Overview

A class action lawsuit has been filed against Snowflake Inc. (“Snowflake” or the “Company”) (NYSE : SNOW) and certain of the Company’s current and former senior executive officers alleging violations of the federal securities laws. The Snowflake lawsuit is brought on behalf of all persons and entities who purchased or otherwise acquired Snowflake common stock between June 27, 2023, and February 28, 2024, inclusive (the “Class Period”). Investors have until April 27, 2026, to seek appointment as lead plaintiff of the Snowflake class action lawsuit.

Snowflake is a software company that provides cloud data storage that enables customers to consolidate data onto data-driven applications and share data for the purpose of running analytics and other processes. Unlike traditional software vendors that rely on fixed subscription licenses, Snowflake operates on a “consumption model,” selling services in units called “credits,” which customers consume over time. Revenue is recognized as credits are consumed.

The Snowflake class action alleges that Defendants misled investors regarding the sustainability of the Company’s revenue growth and consumption trends. Throughout the Class Period, Defendants repeatedly made positive statements regarding customer consumption, product innovation, and long-term revenue targets. For example, on June 27, 2023, during an Investor Day presentation, Snowflake’s Chief Financial Officer (“CFO”), Defendant Michael P. Scarpelli (“Scarpelli”) told investors that consumption was “back where we’d expect it to be” and affirmed the Company’s long-term target of $10 billion in product revenue by fiscal 2029, stating he was “very confident” about achieving the target.  Defendants also touted new products, such as Iceberg Tables, and their potential to increase workloads on Snowflake’s products, stating: “we’re investing so many resources in not just being able to do data warehousing, but expanding through Iceberg OpenTable formats. It really opens up the data lake opportunity, transaction processing, global search, cybersecurity, all the different categories of workloads is incredibly important to this strategy succeeding.”

Furthermore, at the June 2023 Investor Day, Snowflake’s Chief Executive Officer (“CEO”), Defendant Frank Slootman (“Slootman”) made emphatic statements denying rumors of his resignation, stating “My most important thing today is to tell you that I’m still here . . . So I just want to make sure you heard that loud and clear.”

As the Class Period progressed, Defendants continued to assure investors regarding consumption trends.  For example, in August 2023 Defendant Slootman stated “consumption is good . . . stabilization is the right term. We’re not seeing customers reduce their consumption right now.”

The Snowflake lawsuit alleges Defendants’ statements to investors were materially false and misleading because: (1) product efficiency gains, Iceberg Tables and tiered storage pricing were expected to have a material negative impact on customer consumption and revenue growth; (2) the headwinds caused by product efficiency gains, Iceberg Tables and tiered storage pricing put the Company’s ability to reach $10 billion in revenue and product revenue in 2029 in doubt; and (3) despite adamant public denials about his resignation, Defendant Slootman abruptly retired approximately eight months later, surprising investors.

The truth emerged on February 28, 2024, when Snowflake: (i) disclosed that it was forecasting increased revenue headwinds associated with product efficiency gains, tiered storage pricing, and customer adoption of Iceberg Tables; (ii) lowered fiscal 2025 product revenue guidance to approximately 22% year-over-year growth, significantly below market expectations; (iii) withdrew its long-standing $10 billion fiscal 2029 product revenue target; and (iv) announced that CEO Slootman had retired effective February 27, 2024.

On this news, the price of Snowflake stock declined $41.72 per share, or approximately 18%, falling from $230.00 on February 28, 2024, to $188.28 on February 29, 2024.

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If you purchased or otherwise acquired Snowflake common stock between June 27, 2023, and February 28, 2024, and you wish to serve as lead plaintiff in this lawsuit, you are encouraged to submit your information to DiCello Levitt LLP via the form on this page. 

You can also contact DiCello Levitt attorneys Brian O’Mara and Hani Farah by calling (888) 287-9005 or at investors@dicellolevitt.com. 

The deadline to apply to the Court to serve as a lead plaintiff in the Snowflake class action lawsuit is April 27, 2026.