SNOW 10-K & 10-Q changes, risk factors and insider trading

Our revenue was $3.6$4.7 billion, $2.8$3.6 billion, and $2.1$2.8 billion for the fiscal years ended January 31, 2026, 2025, 2024, and 2023,2024, respectively. As a result of our historical rapid growth, limited operating history, large number of new product features, including those incorporating artificial intelligence (AI) and machine learning technology (collectively, AI Technology), and unstable macroeconomic conditions, our ability to accurately forecast our future results of operations, including revenue, gross margin, remaining performance obligations (RPO), and the percentage of RPO we expect to recognize as revenue in future periods, is limited and subject to a number of uncertainties, including our ability to plan for and model future growth and platform consumption. Our historical revenue growth should not be considered indicative of our future performance.

Further, our revenue growth could slow or our revenue could decline for a number of reasons, including increased competition; changes to technology, such as changes in software or underlying cloud infrastructure or the increasing prominence of new technology like artificial intelligenceAI; reputational harm; changes in macroeconomic conditions; and reduced demand for our platform. For example, customers may continue to optimize consumption, rationalize budgets, and prioritize cash flow management, including by reducing storage through shorter data retention policies and shortening committed contract durations. As a result of the foregoing and our rapid revenue growth in prior periods, our revenue growth rate has slowed in recent periods. Any further declines in our revenue growth rate could adversely affect investors’ perceptions of our business, and negatively impact the trading price of our common stock.

Our revenue growth is also dependent on our ability to increase our penetration into existing markets, and to successfully enter and grow new markets, including highly-regulated markets such as financial services, healthcare, and the public sector. Sales to highly-regulated entities are subject to substantial additional costs and risks that are not present in sales to other customers, which are described below in the risk factor titled “We do business with federal, state, local, and foreign governments and agencies, and heavily regulated organizations; as a result, we face heightened risks related to special contract terms, non-standard product deployments, supply chain restrictions, and compliance with additional processes, rules, and regulations.”

We have experienced net losses in each period since inception. We generated net losses of $1.3 billion, $838.0$1.3 millionbillion and $797.5$838.0 million for the fiscal years ended January 31, 2025,2026, 20242025 and 2023,2024, respectively. As of January 31, 20252026 and 2024,2025, we had an accumulated deficit of $7.3$9.5 billion and $4.1$7.3 billion, respectively. We expect our costs and expenses to continue to increase in future periods. In particular, we intend to continue to invest significant resources to further develop our platform, expand our research and development teams, retain our employees, and acquire other businesses, including in the areas of data science, artificial intelligence,AI, and machine learning. We have also entered and may in the future enter into new customer consumption arrangements, and have invested and may continue to invest in new product areas, that are complex and costly and whose adoption and usage are unpredictable. These activities may lead to increased fluctuations in our revenue and lower profit margins. In addition, our platform currently operates on public cloud infrastructure provided by Amazon Web Services (AWS), Microsoft Azure (Azure), and Google Cloud Platform (GCP), and our costs and gross margins are significantly influenced by the prices we are able to negotiate with these public cloud providers, which in certain cases are also our competitors. If we fail to meet any minimum commitments under our third-party cloud infrastructure agreements, we may be required to pay the difference, and our results of operations could be negatively impacted. We will also incur increased general and administrative expenses associated with our growth, including costs related to internal systems, operating as a public company, and targeting regulated industries or markets. Our efforts to grow our business have been and may continue to be costlier than we expect, or our revenue growth rate may be slower than we expect, and we may not be able to increase our revenue enough to offset the increase in operating expenses resulting from these investments. If we are unable to achieve and sustain profitability, or if we are unable to achieve the revenue growth that we expect from these investments, the value of our business and common stock may significantly decrease.

The markets in which we operate are rapidly evolving and highly competitive. In recent years, we have adopted open data formats like Apache Iceberg tables to allow customers to use our platform to process data stored in external customer-controlled environments outside of Snowflake, and we have introduced a significant number of new features and expanded into new product categories like artificialAI intelligence.and transactions. These changes are driving increased competition, both because there is less customer “lock in” when our products are used in external environments, and also because we are competing across more product categories, each of which is subject to distinct customer requirements and preferences. Our success depends on our ability to continue to effectively innovate in response to changing market dynamics.

•other established vendors of legacy database solutions or big data offerings; and

We compete based on various factors, including price, performance, product features, breadth of use cases, multi-cloud availability, brand recognition and reputation, customer support, technical services, and differentiated capabilities, including ease of implementation and data migration, ease of administration and use, scalability and reliability, data governance, security and compatibility with existing standards, programming languages, third-party products, and the ability to operate in hybrid environments. Many of our competitors have substantially greater brand recognition, customer relationships, and financial, technical, and other resources than we do, and may be able to respond more effectively than us to new or changing opportunities, technologies, standards, customer requirements, and buying practices. Some of our privately-held competitors also have greater operational flexibility than we do, including the ability to make strategic long-term business decisions without the short-term financial performance pressure, market expectations, and public disclosure obligations that affect public companies. In addition, we may not be able to respond to market opportunities as quickly as smaller companies or offer as many discounts or free services as our competitors. Our support of open data formats may also reduce switching costs between us and our competitors.

SomeCompanies with which we have strategic partnerships and alliances in some areas may be competitors in other areas, and this trend may increase, particularly as we expand our product offerings. Additionally, companies that are strategic partners in some areas of our business may acquire or form alliances with our competitors, thereby reducing their business with us. We also face competition from some of our customers and vendors. Further, some customers use drivers and/or connectors to connect our platform to third-party applications or databases. Attempts by third-party application or database providers to restrict the use of drivers and connectors may make it more difficult for customers to use our platform, which could lead to reduced sales and consumption. Any inability to effectively manage these complex relationships could materially harm our business, results of operations, and financial condition.

We compete in markets that evolve rapidly. We believe that the pace of innovation will continue to accelerate as customers increasingly base their purchases of cloud data platforms on a broad range of factors, including performance and scale, cost, markets addressed, types of data processed, ease of data ingress and egress, support of open data formats, user experience and programming languages, use of artificialAI, intelligence,interoperability and integrations across tools, applications, and platforms, and data governance, security, and regulatory compliance. We introduced data warehousing on our platform in 2014 as our core use case, and our customers subsequently began using our platform for additional product categories, including analytics, data engineering, artificial intelligence,AI, and applications and collaboration. Our future success depends on our ability to continue to innovate rapidly and effectively and increase customer adoption of our platform and the AI Data Cloud, including theemerging Snowflakeproduct Marketplaceareas such as AI, Apache Iceberg tables, and Snowpark.

Further, the value of our platform to customers increases to the extent they are able to use it to process and access all types of data. We need to continue to invest in technologies, services, and partnerships that increase the types of data available and processed on our platform, the ease with which customers can ingest data into our platform, and the types of environments that our platform supports, including hybrid offerings that extend into customer-managed environments. We must also continue to enhance our data sharing and marketplace capabilities so customers can share their data with internal business units, their customers, and other third parties, acquire additional third-party data and data products to combine with their own data to gain additional business insights, and develop and monetize applications on our platform. As we develop, acquire, and introduce new services and technologies, including those that may incorporate artificialAI intelligenceTechnology, we have been and machinemay learning,continue we mayto be subject to new or heightened legal, ethical, and other challenges. In addition, our platform requires third-party public cloud infrastructure to operate. Currently, we use public cloud offerings provided by AWS, Azure, and GCP. We will need to continue to innovate to optimize our offerings for these and other public clouds that our customers require, particularly as we expand internationally. Further, the markets in which we compete are subject to evolving industry standards and regulations, resulting in increasing data governance and compliance requirements for us and our customers and partners. To the extentAs we expand further into the public sector and highly regulated countries and industries, our platform and operations maywill need to address additional requirements specific to those markets, including data sovereignty requirements.

If we are unable to enhance our platform or operations to keep pace with these rapidly evolving customer needs or other market requirements, or if new technologies emerge that deliver competitive products at lower prices, more efficiently, more conveniently, or more securely than our platform, our business, financial condition, and results of operations could be adversely affected.

If we are not successful in executing ouran investments ineffective AI Technology, including generative AI Technology,strategy, our business, financial condition, and results of operations could be harmed.

We are investing significantly in AI Technology. Our investments include internally developing AI Technology, acquiring companies with complementary AI Technology, and partnering with companies to bring AI Technology to our platform. Our competitors are pursuing similar opportunities and may, as a result of greater resources, branding, or otherwise, develop, adoptadopt, and implement AI Technology faster or more successfully than we do, which could impair our ability to compete effectivelyeffectively. We also use third-party vendors for certain AI Technology components and services, including large language models, and if they are flawed or fail to execute, it may adversely affectimpact our business,ability financialto conditiondeliver our products and resultsservices ofto operations.our customers. In addition, our successful development of AI Technology depends on our access to GPUs,GPUs and ability to recruit and retain AI-skilled personnel, both of which are currently in high demand. Finally, customers’ use of our AI Technology is often dependent on their ability to meet evolving regulatory standards, successfully complete internal compliance reviews, and enter into mutually acceptable contractual terms. If they are unable to do so, they may not use our AI Technology as much as we anticipate, or at all. It is also possible that our investments in AI Technology do not result in the benefits we anticipate, or enable us to maintain our competitive advantage, which may adversely affect our business, financial condition, and results of operations.advantage. For example, we may not accurately anticipate market demand or offer AI Technology that amplifies our core data platform.

If we,We, our customers, or third-party service providers have in the past and may in the future experience an actual or perceived security breach orbreach, unauthorized parties otherwise obtain access to our customers’ data, our data, or ourunintended platform,operation of our platformproducts. If any such event occurs, our products may be perceived as not being secure, our reputation may be harmed, demand for our platformproducts may be reduced, and we may incur significant liabilities.

In the ordinary course of our business, we store, transmit, generate, and process our, our customers’, and our business partners’ confidential and proprietary data. Such data includes sensitive data, such as personal information, protected health information, and financial data. We also use third-party service providers, sub-processors, and technology to help us deliver services to our customers and their end-users, as well as for our internal business operations. ForWe example, our platform is built on the infrastructure of third-party public cloud providers, such as AWS, Azure, and GCP, and wealso use third-party technology to assist with securing our environment and providing access to our platform. Some of our customers also use third-party service providers to assist with their use of our platform or third-party technology, such as connectors, to access our platform. These third-party service providers may process, store, or transmit data of our employees, partners, customers, and customers’ end-users or may otherwise be used to help operate our platform and corporate systems. In addition, AI models and large datasets are increasingly integrated into our, our customers’, and other third parties’ systems. We, our customers and business partners, and these third parties face a variety of evolving and increasing cybersecurity threats.and data threats related to this complex network of technology.

Cybersecurity threats come from a variety of sources, including traditional computer “hackers,” internal and external personnel (such as through theftexfiltration or misuse), sophisticated nation-states, and nation-state-supported actors. Cybersecurity threat actors can use a wide variety of methods, including unauthorized intrusions, denial-of-service attacks, ransomware attacks, business email compromises, computer malware, infostealer malware, social engineering attacks (including through deep-fakes and phishing), internal and external personnel misconduct or error, supply-chain attacks, software vulnerabilities, software or hardware disruptions or failures, and attacks enhanced or facilitated by AI Technology, all of which are prevalent in our industry and our customers’ and partners’ industries. These methods change frequently and are becoming increasingly difficult to detect. Threat actors who successfully compromise networks or systems may use thesuch unauthorized access as a vector to compromise other networks and systems. Threat actors’ goals often include disrupting a company’s operations or ability to provide services, obtaining unauthorized access to platforms, systems, networks, or physical facilities in which data is stored or processed, or through which data is transmitted, and stealing data. Ransomware attacks are becoming more frequentdata, and severe.demanding ransomware payments.

Any security breach of our platform, our operational systems, our software (including open-source software), our physical facilities, or the systems of our third-party service providers or sub-processors, or the perception that one has occurred, or unauthorizedunintended access toor operations within our customers’ or partners’ systems, data, or technology, could result in claims that we have breached customer contracts or other legal obligations, including as described below.obligations. In addition, we may be subject to, and have received in the past, requests by regulators (including members of Congress) for information about our security practices, our public statements about our security program, experiences, and issues. Alleged failures, problems, or issues related to our information security or our customers’ use of our platform, including following such information requests, could result in additional investigations; actions from a variety of regulators, including state attorneys general, the Department of Justice, the Federal Trade Commission (FTC), and the SEC; litigation; indemnity obligations; fines; penalties; mitigation and remediation costs; reputational harm; diversion of management’s attention; customer relationship issues; and other liabilities and damage to our business. Security or data incidents and their resulting consequences, including negative publicity, may also cause customers to stop using our platform, deter existing or prospective customers from using our platform, and negatively impact our ability to grow and operate our business. Further, cybersecurity incidents have in the past and may in the future lead customers or prospective customers to attempt to negotiate contractual terms that are less favorable to us, such as broader indemnification obligations, more stringent cybersecurity requirements, and higher limitations of liability.

Our insurance coverage may not be adequate for liability arising from data security breaches involving us or our customers or other third parties, indemnification obligations, or other liabilities. The successful assertion of one or more large claims against us that exceeds our available insurance coverage or results in changes to our insurance policies (including premium increases or the imposition of large deductible or co-insurance requirements) could have an adverse effect on our business. In addition, we cannot be sure that our existing insurance coverage and coverage for errors and omissions will continue to be available on acceptable terms or that our insurers will not deny coverage as to any future claim.claim, Risks related to our systems and security breaches are likely to increaseparticularly as we continue to expand our platformproduct andofferings geographicwith footprint,different growsecurity ourrisk customer and partner base, acquire operating companies, begin to operate in environments outside of our platform and over which we exercise significantly less or no control, and process, store, and transmit increasingly large amounts of data.profiles.

For example, in May 2024, we became aware that a cybersecurity threat actoractors had accessed a number of our customers’ Snowflake accounts as a result of such customers’ failure to fulfill certain of their obligations under our shared responsibility cybersecurity model (e.g., implementing MFA and network access policies). Even though we did not identify any evidence suggesting this activity was caused by or otherwise related to any vulnerability or misconfiguration of our systems, or a breach of our platform’s security or our environment, we have been the subject of numerous lawsuits, regulatory investigations, and lawmaker inquiries relating to these customer incidents. Since May 2024, we have been made aware of additional cyberattacks on customers’ Snowflake accounts using similar methods intended to take advantage of customers’ failures to implement appropriate security safeguards (e.g., MFA and network access policies). We are unable to predict the outcome or timeline of these matters or ifwhether any additional requests, inquiries, lawsuits, investigations or other government actions may arise. We have suffered and may continue to suffer negative publicity and reputational damage, including due to the misperception that our customers’ incidents resulted from a vulnerability, misconfiguration or breach of our platform’s security or systems and malicious activity within our environment. In addition, we may experience a loss of existing customers or face claims by customers, and it is possible that we are not able to fully recover any losses relating to these matters through any applicable insurance coverage or we may be required to seek indemnification from breached customers to mitigate our damages, which may be unsuccessful or impractical. These matters, together with any additional inquiries, regulatory or governmental investigations, or other disputes that result from these customer security incidents, have in the past and will continue to require us to divert resources and may harm our reputation, business, financial condition, or results of operations.

From time to time, we may become subject to legal proceedings and claims, such as claims brought by our customers in connection with commercial disputes, cybersecurity incidents, employment claims, including claims related to the loss of employee equity grants upon termination, intellectual property claims, or securities class actions or other claims related to volatility in the trading price of our common stock. For example, we are named in a securities class action lawsuit in federal court alleging federal securities law violations, asa wellclass asaction lawsuit in federal court alleging copyright infringement in connection with our large language model training, and numerous class action lawsuits alleging common law and statutory claims in connection with cybersecurity matters. See the section titled “Legal Proceedings” for more information. Litigation has resulted and could continue to result in substantial costs and divertdiversion of management’s attention and resources, which might seriously harm our business, financial condition, and results of operations. Our existing insurance might not cover such claims, provide sufficient payments to cover all the costs to resolve one or more such claims, or continue to be available on terms acceptable to us (including premium increases or the imposition of large deductible or co-insurance requirements). A claim brought against us that is uninsured or underinsured could result in unanticipated costs, potentially harming our business, financial position, and results of operations.

