Shareholder rights law firm Robbins LLP informs investors that on October 6, 2026, the plaintiffs in the class action against Sprout Social (NASDAQ: SPT) beat defendants' motion to dismiss the complaint. Accordingly, the stay of the case was lifted and the parties are to submit a proposed schedule for the completion of fact and expert discovery.

The class action was initially filed on behalf of persons and entities that purchased or otherwise acquired Sprout Social securities between November 2, 2023 and May 2, 2024, inclusive (the "Class Period").

Why Was Sprout Social Sued?

According to the class action complaint, during the Class Period, defendants failed to disclose to investors: (1) the Company’s sales and revenue growth were not indicative of the Company’s growth as it transitioned to an enterprise sales cycle; (2) that the Company faced integration challenges with its acquisition of Tagger; (3) as a result, the Company was “self inducing sales headwinds;” and (4) as a result, the Company would revise fiscal year 2024 revenue guidance.

On May 2, 2024, Sprout Social announced the Company’s operating results for the first fiscal quarter of 2024, disclosing that the Company had missed its revenue guidance for the quarter, and revising its full year 2024 revenue guidance downward $20 million. The Company’s Chief Financial Officer Joe Del Preto stated the Company had “underestimated the magnitude of enterprise seasonality” and that the Company had also been “self-inducing sales execution headwinds.” On this news, Sprout Social’s stock price fell $19.33, or 40.1%, to close at $28.82 per share on May 3, 2024.

What Can Sprout Social Shareholders Do Now?

Investors who purchased Sprout Social shares prior to the Class Period have rights.

For additional information about the Sprout Social matter, contact Robbins LLP by submitting an inquiry, emailing attorney Aaron Dumas, Jr., or calling (800) 350-6003.

Why Robbins LLP?

A recognized leader in shareholder rights litigation, Robbins LLP represents investors in securities fraud and shareholder derivative litigation. We have helped restore more than $2 billion in value to shareholders and secured some of the largest recoveries in shareholder derivative litigation history.

"Companies have an obligation to provide investors with complete and accurate information so that markets can function fairly and efficiently," said Brian J. Robbins, Founding Partner of Robbins LLP.

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