Navan, Inc. Shares Plunge After IPO Amid Surprise Expense Increase

Securities class action lawsuit filed against company, underwriters, and executives

Published on Mar. 11, 2026

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Navan, Inc. (NASDAQ: NAVN) has been hit with a securities class action lawsuit after the company's December 15, 2025 announcement of Q3 2026 quarterly financial results. The lawsuit alleges that Navan and other defendants violated federal securities laws by failing to disclose a significant increase in sales and marketing expenses that coincided with the company's initial public offering (IPO) in which it and certain selling stockholders sold about 36.9 million shares at $25 per share.

Why it matters

The surprise expense increase and subsequent stock price drop have raised questions about the sufficiency of Navan's disclosures in its IPO offering documents. The lawsuit alleges that crucial information, including the spike in sales and marketing costs, was omitted from the IPO prospectus, potentially misleading investors.

The details

Navan reported a 39% sequential spike in its sales and marketing expenses during the IPO-coincident quarter ended October 31, 2025, along with slowing year-over-year revenue growth and a fourfold year-over-year increase in its GAAP net loss. This news sent Navan's stock price down nearly 12% to close at $12.90, or about 48% below the IPO price, on December 16. By the time the complaint was filed on February 23, 2026, the stock had fallen further to $9.16, or 63% below the IPO price.

  • Navan's IPO closed on December 15, 2025.
  • Navan announced its Q3 2026 quarterly financial results on December 15, 2025.
  • Navan's CFO, Amy Butte, departed the company effective January 9, 2026.
  • The securities class action lawsuit was filed on February 23, 2026.

The players

Navan, Inc.

A technology company that went public in December 2025 through an initial public offering (IPO).

Hagens Berman

A national shareholder rights law firm investigating the legal claims against Navan and other defendants.

Reed Kathrein

The Hagens Berman partner leading the firm's investigation into Navan.

Amy Butte

The former CFO of Navan who departed the company effective January 9, 2026.

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What they’re saying

“We're investigating whether, at the time of its IPO, Navan was legally transparent about apparently known, materially adverse trends in its business. We're also investigating the circumstances surrounding the CFO's abrupt departure.”

— Reed Kathrein, Partner, Hagens Berman

What’s next

The judge in the securities class action lawsuit will decide on the next steps in the legal proceedings.

The takeaway

This case highlights the importance of full and accurate disclosure in IPO prospectuses, as investors rely on this information to make informed decisions. The significant stock price drop and pending lawsuit raise concerns about Navan's transparency and the circumstances surrounding its CFO's departure.