•fluctuations in demand for our platform or changes in our pricing modelmodel, including in response to significant price discounts by our competitors;

•fluctuations in consumption resulting from the introduction of new features, technologies, or capabilities to our software, systems, or to underlying cloud infrastructure, including features or capabilities that may increase or decrease the consumption required to execute existing or future workloads, like better storage compression, cloud infrastructure processor improvements, or compute optimization,optimization that automatically adjusts and adapts compute resources based on workloads, or that allow customers to use our platform for compute services without requiring storage;

•the speed and ease with which customers are able to migrate data onto our platform;

•the amount and timing of operating expenses, particularly research and development expenses, including withthose respectrelated to GPUs to develop AI Technology, and sales and marketing expenses, including commissions;

•the amount and timing of costs associated with recruiting,hiring, training, and integrating new employees and retaining and motivating existing employees;

•public health crises, such as theepidemics COVID-19and pandemicpandemics;

Sales to large customers involve risks that may not be present or that are present to a lesser extent with sales to smaller organizations, such as longer sales cycles, stronger customer leverage in negotiating pricing and other terms, more complexcumbersome customer requirements, including in response to evolving industry regulations, the additional need to partner with third parties that advise such customers or help them integrate their IT solutions, substantial upfront sales costs, less predictability in completing some of our sales, and higher customer support expectations. For example, large customers may require considerable time to evaluate and test our platform or new features prior to making a purchase decision. In addition, large customers may be switching from legacy on-premises solutions when purchasing our products, and may rely on third parties with whom we do not have relationships when making purchasing decisions. Furthermore,When we accept non-standard customer requirements that deviate from our standard offerings, we typically need to change our standard operating model, which increases both the cost of compliance as well as the likelihood of noncompliance. Further, large customers typically have more extensive compliance and vendor diligence programs with respect to new products and services, which can increase both the time and resources needed to sell to them and also result in the inability to sell to them if we do not meet their compliance standards. A number of factors also influence the length and variability of our sales cycle, including the need to educate potential customers about the uses and benefits of our platform, the renegotiation of finalized terms or existing agreements to cover increased spend, additional product categories,categories (e.g., our AI features), changing laws,laws and regulations, different use cases or workloads, or heightened security, privacy, or operational expectations, the discretionary nature of purchasing and budget cycles, and the competitive nature of evaluation and purchasing approval processes. As a result, the length of our sales cycle, from identification of the opportunity to deal closure, may vary significantly from customer to customer, with sales to large enterprises typically taking longer to complete. We have also historically seen consumption growth from large enterprises take longer than when compared to smaller enterprises. Moreover, large customers often begin to deploy our products on a limited basis but nevertheless demand implementation services and negotiate pricing discounts, which increase our upfront investment in the sales effort with no guarantee that sales to these customers will justify our substantial upfront investment. If we fail to effectively manage these risks associated with sales cycles and sales to large customers, our business, financial condition, and results of operations could be affected.

We do business with federal, state, local, and foreign governments and agencies, and heavily regulated organizations; as a result, we face heightened risks related to special contract terms, non-standard product deployments, supply chain restrictions, and compliance with additional processes, rules, and regulations.

We sell to the U.S. government, state and local governments, foreign governments, and heavily regulated organizations directly and through our partners. Selling to government and regulated customers involves significant costs and operational efforts that arise from special laws, regulations, certification or clearance requirements, procurement processes, contract terms, and customer requirements.requirements, including potential supply chain restrictions (such as “supply chain risk” designations for our suppliers or partners). We may fail to win sufficient government or regulated business to justify our investments. For the government and regulated business that we do win, performing under the contracts involves higher ongoing costcosts to meet the special requirements as well as heightened civil and criminal liability for noncompliance for us, our officers, and directors.

We have obtained various government certifications and authorizations that are required to support sales opportunities to the government, including FedRAMP High and DODDepartment of War (DoW) Impact Level 4.4 and 5. We may be unable to achieve government certifications or clearances,facility security clearances with certain government agencies, or we may be required to make unexpected changes to our business, operations or products to obtain or sustain such certifications or facility clearances. As a result, our ability to sell into the government sector could be restricted until we satisfy the requirements of such certifications or facility clearances. In addition, we plan to continue to pursue additional authorizations, including nationalpersonnel security clearances that allow us to support the U.S. national security community. Obtaining and maintaining national security clearances within a global enterprise will require significant operational investments and the successful implementation of new processesprocesses, systems, and controls. In addition, unlike our standard commercial offering, we anticipate delivering our platform and other offerings into customer environments, which presents risks and challenges arising from having less visibility into and control over the operation and security of our platform and other offerings.

A substantial majority of our sales to government entities have been made indirectly through our distribution and reseller partners.partners; and, as our capabilities and compliance posture mature, we may begin engaging directly with government customers to accelerate growth, which can expose us to additional government procurement requirements, higher compliance burdens, and other risks associated with directly contracting with government entities. Doing business with government entities, whether directly or indirectly, presents a variety of risks. Many government entities need significant education regarding our business model, as well as the uses and benefits of our platform. The procurement process for governments and their agencies is highly competitive and time-consuming, and government decisions about their procurement needs may,have been and may in the future be, in certain circumstances, be subject to political influence. Beyond this, demand for our platform may be adversely impacted by public sector budgetary cycles, changes in government procurement policies, and funding availability that in any given fiscal cycle may be reduced or delayed, including in connection with an extended federal government shutdown. Further, if we or our partners are successful in receiving a competitive contract award, that award could be challenged by one or more competitive bidders in a legal action known as a “bid protest.” Bid protests may result in an increase in expenses related to obtaining or preserving contract awards or an unfavorable modification or loss of an award. In the event a bid protest is unsuccessful, the resulting delay in the startup and funding of the work under these contracts may cause our actual results to differ materially and adversely from those anticipated. As a result of these lengthy and uncertain sales cycles, it is difficult for us to predict the timing of entering into customer agreements with government entities or with our distribution and reseller partners in the government market.

In addition, public sector customers may have contractual, statutory, or regulatory rights to terminate current contracts with us or our third-party distributors or resellers for convenience or default. If a contract is terminated for convenience, we may only be able to collect fees for platform consumption prior to termination and settlement expenses. If a contract is terminated due to a default, we may be liable for excess costs incurred by the customer for procuring alternative products or services or be precluded from doing further business with government entities. Further, entities providing products or services to governments, whether directly or indirectly, are required to comply with a variety of complex laws, regulations, and contractual provisions relating to the formation, administration, and performance of government contracts. Such laws, regulations, and contractual provisions impose compliance obligations that are more burdensome than those typically encountered in commercial contracts, and they often give customers in the government market substantial rights and remedies, many of which are not typically found in commercial contracts. These rights and remedies may relate to intellectual property, price protection, the accuracy of information provided to the government, incident notification, termination rights, and prohibition against any government indemnification obligations. For example, the government or other people on behalf of the government can bring civil actions under the False Claims Act where a contractor presents a false or fraudulent claim to the government for payment or approval, which can result in substantial civil penalties and/or prohibition from doing business with the government. In addition, governments may use procurement requirements as an alternative to lawmaking, and impose stricter requirements than would apply to the commercial sector in areas that are not directly related to the purchase. These rules and requirements may apply to us or third-party resellers or distributors whose practices we may not control. Such parties’ non-compliance could result in repercussions for us with respect to contractual and customer satisfaction issues.

From time to time, there may be changes in our executive management team or other key employees resulting from the hiring or departure of these personnel. Our executive officers and other key employees are employed on an at-will basis, which means that these personnel could terminate their employment with us at any time. For example, we have experienced several executive leadership transitions since the beginning of fiscal 2025: in February 2024, Frank Slootman retired as Chief Executive Officer and Sridhar Ramaswamy was appointed to replace himFrank Slootman as Chief Executive Officer upon his retirement; in July 2024, Grzegorz Czajkowski, our former EVP, Engineering and Support, resigned and left Snowflake to pursue another opportunity, and in September 2024, Vivek Raghunathan was appointed as SVP, Engineering and Support to replace himGrzegorz Czajkowski, who resigned in July 2024; in FebruaryMarch 2025, Michael Gannon was appointed as Chief Revenue Officer to replace Christopher W. Degnan; and in September 2025, Brian Robins was appointed to replace Michael P. Scarpelli notified us of his intention to retire as Chief Financial Officer onceupon his successor is appointed, after which he will transition into an advisory role to support continuity and a smooth transition; and in March 2025, Christopher W. Degnan notified us of his intention to retire as Chief Revenue Officer and Michael Gannon was appointed to replace him.retirement. The loss of additional executive officers or any significant change in key leadership could harm morale, cause additional personnel to depart, introduce operational delays or risks as departing employees are replaced and successors learn our business, or disrupt operations and implementation of business strategy as result of any changes such successors may make, each of which could harm our operating results.

In addition, to execute our growth plan, we must attract and retain highly qualified personnel. Competition for these personnel is intense, especially for engineers experienced in designing and developing cloud-based data platform products, including products with artificial intelligenceAI capabilities, and experienced sales, customer support, and professional services personnel. We also are dependent on the continued service of our existing software engineers because of the sophistication of our platform.

In order to support our growing business, we will need to continue to hire in new locations around the world and manage return to work and remote/hybrid working policies,policies in certain areas, which may add to the complexity and costs of our business operations. From time to time, we have experienced, and we expect to continue to experience, difficulty in hiring and retaining employees with appropriate qualifications.qualifications, including skilled AI engineers, many of whom are in high demand and command high compensation packages. Many of the companies with which we compete for experienced personnel have greater resources than we have and can provide more competitive compensation and benefits. In addition, we require the majority of our employees to work from a physical office, while certain of our competitors allow remote work environments. In addition, prospective and existing employees often consider the value and other terms of the equity awards they receive into connectionbe withan important part of their employment.employment compensation package. Our stock price declined significantly during a portionportions of fiscal 2026 and fiscal 2025. If the actual or perceived value of our equity awards declines or undergoes significant volatility, or if our existing employees receive significant proceeds from liquidating their previously vested equity awards, it may adversely affect our ability to recruit and retain key employees. Furthermore, current and prospective employees may believe that their equity award offers have limited upside, and our competitors may be able to offer more appealing compensation packages. In order to retain our existing employees and manage potential attrition, including as a result of any stock price decreases and market volatility that impact the actual or perceived value of our equity awards, we may issue additional equity awards or provide our employees with increased cash compensation, which could negatively impact our results of operations and be dilutive to stockholders. For example, our stock-based compensation, net of amounts capitalized, represented 41%34% of our revenue for fiscal 20252026 and 42%41% for fiscal 2024,2025, and we expect stock-based compensation to remain substantial even if we are successful in reducing it as a percentage of our revenue. Finally, if we hire employees from competitors or other companies, their former employers may attempt to assert that we or these employees have breached our or their legal obligations, resulting in a diversion of our time and resources.

Our results of operations may vary based on the impact of changes in our industry or the global economy on us or our customers and potential customers. Negative conditions or volatility in the general economy both in the United States and abroad, including conditions resulting from changes in gross domestic product growth, financial and credit market fluctuations, bank failures, international trade relations, inflation, tariffs,tariffs and trade wars, extended U.S. federal government shutdowns, and interest rate fluctuations, or the existence of epidemics, pandemics or other public health crises, political turmoil and geopolitical conflicts, natural catastrophes, warfare, or terrorist attacks on the United States, Europe, the Asia-Pacific region, Japan, or elsewhere, could cause a decrease in business investments, including spending on cloud technologies, and negatively affect the growth of our business. For example, the existing tariffs and continued threats of new or increased tariffs, sanctions, trade restrictions and trade barriers, ongoing changes in the United States and foreign government trade policies, various ongoing military conflicts and rising geopolitical tensions globally, including the ongoing military conflicts in the Middle East and between Russia and Ukraine and in the Middle East, as well as the rising tensions between China and Taiwan, have created volatility in the global capital marketsmarkets, have had and may continue to have disruptive impact on the global economy, and could have further global economic consequences, including disruptions of the global supply chain. Tariffs may also increase the costs for AWS, Azure, and/or GCP to provide cloud infrastructure services, which may in turn increase the costs for us to use such services when we renew our agreements with them. In addition, unfavorable conditions in the general economyeconomy, including tariffs and trade wars, may negatively impact our customers’ budgets or cash flow, which could impact the contract terms, including payment terms, our customers demand from us. Competitors, many of whom are larger and have greater financial resources than we do, may respond to challenging market conditions by lowering prices in an attempt to attract our customers. We cannot predict the timing, strength, or duration of any economic slowdown, instability, or recovery, generally or within any particular industry.

As part of our vision for the AI Data Cloud, we will need to grow and maintain a network of partners, including data and technology providers, data consumers, and data application developers. The relationships we have with these partners, and that our partners have with our customers, provide our customers with enhanced value from our platform and the AI Data Cloud, including Snowflake Cortex AISnowpark, and the Snowflake Marketplace.Marketplace, and Snowflake Cortex AI. Our future growth will be increasingly dependent on the success of these relationships, and if we are unsuccessful in growing and maintaining these relationships or the types and quality of data and data applications supported by or available for consumption on our platform, our business, financial condition, and results of operations could be adversely affected.

Our professional services business, which performs implementation and training services for our customers, has grown larger and more complex as our product revenue has increased. We believe our future success depends in part on investment in professional services to facilitate activities such as custom development, customer code conversion and migration from legacy solutions and adoption of our platform, especially with large enterprises. As a result, ourOur sales efforts have been and will continue to be focused on helping our customers more quickly realize the value of our platform and the AI Data Cloud rather than on the profitability of our professional services business. We price our professional services based on the anticipated cost of those services and, as a result, we expect to improve the gross profit percentage of our professional services business over time.time; however, if actual delivery costs exceed our estimates, our ability to achieve expected margin improvement may be adversely affected. If we are unable to manage the growth of our professional services business and improve our profit margin from these services, our operating results, including our profit margins, could be harmed.

We typically commit to our customers that our platform will maintain a minimum service-level of availability. If we are unable to meet these commitments, including with respect to newly introduced products that are initially covered under an existing service-level commitment but may eventually require a different level of availability, we may be obligated to provide customers with additional capacity at no cost, which could significantly affect our revenue. We rely on public cloud providers, such as AWS, Azure, and GCP, and any availability interruption in the public cloud could result in us not meeting our service-level commitments to our customers. In some cases, we may not have a contractual right with our public cloud providers that compensates us for any losses due to availability interruptions in the public cloud. Further, any failure to meet our service-level commitments could damage our reputation and hinder the adoption of our platform, and we could face loss of revenue from reduced future consumption of our platform. Any service-level failures could adversely affect our business, financial condition, and results of operations.

We assume liability for data breaches, intellectual property infringement, violation of applicable laws, and other claims, which exposes us to substantial potential liability.

In our customer contracts and certain strategic partnership agreements, we assume liability for certain security breaches and data protection claims caused by us and by certain third parties on which we rely. Our contracts with customers, partners, investors, and other third parties may also include indemnification provisions under which we agree to defend and indemnify them against claims and losses arising from alleged infringement, misappropriation, or other violation of intellectual property rightsrights, violation of applicable laws, security breaches, breach of warranties, and for other matters. Such claims may arise more often (and if they arise, may be more complex to litigate) as we begin to extend our platform and other offerings into customer and partner environments over which we exercise significantly less or no control. We may not be successful in our attempt to limit our liability and indemnity obligations and obtain corresponding liability and indemnification obligations and security, privacy, data protection, and other compliance obligations from vendors and partners that would require them to contribute to our obligations, and an event triggering our liability or indemnity obligations could give rise to multiple claims involving multiple customers or other third parties. In addition, there have been instances where our customers or other business partners attempt to claim indemnification even if indemnification obligations have not been triggered, and defending against such claims can be time-consuming and expensive. There is no assurance that our applicable insurance coverage, if any, would cover, in whole or in part, any such liability or indemnity obligations. We may be liable for up to the full amount of the contractual claims, which could result in substantial liability or material disruption to our business or could negatively impact our relationships with customers or other third parties, cause reputational harm, reduce demand for our platform, and adversely affect our business, financial condition, and results of operations.

Acquisitions, strategic investments, partnerships, or alliances could be difficult to identify,secure or consummate, pose integration challenges, divert the attention of management, disrupt our business, dilute stockholder value, and adversely affect our business, financial condition, and results of operations.

