Investors Urged to Join Class Action Against Varonis Systems Amid Allegations of Securities Fraud
On January 21, 2026, Levi & Korsinsky, LLP announced the filing of a class action lawsuit against Varonis Systems, Inc. (NASDAQ: VRNS), centered around claims of securities fraud that occurred between February 4, 2025, and October 28, 2025. This initiative aims to assist investors who suffered losses due to alleged misleading statements and material facts withheld by the company. Investors are encouraged to connect with Levi & Korsinsky before the impending deadline of March 9, 2026, for potential participation in the suit.
The crux of the lawsuit revolves around the assertion that Varonis continuously provided an overly optimistic outlook to its investors while concealing significant issues regarding its subscription model. The company reportedly failed to effectively demonstrate the advantages of its Software-as-a-Service (SaaS) offerings to existing customers, which allegedly hampered its ability to retain and migrate its user base to the new platform.
As Varonis prepared to reveal its third quarter financial results for fiscal 2025, the situation escalated. On October 28, 2025, the company disclosed that it had substantially missed its Annual Recurring Revenue (ARR) targets and drastically cut its projections for the full fiscal year, a stark contrast to the increased guidance it had provided in the prior two quarters.
Investors reacted swiftly to the disappointing news. Before the announcement on October 28, shares of Varonis were trading at $63.00 each. After the disclosure, the stock plummeted by nearly 49%, closing at $32.34 on October 29. This dramatic decline underlined investor losses and highlighted the precarious state of the company as it acknowledged challenges with renewals and customer conversions in both its federal and non-federal subscription businesses.
Furthermore, in the wake of these disclosures, Varonis announced the termination of its self-hosted solution and implemented a 5% reduction in its workforce—decisions that sparked further concerns regarding the company's strategic direction and market viability.
Investors who experienced losses during the relevant period are advised to act quickly; the cut-off for requesting lead plaintiff status is March 9, 2026. Importantly, participation in this class action does not require individuals to serve as lead plaintiffs, and there will be no personal costs intertwining with their involvement.
Levi & Korsinsky boasts a strong track record, having reclaimed hundreds of millions of dollars for investors over the past two decades. The firm has developed substantial expertise in complex securities litigation, represented by a skilled team of over 70 employees dedicated to serving clients. For seven consecutive years, Levi & Korsinsky has been recognized as one of the top securities litigation firms in the United States, as per the ISS Securities Class Action Services' Top 50 Report.
Investors are urged to reach out to Joseph E. Levi, Esq. at Levi & Korsinsky, LLP, for guidance on the lawsuit. They can call (212) 363-7500 or send an email for further inquiries. The firm is located at 33 Whitehall Street, 27th Floor, New York, NY 10004.
As the deadline approaches, those impacted by Varonis' alleged misstatements would benefit from understanding their rights and the opportunity to seek restitution through this class action lawsuit.
Understanding the Allegations
The crux of the lawsuit revolves around the assertion that Varonis continuously provided an overly optimistic outlook to its investors while concealing significant issues regarding its subscription model. The company reportedly failed to effectively demonstrate the advantages of its Software-as-a-Service (SaaS) offerings to existing customers, which allegedly hampered its ability to retain and migrate its user base to the new platform.
As Varonis prepared to reveal its third quarter financial results for fiscal 2025, the situation escalated. On October 28, 2025, the company disclosed that it had substantially missed its Annual Recurring Revenue (ARR) targets and drastically cut its projections for the full fiscal year, a stark contrast to the increased guidance it had provided in the prior two quarters.
The Financial Fallout
Investors reacted swiftly to the disappointing news. Before the announcement on October 28, shares of Varonis were trading at $63.00 each. After the disclosure, the stock plummeted by nearly 49%, closing at $32.34 on October 29. This dramatic decline underlined investor losses and highlighted the precarious state of the company as it acknowledged challenges with renewals and customer conversions in both its federal and non-federal subscription businesses.
Furthermore, in the wake of these disclosures, Varonis announced the termination of its self-hosted solution and implemented a 5% reduction in its workforce—decisions that sparked further concerns regarding the company's strategic direction and market viability.
Next Steps for Affected Investors
Investors who experienced losses during the relevant period are advised to act quickly; the cut-off for requesting lead plaintiff status is March 9, 2026. Importantly, participation in this class action does not require individuals to serve as lead plaintiffs, and there will be no personal costs intertwining with their involvement.
Why Choose Levi & Korsinsky?
Levi & Korsinsky boasts a strong track record, having reclaimed hundreds of millions of dollars for investors over the past two decades. The firm has developed substantial expertise in complex securities litigation, represented by a skilled team of over 70 employees dedicated to serving clients. For seven consecutive years, Levi & Korsinsky has been recognized as one of the top securities litigation firms in the United States, as per the ISS Securities Class Action Services' Top 50 Report.
Contact Information
Investors are urged to reach out to Joseph E. Levi, Esq. at Levi & Korsinsky, LLP, for guidance on the lawsuit. They can call (212) 363-7500 or send an email for further inquiries. The firm is located at 33 Whitehall Street, 27th Floor, New York, NY 10004.
As the deadline approaches, those impacted by Varonis' alleged misstatements would benefit from understanding their rights and the opportunity to seek restitution through this class action lawsuit.
Topics Financial Services & Investing）
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