Stride, Inc. Faces Class Action Lawsuit After Stock Plummet

2025-12-03 companies

New York, Wednesday, 3 December 2025.
Stride, Inc. is embroiled in a securities fraud lawsuit following a 54% stock drop due to enrollment issues. Investors have until January 12, 2026, to join the legal action.

Background of the Lawsuit

Stride, Inc. (NYSE: LRN), an education technology company, is facing a class action lawsuit for securities fraud following a significant drop in its stock price. The lawsuit, filed on December 1, 2025, alleges that the company engaged in deceptive practices, including inflating enrollment numbers and ignoring compliance requirements. These actions allegedly led to poor customer experiences, resulting in higher withdrawal rates and lower conversion rates, ultimately impacting investor confidence and causing a drastic stock price decline [1][2].

Timeline of Events Leading to the Lawsuit

The sequence of events began with a complaint filed on September 14, 2025, by the Gallup-McKinley County Schools Board of Education, alleging fraud and deceptive practices. This resulted in an over 11% drop in Stride’s stock price the following day [1][2]. On October 28, 2025, Stride publicly admitted that poor customer experience had negatively impacted enrollments by 10,000-15,000 students, contributing to a 54% drop in its stock price by October 29, 2025 [1][3].

Details of the Stock Price Decline

Stride’s stock fell from $153.53 per share on October 28, 2025, to $70.05 per share on October 29, 2025, representing a decline of more than 54% [1][2][3]. This significant loss in value has prompted multiple law firms, including Bleichmar Fonti & Auld LLP and Kahn Swick & Foti, LLC, to initiate legal actions against the company. The class action lawsuit covers purchases made between October 22, 2024, and October 28, 2025, with a deadline for lead plaintiff applications set for January 12, 2026 [1][2][4].

Impact on the Education Technology Sector

The lawsuit against Stride highlights broader concerns about accountability and transparency within the education technology sector. As companies increasingly rely on digital platforms for educational services, the scrutiny over their financial practices and customer satisfaction metrics is intensifying. This case serves as a reminder of the potential risks and volatility associated with investing in technology-driven educational services [1][2][5].

Sources

securities fraud Stride Inc