We have in the past and may in the future seek to acquire or invest in businesses, joint ventures, and platform technologies that we believe could complement or expand our platform, enhance our technology, or otherwise offer growth opportunities. For example, since the beginning of fiscal 2024,2025, we have acquired several companies, including Samooha, Inc., a privately-held company which developed data clean room technology; Neeva Inc. (Neeva), a privately-held internet search company which leveraged generative AI Technology; Mountain US Corporation (f/k/a Mobilize.net Corporation), a privately-held company which provided a suite of tools for efficiently migrating databases to the AI Data Cloud; LeapYear Technologies, Inc., a privately-held company which provided a differential privacy platform; Night Shift Development, Inc., a privately-held data analytics firm focused on the U.S. public sector; and Datavolo, Inc., a privately-held company that built a dataflow infrastructure to support the creation, management, and observability of multimodal data pipelines for enterprise AI.AI; AnyCrunchy suchData acquisitionsSolutions, orInc., investmentsa privately-held company that provided PostgreSQL technology; TensorStax, Inc., a privately-held company that built autonomous AI agents for data engineering services; and Observe, Inc., a privately-held company that built an AI-powered observability platform. Such transactions have in the past and may in the future divert the attention of management and cause us to incur various expenses in identifying, investigating, financing, and pursuing suitable opportunities, whether or not the transactions are completed, and may result in unforeseen operating difficulties and expenditures. In particular, we may encounter difficulties or unexpected costs assimilating or integrating the businesses, technologies, products, personnel, contracts or operations of any acquired companies, particularly if the key personnel of an acquired company choose not to work for us, their software is not easily adapted to work with our platform, or we have difficulty retaining the customers, suppliers, or partners of any acquired business due to changes in ownership, management, or otherwise. Any such transactions that we are able to complete may not result in the synergiesrevenue, synergies, or other benefits we expect to achieve, which could result in substantial impairment charges. These transactions could also result in dilutive issuances of equity securities or the incurrence of debt, which could adversely affect our results of operations. In addition, we may inherit commitments, risks, and liabilities of companies that we acquire that we are unable to successfully mitigate and that may be amplified by our existing business. Finally, disputes or litigation can arise out of our acquisitions or investments from time to time, including in connection with the achievement of earnouts.

We also enter into strategic partnerships where we agree to incorporate third-party technologies into our platform and services. In some cases, we have revenue-sharing arrangements with our strategic partners who supply the technology. We may be unable to reach agreements with potential strategic partners on terms acceptable to us, if at all, and we may not be successful in partnering with the companies that have the technologies we need. Such strategic partnerships are also subject to a number of risks, including with respect to performance issues, security controls, indemnification obligations, and ownership of intellectual property and other proprietary information. Any of the foregoing could harm our business, financial position, and results of operations.

Our customers are also subject to the risk of catastrophic events. If thoseany such events occur, demand for our platform may decrease.

•changes in a specific country’s or region’s political, economic, or legal and regulatory environment, including the effects of pandemics, tariffs,tariffs and trade wars, sanctions, or long-term environmental risks;

Unless the context otherwise requires, all references in this report to “Snowflake,” the “Company,” “we,” “our,” “us,” or similar terms refer to Snowflake Inc. and its consolidated subsidiaries. Unless otherwise noted, all references in this report to our common stock refer to our Class A common stock.stock, which was renamed to “common stock” pursuant to our amended and restated certificate of incorporation filed with the Secretary of State of the State of Delaware on July 3, 2025.

We believe that a cloud computing platform that puts data and artificial intelligence (AI) at its core will offer great benefits to organizations by allowing them to realize the value of the data that powers their businesses. By offering rich primitives for data and applications, we believe that we can create a data connected world where organizations have seamless access to explore, share, and unlock the value of data. Our vision is a world where data and AI turn possibilities into reality. To realize this vision, we deliver the AI Data Cloud, a network where Snowflake customers, partners, developers, data providers, and data consumers can break down data silos and derive value from a growing number of data sets in secure, governed, and compliant ways.

Our platform is the innovative technology that powers the AI Data Cloud, enabling customers to consolidate data into a single source of truth to drive meaningful insights, apply AI to solve business problems, build data applications, and share data and data products. We provide our platform through a customer-centric, consumption-based business model, only charging customers for the resources they use.model.

Our cloud-native architecture includes three independently scalable but logically integrated layers across storage, compute, storage, and cloud services. The storage layer ingests massive amounts and varieties of structured, semi-structured, and unstructured data. The compute layer provides dedicated resources to enable users to simultaneously access common data sets for many use cases with minimal latency. TheWithin storagethe layercompute ingestslayer, massiveusers amountscan clean and varietiesprepare oftheir structured,data, semi-structured,including any required metadata and unstructuredbusiness datasemantics, to create agoverned, unified data record.records that are AI ready and are written back to the storage layer. The cloud services layer intelligentlyenables optimizesusers eachto securely use case’sAI performancewithin requirementsapplications, withtools, noand administration.processes. This architecture is built on three major public clouds across 4753 regional deployments around the world. These deployments are generally interconnected to deliver the AI Data Cloud, enabling a consistent, global user experience.

Our go-to-market strategy is focused on acquiring new customers and driving increased use of our platform for existing customers. We primarily focus our selling efforts on large organizations and primarily sell our platform through a direct sales force, which targets technical and business leaders who are adopting a cloud strategy and leveraging data to improve their business performance. In addition to direct sales, we also sell our platform through resellers and distributors. Our sales force is comprised of inside and field sales, solution engineering, sales development, insidepartner sales, and fieldspecialist sales personnel and is segmented by the industry, size, and region of prospective customers. Once our platform has been adopted, we focus on increasing the migration of additional customer workloads to our platform to drive increased consumption, as evidenced by our net revenue retention rate of 126%125% and 131%126% as of January 31, 20252026 and 2024,2025, respectively. See the section titled “Key Business Metrics” for a definition of net revenue retention rate.

Our platform is used globally by organizations of all sizes across a broad range of industries. As of January 31, 2025,2026, we had 11,15913,328 total customers, increasing from 9,38410,996 customers as of January 31, 2024.2025. Our customer count is subject to adjustments for acquisitions, consolidations, spin-offs, and other market activity, and we present our total customer count for historical periods reflecting these adjustments. Our platform has been adopted by many of the world’s largest organizations that view Snowflake as a key strategic partner in their cloud and data transformation initiatives. As of January 31, 2025,2026, our customers included 745790 of the Forbes Global 2000, based on the 20242025 Forbes Global 2000 list, and those customers contributed approximately 42%43% of our revenue for the fiscal year ended January 31, 2025.2026. Our Forbes Global 2000 customer count is subject to adjustments for annual updates to the Global 2000 list by Forbes, as well as acquisitions, consolidations, spin-offs, and other market activity with respect to such customers, and we present our Forbes Global 2000 customer count for historical periods reflecting these adjustments. See the section titled “Key Business Metrics” for how we determine our customer count.

Our business and financial condition have been, and may continue to be, impacted by adverse macroeconomic conditions, including inflation, high interest rates, and fluctuations or volatility in capital markets or foreign currency exchange rates.rates, tariffs and trade wars, and geopolitical and military conflicts. These conditions have caused, and may continue to cause, customers to rationalize budgets, prioritize cash flow management, including through shortened contract duration, and optimize consumption, including by reducing storage through shorter data retention policies. We are continuing to monitor the actual and potential effects of general macroeconomic conditions across our business. For additional details, see the section titled “Risk Factors.”

Business CombinationCombinations

The results of operations of this business combination have been included in our consolidated financial statements from the date of acquisition. See Note 7, “Business Combinations,” and Note 16, “Subsequent Events,” to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for details regarding thisthese business combination.combinations.

Our future success depends in large part on the market adoption of our platform, including new product functionality, such as,as Snowpark and our artificial intelligenceAI and machine learning technology (collectively, AI Technology), such as Snowflake Cortex AI.. While we see growing demand for our platform, particularly from large enterprises, many of these organizations have invested substantial technical, financial, and personnel resources in their existing database products or big data offerings. In addition, customers’ use of our AI Technology is often dependent on their ability to meet evolving regulatory standards, successfully complete internal compliance reviews, and enter into mutually acceptable contractual terms. While this makes it difficult to predict customer adoption rates and future demand, we believe that the benefits of our platform put us in a strong position to capture the significant market opportunity ahead.

New software releases or hardware improvements, like better storage compression, cloud infrastructure processor improvements, and compute optimization, may make our platform more efficient, enabling customers to consume fewer compute, storage, and data transfer resources to accomplish the same workloads. In addition, newopen productdata featuresformats allow customers to use our platform for compute services without requiring storage. To the extent these improvements do not result in an offsetting increase in new workloads, we may experience lower revenue. Our ability to increase usage of our platform by, and sell additional contracted capacity to, existing customers, and, in particular, large enterprise customers, will depend on a number of factors, including our customers’ satisfaction with our platform, our customers’ adoption and use of new product features, competition, pricing, macroeconomic conditions, overall changes in our customers’ spending levels, customers’ attempts to optimize their consumption, our customers’ confidence in the security of our platform, our ability to maintain our reputation as a trustworthy vendor, the effectiveness of our and our partners’ efforts to help our customers realize the benefits of our platform, and the extent to which customers migrate new workloads to our platform over time, including data science, artificial intelligence,AI, and machine learning workloads.

Our future success also depends on our ability to acquire new customers. We believe there is a substantial opportunity to further grow our customer base by continuing to make significant investments in sales and marketing and brand awareness. Our ability to attract new customers will depend on a number of factors, including the productivity of our sales organization, competitive dynamics in our target markets, changes in our customers’ spending and platform consumption in response to market uncertainty, our ability to promote, maintain, and enhance our brand and reputation, our ability to mitigate reputational damage following cybersecurity threat activity directed at our customers, and our ability to build and maintain partner relationships, including with global system integrators, resellers, technology partners, and third-party providers of native applications on the Snowflake Marketplace.Marketplace, and our ability to meet the heightened needs of customers in regulated markets, such as the public sector, financial services, and countries with data localization requirements. While our platform is built for organizations of all sizes, we focus our selling efforts on large enterprise customers, customers with vast amounts of data, and customers requiring industry-specific solutions. We may not achieve anticipated revenue growth if we are unable to attract, hire, develop, integrate, and retain talented and effective sales personnel; if our sales personnel are unable to achieve desired productivity levels in a reasonable period of time and maintain productivity; or if our sales and marketing programs are not effective.

We are focused on our long-term revenue potentialpotential, and believe our market opportunity is large. We will continue to invest significantly in research and development to improve our platform, including in the areas of data science and AI Technology. In addition, we are focused on expanding our business both domestically and internationally. As part of these efforts, we are investing in meeting the needs of organizations in geographies and government and regulated industries that have heightened requirements, including with respect to data localization, privacy, and security. We intend to continue to invest heavily to grow our business to take advantage of our expansive market opportunity, while also focusing on cash flow and long-term profitability.

(5)As of January 31, 2025,2026, our remaining performance obligations were approximately $6.9$9.8 billion, of which we expect approximately 48%46% to be recognized as revenue in the twelve12 months ending January 31, 20262027 based on historical customer consumption patterns. The weighted-average remaining life of our capacity contracts was 2.42.7 years as of January 31, 2025.2026. However, the amount and timing of revenue recognition are generally dependent upon customers’ future consumption, which is inherently variable at our customers’ discretion and can extend beyond the original contract term in cases where customers are permitted to roll over unused capacity to future periods, generally upon the purchase of additional capacity at renewal. In addition, our historical customer consumption patterns are not necessarily indicative of future results.

We define free cash flow, a non-GAAP financial measure, as GAAP net cash provided by operating activities reduced by purchases of property and equipment and capitalized internal-use software development costs. Cash outflows for employee payroll tax items related to the net share settlement of equity awards are included in cash flow for financing activities and, as a result, do not have an effect on the calculation of free cash flow. We believe information regarding free cash flow provides useful supplemental information to investors because it is an indicator of the strength and performance of our core business operations.

We deliver our platform over the internet as a service. Customers choose to consume our platform under either capacity arrangements, in which they commit to a certain amount of consumption at specified prices, or under on-demand arrangements, in which we charge for use of our platform monthly in arrears. Under capacity arrangements, from which a majority of our revenue is derived, we typically bill our customers annually in advance of their consumption. However, in future periods, we expect to see an increase in capacity contracts providing for quarterly upfront billings and monthly in arrears billings as our customers increasingly want to align consumption and timing of payments. Revenue from on-demand arrangements typically relates to customers with lower usage levels or overage consumption beyond a customer’s contracted usage amount under a capacity contract or following the expiration of a customer’s capacity contract. We recognize revenue as customers consume compute, storage, and data transfer resources under either of these arrangements. Revenue from on-demand arrangements represented approximately 1%, 2%, 3%, and 2%3% of our revenue for the fiscal years ended January 31, 2026, 2025, and 2024, and 2023, respectively.

Cost of product revenue. Cost of product revenue consists primarily of (i) third-party cloud infrastructure expenses, including those related to graphics processing units (GPUs), and AI inference, incurred in connection with our customers’ use of our platform and the deployment and maintenance of our platform on public clouds, including different regional deployments, and (ii) personnel-related costs associated with customer support and maintaining service availability and security of our platform, including salaries, benefits, bonuses, and stock-based compensation. We periodically receive credits from third-party cloud providers that are recorded as a reduction to the third-party cloud infrastructure expenses. Cost of product revenue also includes amortization of capitalized internal-use software development costs, amortization of acquired intangible assets, and expenses associated with software and subscription services dedicated for use by our customer support team and our engineering team responsible for maintaining our platform.

Cost of professional services and other revenue. Cost of professional services and other revenue consists primarily of personnel-related costs associated with our professional services and training departments, including salaries, benefits, bonuses, and stock-based compensation, amortization of an acquired intangible asset,assets, and costs of contracted third-party partners and software tools.

We intend to continue to invest additional resources in our platform infrastructure and our customer support and professional services organizations to support the growth of our business. Some of these investments, including costs associated with GPUs and AI inference, certain support costs and costs of expanding our business internationally, are incurred in advance of generating revenue, and either the failure to generate anticipated revenue or fluctuations in the timing of revenue could affect our gross margin from period to period.

Sales and marketing expenses consist primarily of personnel-related expenses associated with our sales and marketing staff, including salaries, benefits, bonuses, and stock-based compensation. Sales and marketing expenses also include sales commissions and draws paid to our sales force and certain referral fees paid to third parties, including amortization of deferred commissions. A portion of the sales commissions paid to the sales force is earned based on the level of the customers’ consumption of our platform, and a portion of the commissions paid to the sales force is earned upon the origination, expansion, or renewal of customer contracts. Sales commissions tied to customers’ consumption are expensed in the same period as they are earned. Sales commissions and referral fees earned upon the origination or expansion of customer contracts that are not commensurate with those earned upon the renewal of contracts are capitalized and then amortized over a period of benefit that we determined to be five years. Sales commissions earned upon the renewal of customer contracts, as well as sales commissions earned upon the origination or expansion of customer contracts that are commensurate with those for renewal contracts, are capitalized and then amortized over the respective weighted-average contractual term of the related contracts. Sales and marketing expenses also include advertising costs and other expenses associated with our sales, marketing and business development programs, including our user conferences, offset by proceeds from such conferences and programs. In addition, sales and marketing expenses are comprised of travel-related expenses, software and subscription services dedicated for use by our sales and marketing organizations, amortization of acquired intangible assets, and outside services contracted for sales and marketing purposes. We expect that our sales and marketing expenses will increase in absolute dollars and continue to be our largest operating expense for the foreseeable future as we grow our business. However, we expect that our sales and marketing expenses will decrease as a percentage of our revenue over time,time due to improved spend efficiency, although the percentage may fluctuate from period to period depending on the timing and the extent of these expenses.

