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DUTCH BROS DEADLINE ALERT: Bragar Eagel & Squire, P.C. Reminds Investors that a Class Action Lawsuit Has Been Filed Against Dutch Bros Inc. and Encourages Investors to Contact the Firm

NEW YORK, April 28, 2023 (GLOBE NEWSWIRE) -- Bragar Eagel & Squire, P.C., a nationally recognized stockholder rights law firm, reminds investors that a class action lawsuit has been filed against Dutch Bros Inc. (“Dutch Bros” or the “Company”) (NYSE: BROS) in the United States District Court for the Southern District of New York on behalf of all persons and entities who purchased or otherwise acquired Dutch Bros securities between March 1, 2022, and May 11, 2022, both dates inclusive (the “Class Period”). Investors have until May 1, 2023 to apply to the Court to be appointed as lead plaintiff in the lawsuit.

Click here to participate in the action.

Dutch Bros operates and franchises drive-thru coffee shops. The Company also sells and distributes coffee and coffee-related products and accessories. The Company claims that as of March 31, 2022, it had 572 shops in operation in 12 U.S. states, of which 310 were company operated and 262 were franchised.

On March 1, 2022, two-thirds of the way through the Company’s first quarter of 2022, Dutch Bros held a conference call to discuss its fourth quarter and full year 2021 results. On the call, Defendants made numerous statements reassuring investors that the Company’s first quarter 2022 results would be positive, and in particular that the Company’s margins were healthy. For example, Defendant Jonathan “Joth” Ricci (“Ricci”), the Company’s Chief Executive Officer (“CEO”) stated that, while Dutch Bros is “not immune to margin pressures,” the Company was “managing it appropriately” and that “we are feeling good as we enter ‘22 with the trajectory of our margins, given everything going on.” Defendant Charles L. Jemley (“Jemley”), the Company’s Chief Financial Officer (“CFO”) similarly stated “we’re just not feeling compression in margins.”

However, on May 11, 2022, after the market closed, the Company issued a press release announcing poor financial results for the first quarter of 2022. Therein, the Company reported a net loss of $16.3 million, compared to a net loss of $4.8 million for the first quarter of 2021. The Company also reported an adjusted net loss of $2.5 million (a loss of $0.02 per share), which fell below the Street’s estimated earnings of $0.01 per share.

The same day, the Company held a conference call to discuss the Company’s first quarter 2022 results. To explain the Company’s poor performance, Defendant Ricci pointed to Dutch Bros’ margins, stating:

[M]argin pressure on our company shops led to a lower adjusted EBITDA result than we expected. That margin pressure was primarily a result of these factors: our decision to be disciplined on the price we took, which we believe is less than half as much as many of our peers; faster inflation and cost of goods, especially in dairy; the pull forward of deferred expenses related to the maintenance of shops; and normal new store inefficiency amplified by the volume of new and ramping units in quarter 1.

Defendant Ricci further explained: “we did not perceive the speed and magnitude of cost escalation within the quarter. Dairy, for example, which makes up 28% of our commodity basket, rose almost 25% in Q1.”

On this news, Dutch Bros’ share price fell $9.26, or 26.9%, to close at $25.11 per share on May 12, 2022, thereby injuring investors.

During the Class Period, Defendants made materially false and/or misleading statements, and failed to disclose material adverse facts about the Company’s business, operations, and prospects. Specifically, Defendants failed to disclose to investors: (1) that the Company was experiencing increased costs and expenses, including on dairy; (2) that, as a result, the Company was experiencing increased margin pressure and decreased profitability in the first quarter of 2022; and (3) that, as a result of the foregoing, Defendants’ positive statements about the Company’s business, operations, and prospects were materially misleading and/or lacked a reasonable basis.

If you purchased or otherwise acquired Dutch Bros shares and suffered a loss, are a long-term stockholder, have information, would like to learn more about these claims, or have any questions concerning this announcement or your rights or interests with respect to these matters, please contact Brandon Walker or Melissa Fortunato by email at, telephone at (212) 355-4648, or by filling out this contact form. There is no cost or obligation to you.

About Bragar Eagel & Squire, P.C.:

Bragar Eagel & Squire, P.C. is a nationally recognized law firm with offices in New York, California, and South Carolina. The firm represents individual and institutional investors in commercial, securities, derivative, and other complex litigation in state and federal courts across the country. For more information about the firm, please visit Attorney advertising. Prior results do not guarantee similar outcomes.

Contact Information:

Bragar Eagel & Squire, P.C.
Brandon Walker, Esq.
Melissa Fortunato, Esq.
(212) 355-4648

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