Latch Manipulated and Inflated Bookings, Allege Ex-Employees

***** ******* ******* ** ******, ********* and ************ ********, * ****** ***** reported ** ********* ******* *** ******* and ******** *************, ********* ** **** interviews **** * ****** ***** *********.

*** *********** **** ******* ******* *** ****** ********* *** filing, ****** ** ***** ***************** *** ********* ************** * ****** ** ******* ** the **** *** ******. **** ****************** ** *****'* ******* *******-***** *********** in *** ****.

Allegations: ******** ***********

***** ****** ***** ***** *********, ******** to **** ** *** ********* **** their ********** *** ** *********, ****** that ***-******* ******* ** ****** (***) were ********** *********** *** ********, *************** bookings.

*** *********** **** **** ***** **********:

1. ***** ********* *** **** ****** ** customers **** *** *** ******* ***** purchase *** *******.
2. ***** ********* ******** **** **** ******* that **** *** *** ****** *** customers ** ******** ********.
3. ***** ********* *** **** ****** ** non-customers.

Employees ************ ** **** ****

*** ****** ***** ********* **** **** that ***** ******* **** **** ** LOIs, ******** ** ********* *** ***** employees ** **** *** ********** **** for ***** **** **** *** ****** to ** *********. ***********, ********** ************ pushed ******* ****, ********* **** ******** to *** **** **********.

****** **** *********, **** *********** ******** an *********** ** ******** ************* *********** by ******* **** **** *** *********** knew **** ****** ********, ***********, ** even *** ****** ** ** ****** customer.

** *** ***** ****, **** ******** high *******, ** ***** ********** *** the ****** (** ***** ** ********) they ****** ** ***** **** **** Street *** *********** **** **** **** compensated.

Magnitude ** ********* / ************ *******

** **** ****** ** ********* *** magnitude ** *** ********* / ************ alleged (*.*., ******* **** *********** *%, 20%, **%, ***. ** ********). ** do ****** ******* ***** ***** ** ************** *********** ****.

No ******** **** *****

**** ********* ***** ******** ***** ***** this *** *** *** ******* * response. ** ***** *******, ** **** update **** ******.

****** *** ***** ** ***** **** IPVM *** ** ** *************** ** emailing******@****.***.

Research *******

** *** ******** ******* ** *** report, ** ******* *** ********* ************ of ***** *********** *** *** ********* for ***** ** *** ******** ***** its ******* ** ********.

Latch's ***** ** ********

******** (*.*., ***** ****) **** **** central ** *** ***** ************ *** strength *** ****** ** ********* ***** the **************** *** **** ** ******* ****:

*** ******* ***booked **** ***,*** ***** ****** **** **** ** ******, with one in ten new multifamily apartments in the United States built with Latch in 2019.

**** *********** ******** *** ******* *** Latch ** ********** *** ******* *** market ********* ***drive ******** ******. [emphasis added]

** *****'*** **** ************'* *** ********** *** ********* ******** were *** ******.

********** ** *** ****** ******* *******, the ***** ***** ** **** *** strong *** ********* ******* ******** ** driving *very ******** ******** ****** that exceeded even our internal expectations for the quarter. Bookings growth specifically accelerated in Q2 to the 102% year over year growth I stated earlier, which is a powerful ********* ** ******** ******* ******** ********, demand from our customers and accelerating sales velocity. [emphasis added]

******, ***** ****** *** ******* ******** expressing ********** ** *** ***** ****** than **** ********:

*** *** ** **** ** ********.Because ** *** ************ ****** in demand for our products and our strong year-to-date execution, we're *** ******* *** ****-**** ***** ******** ************ ** *** ***** ** $*** ******* ** $*** ******* reflecting 97% to 105% year-over-year growth, compared to our previous guidance range of $290 million to $325 million. [emphasis added]

** *****'*Q3 **** ************'* *** *********** ********:

We *** ******* ****** ******** ******* for Latch as well, and we saw a substantial acceleration in bookings growth up 181% to $96 million. And we also saw growth in booked ARR up 126% to $59.8 million. [emphasis added]

*****, **** ** *** ******** *******, Latch ****** *** ******** ******** ** it *** ****** **** ** ********:

*** *** ** **** ** ********.Because ** *** ************ ****** and demand for our products and our strong year-to-date execution, we *** ******* ** ***** *** ****** ***** ******** ***** ** $355 ******* ** $*** ******* from our previous guide of $325 million to $340 million, which reflects a 115% to 121% year-over-year increase in total bookings. [emphasis added]

********* ******** **** ***** ****, ** a****** **** ****** **********:

Bookings ********* *** ****** ** ***** **** *****'* ********* **** ******** ** ***, roughly within the next 2 years. When a large apartment complex is getting built, the locks and the software for those locks are likely the last things to get added -- yet Latch receives these promises to use Latch from apartment builders before they start construction. Latch records bookings made when it signs a contract with builders -- but it only books that revenue after the apartments are fully constructed. As long as those buildings actually get built, Latch's ******** ***** ****** ** ******* ***** ** **** **** ** ***** **** *******. [emphasis added]

Latch's ****** ******* *** **********

*** ***** ** ******** ** ****, especially ***** **** **** ****** ******** and *********** ******** **** *****'* ********** and ********* **** ********* **** ***** was ********** *** ****** **** ** did.

*** **** ***** ** ********** *** Annual ********* ******* (***), ** ** clear **** *** *******'* **** *********** is * ******** ** *** ********** it ******* * **** ***.

** *** ****, ***** ***** ******* disclosing *** ****** ***,"******** ***********" ***** $*.* ******* *** *** *** of ** ****.

** ********, * ****** **********, ***** only ********* *** "***** ****** ***" of $**.* *******, **** **** *** the ****** ** *** ****** *** they ***** ******** *** *** **** quarter.

***** **** *** $*.* ******* ****** ARR ** *** *** ** ** was **** ***** *** **** ******** "full **** **** *** ******** ** $11.1 ** $**.* *******", ******** **** they **** **** ********* ** *** ~$1 ******* ** *** *** ******* for *** **** ** *** ****.

** ********, *** ******* *** **** losing *********** ******* ** ******* ******** (see-**% ***** ******** ***** ****** *******) ***** *** ******* ***** $**+ million ** ** ** ***** *** marketing ******** ** ******** ** ********** ARR ** **** ~$*.* *******.

*** ****** ** **** ***** ***** an ******* *** *** ****** ** sales *** ********* **** ** ******* in *** *** ** ****.

***, ***** *** * *******, *** cost ********* ** ***** (******* **%) but ******* ** ******* *** **** such ** ******* **** (*.*., ********** operating ******** ** ~$*** ******* ****** ARR ** $*.* *******) **** **** these ****, *** ******* *** ***** be ******** *** *** **** *** its ******* ****.

** **********, ******** *** *********** ******** may **** ****** ***** ** ****** far *** *******, *** **** ******* operational **** *** ** ****** ** appropriately ******* *** *******'* *******, *********** expenses, *** ********** **** ****.