Research and development expenses consist primarily of personnel-related expenses associated with our research and development staff, including salaries, benefits, bonuses, and stock-based compensation. Research and development expenses also include contractor or professional services fees, third-party cloud infrastructure expenses incurred primarily in developing our platform (including withthose respectrelated to GPUs to develop AI Technology), amortization of acquired intangible assets, and expenses associated with software and subscription services dedicated for use by our research and development organization. Prior to fiscal 2026, research and development expenses related to our cloud platform that qualified as internal-use software development costs were capitalized under Accounting Standards Codification (ASC) Topic 350-40, Internal-use Software (ASC 350-40). During fiscal 2026, we began marketing the Snowflake platform to selected public sector customers who will have contractual rights to take possession of our software and who will contract with third parties to host our software. As a result, our ongoing and future software development costs related to the Snowflake platform must be accounted for under ASC 985-20, Costs of Software to be Sold, Leased or Marketed (ASC 985-20). Costs that meet the criteria for capitalization under ASC 985-20 were not material for the fiscal year ended January 31, 2026. Software development costs capitalized prior to fiscal 2026 in connection with the Snowflake platform will be amortized over their remaining useful life and recognized as cost of product revenue. See Note 2, “Basis of Presentation and Summary of Significant Accounting Policies,” to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for further details. We expect that our research and development expenses will increase in absolute dollars asdue ourto business grows, particularly as we incur additional costs related togrowth, continued investments in our platform.platform, and a decrease in the amount of software development costs eligible for capitalization. However, we expect that our research and development expenses will decrease as a percentage of our revenue over time,time due to improved spend efficiency, although the percentage may fluctuate from period to period depending on the timing and the extent of these expenses. In addition, research and development expenses that qualify as internal-use software development costs are capitalized.

General and administrative expenses consist primarily of personnel-related expenses for our finance, legal, human resources, facilities, and administrative personnel, including salaries, benefits, bonuses, and stock-based compensation. General and administrative expenses also include external legal, accounting, and other professional services fees, software and subscription services dedicated for use by our general and administrative functions, insurance, unallocated lease costs associated with unused office facilities to accommodate planned headcount growth, and other corporate expenses. We expect that our general and administrative expenses will increase in absolute dollars as our business grows but will decrease as a percentage of our revenue over time,time due to improved spend efficiency, although the percentage may fluctuate from period to period depending on the timing and the extent of these expenses. In addition, during the fiscal year ended January 31, 2026, we expectrecognized ourasset impairment charges of $108.7 million as general and administrative expensesexpenses, primarily relating to increase during fiscal 2026 due to anticipated asset impairment charges upon the cease-use of our San Mateo office facility. See Note 11, “Commitments and Contingencies,” to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for further details.

The overall increase in stock-based compensation for the fiscal year ended January 31, 2025,2026, compared to the fiscal year ended January 31, 2024,2025, was primarily attributable to additional equity awards granted to newexisting and existingnew employees, partially offset by the effects of equity awards that became forfeitedfully vested or fully vested.forfeited.

Product revenue increased $795.6$1.0 millionbillion for the fiscal year ended January 31, 2025,2026, compared to the prior fiscal year, primarily due to increased consumption of our platform by existing customers, as evidenced by our net revenue retention rate of 126%125% as of January 31, 2025.2026.

We had 580733 customers with product revenue of greater than $1 million for the trailing 12 months ended January 31, 2025,2026, an increase from 455576 customers as of January 31, 2024.2025. Such customers represented approximately 67%68% and 65%66% of our product revenue for the trailing 12 months ended January 31, 20252026 and 2024,2025, respectively. Within these customers, we had 110135 and 3956 customers with product revenue of greater than $5 million and $10 million, respectively, for the trailing 12 months ended January 31, 2025.2026. The substantial majority of our revenue was derived from existing customers under capacity arrangements, which represented approximately 97% of our revenue for each of the fiscal years ended January 31, 20252026 and 2024.2025. The remainder was derived from on-demand arrangements and new customers under capacity arrangements and on-demand arrangements. The preceding historical metrics reflect any adjustments for acquisitions, consolidations, spin-offs, and other market activity. For purposes of determining revenue derived from (i) customers with trailing 12-month product revenue greater than $1 million, (ii) new customers, and (iii) existing customers, we treat each customer account, including accounts for end-customers under a reseller arrangement, that has at least one corresponding capacity contract as a unique customer, and a single organization with multiple divisions, segments, or subsidiaries may be counted as multiple customers.

Professional services and other revenue increased $24.3$47.7 million for the fiscal year ended January 31, 2025,2026, compared to the prior fiscal year, as we continued to expand our professional services organization continues to expand and evolve to help our customers further realize the benefits of our platform.

Cost of product revenue increased $290.9$268.3 million for the fiscal year ended January 31, 2025,2026, compared to the prior fiscal year. The increase was primarily due to an increase of $176.8$248.1 million in third-party cloud infrastructure expenses (including those related to GPUsAI inference), mainly as a result of increased customer consumption of our platform. Personnel-related costs and allocated overhead costs also increased $45.3 million for the fiscal year ended January 31, 2025, compared to the prior fiscal year, as a result of increased headcount and overall costs to support the growth in our business, and increased stock-based compensation primarily related to additional equity awards granted to existing and new employees. Additionally, amortizationAmortization of capitalized internal-use software development costs and acquired developed technology intangible assets also increased $37.5$27.9 million and $11.1 million, respectively, for the fiscal year ended January 31, 2025,2026, compared to the prior fiscal year. The remainingoverall increase in cost of product revenue was primarilypartially attributableoffset toby $7.7a decrease of $12.7 million in costs incurred by us during fiscal 2025 in connection with a restructuring plan for a majority-owned subsidiary.subsidiary, net of associated income and recoveries.

Our product gross margin was 71%72% for the fiscal year ended January 31, 2025,2026, compared to 74%71% for the prior fiscal year. This declineslight improvement is primarily due to the decrease in personnel-related costs and the aforementioned restructuring costs as a percentage of product revenue, offset by costs attributable to newly launched product capabilities and features that have not yet reached economies of scale. We expect our product gross margin to fluctuate from period to period due to a number of factors, including, but not limited to: (i) fluctuations in the mix and timing of customers’ consumption, which is inherently variable at our customers’ discretion, (ii) our pricing model and discounting practices, (iii) the extent of our investments in new product capabilities, features, and operations, such as investments in AI Technology and performance improvements that may make our platform or the underlying cloud infrastructure more efficient, (iv) new product offerings that are margin compressive, and (ivv) stock-based compensation.

Cost of professional services and other revenue increased $25.2$54.9 million for the fiscal year ended January 31, 2025,2026, compared to the prior fiscal year,year. The increase was primarily due to an increase of $12.9$44.2 million in personnel-related costs and allocated overhead costscosts, as a result of increased headcount.headcount and stock-based compensation. The remaining increase in cost of professional services and other revenue was primarily driven by an increase of $10.9 million inincreased costs of contracted third-party partners and software tools to support the growth in our business.

Sales and marketing expenses increased $280.3$390.0 million for the fiscal year ended January 31, 2025,2026, compared to the prior fiscal year, primarily due to an increase of $131.7$270.1 million in personnel-related costs (excluding commission expenses) and allocated overhead costs, as a result of increased headcount, stock-based compensation, and overall costs to support the growth in our business. The increase in personnel-related costs included a $32.1$47.1 million increase in stock-based compensation for the fiscal year ended January 31, 2025,2026, compared to the prior fiscal year, primarily related to additional equity awards granted to existingnew and newexisting employees, partially offset by the effects of equity awards that became forfeited or fully vested.

ExpensesIn addition, expenses associated with sales commissions and draws paid to our sales force and certain referral fees paid to third parties, including amortization of deferred commissions, also increased $86.0$47.9 million for the fiscal year ended January 31, 2025,2026, compared to the prior fiscal year, primarily attributabledue to salesincreases commissionsin tiedthe toannualized contract value of our customer contracts and customers’ consumption.consumption Inof addition,our advertisingplatform. Advertising costs and other expenses associated with our sales, marketing and business development programsprograms, as well as travel-related expenses, increased $26.0$42.2 million for the fiscal year ended January 31, 2025,2026, compared to the prior fiscal year. The remaining increase in sales and marketing expenses for the fiscal year ended January 31, 2025 was primarily attributable to a $16.1 million increase in travel-related expenses.

Research and development expenses increased $495.4$186.1 million for the fiscal year ended January 31, 2025,2026, compared to the prior fiscal year, primarily due to an increase of $389.2$185.6 million in personnel-related costs and allocated overhead costs, as a result of increased headcount, stock-based compensation, headcount, and overall costs to support the growth in our business. The increase in personnel-related costs included a $207.1$83.4 million increase in stock-based compensation, primarily related to additional equity awards granted to existingnew and newexisting employees, partially offset by the effects of equity awards that became forfeited or fully vested.

Third-partyIn addition, third-party cloud infrastructure expenses, incurred primarily in developing our platform (including with respect to GPUs to develop AI Technology), alsoplatform, increased $92.7$18.1 million for the fiscal year ended January 31, 2025,2026, compared to the prior fiscal year. The remainingoverall increase in research and development expenses for the fiscal year ended January 31, 20252026 was primarilypartially attributableoffset toby $11.0a decrease of $17.0 million in costs incurred by us during fiscal 2025 in connection with a restructuring plan for a majority-owned subsidiary.subsidiary, net of associated income and recoveries.

General and administrative expenses increased $89.3$137.4 million for the fiscal year ended January 31, 2025,2026, compared to the prior fiscal year,year. During the fiscal year ended January 31, 2026, we recognized asset impairment charges of $108.7 million, primarily duerelating to anthe increasecease-use of our San Mateo office facility. See Note 11, “Commitments and Contingencies,” to our consolidated financial statements included elsewhere in personnel-relatedthis costsAnnual andReport allocatedon overheadForm costs,10-K asfor afurther result of increased stock-based compensation, headcount, and overall costs to support the growth in our business.details.

Interest income increaseddecreased $8.3$18.5 million for the fiscal year ended January 31, 2025,2026, compared to the prior fiscal year, primarily due to higherlower weighted-average annual yields on our cash equivalents and investments in available-for-sale marketable debt securities.securities as a result of decreased interest rates. See Note 4, “Cash EquivalentsEquivalents, Investments, and Strategic Investments,” to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for further details on our cash equivalents and investments.

Other Income (Expense),Expense, Net

Other income (expense),expense, net decreasedincreased $80.2$23.7 million for the fiscal year ended January 31, 2025,2026, compared to the prior fiscal year, primarily due to impairments and changes in net realized and unrealized gains (losses) and impairments on our strategic investments in equity securities. See Note 5,4, “FairCash ValueEquivalents, Measurements,Investments, and Strategic Investments,” to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K for further details.

Provision for (Benefit from) Income Taxes

Our provision for income taxes wasincreased $4.1$13.0 million for the fiscal year ended January 31, 2025,2026, compared to ourthe benefit from income taxes of $11.2 million for theprior fiscal year ended January 31, 2024,year, primarily due to partialhigher releasestax ofprovisions valuationin allowancesforeign fromjurisdictions theand businessan combinationsincrease completedin duringour fiscalunrecognized 2024.tax benefits.

As of January 31, 2025,2026, our principal sources of liquidity were cash, cash equivalents, and short-term and long-term investments totaling $5.3$4.8 billion. Our cash equivalents and investments primarily consist of money market funds, corporate notes and bonds, U.S. government and agency securities, commercialtime paper,deposits, certificates of deposit, and timecommercial deposits.paper.

Our primary sourcesources of cash isare payments received from our customers as well as net proceeds from the issuance of theour Notes.convertible senior notes. Our primary uses of cash include personnel-related expenses, third-party cloud infrastructure expenses (including withthose respectrelated to GPUs to developand AI Technologyinference), sales and marketing expenses, overhead costs, acquisitions and strategic investments we may make from time to time, and repurchases of our common stock under our authorized stock repurchase program. As of January 31, 2025,2026, our material cash requirements from known contractual obligations and commitments relate primarily to (i) third-party cloud infrastructure agreements, (ii) theour Notes,convertible senior notes, (iii) operating leases for office facilities, and (iv) subscription arrangements used to facilitate our operations at the enterprise level. These agreements are enforceable and legally binding and specify all significant terms, including fixed or minimum services to be used, fixed, minimum or variable price provisions, and the approximate timing of the actions under the contracts. For more information regarding our contractual obligations and commitments (excluding theour Notesconvertible senior notes) as of January 31, 2025,2026, see Note 11, “Commitments and Contingencies,” to our consolidated financial statements included elsewhere in this Annual Report on Form 10-K. Our long-term purchase commitments may be satisfied earlier than the payment periods presented as we continue to grow and scale our business.

Our revenue was $1.4$1.5 billion and $1.0$1.1 billion for the three months ended AprilJuly 30,31, 2026 and 2025, respectively. As a result of our historical rapid growth, limited operating history, large number of new product features, including those incorporating artificial intelligence (AI) and(including machine learninglearning, technologylarge (collectively,language, and other generative or agentic AI Technologymodels, and software functionality to operationalize the foregoing), and unstable macroeconomicmacro- and microeconomic conditions, our ability to accurately forecast our future results of operations, including revenue, gross margin, remaining performance obligations (RPO), and the percentage of RPO we expect to recognize as revenue in future periods, is limited and subject to a number of uncertainties, including our ability to plan for and model future growth and platform consumption. Our historical revenue growth should not be considered indicative of our future performance.

Further, our revenue growth could slow or our revenue could decline for a number of reasons, including increased competition; changes to technology, such as changes in software or underlying cloud infrastructure or the increasing prominence of new technology like AI; reputational harm; changes in macroeconomicmacro- or microeconomic conditions; and reduced demand for our platform. For example, customers’ willingness to invest in AI technologies may decrease or customers may continue to optimize consumption, rationalize budgets, and prioritize cash flow management, including by reducing storage through shorter data retention policies andpolicies, shortening committed contract durations.durations, and optimizing AI usage. As a result of the foregoing and our rapid revenue growth in priorearlier periods, ourwe have experienced, and will likely experience in the future, periods of slowed revenue growth rate has slowed in recent periods.growth. Any further declines in our revenue growth rate could adversely affect investors’ perceptions of our business, and negatively impact the trading price of our common stock.

Customers generally consume our platform by using compute, storage, and/or data transfer resources. Unlike a subscription-based business model, in which revenue is recognized ratably over the term of the subscription, we generally recognize revenue on consumption. Because our customers have flexibility in the timing of their consumption, we do not have the visibility into the timing of revenue recognition that a typical subscription-based software company has. Customer consumption fluctuates from time to time, and there is a risk that customers will consume our platform at lower levels than we expect, including in response to new software releases or hardware improvements that may make our platform more efficient, adverse macroeconomicmacro- or microeconomic conditions, or holidays. Unexpected fluctuations in customer consumption may cause actual results to differ from our forecasts. As a result, our results of operations in a given period should not be relied upon as indicative of future performance.

We have experienced net losses in each period since inception. We generated net losses of $295.6$191.7 million and $430.0$297.9 million for the three months ended AprilJuly 30,31, 2026 and 2025, respectively. As of AprilJuly 30,31, 2026 and January 31, 2026, we had an accumulated deficit of $10.1$10.3 billion and $9.5 billion, respectively. We expect our costs and expenses to continue to increase in future periods. In particular, we intend to continue to invest significant resources to further develop our platform, expand our research and development teams, retain our employees, and acquire other businesses, including in the areas of data science, AI, and machine learning. We have also entered and may in the future enter into new customer consumption arrangements, and have invested and may continue to invest in new product areas, that are complex and costly, whose adoption and usage are unpredictable or that require time and effort before reaching economies of scale. These activities have in the past and may continue to lead to increased fluctuations in our revenue and lower profit margins.

In addition, our platform currently operates on public cloud infrastructure provided by Amazon Web Services (AWS), Microsoft Azure (Azure), and Google Cloud Platform (GCP), and services provided by these public cloud providers and frontier AI model providers such as Anthropic and OpenAI, and our costs and gross margins are significantly influenced by the prices we are able to negotiate with these public cloud providers, which in certain cases are also our competitors. If we fail to meet any minimum commitments under our third-party cloud infrastructure and services agreements, we may be required to pay the difference, and our results of operations could be negatively impacted. We will also incur increased general and administrative expenses associated with our growth, including costs related to internal systems, operating as a public company, and targeting regulated industries or markets. Our efforts to grow our business have been and may continue to be costlier than we expect, or our revenue growth rate may be slower than we expect, and we may not be able to increase our revenue enough to offset the increase in operating expenses resulting from these investments. If we are unable to achieve and sustain profitability, or if we are unable to achieve the revenue growth that we expect from these investments, the value of our business and common stock may significantly decrease.

