close
close

Association-anemone

Bite-sized brilliance in every update

the evolv rate drops due to fake numbers
asane

the evolv rate drops due to fake numbers

Shares in Waltham-based Evolv Technology, which makes weapons detection systems used in sports arenas around the world, steadied but remained lower on Monday after a shock Friday that sent the company’s shares lower by 40 percent.

The sale came after Evolv said it would have to correct its earnings reports for fiscal years 2022 and 2023 and the first two quarters of 2024 due to “premature or incorrect revenue recognition of approximately $4 million to $6 million” . In addition, the company said the release of its 2024 third quarter financial report will be delayed.

Shares of Evolv traded down from $4.13 to $2.24 in Nasdaq trading on Friday. It bounced back later in the day and closed Monday at $2.52.

Evolv said sales to at least one major customer included terms and conditions that exceeded the company’s standard contracts and that “certain company personnel engaged in misconduct in connection with those transactions.”

It’s another headache for Evolv, which already faces a shareholder lawsuit as well as investigations by the Federal Trade Commission and the Securities and Exchange Commission. Critics of the company say it has made false and exaggerated claims about the effectiveness of its system, which uses metal detectors and artificial intelligence software to detect people carrying guns.

Evolv shares were also hit in May after the company cut its revenue guidance for the full year 2024. And the New York Daily News reported earlier this month that the city’s Department of Investigation is looking into possible improprieties in the decision to to test Evolv systems in some subway stations in New York.

In addition, Evolv recently announced new clients including Spectrum Center, home of the NBA’s Charlotte Hornets, and Moda Center, home of the NBA’s Portland Trail Blazers. Evolv systems are used at Gillette Stadium, Fenway Park and TD Garden.


Hiawatha Bray can be reached at [email protected]. Follow L @GlobeTechLab.