Background of the Lawsuit
- The Trade Desk is accused of exaggerating the benefits of the Kokai platform.
- At the same time, significant problems during the transition from the old Solimar platform to Kokai were allegedly concealed.
- These problems reportedly led to delays and negatively impacted the company’s growth.
- The lawsuit pertains to statements made between May 9, 2024, and February 12, 2025.
The proceedings are ongoing before the Federal District Court for the Central District of California. Investors who purchased shares during this period can register as lead plaintiffs until April 21, 2025.
Impact on Stock Price and Market Reaction
The stock of The Trade Desk has been in a downward trend since the issues became known:
- After the business report in February 2025, the stock plummeted after admitting delays with Kokai.
- The day after the filing of the class action lawsuit, the stock fell by another approximately 2.55 percent to about 42.55 euros.
- Over the last 30 days, the total price loss amounts to nearly 18 percent; since the beginning of the year, it is even over 60 percent compared to last year’s peak.
The disappointing quarterly figures from Q4/2024 underline this negative trend: Revenues were approximately 741 million dollars, below analysts’ expectations (758 million dollars), and the forecast for Q1/2025 was also disappointing, with expected revenues below consensus.
Importance for Investors
- Trust in management is suffering due to allegedly misleading communication regarding platform development.
- Operational challenges with Kokai remain a central burden for the company.
Investors are thus faced with a difficult decision between potentially entering at low prices or selling to minimize risk.
In summary, the class action against The Trade Desk for misleading statements about the AI platform Kokai has already left significant marks on the stock price and heavily burdens trust in the company. The further development primarily depends on the outcome of the court proceedings as well as the success in the technical implementation of Kokai.