•existing observability solution providers, particularly those with strong technological, marketing, and sales positions; and

We compete based on various factors, including price, performance, product features, breadth of use cases, multi-cloud availability, ability to offer state-of-the-art AI models and agentic AI solutions, brand recognition and reputation, customer support, technical services, and differentiated capabilities, including ease of implementation and data migration, ease of administration and use, scalability and reliability, data governance, security and compatibility with existing standards, programming languages, third-party products, and the ability to operate in hybrid environments. Many of our competitors have substantially greater brand recognition, customer relationships, and financial, technical, and other resources than we do, and may be able to respond more effectively than us to new or changing opportunities, technologies, standards, customer requirements, and buying practices. Some of our privately-held competitors also have greater operational flexibility than we do, including the ability to make strategic long-term business decisions without the short-term financial performance pressure, market expectations, and public disclosure obligations that affect public companies. In addition, we may not be able to respond to market opportunities as quickly as smaller companies or offer as many discounts or free services as our competitors. Our support of open data formats may also reduce switching costs between us and our competitors.

We compete in markets that evolve rapidly. We believe that the pace of innovation will continue to accelerate as customers increasingly base their purchases of cloud data platforms on a broad range of factors, including performance and scale, cost, markets addressed, types of data processed, ease of data ingress and egress, support of open data formats, user experience and programming languages, use of AI, interoperability and integrations across tools, applications, and platforms, and data governance, security, and regulatory compliance. We introduced data warehousing on our platform in 2014 as our core use case, and our customers subsequently began using our platform for additional product categories, including data engineering, analytics, transactions, AI, and applications and collaboration. Our future success depends on our ability to continue to innovate rapidly and effectively and increase customer adoption of our platform and the AI Data Cloud, including emerging product areas such as AI,AI (including Snowflake CoWork and Cortex Code), Postgres, Observability, Apache Iceberg tables, and Snowpark.

Further, the value of our platform to customers increases to the extent they are able to use it to process and access all types of data. We need to continue to invest in technologies, services, and partnerships that increase the types of data available and processed on our platform, the ease with which customers can ingest data into our platform, and the types of environments that our platform supports, including hybrid offerings that extend into customer-managed environments. We must also continue to enhance our data sharing and marketplace capabilities so customers can share their data with internal business units, their customers, and other third parties, acquire additional third-party data and data products to combine with their own data to gain additional business insights, and develop and monetize applications on our platform. As we develop, acquire, and introduce new services and technologies, including those that incorporate AI Technology,AI, we have been and may continue to be subject to new or heightened legal, ethical, and other challenges. In addition, our platform requires third-party public cloud infrastructure to operate. We need to continue to innovate to optimize our offerings for these and other public clouds that our customers require, particularly as we expand internationally. Further, the markets in which we compete are subject to evolving industry standards and regulations, resulting in increasing data governance and compliance requirements for us and our customers and partners. As we expand further into the public sector and highly regulated countries and industries, our platform and operations will need to address additional requirements specific to those markets, including data sovereignty requirements.

We have invested and continue to invest significantly in AI Technology. Our investments include internally developing AI Technology, acquiring companies with complementary AI Technology, and partnering with companies to bring AI Technology to our platform. Our competitors are pursuing similar opportunities and may, as a result of greater resources, branding, or otherwise, develop, adopt, and implement AI Technology faster or more successfully than we do, which could impair our ability to compete effectively. We also use third-party vendors for certain AI Technology components and services, including large language models, and if they are flawed or fail to execute, it may adversely impact our ability to deliver our products and services to our customers. In addition, our successful development of AI Technology depends on our access to GPUs and ability to recruit and retain AI-skilled personnel, both of which are currently in high demand. Finally, customers’Customers’ use of our AI Technologyfunctionality is often dependent on their ability to meet evolving regulatory standards, successfully complete internal compliance reviews, and enter into mutually acceptable contractual terms. If they are unable to do so, they may not use our AI Technologyfunctionality as much as we anticipate, or at all. It is also possible that our investments in AI Technology do not result in the benefits we anticipate, or enable us to maintain our competitive advantage. For example, we may not accurately anticipate market demand or offer AI Technologyfunctionality that amplifies our core data platform.

In addition,Finally, we are increasingly using AI Technology as part of our internal operations. For example, we use AI Technology to enhance research and development, sales and marketing, services delivery, and compliance activities. If we are unable to effectively leverage AI Technology in our internal operations, or if we fail to use AI Technology responsibly, our productivity, operational efficiency, or effectiveness may suffer. Any of the foregoing could have a material adverse effect on our business, financial condition, results of operations, or prospects.

In the ordinary course of our business, we store, transmit, generate, and process our, our customers’, and our business partners’ confidential and proprietary data. Such data includes sensitive data, such as personal information, protected health information, and financial data. We use third-party service providers, sub-processors, and technology to help us deliver services to our customers and their end-users, as well as for our internal business operations. We also use third-party technology to assist with securing our environment and providing access to our platform. Some of our customers also use third-party service providers to assist with their use of our platform or third-party technology, such as connectors,connectors and agent-to-platform integration protocols (such as the Model Context Protocol), to access our platform. These third-party service providers may process, store, or transmit data of our employees, partners, customers, and customers’ end-users or may otherwise be used to help operate our platform and corporate systems. In addition, AI modelsmodels, agents, and large datasets are increasingly integrated into our, our customers’, and other third parties’ systems.systems, which are susceptible to unique and evolving attack techniques such as prompt injection, jailbreaking, hijacking, data poisoning, model inversion, and model theft (or model extraction). We, our customers and business partners, and these third parties face a variety of evolving and increasing cybersecurity and data threats related to this complex network of technology.

Cybersecurity threats come from a variety of sources, including traditional computer “hackers,” internal and external personnel (such as through exfiltration or misuse), sophisticated nation-states, nation-state-supported actors, and nation-state-supportedAI actors.technologies, including systems that may act autonomously or otherwise behave in unintended, unpredictable, or malicious ways. Cybersecurity threat actors can use a wide variety of methods, often enhanced or facilitated by AI, including unauthorized intrusions, denial-of-service attacks, ransomware attacks, business email compromises, computer malware, infostealer malware, social engineering attacks (including through deep-fakes and phishing), internal and external personnel misconduct or error, supply-chain attacks, software vulnerabilities, and software or hardware disruptions or failures, and attacks enhanced or facilitated by AI Technology, all of which are prevalent in our industry and our customers’ and partners’ industries. These methods change frequently and are becoming increasingly difficult to detect.detect, particularly as AI enables threat actors to identify novel software and system vulnerabilities to exploit previously unknown vulnerabilities before they can be remediated. Threat actors who successfully compromise networks or systems may use such unauthorized access as a vector to compromise other networks and systems. Threat actors’ goals often include disrupting a company’s operations or ability to provide services, obtaining unauthorized access to platforms, systems, networks, or physical facilities in which data is stored or processed, or through which data is transmitted, stealing data, and demanding ransomware payments.

In addition, the risk of cybersecurity and data incidents will increase as we continue to expand our product offerings and geographic footprint, grow our customer and partner base, expand our AI Technology offerings, acquire operating companies, increase our technological integrations with external environments, provide technical consulting services where our personnel are operating within customer environments, and process, store, and transmit increasingly large amounts and increasingly sensitive and highly regulated types of data. In particular, certain new product offerings, including through both internal development and strategic acquisitions, may pose different or greater data and security risks than our traditional offerings. These products include, for example, features and functionality that access, take instructions from, and operate on large amounts of data inside and outside our platform, that are customized based on customer specifications, that use agent-to-platform integration protocols to interact with our or third-party systems, or or that are deployed to or accessible from external environments where we have no or limited visibility or control, such as distributed endpoints (e.g., a user’s local device) and publicly accessible networks, which increase the potential attack surface for threat actors. If our security measures designed to mitigate and defend against these risks are not effective or if our customers fail to effectively implement them, we or our customers may experience unintended access to or actions taken with respect to our or their systems or data.

We have contractual and other legal obligations to notify customers and other parties of certain incidents, and may choose to make such notifications even if not legally required to do so. For example, SEC rules require disclosure on Form 8-K of the nature, scopescope, and timing of any material cybersecurity incident and the reasonably likely impact of such incident. Determining whether a cybersecurity incident is notifiable or reportable may not be straightforward, and any such mandatory disclosures are costly and could lead to negative publicity, loss of customer or partner confidence in the effectiveness of our security measures, diversion of management’s attention, governmental investigations, and the expenditure of significant capital and other resources to investigate, respond to, or alleviate problems caused by the actual or perceived security breach.

•investments in new features, functionality, and programming languages, including investments in AI Technology and in making our platform available to store and process highly regulated data or comply with new or existing data sovereignty requirements;

•the amount and timing of operating expenses, particularly research and development expenses, including those related to GPUs to develop AI Technology,technologies, and sales and marketing expenses, including commissions;

•general political, geopolitical, social, market, and economic conditions, uncertainty, or volatility, both domestically and internationally, as well as political, geopolitical, social, and economic conditions specifically affecting industries in which our customers and partners participate or on which they rely;

•significant security breaches affecting our platform or systems, our customers’ accounts, external systems, or datadata, or our third-party service providers’ platforms or systems;

We must continue to expand the capabilities and increase the size and productivity of our sales and marketing organization to increase our sales to new and existing customers. It requires significant time and resources to hire and effectively onboard new sales and marketing personnel and to train and manage new and existing personnel so they are able to successfully sell our product. We also plan to continue to dedicate significant resources to sales and marketing programs that are industry-specific and focused on large organizations. Once a new customer begins using our platform, our sales team needs to focus on expanding consumption with that customer. All these efforts require us to invest significant financial and other resources, including in industries and sales channels in which we have limited experience to date. In addition, our sales compensation plans must be structured in a way that properly incentivizes our sales and marketing personnel to drive increased consumption and new capacity arrangements on favorable terms. Our business and results of operations will be harmed if our sales and marketing efforts generate increases in revenue that are smaller than anticipated. We may not achieve anticipated revenue growth from our sales force if we are unable to attract, hire, develop, integrate, and retain talented and effective sales personnel, if our sales personnel are unable to achieve desired productivity levels, or if our sales and marketing programs, including our sales compensation plans, are not effective.

Sales efforts to large customersenterprises involve risks that may not be present or that are present to a lesser extent with respect to sales to smaller organizations.

Sales to large customersenterprises involve risks that may not be present or that are present to a lesser extent with sales to smaller organizations, such as longer sales cycles, stronger customer leverage in negotiating pricing and other terms, more cumbersome customer requirements, the additional need to partner with third parties that advise such customers or help them integrate their IT solutions, substantial upfront sales costs, less predictability in completing some of our sales, and higher customer support expectations. For example, large customersenterprises may require considerable time to evaluate and test our platform or new features prior to making a purchase decision. In addition, large customersenterprises may be switching from legacy on-premises solutions when purchasing our products, and may rely on third parties with whom we do not have relationships when making purchasing decisions. When we accept non-standard customer requirements that deviate from our standard offerings, we typically need to change our standard operating model, which increases both the cost of compliance as well as the likelihood of noncompliance. Further, large customersenterprises typically have more extensive compliance and vendor diligence programs with respect to new products and services, which can increase both the time and resources needed to sell to them and also result in the inability to sell to them if we do not meet their compliance standards. A number of factors also influence the length and variability of our sales cycle, including the need to educate potential customers about the uses and benefits of our platform, the renegotiation of finalized terms or existing agreements to cover increased spend, additional product categories (e.g., our AI features), changing laws and regulations, different use cases or workloads, or heightened security, privacy, or operational expectations, the discretionary nature of purchasing and budget cycles, and the competitive nature of evaluation and purchasing approval processes. As a result, the length of our sales cycle, from identification of the opportunity to deal closure, may vary significantly from customer to customer, with sales to large enterprises typically taking longer to complete. We have also historically seen consumption growth from large enterprises take longer than when compared to smaller enterprises. Moreover, large customersenterprises often begin to deploy our products on a limited basis but nevertheless demand implementation services and negotiate pricing discounts, which increase our upfront investment in the sales effort with no guarantee that sales to these customers will justify our substantial upfront investment. If we fail to effectively manage these risks associated with sales cycles and sales to large customers,enterprises, our business, financial condition, and results of operations could be affected.

We sell to the U.S. government, state and local governments, foreign governments, and heavily regulated organizations directly and through our partners. Selling to government and regulated customers involves significant costs and operational efforts that arise from special laws, regulations, certification or clearance requirements, procurement processes, contract terms, and customer requirements, including potential supply chain restrictions (such as “supply chain risk” designations for our suppliers or partners and export control directives limiting our access to their products or services). We may fail to win sufficient government or regulated business to justify our investments. For the government and regulated business that we do win, performing under the contracts involves higher ongoing costs to meet the special requirements as well as heightened civil and criminal liability for noncompliance for us, our officers, and directors.

We have obtained various government certifications and authorizations that are required to support sales opportunities to the government, including FedRAMP Class C (Moderate) and Class D (High) and Department of War (DoW) Impact LevelLevels 4 and 5. We may be unable to achieve government certifications or facility security clearances with certain government agencies, or we may be required to make unexpected changes to our business, operations or products to obtain or sustain such certifications or facility clearances. As a result, our ability to sell into the government sector could be restricted until we satisfy the requirements of such certifications or facility clearances. In addition, we plan to continue to pursue additional authorizations, including personnel security clearances that allow us to support the U.S. national security community. Obtaining and maintaining national security clearances within a global enterprise will require significant operational investments and the successful implementation of new processes, systems, and controls. In addition, unlike our standard commercial offering, we anticipate delivering our platform and other offerings into customer environments, which presents risks and challenges arising from having less visibility into and control over the operation and security of our platform and other offerings.

In addition, public sector customers may have contractual, statutory, or regulatory rights to terminate current contracts with us or our third-party distributors or resellers for convenience or default. If a contract is terminated for convenience, we may only be able to collect fees for platform consumption prior to termination and settlement expenses. If a contract is terminated due to a default, we may be liable for excess costs incurred by the customer for procuring alternative products or services or be precluded from doing further business with government entities. Further, entities providing products or services to governments, whether directly or indirectly, are required to comply with a variety of complex laws, regulations, and contractual provisions relating to the formation, administration, and performance of government contracts. Such laws, regulations, and contractual provisions are introduced and change more frequently than laws applicable to non-public sector contracts, and impose compliance obligations that are more burdensome than those typically encountered in commercial contracts,contracts. and theyThey often give customers in the government market substantial rights and remedies, many of which are not typically found in commercial contracts. These rights and remedies may relate to intellectual property, price protection, the accuracy of information provided to the government, incident notification, termination rights, and prohibition against any government indemnification obligations. For example, the government or other people on behalf of the government can bring civil actions under the False Claims Act where a contractor presents a false or fraudulent claim to the government for payment or approval, which can result in substantial civil penalties and/or prohibition from doing business with the government. In addition, governments may use procurement requirements as an alternative to lawmaking, and impose stricter requirements than would apply to the commercial sector in areas that are not directly related to the purchase. These rules and requirements may apply to us or third-party resellers or distributors whose practices we may not control. Such parties’ non-compliance could result in repercussions for us with respect to contractual and customer satisfaction issues.

Our customers include a number of non-U.S. governments, to which similar certification, procurement, budgetary, contract, and audit risks of U.S. government contracting also apply, particularly in certain emerging markets where our customer base is less established. Such sales may also heighten our exposure to liabilities under anti-corruption laws. In addition, compliance with complex regulations, security certifications, and contracting provisions in a variety of jurisdictions can be expensive and consume significant financial and management resources. In certain jurisdictions, our ability to win business may be constrained by political and other factors unrelated to our competitive position in the market. Further, our business and results of operations could be harmed if our efforts to do business with governments and heavily regulated organizations do not generate the anticipated increases in revenue. Each of these difficulties could materially adversely affect our business and results of operations.

