Snowflake explodes 165% higher on first day of trading after biggest US IPO of 2020
- The cloud-data unicorn Snowflake rocketed as much as 165% higher after making its public-market debut on Wednesday.
- The company raised $3.4 billion in its initial public offering, making it the biggest-ever software IPO and the biggest offering of the year.
- Snowflake's IPO caught investor attention earlier this month after Warren Buffett pledged to invest more than $550 million in the company once it went public.
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Shares of the cloud-data startup Snowflake spiked as much as 165%, to $318.37, on its first day of public-market trading on Wednesday. Trading in the stock was halted shortly after the opening because of volatility.
The company debuted on the New York Stock Exchange after raising $3.4 billion in its initial public offering. The haul cemented Snowflake as the largest software IPO ever and the biggest share sale of 2020.
The firm sold 28 million shares at $120 each, pricing the stock above its previous range amid strong investor demand. Snowflake's trading debut garnered Wall Street enthusiasm earlier in the month after the legendary investor Warren Buffett pledged to invest more than $550 million in the company after its IPO.
Snowflake trades under the ticker SNOW. Shares traded roughly 130% higher, at $283.19, as of 12:47 p.m. ET.
Founded in 2012, Snowflake became a major player in cloud data warehousing, which became a hot market with the rapid growth of the cloud, the enterprise trend in which businesses set up networks on web-based platforms.
Snowflake reported that its revenue jumped to $264.7 million in 2020 from $97 million in 2019. But its losses ballooned to $348.5 million from $178 million in the same period.
Snowflake raised $479 million in February at a $12.4 billion valuation. In total, it has raised $1.4 billion from investors including Sequoia and Iconiq Capital. The company also recently got a boost from new investments from Buffett and Salesforce.
Snowflake said it had about 3,100 customers, including 56 clients that contributed about $1 million in a 12-month period.
Experts have said the stronger need for cloud computing from the pivot to remote work during the coronavirus pandemic boosted demand for Snowflake's platform. But they also pointed to challenges ahead as the company faces competition from other players including the cloud giants led by Amazon and Microsoft.
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