Snowflake Inc. Class Action Lawsuit – SNOW

Introduction to Snowflake Inc. (SNOW) Securities Class Action Lawsuit

A securities fraud class action has been filed against Snowflake Inc. (NYSE: SNOW) and two of its former executives for alleged misstatements made between June 27, 2023 and February 28, 2024, alleging violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5. Investors allege that the company and its leadership repeatedly made positive statements about consumption trends, product developments, and revenue growth while concealing that product efficiency gains, Iceberg Tables, and tiered storage pricing were expected to materially harm consumption and revenues, which are driven by a consumption-based revenue model. On February 28, 2024, after market close, the company disclosed significant revenue headwinds from these very factors, withdrew its $10 billion revenue target for 2029, and lowered fiscal year 2025 guidance to 22% growth. The release, a corrective disclosure, sent the stock plummeting 18.14% in a single day, erasing over $41 per share in value.

Snowflake Inc. (SNOW) Securities Lawsuit Case Details

Case Name: Harsh Patel v. Snowflake Inc., et al.

Case No.: 3:26-cv-1613

Jurisdiction: U.S. District Court, Northern District of California

Filed on: February 24, 2026

Snowflake Inc. (SNOW) Company Profile

Snowflake is a software company that provides cloud data storage, a cloud-based data platform used by enterprise customers enabling customers to consolidate data onto data-driven applications, across a multi-cloud environment and share data for analytics and other processes, including data warehousing and analytics services. The company operates on a consumption model, a usage-based billing system, selling services in units called "credits" that customers must consume over contractually defined periods, reflecting a consumption-based revenue model, recognizing revenue as credits are used, consistent with storage and compute separation architecture.

Snowflake Inc. (SNOW) Securities Lawsuit Class Period

June 27, 2023 – February 28, 2024 at 4pm EST, inclusive.

This lawsuit seeks to represent all persons and entities who purchased Snowflake Class A common stock on the NYSE (ticker SNOW) during the Class Period and may be eligible to join the Snowflake Inc. (SNOW) class action lawsuit.

Allegations in the Snowflake Inc. (SNOW) Securities Class Action Lawsuit

The complaint targets Snowflake Inc., former CEO and Chairman Frank Slootman, and former CFO Michael P. Scarpelli for allegedly misleading investors about the company's consumption trends and growth prospects, through false statements and material omissions, in violation of the federal securities laws. According to investors, the alleged deception began on June 27, 2023, when Scarpelli told investors at an Investor Day presentation that consumption had returned to expected levels after a brief April slowdown, stating that "coming into May and into June, consumption is back where we'd expect it to be", a key driver of the company's consumption-based revenue. That same day, he allegedly promoted the company's expansion as critical to the business strategy, i.e., support for open table formats such as Iceberg Tables, claiming it would "open up the data lake opportunity" across multiple workload categories. Scarpelli also reaffirmed the company's confidence in reaching $10 billion in product revenue by fiscal year 2029, a long-term revenue target that investors allege lacked a reasonable basis.

During this same June 27, 2023 presentation, Slootman allegedly addressed retirement rumors directly, denying he was stepping down and emphasizing "I'm still here" to reassure investors. Two months later on August 23, 2023, Scarpelli continued the positive narrative, while failing to disclose revenue headwinds from product efficiency gains and tiered storage pricing, telling analysts that consumption was "really good" and that the company was seeing stabilization rather than reduction in customer consumption. He pointed to upcoming product releases including Streamlit, Unistore, and Containerized Services as factors that would "have a very positive impact on our revenue growth rate next year", which investors allege lacked a reasonable basis. By November 29, 2023, Scarpelli reported "strong consumption from a broad base of customers" and highlighted that migrations were driving growth, with the company adding multiple customers generating over $5 million in trailing twelve-month revenue, including large enterprise customers.

Investors allege that throughout this period, defendants knew or should have known that product efficiency gains, Iceberg Tables, and tiered storage pricing were expected to materially harm consumption and revenues, rendering their positive statements about consumption patterns and growth prospects misleading, and that the company's Class A common stock traded at artificially inflated prices.

The Truth Emerges

The alleged scheme unraveled on February 28, 2024, when Snowflake released financial results and guidance after market close, a corrective disclosure. On the earnings call that same day, management disclosed that "consumption trends have improved since the ending of last year, but have not returned to pre-FY '24 patterns" and announced they were "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", linking these factors to headwinds in a consumption-based revenue model. The company withdrew its $10 billion 2029 product revenue target and lowered fiscal year 2025 guidance to just 22% year-over-year growth. In the same announcement, Snowflake revealed that Slootman had retired as CEO effective February 27, 2024, contradicting his June 2023 denials of impending departure, a leadership transition that investors allege was concealed until this disclosure.

Days later on March 5, 2024, management admitted that tiered storage pricing had begun rolling out in the third and fourth quarters of fiscal 2024 and that large customers had already informed the company of plans to adopt Iceberg Tables, which would reduce storage revenues and impact consumption patterns. Senior Vice President Christian Kleinerman acknowledged that "for many of our large customers, we have been in touch on their plans for adoption on Iceberg. So some of what you see in our guidance has factored in those intentions." These admissions directly contradicted the positive statements about product developments and consumption trends made throughout the class period, and supported allegations under Rule 10b-5.

Market Reaction

The February 28, 2024 after-hours disclosures devastated Snowflake's NYSE: SNOW stock price. On February 29, 2024, shares declined $41.72, or 18.14%, closing at $188.28 compared to the prior day's $230.00, triggering shareholder losses and class-period damages.

Next Steps

●      The Court will issue its order for lead plaintiff and counsel in the weeks after submissions are due.

●      The Court will then consider motion for class certification.

●      The Court will later consider a Motion to Dismiss.

Disclaimer: This shareholder alert is for informational purposes only and does not constitute legal advice. Consult a qualified attorney for personalized guidance. No specific outcomes are guaranteed.

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