Securities class action litigation has been filed on behalf of investors who purchased Class A common stock of Snowflake Inc. (“Snowflake” or the “Company”) (NYSE: SNOW) between September 16, 2020 and March 2, 2022, inclusive (the “Class Period”).

If you purchased Snowflake securities during the Class Period, you may move the Court for appointment as lead plaintiff by no later than April 29, 2024.

A lead plaintiff is a representative party who acts on behalf of other class members in directing the litigation. Your share of any recovery in the actions will not be affected by your decision of whether to seek appointment as lead plaintiff. You may retain Lieff Cabraser, or other attorneys, as your counsel in the action.

Snowflake investors who wish to learn more about the litigation and how to seek appointment as lead plaintiff should complete the form below, text or email investorinfo@lchb.com, or call Lieff Cabraser partner Sharon M. Lee at 1-800-541-7358.

Snowflake, incorporated in Delaware and formerly headquartered in San Mateo, California, is a cloud-based data storage and computing company. The Company provides access to its platform using a consumption-based model, whereby enterprise customers typically enter into capacity arrangements with a term of one or more years. Under such arrangements, customers commit to consume a certain amount of data resources over the term of the arrangements. Customers then pay in advance to receive credits, which are deducted and recorded as Company revenue as resources are consumed. When a customer’s consumption during the contract term falls below the capacity commitment amount, it may roll over unused credits to future periods as long as it continues to purchase some amount of additional consumption capacity. At the time of Snowflake’s initial public offering (“IPO”), on September 16, 2020, 90% of its revenue was generated through capacity arrangements. The complexity and novelty of Snowflake’s platform presents customers with a steep learning curve, which grants Company sales representatives latitude in guiding customers’ decision-making regarding the number of credits to purchase.

The action alleges that, throughout the Class Period, Defendants knowingly and systematically oversold consumption credits to customers, often at unsustainably discounted rates, giving investors the misleading impression that consumption of and demand for Snowflake’s products and services were stronger than they actually were. At the same time, Snowflake and its senior executives repeatedly made misleading statements about “strong consumption trends” and sustained market demand for its products and services. In reality, customers were not using all of their contracted-for credits and were poised to roll over a significant amount of unused credits or refuse to renew their capacity arrangements altogether, disrupting future sales.

Meanwhile, Company insiders, including Chief Executive Officer Frank Slootman and Chief Financial Officer Michael P. Scarpelli, both Defendants in the action, capitalized on Snowflake’s increased stock price resulting from Defendants’ false and misleading statements, selling over $1.8 billion worth of Snowflake stock at artificially inflated prices.

On March 2, 2022, after market hours, Snowflake reported its results for its fourth fiscal quarter ended January 31, 2022 and fiscal 2023 guidance. The Company slashed its projected product revenue growth rate for fiscal 2023. This decline can be attributed to the expiration of a significant number of one-year capacity arrangements sold to customers around the time of the IPO. On this news, the price of Snowflake Class A common stock plummeted $40.67 per share, or approximately 15.37%, from its closing price of $264.69 per share on March 2, 2022, to close at $224.02 per share on March 3, 2022, on highly elevated trading volume. The stock price continued to drop another approximately 14.47% over the next few days, closing at $191.61 per share on March 8, 2022.

About Lieff Cabraser

Lieff Cabraser Heimann & Bernstein, LLP, with offices in San Francisco, New York, Nashville, and Munich, is an internationally-recognized law firm committed to advancing the rights of investors and promoting corporate responsibility. Recognized as a “Plaintiffs’ Powerhouse” by Law360, Lieff Cabraser has litigated some of the most important civil cases in the United States, and has assisted clients in recovering over $129 billion in verdicts and settlements. Law360 has selected Lieff Cabraser as one of the Top 50 law firms nationwide for litigation, highlighting our firm’s “laser focus” and noting that our firm routinely finds itself “facing off against some of the largest and strongest defense law firms in the world.” In 2021, The American Lawyer named our firm its “Boutique Litigation Firm of the Year.” Benchmark Litigation has named Lieff Cabraser one of the “Top 10 Plaintiffs’ Firms in America,” and listed us as its “2020 California Plaintiff Firm of the Year.” Lieff Cabraser is committed to ensuring access to justice for all.

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