Cochlear Ltd faces shareholder class action over profit guidance

Cochlear Ltd is facing a shareholder class action in the Supreme Court of Victoria. The legal claim, brought by the firm Echo Law, alleges that the medical device company engaged in misleading or deceptive conduct and failed to meet continuous disclosure obligations regarding its FY26 profit outlook.

The litigation focuses on the period between 15 August 2025 and 21 April 2026. This timeframe concludes just one day before Cochlear significantly reduced its underlying net profit guidance from an initial forecast of $435 million–$460 million down to $290 million–$330 million. Following this announcement in April, the company's shares experienced a decline of over 40%.

Cochlear has denied the allegations and stated its intention to defend itself. The company previously attributed the lowered guidance to factors including weaker demand for implants and hospital capacity constraints. Despite recent volatility, the company maintains a strong financial position with a negative net debt of -$270 million.