Power Solutions International, Inc. Class Action Lawsuit – PSIX

Introduction to Power Solutions International, Inc. (PSIX) Securities Class Action Lawsuit

A securities fraud class action has been filed against Power Solutions International, Inc. (NASDAQ: PSIX) and two of its executives in the U.S. District Court for the Northern District of Illinois, alleging violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934. The lawsuit covers the period from May 8, 2025 through March 2, 2026, the putative class period. Investors allege the company misrepresented its ability to capture sales demand for power systems in the data center market and minimized the costs and inefficiencies associated with ramping up manufacturing capacity to meet that demand, including understated manufacturing capacity enhancement costs. According to the complaint, while executives touted record-breaking sales growth and strong demand, the company was actually experiencing significant manufacturing inefficiencies and gross margin compression that would undermine its financial performance. When the alleged truth emerged through two alleged corrective disclosures in late 2025 and early 2026, PSIX shares fell $15.55, or 19.14%, on November 7, 2025, and $24.84, or 28.97%, on March 3, 2026, according to the complaint.

Power Solutions International, Inc. (PSIX) Securities Lawsuit Case Details

Case Name: Don Dishion v. Power Solutions International, Inc., et al.

Case No.: 1:26-cv-03149

Jurisdiction: U.S. District Court, Northern District of Illinois

Filed on: March 20, 2026

Power Solutions International, Inc. (PSIX) Company Profile

Power Solutions International, Inc., headquartered in Wood Dale, Illinois, designs, engineers, manufactures, and sells engines and power systems, including alternative-fuel, emissions-certified offerings. The company mainly sells small engines used in industrial equipment like forklifts, transportation vehicles like transit buses, micro-power systems, and power solutions for data centers, serving both stationary and mobile applications across industrial and data center markets.

Power Solutions International, Inc. (PSIX) Securities Lawsuit Class Period

May 8, 2025 – March 2, 2026, inclusive.

Investors who purchased or otherwise acquired Power Solutions securities (ticker PSIX on the NASDAQ) during the Class Period and suffered damages may be eligible to join the Power Solutions International, Inc. (PSIX) class action lawsuit.

Allegations in the Power Solutions International, Inc. (PSIX) Securities Class Action Lawsuit

The complaint targets Power Solutions International, Inc., along with Chief Executive Officer Dino Xykis and Chief Financial Officer Xun Li, alleging they made materially false and misleading statements and omissions about the company's business operations and prospects during the class period, in violation of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934.

On May 8, 2025, Xykis announced the company's "best first quarter performance in the Company's history," highlighting 42% year-over-year sales growth and a 168% increase in net income, attributing the results to "growing demand for our solutions particularly in power systems, combined with company wide operational enhancements and a continued commitment to financial discipline." Three months later, on August 7, 2025, Xykis declared the second quarter marked "the strongest sales and profit performance in our Company's history," with 74% year-over-year sales growth and 138% increase in net income, again emphasizing "strong demand for our power systems solutions" and "disciplined execution of our strategy." On November 6, 2025, the CEO announced "the highest sales in our company's history," with sales increasing 62% and net income rising 59%, underscoring "the robust demand for our power systems solutions, particularly within the data center market."

According to the complaint, these statements were misleading because they concealed critical problems beneath the surface, including material adverse facts about operating inefficiencies and manufacturing capacity, and because the positive statements allegedly lacked a reasonable basis. Investors allege the company overstated its ability to capture sales demand for power systems solutions in the data center market and understated the impact of its enhancements to manufacturing capacity, including the expected costs and the nature of related inefficiencies, such as manufacturing capacity enhancement costs and supply chain performance issues. The complaint alleges that while executives touted operational enhancements and strong execution, the company was actually struggling with significant manufacturing challenges tied to an accelerated production ramp-up for data center product lines that would severely compress gross margins and undermine the profitability of its data center business.

The Truth Emerges

The truth began to surface on November 6, 2025, when Power Solutions released its third quarter 2025 financial results after the market closed and disclosed operating metrics affecting gross margin. The company revealed that gross margin had decreased 5.0% year-over-year to 23.9%, attributing the decline in part to "temporary inefficiencies related to our accelerated production ramp-up" for "key data center product lines." The company also disclosed it anticipated sales growth of only 45% for full year 2025 year-over-year, a sharp deceleration from the 74% growth reported in the second quarter and 62% growth in the third quarter. These revelations contradicted prior statements about operational enhancements and the strength of the company's strategic execution, and exposed operating inefficiencies tied to the production ramp-up.