From time to time, there may be changes in our executive management team or other key employees resulting from the hiring or departure of these personnel. Our executive officers and other key employees are employed on an at-will basis, which means that these personnel could terminate their employment with us can be terminated by either party at any time.time for any reason. For example, in February 2024, Sridhar Ramaswamy was appointed as Chief Executive Officer to replace Frank Slootman. Following our Chief Executive Officer transition, we experienced several executive leadership transitions, including the following transitions that occurred since the beginning of fiscal 2026: in March 2025, Michael Gannon was appointed as Chief Revenue Officer to replace Christopher W. Degnan; in September 2025, Brian Robins was appointed to replace Michael P. Scarpelli as Chief Financial Officer upon his retirement; and in March 2026, Jonathan Beaulier was appointed as Chief Revenue Officer to succeed Mr. Gannon. Loss of additional executive officers, key employees, any otherwise significant turnover or attrition could harm morale, cause additional personnel to depart, degrade customer and partner relationships, cause us to incur unanticipated costs to hire and train replacement personnel, and introduce operational delays or risks, each of which could harm our operating results.

In addition, to execute our growth plan, we must attract and retain highly qualified personnel. Competition for these personnel is intense, especially for executive leadership, engineers experienced in designing and developing cloud-based data platform products, including products with AI capabilities, and experienced sales, customer support, and professional services personnel. We also are dependent on the continued service of our existing software engineers because of the sophistication of our platform.

In order to support our growing business, we will need to continue to hire in new locations around the world and manage remote/hybrid working policies in certain areas, which may add to the complexity and costs of our business operations. From time to time, we have experienced, and we expect to continue to experience, difficulty in hiring and retaining employees with appropriate qualifications, including skilled AI engineers and qualified sales and marketing personnel, many of whom are in high demand and command high compensation packages. Many of the companies with which we compete for experienced personnel have greater resources than we have and can provide more competitive compensation and benefits. In addition, prospective and existing employees (including members of executive management) often consider the value and other terms of the equity awards they receive to be an important part of their employment compensation package. Our stock price declinedfluctuated significantly during portions of fiscal 2027 and fiscal 2026. If the actual or perceived value of our equity awards declines or undergoes significant volatility, or if our existing employees receive significant proceeds from liquidating their previously vested equity awards, it may adversely affect our ability to recruit and retain key employees. Furthermore, current and prospective employees may believe that their equity award offers have limited upside, and our competitors may be able to offer more appealing compensation packages. In order to retain our existing employees and manage potential attrition, including as a result of any stock price decreases and market volatility that impact the actual or perceived value of our equity awards, we have issued and may continue to issue additional equity awards or provide our employees with increased cash compensation, which could negatively impact our results of operations and be dilutive to stockholders. For example, our stock-based compensation, net of amounts capitalized, represented 34% of our revenue for fiscal 2026 and 41% for fiscal 2025, and we expect stock-based compensation to remain substantial even if we are successful in reducing it as a percentage of our revenue. Finally, if we hire employees from competitors or other companies, their former employers may attempt to assert that we or these employees have breached our or their legal obligations, resulting in a diversion of our time and resources.

As part of our vision for the AI Data Cloud, we will need to grow and maintain a network of partners, including data and technology providers, data consumers, and data application developers. The relationships we have with these partners, and that our partners have with our customers, provide our customers with enhanced value from our platform and the AI Data Cloud, including Snowpark, the Snowflake Marketplace, and Snowflake Cortex AI. Our future growth will be increasingly dependent on the success of these relationships, and if we are unsuccessful in growing and maintaining these relationships or the types and quality of data and data applications supported by or available for consumption on our platform, or if our partners failed to deliver on their responsibilities or commitments to us or our customers, our business, financial condition, and results of operations could be adversely affected.

Our professional services business, which performs implementation and training services for our customers, has grown larger and more complex as our product revenue has increased. We believe our future success depends in part on investment inour professional services business, which performs implementation, migration, and training services for our customers designed to facilitate activities such as AI/ML solutions,offerings, custom development, customer code conversion and migration from legacy solutions and adoption of our platform, especially with large enterprises. Our sales efforts have been and will continue to be focused on helping our customers more quickly realize the value of our platform and the AI Data Cloud rather than on the profitability of our professional services business. We price our professional services based on the anticipated cost of those services and demand for these services has grown and is expected to continue to grow and, as a result, we expect to improve the gross profit percentage of our professional services business over time. If we fail to scale our professional services to meet this demand, or if we fail to deliver to customers on time; however,and on budget, customers may experience delays or difficulties in adopting and consuming our platform, which could impact customer acquisition, reduce platform consumption, slow customer expansion, and adversely affect our product revenue and our ability to retain and expand within our customer base. In addition, if actual delivery costs exceed our estimates, our ability to achieve expected margin improvement may be adversely affected. If we are unable to manage the growth of our professional services business and improve our profit margin from these services, our operating results, including our profit margins, could be harmed.

In our customer contracts and certain strategic partnership agreements, we assume liability for certain security breaches and data protection claims caused by us and by certain third parties on which we rely. Our contracts with customers, partners, investors, and other third parties may also include indemnification provisions under which we agree to defend and indemnify them against claims and losses arising from alleged infringement, misappropriation, or other violation of intellectual property rights, violation of applicable laws, security breaches, breach of warranties, and for other matters. Such claims may arise more often (and if they arise, may be more complex to litigate) as we begin to extend our platform and other offerings into customer and partner environments over which we exercise significantly less or no control. We may not be successful in our attempt to adequately limit our liability and indemnity obligations and obtain corresponding liability and indemnification obligations and security, privacy, data protection, and other compliance obligations from vendors and partners that would require them to contribute to our obligations, and an event triggering our liability or indemnity obligations could give rise to multiple claims involving multiple customers or other third parties. In addition, there have been instances where our customers or other business partners attempt to claim indemnification even if indemnification obligations have not been triggered, and defending against such claims can be time-consuming and expensive. There is no assurance that our applicable insurance coverage, if any, would cover, in whole or in part, any such liability or indemnity obligations. We may be liable for up to the full amount of the contractual claims, which could result in substantial liability or material disruption to our business or could negatively impact our relationships with customers or other third parties, cause reputational harm, reduce demand for our platform, and adversely affect our business, financial condition, and results of operations.

We have in the past and may in the future seek to acquire or invest in businesses, joint ventures, and platform technologies that we believe could complement or expand our platform, enhance our technology, or otherwise offer growth opportunities. For example, since the beginning of fiscal 2026, we have acquired several companies, including Crunchy Data Solutions, Inc., a privately-held company that provided PostgreSQL technology; TensorStax, Inc., a privately-held company that built autonomous AI agents for data engineering services; and Observe, Inc. (Observe),Inc., a privately-held company that built an AI-powered observability platform.platform; and Natoma Labs, Inc. (Natoma), an enterprise Model Context Protocol platform for AI agents. Such transactions have in the past and may in the future divert the attention of management and cause us to incur various expenses in identifying, investigating, financing, and pursuing suitable opportunities, whether or not the transactions are completed, and may result in unforeseen operating difficulties and expenditures. In particular, we have encountered and may continue to encounter difficulties or unexpected costs integrating the businesses, technologies, products, personnel, contracts or operations of any acquired companies, particularly if the key personnel of an acquired company choose not to work for us, their software is not easily adapted to work with our platform, or we have difficulty retaining the customers, suppliers, or partners of any acquired business due to changes in ownership, management, or otherwise. Any such transactions that we are able to complete may not result in the revenue, synergies, or other benefits we expect to achieve, which could result in substantial impairment charges. These transactions could also result in dilutive issuances of equity securities or the incurrence of debt, which could adversely affect our results of operations. In addition, we may inherit commitments, risks, and liabilities of companies that we acquire that we are unable to successfully mitigate and that may be amplified by our existing business. Finally, disputes or litigation can arise out of our acquisitions or investments from time to time, including in connection with the achievement of earnouts.

We also enter into strategic partnerships and alliances where we agree to incorporate third-party technologies into our platform and services.services or use third-party services in connection with customers’ use of our platform. In some cases, we have revenue-sharing arrangements with our strategic partners who supply the technology. We may be unable to reach agreements with potential strategic partners on terms acceptable to us, if at all, and we may not be successful in partnering with the companies that have the technologies we need.need, and we have accepted and may in the future accept contract terms required by partners with stronger negotiating leverage that are non-standard or less favorable. Such strategic partnerships are also subject to a number of risks, including with respect to performance issues, security controls, indemnification obligations,obligations and other liability, ownership of intellectual property and other proprietary information.information, and potential reputational harm. Any of the foregoing could harm our business, financial position, and results of operations.

A component of our growth strategy involves the further expansion of our operations and customer base internationally. Customer accounts outside the United States generated 26% and 25% of our revenue for the three and six months ended AprilJuly 30,31, 2026. We are continuing to adapt to and develop strategies to address international markets, but there is no guarantee that such efforts will have the desired effect. For example, we anticipate that we will need to establish relationships with new partners in order to expand or continue our expansion into certain countries, including China, and if we fail to identify, establish, and maintain such relationships, we may be unable to execute on our expansion plans. We expect that our international activities will continue to grow for the foreseeable future as we continue to pursue opportunities in existing and new international markets, which will require significant dedication of management attention and financial resources.

•new, evolving, and potentially more stringent regulations relating to AI Technology;

As we are offering our platform in China through a Chinese-owned operating partner to Chinese affiliates of certain multi-national customers,companies, risks associated with economic, political, and social events in China or tension between China and the U.S. or other countries could negatively affect our business, financial condition, results of operations and growth prospects.

We are currently offering our platform in China to Chinese affiliates of certain multi-national customers.companies. Under Chinese law, we must offer our platform through a Chinese-owned operating partner, which must assume control and management of certain aspects of our platform and serve as the seller of record. This has required a new operating and go-to-market model, and there is a risk that functionality or customer experience may suffer and that we may incur liability or brand impairment arising from the operating partner’s actions, inactions, or ineffectiveness. In addition, developing and operationalizing this new model is a significant investment and may not generate expected returns.

Our ability to make scheduled payments of the principal of, to pay special interest, if any, on or to refinance the Notes depends on our future performance, which is subject to economic, financial, competitive and other factors beyond our control. Our business may not continue to generate sufficient cash flow from operations to service our debt and make necessary capital expenditures. If we are unable to generate such cash flow, we may be required to adopt one or more alternatives, such as selling assets, restructuring debt, or obtaining additional equity capital on terms that may be onerous or highly dilutive. Our ability to refinance the Notes will depend on the capital markets and our financial condition at such time. We may not be able to engage in any of these activities or engage in these activities on desirable terms,terms or timing, which could result in a default on our debt obligations.

If the conditional conversion feature of a series of the Notes is triggered, holders of such Notes will be entitled to elect to convert their Notes at any time during specified periods, as described in the applicable Indenture. For example, the conditional conversion feature of each series of the Notes washas been triggered based on the sale price of our common stock in the past.past and was triggered during the fiscal quarter ended July 31, 2026 such that holders of each series of the Notes can convert their Notes at any time during the fiscal quarter ending October 31, 2026. If one or more holders elect to convert their Notes, we would be required to settle a portion or all of our conversion obligation through the payment of cash, unless we elect to fully settle such conversion by delivering shares of our common stock (other than any cash paid in lieu of delivering fractional shares), which could adversely affect our liquidity. In addition, even if holders do not elect to convert their Notes, we could be required under applicable accounting rules to reclassify all or a portion of the outstanding principal of the relevant series of Notes as a current rather than long-term liability, which would result in a material reduction of our net working capital.

•uncertainty regarding the applicability of intellectual property protections to AI Technology (including outputs generated from AI Technology); and

Litigation may be necessary to enforce or defend our intellectual property or proprietary rights, protect our trade secrets, protect our trademarks, or determine the validity and scope of proprietary rights claimed by others. Any litigation, whether or not resolved in our favor, could result in significant expense to us, divert the efforts of our technical and management personnel, and result in counterclaims with respect to infringement of intellectual property rights by us. If we are unable to prevent third parties from infringing upon or misappropriating our intellectual property or are required to incur substantial expenses defending our intellectual property rights, our business, financial condition, and results of operations may be materially adversely affected.

•The certifications we maintain and the standards that apply to our platform (or those we may maintain or that may apply in the future), such as the U.S. Federal Risk and Authorization Management Program (FedRAMP), U.S. DoW Impact Level 4 (IL4) and Impact Level 5 (IL5), Payment Card Industry Data Security Standards (PCI-DSS), International Organization for Standardization (ISO)/International Electrotechnical Commission (IEC) 27001, System and Organization Controls (SOC), Health Information Trust Alliance Common Security Framework (HI-TRUST CSF), GovRAMP, among others, are becoming and may become more stringent.

•We are and may become subject to new laws that specifically regulate non-personal data. For example, we are subject to certain parts of the EU’s Data Act, which imposes certain data and cloud service interoperability and switching obligations to enable users to switch between cloud service providers without undue delay or cost, as well as certain requirements concerning cross-border international transfers of, and governmental access to, non-personal data outside the European Economic Area. Additionally, in the EU, the Network and Information Security Directive (NIS2) regulates resilience and incident response capabilities of entities operating in a number of sectors, including the digital infrastructure sector (such as cloud computing service providers). The deadline for transposition of NIS2 into local law was October 17, 2024; however, many of the member states in the EU have not fully transposed the Directive, leading to the opening of infringement procedures by the European Commission against the member states. Once fully implemented, non-compliance with NIS2 may lead to significant fines.

These and other similar legal and regulatory developments could contribute to legal and economic uncertainty, increase our exposure to liability, affect how we design, market, and sell our platform, and impact how we operate our business, how our customers and partners process and share data, how we process and use data, and how we transfer personal data from one jurisdiction to another, any of which could increase our costs, require us to take on more onerous obligations in our contracts, impact our ability to operate in certain jurisdictions, and/or negatively impact the types of data available on or the demand for our platform. We incur substantial costs to comply with such laws and regulations, to meet the demands of our customers relating to their own compliance with applicable laws and regulations, and to establish and maintain internal policies, self-attestations, and third-party certifications supporting our compliance programs. Our customers may delegate certain of their GDPR compliance or other privacy or security law obligations to us, and we may otherwise be required to expend resources to assist our customers with such compliance obligations.

Issues in the development and use of AI Technology,AI, combined with an uncertain regulatory environment, may result in reputational harm, liability, or other adverse consequences to our business operations.

The legal and regulatory landscape applicable to AI Technology is uncertain and is evolving rapidly, which may result in new and enhanced governmental or regulatory scrutiny, litigation, confidentiality, privacy or security risks, ethical concerns, legal liability, or other complications that could adversely affect our business, reputation or financial condition, or results of operations. States, regions, and supranational bodies, including the EU and the United States, have passed or proposed new rules and regulations related to the use or sale of AI Technology.technologies. For example, the EU’s Artificial Intelligence Act, which entered into force in August 2024, established a comprehensive legal framework regulating AI; Texas’ Responsible Artificial Intelligence Governance Act, which went into effect on January 1, 2026, imposes obligations on developers and deployers of AI systems; California’s AI Training Data Transparency Act, which went into effect on January 1, 2026, imposes obligations on generative AI systems or services; Colorado’s ArtificialAutomated IntelligenceDecision-Making Technology Act, which is expected go into effect on JuneJanuary 30,1, 2026,2027, imposes obligations on developers and deployers of “high-risk”technology AIthat systemsprocesses personal data and uses computation to generate outputs used to make or assist decisions about individuals; China’s Measures and National Standards on AI-Generated Content, which went into effect on September 1, 2025, imposes obligations on developers and users of AI-generated synthetic content; and South Korea’s AI Basic Act, the country’s first major AI legislation, which went into effect on January 22, 2026, imposes obligations on developers and deployers of “high impact” and generative AI Technology.AI. These regulations may impose onerous obligations related to our development, offering, and use of AI Technology and expose us to an increased risk of regulatory enforcement and litigation. If we cannot use AI Technology or that use is restricted, our business may be less efficient, or we may be at a competitive disadvantage. The laws governing AI are often principle-based and vague and, until market practice and enforcement patterns are established, there is substantial uncertainty around compliance requirements. Further, the rapid growth of AI laws and regulations has been met with legal challenges. For example, the December 11, 2025 Executive Order 14365 directed the U.S. Department of Justice to challenge state AI laws deemed onerous and excessive. We may face changing and potentially conflicting regulations and requirements, which can increase our compliance burden to regulators and customers.

