The NASDAQ OMX Copenhagen reprimanded Pandora on Dec. 22 for not informing the market that it would miss its annual revenue forecasts.
On Aug. 2, the Danish charm manufacturer announced it was dramatically scaling back its yearly projections—which originally foresaw a 30 percent jump in sales. But NASDAQ ruled that “it must have been clear to the company at an earlier stage” that its previous projections could not be reached.
The exchange noted the resetting of expectations led to a 70 percent drop in the company’s share price, and occurred only three and a half months after the positive guidance was issued.
In a statement, Pandora said it “acted properly” in response to “a swift and unexpected downturn in sales.”
“At the beginning of July 2011, year-to-date revenue was up 22 percent against the same period in 2010,” the company noted, adding that at the time it believed its prior forecast of 30 percent revenue growth would still hold.
However, “trading conditions significantly worsened in July 2011, with revenues in July 2011 being down by more than 30 percent against July 2010,” the company added.
At this time, executives “acted decisively and in a timely manner” by broadcasting the new projections, said the statement.
The company said it is in dialogue with the Danish Financial Supervisory Authority.
On Dec. 19, Pandora announced it had hired a new CEO.