NEW YORK, NY / ACCESSWIRE / April 7, 2024 / Bronstein, Gewirtz & Grossman, LLC, a nationally recognized law firm, notifies investors that a class action lawsuit has been filed against Snowflake Inc. ("Snowflake" or "the Company") (NYSE:SNOW) and certain of its officers.
Class Definition:
This lawsuit seeks to recover damages against Defendants for alleged violations of the federal securities laws on behalf of all persons and entities that purchased or otherwise acquired Snowflake securities between September 9, 2020 and March 2, 2022, inclusive (the "Class Period"). Such investors are encouraged to join this case by visiting the firm's site: bgandg.com/SNOW.
Case Details:
Snowflake is a data cloud platform that enables customers to consolidate data into a single source, build data-driven applications, and share data.
The Complaint alleges that throughout the Class Period Snowflake made materially false and misleading statements because Snowflake knew or deliberately disregarded and failed to disclose the following adverse facts about the Snowflake's business, operations, and prospects:
(1) that Snowflake had systematically oversold capacity to customers, which created a misleading appearance of the demand for Snowflake's products and services;
(2) that Snowflake had provided significant discounts to its customers prior to the 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; and
(3) that, 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;
(4) that, consequently, Snowflake's product revenue and remaining performance obligations had been artificially inflated leading up to and during the Class Period; and
(5) that, accordingly, Snowflake lacked a reasonable basis for its positive statements about Snowflake's business, financials, and growth trajectory.
On March 2, 2022, Snowflake reported 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 fourth quarter 2022 earnings call also held on March 2, 2022, Snowflake CFO, P. Scarpelli, further revealed that Snowflake customers were consuming at a reduced rate, which he blamed on "platform enhancements . . . which lowered credit consumption." Scarpelli claimed that while "these efforts negatively impact our revenue in the near term, over time, they lead customers to deploy more workloads to Snowflake due to the improved economics."
The Complaint alleges that Snowflake's false and misleading statements had the intended effect and caused Snowflake common stock to trade at artificially inflated levels throughout the Class Period, trading as high as $429 per share on December 8, 2020. When the truth about the Company was revealed to the market, the price of Snowflake common stock fell significantly, dropping to a low of less than $183 per share on March 8, 2022, removing the inflation therefrom, and causing economic loss to investors.
What's Next?
A class action lawsuit has already been filed. If you wish to review a copy of the Complaint, you can visit the firm's site: bgandg.com/SNOW or you may contact Peretz Bronstein, Esq. or his Law Clerk and Client Relations Manager, Yael Nathanson of Bronstein, Gewirtz & Grossman, LLC at 332-239-2660. If you suffered a loss in Snowflake you have until April 29, 2024, to request that the Court appoint you as lead plaintiff. Your ability to share in any recovery doesn't require that you serve as lead plaintiff.
There is No Cost to You
We represent investors in class actions on a contingency fee basis. That means we will ask the court to reimburse us for out-of-pocket expenses and attorneys' fees, usually a percentage of the total recovery, only if we are successful.
Why Bronstein, Gewirtz & Grossman:
Bronstein, Gewirtz & Grossman, LLC is a nationally recognized firm that represents investors in securities fraud class actions and shareholder derivative suits. Our firm has recovered hundreds of millions of dollars for investors nationwide.
Attorney advertising. Prior results do not guarantee similar outcomes.
Contact:
Bronstein, Gewirtz & Grossman, LLC
Peretz Bronstein or Yael Nathanson
332-239-2660 | info@bgandg.com
SOURCE: Bronstein, Gewirtz & Grossman, LLC
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