driver, making the inventory mismatch central to the company's reported growth.
The lawsuit alleges the company used an undisclosed discount program to incentivize customers to place bulk handpiece orders in excess of procedure demand, artificially inflating reported U.S. handpiece unit sales and pulling forward revenue at the expense of future periods. The complaint also charges that PROCEPT overstated handpiece unit sales and the utilization of its field systems, exposing the company to undisclosed risks of operational and financial harm.
The stock's slide leaves holders who bought during the class period facing potential losses, with the lead plaintiff deadline set for Sept. 22. Investors who do not seek lead plaintiff status may remain absent class members and still share in any recovery. The case adds legal costs and reputational pressure to a company already contending with a weakened demand outlook after the inventory glut, and the Sept. 22 deadline will determine who leads the litigation.
This article is for informational purposes only and does not constitute investment advice.
