Kaskela Law LLC is investigating Snowflake Inc. (NYSE: SNOW) on behalf of the company’s long-term investors.

Recently a securities fraud complaint was filed against Snowflake on behalf of investors who purchased shares of the company’s stock between September 16, 2020 and March 1, 2023 (the “Class Period”).  According to the complaint, during the Class Period Snowflake and certain of the company’s senior executive officers made false and/or misleading statements and/or failed to disclose that: (i) Snowflake had systematically oversold capacity to customers which created a misleading appearance of the demand for Snowflake’s products and services; (ii) Snowflake had provided significant discounts to its customers prior to its initial public offering (“IPO”) that temporarily boosted sales but would not be sustainable after the IPO and/or necessitate platform efficiency adjustments that negatively impacted client consumption and Snowflake’s revenue and profit margins; (iii) as a result, Snowflake’s customers were poised to roll over a material amount of unused credits (and thereby cannibalize future sales) at the end of their contracts’ terms or to refuse to renew their contracts at prior consumption levels or at all; and (iv) consequently, Snowflake’s product revenue and remaining performance obligations had been artificially inflated leading up to and during the Class Period.

As further detailed in the complaint, on March 2, 2022, Snowflake revealed that its product revenue growth rate for fiscal 2023 was projected to be slashed to a range of 65% to 67%, far below the triple-digit growth and purportedly ongoing favorable business trends highlighted by defendants during the Class Period.  Subsequently, Snowflake’s CFO further revealed that Snowflake customers were consuming at a reduced rate, which he blamed on “platform enhancements . . . which lowered credit consumption.”  Following this news, shares of Snowflake’s stock fell $71.69 per share, or 27% in value, over the following three trading days to close on March 7, 2022 at $193.00 per share, on unusually heavy trading volume.

Snowflake shareholders who purchased or acquired SNOW shares prior to March 2, 2022 are encouraged to contact Kaskela Law LLC (D. Seamus Kaskela, Esq. or Adrienne Bell, Esq.) at (484) 229 – 0750, or by completing the form on this page, to receive additional information about this investigation and their legal rights and options.

CONTACT:

KASKELA LAW LLC
D. Seamus Kaskela, Esq.
([email protected])
Adrienne Bell, Esq.
([email protected])
18 Campus Blvd., Suite 100
Newtown Square, PA 19073
(484) 229 – 0750