A class action lawsuit was filed against Snowflake (SNOW) on February 24, 2026.
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Plaintiffs-shareholders- in the federal securities class action allege that they acquired Snowflake stock at artificially inflated prices between June 27, 2023 through February 28, 2024, known as the “Class Period.” They are now seeking compensation for financial losses incurred upon public revelation of the company’s alleged misconduct during that time. To learn whether you may be eligible for a recovery under this securities lawsuit, click here.
What Does Snowflake Do?
Snowflake is a software company engaged in the provision of cloud data storage. As detailed in the complaint, the company’s cloud storage allows customers to combine data so it can be transferred to data-driven applications. It can then be shared in order to run analytics and for other activities.
It provides additional insight into how its platform is used, saying it is “the engine that powers and provides access to the AI Data Cloud.” By doing so, it facilitates undertakings such as data engineering, analytics, and collaboration.
In all, more than 700 Forbes Global 2000 businesses use the company’s cloud data storage system, according to Snowflake’s website. Its customers include AT&T (T) and Pizza Hut, among others.
The company’s claims about product demand and revenues based on its “consumption” rather than a traditional licensing model are at the crux of the current complaint.
Why are Shareholders Suing Snowflake?
The company and two of its former senior officers (the “Individual Defendants”) are now accused of deceiving investors by lying and withholding important information about Snowflake’s business and prospects during the Class Period.
In particular, they are accused of omitting truthful information about its ability to meet immediate and long term revenue projections from SEC filings and related material. By knowingly or recklessly doing so, they allegedly caused Snowflake stock to trade at artificially inflated prices during the time in question. The truth, according to shareholders, came out after the market closed on February 28, 2024. That’s when the company issued a press release and guidance, and held a related conference call with analysts and investors to discuss its financial results for the fourth fiscal quarter and full year 2024.
During the conference call, Snowflake’s then-CFO, an Individual Defendant stated in relevant part: “[c]onsumption trends have improved since the ending of last year, but have not returned to pre-FY ‘24 patterns. We have evolved our forecasting process to be more receptive to recent trends. For that reason, our guidance assumes similar customer behavior to fiscal 2024. We are forecasting increased revenue headwinds associated with product efficiency gains, tiered storage pricing and the expectation that some of our customers will leverage Iceberg Tables for their storage.”
Taking a Closer Look
As alleged, the company and/or Individual Defendants repeatedly made false and misleading public statements throughout the Class Period.
During an Investor Day presentation held at the beginning of the Class Period, for instance, Snowflake’s CFO stated in pertinent part: “So that’s why 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 through this strategy succeeding.”
Then, during an August 23, 2023 conference call with analysts and investors, the company’s CFO stated in pertinent part: “I think it is easing a little bit at the top level in terms of approvals for customers and they’re willing to commit. But it takes time to convert that to consumption. With that said, consumption is good. It was really good today as an example but it’s only one data point. It’s – we want to see more days of that before we think the – we’re into a real recovery. I think stabilization is the right term. We’re not seeing customers reduce their consumption right now.”
Lastly, during yet another conference call with analysts and investors held on November 29, 2023, Snowflake’s CFO stated in relevant part: “In Q3, we saw strong consumption from a broad base of customers. Our performance was evenly split between large and small accounts. Our largest customer stabilized as expected. Migrations drove growth in Q3.”
Actions You May Take
If you have purchased the company’s stock during the Class Period, you may join the class action as a lead plaintiff, remain a passive class member, or opt out of this litigation and pursue individual claims that may not be available to the class as a whole. To learn more about your options, click here.
The deadline to file for lead plaintiff in this class action is April 27, 2026.