#USA #San Francisco #Securities Fraud #Hagens Berman #Varonis Systems

Investigation Underway Surrounding Varonis Systems

In a significant move, the prominent law firm Hagens Berman has launched an investigation into Varonis Systems, Inc. (NASDAQ: VRNS), following allegations of misleading statements made by the company regarding its transition to a Software-as-a-Service (SaaS) model. The focus of the inquiry is whether Varonis executives misled investors regarding the company’s capability to efficiently convert its traditional on-premise clientele to a SaaS framework.

Background of the Allegations

Investor concerns were amplified when Varonis disclosed substantial declines in its key revenue streams, particularly after revealing a staggering 63.9% year-over-year drop in term license subscription revenues on October 28, 2025. This information was a sharp contrast to the previous optimistic messages communicated by the company regarding its growth potential, including claims of a seamless transition to SaaS. The fallout from this disclosure resulted in a dramatic 48% decline in share price, amounting to a loss of approximately $3.8 billion in market capitalization.

According to Hagens Berman, the investigation is exploring whether Varonis indeed communicated a false narrative regarding its ability to accelerate annual recurring revenue (ARR), while the underlying data indicated a significant drag from its legacy business operations.

Misleading Statements and Market Impact

Details from the litigation reveal that Varonis provided several assurances to investors. Executives responded with promises of efficient transitions for existing customers and suggested that strong renewal rates would facilitate the company’s growth in the SaaS sector. Phrases such as “we are well on our way to becoming a SaaS company” were touted, yet the reality showed a disconnect between these assurances and the subsequent performance.

After revealing the dramatic drop in revenues, Varonis was forced to cut its revenue guidance for the remainder of the fiscal year significantly. In less than a day, Varonis shares plummeted from $63 to $32.34, illustrating the market's immediate reaction to the alarming news.

Next Steps for Affected Investors

Hagens Berman is urging investors who sustained losses while purchasing Varonis shares during the affected timeline—between February 4, 2025, and October 28, 2025—to come forward. If they believe their investments were influenced by the information provided—or lack of it—by Varonis during this timeframe, they are encouraged to reach out for guidance and assistance.

The law firm is particularly looking for individuals who have suffered significant financial setbacks as a result of the confusing and misleading information that has now come to light.

Conclusion

With the lead plaintiff deadline approaching on March 9, 2026, affected investors should act promptly if they wish to participate in the ongoing legal proceedings. Hagens Berman is known for its extensive experience in handling securities class action lawsuits, and they are prepared to assist investors in seeking just compensation for their losses.
Hagens Berman continues to advocate for transparency and accountability in corporate practices and is committed to ensuring that investors’ rights are upheld amid these troubling allegations concerning Varonis Systems.