SAN DIEGO, April 11, 2024 (GLOBE NEWSWIRE) -- Shareholder rights law firm Robbins LLP reminds investors it has filed a class action lawsuit on behalf of all persons who purchased or otherwise acquired Snowflake Inc. ("Snowflake") (NYSE: SNOW) Class A stock between September 16, 2020 and March 2, 2022 (the "Class Period"). The complaint alleges violations of sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and U.S. Securities and Exchange Commission Rule 10b-5, promulgated thereunder. The complaint seeks relief on behalf of the named plaintiff and all other similarly situated holders of Snowflake during the Class Period. The named plaintiff is represented by Robbins LLP.
The Allegations:
Snowflake is a cloud data platform that enables its enterprise customers to consolidate data into a single source to build data-driven applications and share data. Snowflake’s platform purportedly enables customers to store data that can be accessed and shared by multiple users, and its data cloud enables data storage, processing, and analytic capabilities.
The Snowflake class action lawsuit alleges that defendants throughout the Class Period 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.
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. On a related earnings call also held on March 2, 2022, Snowflake CFO, defendant Michael P. Scarpelli, further revealed that Snowflake customers were consuming at a reduced rate, which he blamed on “platform enhancements . . . which lowered credit consumption.” On this news, the price of Snowflake Class A common stock fell nearly 28% over several trading sessions, damaging investors.
Next Steps: If you purchased or otherwise acquired Snowflake Inc. Class A stock between September 16, 2020 and March 2, 2022, and wish to serve as lead plaintiff, you have up to April 29, 2024, to ask the court to appoint you as the lead plaintiff for the class.
If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact attorney Aaron Dumas, Jr. of Robbins LLP at (800) 350-6003, via email, or via the shareholder information form on our website. Any member of the class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member. A copy of the complaint can be found here.
All representation is on a contingency fee basis. Shareholders pay no fees or expenses.
About Robbins LLP: Some law firms issuing releases about this matter do not actually litigate securities class actions; Robbins LLP does. A recognized leader in shareholder rights litigation, the attorneys and staff of Robbins LLP have been dedicated to helping shareholders recover losses, improve corporate governance structures, and hold company executives accountable for their wrongdoing since 2002. Since our inception, we have obtained over $1 billion for shareholders.
Attorney Advertising. Past results do not guarantee a similar outcome.
Contact:
Aaron Dumas, Jr.
Robbins LLP
5060 Shoreham Place, Ste. 300
San Diego, CA 92121
adumas@robbinsllp.com
(619) 525-3990 or Toll Free (800) 350-6003
www.robbinsllp.com
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