The full extent of the problems became clear on March 2, 2026, when Power Solutions announced fourth quarter and full year 2025 financial results after the market closed. The company disclosed that gross margin had declined 8% year-over-year for full year 2025 due to "operating inefficiencies related to our accelerated production ramp-up for data center product lines." The company provided its outlook for 2026, projecting only "moderate margin improvement from the products serving data center markets." CEO Xykis admitted that "operating efficiency was impacted by the ramp up of new manufacturing capacity and increased volumes across certain product lines," and that management was "executing specific actions to improve supply chain performance and manufacturing cost structures" and was only "beginning to see measurable improvements." According to the complaint, these disclosures indicated that the manufacturing inefficiencies and margin pressures associated with the accelerated ramp-up for data center product lines were more substantial than prior statements had suggested.

Market Reaction

Following the November 6, 2025 disclosure of Q3 2025 earnings, Power Solutions' (NASDAQ: PSIX) stock price fell $15.55, or 19.14%, to close at $65.69 per share on November 7, 2025, on unusually heavy trading volume. The damage intensified after the March 2, 2026 disclosure of Q4 and full year 2025 results, when the stock (PSIX) fell $24.84, or 28.97%, to close at $60.91 on March 3, 2026, with unusually heavy trading volume on both disclosure dates.

Next Steps

● The Court will issue its order for lead plaintiff and counsel in the weeks after submissions are due.

● The Court will then consider motion for class certification.

● The Court will later consider a Motion to Dismiss.

Disclaimer: This shareholder alert is for informational purposes only and does not constitute legal advice. Consult a qualified attorney for personalized guidance. No specific outcomes are guaranteed.

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Certification of Plaintiff Pursuant to Federal Securities Laws

I, duly certify and say, as to the claims asserted under the federal securities laws, that:

I have reviewed a complaint filed in the action.
I did not purchase the security that is the subject of this action at the direction of plaintiff's counsel or in order to participate in this action.
I am willing to serve as a representative party on behalf of the class, including providing testimony at deposition and trial, if necessary.
My transaction(s) in Power Solutions International, Inc. which are the subject of this litigation during the class period set forth in the complaint are set forth in the chart attached hereto.
Within the last 3 years,
I have not sought to serve nor have I served as a class representative in any federal securities fraud case. I have sought to serve as a class representative in
I will not accept any payment for serving as a representative party on behalf of the class beyond the Plaintiff's pro rata share of any recovery, except as ordered or approved by the court, including any award for reasonable costs and expenses (including lost wages) directly relating to the representation of the class.

Are you US Citizen?

Yes. I certify under penalty of perjury that the foregoing is true and correct. Executed this No. I certify under penalty of perjury under the laws of the United States of America that the foregoing is true and correct. Executed this

Clear

Signed pursuant to California Civil Code Section 1633.1, et seq. - and the Uniform Electronic Transactions Act as adopted by the various states and territories of the United States.

By your signature above, you confirm that have retained Levi & Korsinsky, LLP to represent you and the shareholder class as a lead plaintiff in the pending class action against Power Solutions International, Inc. This representation will be on a contingency basis, meaning that Levi & Korsinsky will advance all expenses in the litigation and will only seek compensation and/or reimbursement of expenses if the firm obtains a recovery. Regardless of the result, we will never ask you to directly pay for any attorneys’ fees, expenses, or costs. Should we obtain a favorable result, we may ask the court to award us compensation and reimbursement of expenses to be paid by the defendants or as a portion of any class recovery. In exchange for our representation, you agree to cooperate as our client by providing, for example, relevant documents and deposition testimony, if necessary. During the course of this litigation, we may employ and/or work with other law firms, experts, and third-parties to successfully prosecute this action. If you are not appointed as the lead plaintiff or Levi & Korsinsky is not appointed as lead counsel, we will notify you of such decision at which time this representation will end unless otherwise extended by you and the firm. We look forward to working with you towards a successful resolution of this action.

I have reviewed the complaint linked in paragraph 1