In particular, there is significant uncertainty surrounding the applications of intellectual property and privacy laws to AI Technology.AI. Intellectual property ownership and rights (including copyright) and the remedies of rights owners surrounding the use and development of AI Technology have not been fully addressed by courts or other federal or state laws or regulations, and our use of AI Technology or adoption of AI Technology into our products and services may result in disputes with respect to ownership of intellectual property, or exposure to claims of copyright or other intellectual property infringement, misappropriation, or violations of rights of publicity. In addition, our AI Technologyofferings may involve the processing of personal and other sensitive data and may be subject to laws, policies, legal obligations, and contractual requirements related to privacy, data protection, and information security. Certain privacy laws extend rights to consumers (such as the right to obtain consent or delete certain personal data) and regulate automated decision making. An alleged or actual failure to meet these obligations may lead to regulatory investigations and fines or penalties, require us to change our business practices or retrain our algorithms, or prevent or limit our use of AI Technology.AI. For example, the FTC has required other companies to turn over or disgorge valuable insights or trainings generated through the use of AI Technology where the FTC determined such companies violated privacy and consumer protection laws. We may also be held liable for intellectual property rights infringement or misappropriation, violations of privacy rights, or other legal violations of third-party AI Technologytechnologies (including outputs from AI Technology) that we use, and we may not have full recourse for any damages that we suffer (for example, our use of third-party AI Technologytechnologies may be subject to limitations of liability or provide no liability coverage (e.g., free or open-source technology)). We could also face claims alleging open-source software or other license terms apply with respect to outputs from AI Technology that we believed to be available for use, and not subject to license terms or other third-party proprietary rights.

The algorithms or training methodologies used in the AI Technologytechnologies we use or offer may be flawed. Data sets may be overly broad, insufficient, or contain inappropriately biased information. Our generative AI Technologyfunctionality may also generate outputs that are inaccurate, misleading, harmful, offensive, or otherwise flawed. This may happen if the inputs that the model relied on were inaccurate, incomplete, or flawed (including if a bad actor “poisons” the model with bad inputs or logic), or if the logic of the algorithm is flawed (a so-called “hallucination”). Such inputs and outputs may also contain copyrighted or other protected material.material, which could result in legal claims against us. Our customers or others may rely on or use such outputs to their detriment, or it may lead to adverse outcomes, which may expose us to brand or reputational harm, competitive harm, and/or legal liability. Further, unauthorized use or misuse of generative AI Technology by our employees or others who have access to our systems may result in disclosure of confidential company and customer data, reputational harm, privacy or AI law violations and legal liability. Finally, if we enable or offer services or technologies that draw scrutiny or controversy, if our use of AI Technology becomes controversial or causes ethical issues, if our customers’ use our AI Technologyfunctionality in an improper or controversial way, or if we are perceived to overstate the capabilities or benefits of our products, services, or technologies that employ AI Technology,AI, we may experience brand or reputational harm, competitive harm, and/or legal liability.

Companies across many industries face ongoing scrutiny related to their environmental, socialsocial, and governance (ESG) practices and reporting, both in the United States and internationally. Our response to ESG disclosure requirements and stakeholder expectations may require additional investments and implementation of new practices and reporting processes, all entailing additional compliance risk and cost. To the extent we share information about our ESG practices, we could be criticized for the accuracy, adequacy, or completeness of such disclosures. In addition, we may communicate ESG goals or initiatives from time to time, which can be costly to achieve and difficult to implement. There is no assurance that we will achieve any of these goals, that our initiatives will achieve their intended outcome, and our ability to implement these ESG-related initiatives or achieve ESG-related goals may be dependent on external factors outside our control.

•our involvement in litigation or governmental or regulatory investigations or inquiries and the development and outcome of such litigation, investigations, or inquiries(including the amount and timing of related settlements, judgments, fines, legal fees, and other charges);

Broad market and industry fluctuations, as well as general economic, political, regulatory, and market conditions, such as recessions, inflation, interest rate changes, tariffs and trade wars, extended U.S. federal government shutdowns, or international currency fluctuations, may also negatively impact the market price of our common stock. In addition, technology stocks have historically experienced high levels of volatility.volatility In the past,and companies that have experienced volatility in the market price of their securities haveare beenoften subject to securities class action litigation. We have been, and may be in the future, the target of this type of litigation, which could result in substantial expenses and divert our management’s attention. We are currently subject to certain separate securities class action lawsuits in federal court. See the section titled “Legal Proceedings” for more information.

Our go-to-market strategy is focused on acquiring new customers and driving increased use of our platform for existing customers. We primarily focus our selling efforts on large organizations and primarily sell our platform through a direct sales force, which targets technical and business leaders who are adopting a cloud strategy and leveraging data to improve their business performance. In addition to direct sales, we also sell our platform through resellers and distributors. Our sales force is comprised of inside and field sales, solution engineering, sales development, partner sales, and specialist sales personnel and is segmented by the industry, size, and region of prospective customers. Once our platform has been adopted, we focus on increasing the migration of additional customer workloads to our platform to drive increased consumption, as evidenced by our net revenue retention rate of 126% and 125% as of AprilJuly 30,31, 2026 and January 31, 2026, respectively. See the section titled “Key Business Metrics” for a definition of net revenue retention rate.

Our platform is used globally by organizations of all sizes across a broad range of industries. As of AprilJuly 30,31, 2026, we had 13,91214,554 total customers, increasing from 13,29613,245 customers as of January 31, 2026. Our customer count is subject to adjustments for acquisitions, consolidations, spin-offs, and other market activity, and we present our total customer count for historical periods reflecting these adjustments. Our platform has been adopted by many of the world’s largest organizations that view Snowflake as a key strategic partner in their cloudcloud, data, and dataAI transformation initiatives. As of AprilJuly 30,31, 2026, our customers included 813829 of the Forbes Global 2000, based on the 20252026 Forbes Global 2000 list, and those customers contributed approximately 43%41% of our revenue for the threesix months ended AprilJuly 30,31, 2026. Our Forbes Global 2000 customer count is subject to adjustments for annual updates to the Global 2000 list by Forbes, as well as acquisitions, consolidations, spin-offs, and other market activity with respect to such customers, and we present our Forbes Global 2000 customer count for historical periods reflecting these adjustments. See the section titled “Key Business Metrics” for how we determine our customer count.

Impact of MacroeconomicMacro- and Microeconomic Conditions

Our business and financial condition have been, and may continue to be, impacted by adverse macroeconomicmacro- or microeconomic conditions, including inflation, high interest rates, fluctuations or volatility in capital markets, energy markets, or foreign currency exchange rates, sector-specific capital expenditure concentration, tariffs and trade wars, and geopolitical and military conflicts. These conditions have caused, and may continue to cause, customers to rationalize budgets, prioritize cash flow management, including through shortened contract duration, and optimize consumption, including by reducing storage through shorter data retention policies.policies and optimizing AI usage. We are continuing to monitor the actual and potential effects of general macroeconomicmacro- and microeconomic conditions across our business. For additional details, see the section titled “Risk Factors.”

Business CombinationCombinations

The results of operations of thisthese business combinationcombinations have been included in our condensed consolidated financial statements from the date of the respective acquisition. See Note 7, “Business Combinations,” to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for details regarding thisthese business combination.combinations.

Our future success depends in large part on the market adoption of our platform, including new product functionality, such as Snowpark and our AI and machine learning technology (collectively, AI Technology).AI. While we see growing demand for our platform, particularly from large enterprises, many of these organizations have invested substantial technical, financial, and personnel resources in their existing database products or big data offerings. In addition, customers’ use of our AI Technology is often dependent on their ability to meet evolving regulatory standards, successfully complete internal compliance reviews, and enter into mutually acceptable contractual terms. While this makes it difficult to predict customer adoption rates and future demand, we believe that the benefits of our platform put us in a strong position to capture the significant market opportunity ahead.

Once deployed, our customers often expand their use of our platform more broadly within the enterprise and across their ecosystem of customers and partners as they migrate more data to the public cloud, identify new use cases, and realize the benefits of our platform and the AI Data Cloud. However, because we generally recognize product revenue on consumption and not ratably over the term of the contract, we do not have visibility into the timing of revenue recognition from any particular customer. In addition, many customers are attempting to rationalize budgets, prioritize cash flow management, and optimize consumption amidst macroeconomicmacro- and microeconomic uncertainty. In any given period, there is a risk that customer consumption of our platform will be slower than we expect, which may cause fluctuations in our revenue and results of operations.

New software releases or hardware improvements, like better storage compression, cloud infrastructure processor improvements, and compute optimization, may make our platform more efficient, enabling customers to consume fewer compute, storage, and data transfer resources to accomplish the same workloads. In addition, open data formats allow customers to use our platform for compute services without requiring storage. To the extent these improvements do not result in an offsetting increase in new workloads, we may experience lower revenue. Our ability to increase usage of our platform by, and sell additional contracted capacity to, existing customers, and, in particular, large enterprise customers, will depend on a number of factors, including our customers’ satisfaction with our platform, our customers’ adoption and use of new product features, competition, pricing, macroeconomicmacro- and microeconomic conditions, overall changes in our customers’ spending levels, customers’ attempts to optimize their consumption, our customers’ confidence in the security of our platform, our ability to maintain our reputation as a trustworthy vendor, the effectiveness of our and our partners’ efforts to help our customers realize the benefits of our platform, and the extent to which customers migrate new workloads to our platform over time, including data science, AI, and machine learning workloads.

We are focused on our long-term revenue potential, and believe our market opportunity is large. We will continue to invest significantly in research and development to improve our platform, including in the areas of data science and AI Technology.AI. In addition, we are focused on expanding our business both domestically and internationally. As part of these efforts, we are investing in meeting the needs of organizations in geographies and government and regulated industries that have heightened requirements, including with respect to data localization, privacy, and security. We intend to continue to invest heavily to grow our business to take advantage of our expansive market opportunity, while also focusing on cash flow and long-term profitability.

(3)Cash outflows for employee payroll tax items related to the net share settlement of equity awards were $184.9 million, $142.8 million, $187.6 million, $190.7 million, $162.0 million, and $132.5$162.0 million for the three months ended July 31, 2026, April 30, 2026, January 31, 2026, October 31, 2025, and July 31, 2025, and April 30, 2025, respectively. These amounts are included in cash flow for financing activities and, as a result, do not have an effect on the calculation of non-GAAP free cash flow. See the section titled “Free Cash Flow” for a reconciliation of net cash provided by operating activities, which is the most directly comparable financial measure calculated in accordance with GAAP, to non-GAAP free cash flow.

(5)As of AprilJuly 30,31, 2026, our remaining performance obligations were approximately $9.2$9.0 billion, of which we expect approximately 50%54% to be recognized as revenue in the 12 months ending AprilJuly 30,31, 2027 based on historical customer consumption patterns. The weighted-average remaining life of our capacity contracts was 2.62.4 years as of AprilJuly 30,31, 2026. However, the amount and timing of revenue recognition are generally dependent upon customers’ future consumption, which is inherently variable at our customers’ discretion and can extend beyond the original contract term in cases where customers are permitted to roll over unused capacity to future periods, generally upon the purchase of additional capacity at renewal. In addition, our historical customer consumption patterns are not necessarily indicative of future results.

(2)Cash outflows for employee payroll tax items related to the net share settlement of equity awards were $184.9 million, $142.8 million, $187.6 million, $190.7 million, $162.0 million, and $132.5$162.0 million, for the three months ended July 31, 2026, April 30, 2026, January 31, 2026, October 31, 2025, and July 31, 2025, and April 30, 2025, respectively. These amounts are included in cash flow for financing activities and, as a result, do not have an effect on the calculation of free cash flow.

We deliver our platform over the internet as a service. Customers choose to consume our platform under either capacity arrangements, in which they commit to a certain amount of consumption at specified prices, or under on-demand arrangements, in which we charge for use of our platform monthly in arrears. Under capacity arrangements, from which a majority of our revenue is derived, we typically bill our customers annually in advance of their consumption. However, in future periods, we expect to see an increase in capacity contracts providing for quarterly upfront billings and monthly in arrears billings as our customers increasingly want to align consumption and timing of payments. Revenue from on-demand arrangements typically relates to customers with lower usage levels or overage consumption beyond a customer’s contracted usage amount under a capacity contract or following the expiration of a customer’s capacity contract. We recognize revenue as customers consume compute, storage, and data transfer resources under either of these arrangements. Revenue from on-demand arrangements represented approximately 3% of our revenue for each of the three and six months ended July 31, 2026, and approximately 3% and 2% of our revenue for the three and six months ended AprilJuly 30, 2026 and31, 2025, respectively.

Our customer contracts for capacity typically have a term of one to four years. The weighted-average term of capacity contracts entered into during each of the three and six months ended AprilJuly 30,31, 2026 is approximately 2.22.1 years. To the extent our customers enter into such contracts and either consume our platform in excess of their capacity commitments or continue to use our platform after expiration of the contract term, they are charged for their incremental consumption. In many cases, our customer contracts permit customers to roll over any unused capacity to a subsequent order, generally upon the purchase of additional capacity. For those customers who do not have a capacity arrangement, our on-demand arrangements generally have a monthly stated contract term and can be terminated at any time by either the customer or us.

Because customers have flexibility in their consumption, and we generally recognize revenue on consumption and not ratably over the term of the contract, we do not have the visibility into the timing of revenue recognition from any particular customer contract that typical subscription-based software companies may have. As our customer base grows, we expect our ability to forecast customer consumption in the aggregate to improve. However, in any given period, there is a risk that customers will consume our platform more slowly than we expect, including in response to adverse macroeconomicmacro- or microeconomic conditions, which may cause fluctuations in our revenue and results of operations.

We intend to continue to invest additional resources in our platform infrastructure and our customer support and professional services organizations to support the growth of our business. Some of these investments, including costs associated with GPUsAI inference and AI inference,GPUs, certain support costs and costs of expanding our business internationally, are incurred in advance of generating revenue, and either the failure to generate anticipated revenue or fluctuations in the timing of revenue could affect our gross margin from period to period.

Research and development expenses consist primarily of personnel-related expenses associated with our research and development staff, including salaries, benefits, bonuses, and stock-based compensation. Research and development expenses also include contractor or professional services fees, third-party cloud infrastructure expenses, including those related to AI inference and GPUs, incurred in developing our platform, amortization of acquired intangible assets, and expenses associated with software and subscription services dedicated for use by our research and development organization. Prior to fiscal 2026, research and development expenses related to our cloud platform that qualified as internal-use software development costs were capitalized under Accounting Standards Codification (ASC) Topic 350-40, Internal-use Software (ASC 350-40). During the three months ended April 30, 2025, we began marketing the Snowflake platform to selected public sector customers who will have contractual rights to take possession of our software and who will contract with third parties to host our software. As a result, our ongoing and future software development costs related to the Snowflake platform must be accounted for under ASC 985-20, Costs of Software to be Sold, Leased or Marketed (ASC 985-20). Costs that meet the criteria for capitalization under ASC 985-20 were not material for each of the threesix months ended AprilJuly 30,31, 2026 and 2025. Software development costs capitalized prior to fiscal 2026 in connection with the Snowflake platform are amortized over their remaining useful life and recognized as cost of product revenue. We expect that our research and development expenses will increase in absolute dollars due to business growth, continued investments in our platform, and a decrease in the amount of software development costs eligible for capitalization. However, we expect that our research and development expenses will decrease as a percentage of our revenue over time due to improved spend efficiency, although the percentage may fluctuate from period to period depending on the timing and the extent of these expenses.

General and administrative expenses consist primarily of personnel-related expenses for our finance, legal, human resources, facilities, and administrative personnel, including salaries, benefits, bonuses, and stock-based compensation. General and administrative expenses also include external legal, accounting, and other professional services fees, software and subscription services dedicated for use by our general and administrative functions, insurance, unallocated lease costs associated with unused office facilities to accommodate planned headcount growth, and other corporate expenses. We expect that our general and administrative expenses will increase in absolute dollars as our business grows but will decrease as a percentage of our revenue over time due to improved spend efficiency, although the percentage may fluctuate from period to period depending on the timing and the extent of these expenses. In addition, during the threesix months ended AprilJuly 30,31, 2025, we recognized asset impairment charges of $106.5$108.6 million as general and administrative expenses, primarily relating to the cease-use of our San Mateo office facility. See Note 11, “Commitments and Contingencies,” to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for further details.

