Investors Target Cogent Communications Over Alleged Backlog Misstatements

The litigation, spearheaded by Hagens Berman Sobol Shapiro LLP, challenges claims that Cogent’s wavelength backlog served as a legitimate indicator of future revenue growth. According to the complaint, these figures were largely illusory, as many customers lacked the capacity or desire to accept delivery, despite management’s assurances to the contrary. Plaintiffs argue these misrepresentations inflated the company’s stock value.

Signs of trouble surfaced throughout the class period. In February 2025, Cogent revealed a 20% sequential decline in its backlog and admitted to purging 1,500 stale orders, causing the stock price to drop. The company eventually stopped disclosing this data in February 2026 after investors lost confidence in the metric. By May 2026, management conceded that customers were consistently delaying or rejecting wavelength installations.

Reed Kathrein, the partner leading the investigation, stated the firm is focusing on whether management intentionally promoted the backlog and funnel to misrepresent actual demand. Investors seeking to serve as lead plaintiffs must submit their claims by September 21, 2026.