Snowflake’s AI Winter

Investors are certainly giving Snowflake the cold shoulder. On Wednesday, the data analytics firm delivered an earnings update that showed July-quarter revenue above the company’s own projections and increased its estimate of full-year revenue growth for fiscal 2025 by two percentage points, to 26%. As Deutsche Bank analyst Brad Zelnick pointed out in a report, that rate of growth is better than those of most other large publicly listed software firms. 

And yet investors sent Snowflake’s stock tumbling nearly 15% today to $115.21, 4% below its 2020 IPO price and near its all-time low. What gives? Those with long memories might remember that Snowflake was once a favorite of enterprise software investors. It had one of the hottest IPOs of the era—its stock more than doubled on the first day—and for a brief period in late 2020 it was worth more than IBM.