Snowflake, one of the fastest growing cloud software companies in Silicon Valley, has filed for an initial public offering (IPO).
Snowflake announced plans to go public after its revenue more than doubled in the first half of this year to $242 million U.S. Snowflake’s data warehouse technology allows businesses to store and manage data in the cloud rather than on legacy databases, making it easier for clients to quickly access and analyze critical information across their enterprises.
Led by Chief Executive Officer Frank Slootman, Snowflake is among the most anticipated IPOs of the year. The company counts on infrastructure from Amazon, Microsoft and Google to store the data while also competing with services from each vendor.
Late-stage venture-backed technology companies are taking advantage of the current surge in the NASDAQ stock exchange and demand for new names, now that Apple has passed $2 trillion in market capitalization, and Amazon and Microsoft are both over $1.6 trillion.
While Snowflake’s revenue jumped from $104 million in the first half of 2019 to $242 million in the same period of this year, its gross profit almost tripled, showing that the company is generating more earnings as it grows. Its net loss narrowed to $171.3 million from $177.2 million, which is still big loss but one that investors may stomach given the company’s rapid expansion.
Snowflake was founded in 2012 and started selling its platform two years later. Because Snowflake’s technology resides in the cloud, the company has a hefty bill to pay for the infrastructure. It said in the filing that it is committed to spend $1.2 billion between now and 2025 on infrastructure services. Most of its business is on Amazon Web Services (AWS).
Goldman Sachs and Morgan Stanley are managing Snowflake’s IPO. The company plans to list on the New York Stock Exchange under the ticker symbol “SNOW.” The exact date for the IPO has not been announced.
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