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Investigation of Varonis Systems by Hagens Berman

Hagens Berman, a prominent law firm specializing in shareholder rights, has initiated an investigation into Varonis Systems, Inc. (NASDAQ: VRNS). The investigation is pertinent to a pending class action lawsuit focused on claims against the company and several of its executives. Investors who acquired Varonis stock between February 4, 2025, and October 28, 2025, are encouraged to participate, particularly as the deadline to become a lead plaintiff is set for March 9, 2026.

Allegations of Misleading Statements

The central issue at hand revolves around accusations that Varonis executives provided misleading information concerning the company's transition from traditional on-premises solutions to a Software-as-a-Service (SaaS) model. During this period, Varonis promoted an optimistic narrative about its capacity to convert its legacy customer base to the SaaS platform, which was purported to significantly bolster its annual recurring revenue (ARR).

However, in a shocking turn of events disclosed on October 28, 2025, Varonis reported a staggering 63.9% decline year-over-year in term license subscription revenues. This revelation triggered an enormous stock price drop of 48%, resulting in a loss of nearly $3.8 billion in market capitalization, raising serious concerns about the veracity of the prior assurances made by the company.

Implications of the Findings

Reed Kathrein, a partner at Hagens Berman overseeing the investigation, emphasized the seriousness of the situation. He stated, "We are investigating whether Varonis painted a false picture of a seamless SaaS transition while the reality was a significant drag from its legacy business." This raises critical questions about the potential risks that were not disclosed to investors, which could have impacted their investment decisions.

The lawsuit highlights claims that Varonis misrepresented its conversion potential, stating that they were on the verge of a substantial transformation. The firm had previously asserted that they were well along their journey to evolve into a SaaS-centric organization, claiming a significant opportunity to increase ARR from existing clients. Contrarily, the reality appears significantly more complex and less optimistic.

The Route Ahead for Affected Investors

As the investigation progresses, it is crucial for Varonis investors who have faced losses during the relevant period to reach out. The Hagens Berman law firm continues to guide individuals through the necessary steps to secure their claims effectively. The legal expert team is keen to assist in evaluating the extent of losses suffered and strategizing appropriate actions moving forward. More information can be sought through Hagens Berman’s dedicated VRNS case page.

Furthermore, whistleblowers possessing non-public information concerning Varonis are encouraged to come forward as they may help in this investigation. Under the SEC Whistleblower program, individuals providing insightful information could earn up to 30% of any successful recovery.

About Hagens Berman

Hagens Berman Sobol Shapiro LLP is a distinguished plaintiffs’ rights litigation firm focused on corporate accountability. With over $2.9 billion secured for clients affected by corporate misconduct, the firm represents a wide array of stakeholders, including investors, whistleblowers, and consumers. Their advocacy aims to address issues stemming from negligence and fraudulent practices in various corporate sectors.

In conclusion, as the investigation into Varonis unfolds, those impacted by the alleged misleading statements are urged to act swiftly, ensuring their voices are heard and justice is pursued. For further information on the ongoing case or to submit claims, affected investors can visit the Hagens Berman website or contact their office directly.