Our condensed consolidated financial statements include the accounts of Snowflake Inc., our wholly-owned subsidiaries, and, prior to OctoberNovember 31,1, 2025, a majority-owned subsidiary in which we had a controlling financial interest. Net income (loss) attributable to noncontrolling interest represents the net income (loss) of our majority-owned subsidiary attributed to noncontrolling interest using the hypothetical liquidation at book value method. See Note 2, “Basis of Presentation and Summary of Significant Accounting Policies,” to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for further details.

The overall increase in stock-based compensation for the three and six months ended AprilJuly 30,31, 2026, compared to the three and six months ended AprilJuly 30,31, 2025, was primarily attributable to additional equity awards granted to new and existing employees, partially offset by the effects of equity awards that became forfeited or fully vested.

As of AprilJuly 30,31, 2026, total compensation cost related to unvested awards not yet recognized was approximately $3.8 billion, which will be recognized over a weighted-average period of 2.92.6 years. See Note 12, “Equity,” to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for further details.

Comparison of the Three and Six Months Ended AprilJuly 30,31, 2026 and 2025

Product revenue increased $337.5$401.4 million and $738.9 million for the three and six months ended AprilJuly 30,31, 2026, compared to the three and six months ended AprilJuly 30,31, 2025, respectively, primarily due to increased consumption of our platform by existing customers, as evidenced by our net revenue retention rate of 126% as of AprilJuly 30,31, 2026.

We had 779828 customers with product revenue of greater than $1 million for the trailing 12 months ended AprilJuly 30,31, 2026, an increase from 604654 such customers as of AprilJuly 30,31, 2025. Such customers represented approximately 68% and 66%67% of our product revenue for the trailing 12 months ended AprilJuly 30,31, 2026 and 2025, respectively. Within these customers, we had 144156 and 6465 customers with product revenue of greater than $5 million and $10 million, respectively, for the trailing 12 months ended AprilJuly 30,31, 2026. The substantial majority of our revenue was derived from existing customers under capacity arrangements, which represented approximately 97% and 98%96% of our revenue for the three and six months ended AprilJuly 30,31, 20262026, respectively, and 2025,98% respectively.of our revenue for each of the three and six months ended July 31, 2025. The preceding historical metrics reflect any adjustments for acquisitions, consolidations, spin-offs, and other market activity. For purposes of determining revenue derived from (i) customers with trailing 12-month product revenue greater than $1 million, (ii) new customers, and (iii) existing customers, we treat each customer account, including accounts for end-customers under a reseller arrangement, that has at least one corresponding capacity contract as a unique customer, and a single organization with multiple divisions, segments, or subsidiaries may be counted as multiple customers.

Professional services and other revenue increased $11.4$0.5 million and $11.8 million for the three and six months ended AprilJuly 30,31, 2026, compared to the three and six months ended AprilJuly 30,31, 2025, respectively, as our professional services organization continues to expand and evolve to help our customers further realize the benefits of our platform.

Cost of product revenue increased $101.6$132.1 million and $233.7 million for the three and six months ended AprilJuly 30,31, 2026, compared to the three and six months ended AprilJuly 30,31, 2025, respectively. These increases were primarily due to an increase of $86.0$113.6 million and $199.7 million in third-party cloud infrastructure expenses (including those related to AI inference and GPUs), for the three and six months ended July 31, 2026, respectively, compared to the same periods in the prior year, mainly as a result of increased customer consumption of our platform. Amortization of acquired developed technology intangible assets also increased $11.9 million and $23.7 million for the three and six months ended AprilJuly 30,31, 2026, respectively, compared to the same periodperiods in the prior year.

Our product gross margin remained flat atwas 71% for each of the three and six months ended AprilJuly 30,31, 20262026, compared to 72% for each of the three and six months ended July 31, 2025, respectively, primarily due to the decrease in personnel-related costs as a percentage of product revenue and higher volume-based discounts for our purchases of third-party cloud infrastructure, offset by costs attributable to newly launched product capabilities and features that have not yet reached economies of scale.scale, partially offset by higher discounts for our purchases of third-party cloud infrastructure. We expect our product gross margin to fluctuate from period to period due to a number of factors, including, but not limited to: (i) fluctuations in the mix and timing of customers’ consumption, which is inherently variable at our customers’ discretion, (ii) our pricing model and discounting practices, (iii) the extent of our investments in new product capabilities, features, and operations, such as investments in AI Technology and performance improvements that may make our platform or the underlying cloud infrastructure more efficient, (iv) new product offerings that are margin compressive, and (v) stock-based compensation.

Cost of professional services and other revenue increased $14.1$6.2 million and $20.3 million for the three and six months ended AprilJuly 30,31, 2026, compared to the three and six months ended AprilJuly 30,31, 2025, respectively. These increases were primarily due to an increase of $8.9 million and $24.3 million in personnel-related costs and allocated overhead costs for the three and six months ended AprilJuly 30,31, 20262026, respectively, compared to the same periods in the prior year, as a result of increased headcount. These increases were partially offset by a decrease of $4.1 million and $6.4 million in costs of contracted third-party partners and software tools for the three and six months ended July 31, 2026, respectively, as compared to the same periods in the prior year.

Professional services and other gross margin was (37%38%) and (40%37%) for the three and six months ended AprilJuly 30,31, 20262026, respectively, compared to (28%) and (33%) for the three and six months ended July 31, 2025, respectively. We do not believe the year-over-year changes in professional services and other gross margins are meaningful given that our professional services and other revenue represents a small percentage of our revenue.

Sales and marketing expenses increased $130.4$109.7 million and $240.1 million for the three and six months ended AprilJuly 30,31, 2026, compared to the three and six months ended AprilJuly 30,31, 2025, respectively. These increases were primarily due to an increase of $63.5$38.2 million and $101.7 million in personnel-related costs (excluding commission expenses) and allocated overhead costs,costs for the three and six months ended July 31, 2026, respectively, compared to the same periods in the prior year, as a result of increased headcount, stock-based compensation, and overall costs to support the growth in our business. The increaseincreases in personnel-related costs included a $10.5$6.9 million and $17.4 million increase in stock-based compensation for the three and six months ended AprilJuly 30,31, 2026, respectively, compared to the same periodperiods in the prior year, primarily related to additional equity awards granted to existingnew and newexisting employees, partially offset by the effects of equity awards that became forfeited or fully vested.

In addition, expenses associated with sales commissions and draws paid to our sales force and certain referral fees paid to third parties, including amortization of deferred commissions, increased $36.4$54.7 million and $91.1 million for the three and six months ended AprilJuly 30,31, 2026, respectively, compared to the same periodperiods in the prior year, primarily due to increases in the annualized contract value of our customer contracts and customers’ consumption of our platform. Advertising costs and other expenses associated with our sales, marketing and business development programs, as well as travel-related expenses increased $11.7 million. The remaining increaseincreases wasin sales and marketing expenses for the three and six months ended July 31, 2026, compared to the same periods in the prior year, were primarily attributable to increased expenses associated with third-party cloud marketplace sales transactions and amortization of acquired intangible assets.

ResearchIn and development expenses increased $62.5 million for the three months ended April 30, 2026, compared to the three months ended April 30, 2025, primarily due to an increase of $39.6 million inaddition, personnel-related costs and allocated overhead costs increased $30.3 million and $69.9 million for the three and six months ended July 31, 2026, respectively, compared to the same periods in the prior year, as a result of increased stock-based compensation, headcount, and overall costs to support the growth in our business. The increaseincreases in personnel-related costs included a $16.8$13.8 million and $30.7 million increase in stock-based compensation,compensation for the three and six months ended July 31, 2026, respectively, compared to the same periods in the prior year, primarily related to additional equity awards granted to new and existing employees, partially offset by the effects of equity awards that became forfeited or fully vested.

General and administrative expenses decreased $80.9by $79.7 million for the threesix months ended AprilJuly 30,31, 2026, compared to the threesix months ended AprilJuly 30,31, 2025, primarily driven by a decrease of $88.8$90.9 million in asset impairment charges related to office facility exits. During the threesix months ended AprilJuly 30,31, 2025, we recognized asset impairment charges of $106.5$108.6 million, primarily relating to the cease-use of our San Mateo office facility. See Note 11, “Commitments and Contingencies,” to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for additional details.

Interest income decreased $12.0$7.5 million and $19.5 million during the three and six months ended AprilJuly 30,31, 2026, compared to the three and six months ended AprilJuly 30,31, 2025, respectively, primarily driven by lower weighted average annual yields as well as a decrease in the average balance of our cash equivalents and investments in available-for-sale marketable debt securities. See Note 4, “Cash Equivalents, Investments, and Strategic Investments,” to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for further details on our cash equivalents and investments.

Other Expense,Income (Expense), Net

Other expense,income (expense), net decreasedincreased $18.5$39.7 million and $58.2 million for the three and six months ended AprilJuly 30,31, 2026, compared to the three and six months ended AprilJuly 30,31, 2025, respectively, primarily due to ahigher decreaseupward in impairmentsadjustments and changes in net unrealized gains (losses) on our strategic investments, partially offset by changes in net realized gains (losses) on strategic investments in equity securities and the fair value ofour non-marketable debt security under the fair value option.securities. See Note 4, “Cash Equivalents, Investments, and Strategic Investments,” to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for further details.

Provision for (Benefit from) Income Taxes

Our benefitprovision fromfor income taxes wasincreased $1.1$3.4 million for the three months ended AprilJuly 30,31, 2026, compared to the three months ended July 31, 2025, primarily attributable to an increase in our provisionforeign for income taxes of $5.7 millionearnings for the three months ended AprilJuly 30,31, 2025,2026, due toand the partial release of valuation allowances associated with a business combination completed during the three months ended AprilJuly 30,31, 2026.2025.

As of AprilJuly 30,31, 2026, our principal sources of liquidity were cash, cash equivalents, and short-term and long-term investments totaling approximately $4.4$4.3 billion. Our cash equivalents and investments primarily consist of corporate notes and bonds, money market funds, U.S. government and agency securities, asset-backed securities, time deposits, commercial paper, and certificates of deposit, asset-backed securities, and commercial paper.deposit.

As of AprilJuly 30,31, 2026, our RPO was approximately $9.2$9.0 billion. Our RPO represents the amount of contracted future revenue that has not yet been recognized, including (i) deferred revenue and (ii) non-cancelable contracted amounts that will be invoiced and recognized as revenue in future periods, but that are not recorded on the balance sheet. Portions of RPO that are not yet invoiced and are denominated in foreign currencies are revalued into U.S. dollars each period based on the applicable period-end exchange rates.

Our primary sources of cash are payments received from our customers as well as net proceeds from the issuance of our convertible senior notes. Our primary uses of cash include personnel-related expenses, third-party cloud infrastructure expenses (including those related to GPUsAI inference and AI inferenceGPUs), sales and marketing expenses, overhead costs, acquisitions and strategic investments we may make from time to time, and repurchases of our common stock under our authorized stock repurchase program. As of AprilJuly 30,31, 2026, our material cash requirements from known contractual obligations and commitments relate primarily to (i) third-party cloud infrastructure agreements, (ii) our convertible senior notes, (iii) operating leases for office facilities, and (iv) subscription arrangements used to facilitate our operations at the enterprise level. These agreements are enforceable and legally binding and specify all significant terms, including fixed or minimum services to be used, fixed, minimum or variable price provisions, and the approximate timing of the actions under the contracts. Other than the amended third-party AI service provider and cloud infrastructure agreementagreements entered into during the threesix months ended AprilJuly 30,31, 2026, as described below, there were no material changes outside of the ordinary course of business in our commitments and contractual obligations disclosed in our Annual Report on Form 10-K for the fiscal year ended January 31, 2026, which was filed with the SEC on March 20, 2026. See Note 11, “Commitments and Contingencies,” to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for additional details.

In April 2026, we amended one of our third-party cloud infrastructure agreements (April 2026 Amendment). Under the amended agreement, we have committed to a cumulative minimum spend of $6.0 billion over a five-year contract term ending March 31, 2031 with minimum spend for each contract year ranging from $900.0 million to $1.25 billion. We are required to pay the difference if we fail to meet the cumulative spend or minimum spend for any contract year, and such payments can be applied to qualifying spending on cloud infrastructure services during the term of the April 2026 Amendment. We are no longer required to fulfill the remaining non-cancelable purchase commitment under the agreement prior to the April 2026 Amendment. In June 2026, we further amended the agreement by committing to utilize incremental exabytes of storage at certain contracted rates over a 10-year contract term that extends the term for such storage from March 2031 to May 2036. The incremental exabytes of storage may be subject to adjustments based on our actual usage. We estimate the aggregate minimum purchase obligation for the incremental exabytes of storage to be approximately $58 million as of July 31, 2026.

On February 2, 2026, we acquired all of the outstanding capital stock of Observe, Inc., a privately-held company that built an AI-powered observability platform. The preliminary purchase consideration was $595.8 million, which was comprised primarily of $285.7 million in cash and approximately 1.5 million shares of our common stock valued at $285.3 million as of the acquisition date.

In September 2024, we issued an aggregate principal amount of $2.3 billion of convertible senior notes in a private placement to qualified institutional buyers, comprising of (i) $1.15 billion aggregate principal amount of 0% convertible senior notes due 2027 (2027 Notes) and (ii) $1.15 billion aggregate principal amount of 0% convertible senior notes due 2029 (2029 Notes, and together with the 2027 Notes, the Notes). The Notes are general, senior unsecured obligations. The 2027 Notes will mature on October 1, 2027 and the 2029 Notes will mature on October 1, 2029, in each case unless earlier converted, redeemed, or repurchased. Upon conversion of the Notes, we may satisfy our conversion obligation by paying or delivering, as the case may be, cash, shares of our common stock or a combination of both, at our election. The total proceeds from the issuance of the Notes were approximately $2.27 billion, net of $31.2 million of debt issuance costs. The outstanding principal of the 2027 Notes and the 2029 Notes was $1.15 billion each as of eachJuly of April 30,31, 2026 and January 31, 2026.

The Sale Price Trigger, as discussed in Note 10, “Convertible Senior Notes,” to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q, was met during each of the three months ended July 31, 2025, October 31, 2025, January 31, 2026, and JanuaryJuly 31, 2026, and as a result, holders were or are entitled to convert the Notes at any time during each of the three months ending October 31, 2025, January 31, 2026, and April 30, 2026, and October 31, 2026. To the extent we receive notices of conversion, we may choose to pay or deliver, as the case may be, cash, shares of our common stock or a combination of cash and shares of our common stock, at our election. Through AprilJuly 30,31, 2026, the amount of the principal balance of the 2027 Notes that had been converted was not material. See Note 10, “Convertible Senior Notes,” to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for additional details.

During the threesix months ended AprilJuly 30,31, 2026, we repurchased 1.7 million shares of our outstanding common stock for an aggregate purchase price of $300.0 million, excluding transaction costs associated with the repurchases, at a weighted-average price of $178.95 per share. All repurchases were made in open market transactions. As of AprilJuly 30,31, 2026, $802.7 million remained available for future repurchases under the stock repurchase program (exclusive of transaction costs associated with repurchases). See Note 12, “Equity,” to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q for additional details.

We believe that our existing cash, cash equivalents, and short-term and long-term investments, as well as cash flows expected to be generated by our operations, will be sufficient to support our working capital and capital expenditure requirements, convertible senior notes repayment requirements, acquisitions and strategic investments we may make from time to time, and repurchases of our common stock under our existing or any future stock repurchase program, for the next 12 months and beyond. Our future capital requirements will depend on many factors, including our revenue growth rate, expenditures related to our headcount growth, the timing and the amount of cash received from customers, the expansion of sales and marketing activities, the timing and extent of spending to support development efforts, the price at which we are able to purchase public cloud capacity, our existing commitments to our third-party AI and cloud providers, expenses associated with our international expansion, the introduction of platform enhancements, the continuing market adoption of our platform, and the volume and timing of our stock repurchases. We may continue to enter into arrangements to acquire or invest in complementary businesses, products, and technologies. We may, as a result of those arrangements or the general expansion of our business, be required to seek additional equity or debt financing. In the event that we require additional financing, we may not be able to raise such financing on terms acceptable to us or at all. If we are unable to raise additional capital or generate cash flows necessary to expand our operations and invest in continued innovation, we may not be able to compete successfully, which would harm our business, results of operations, and financial condition.

Net cash provided by operating activities mainly consists of our net loss adjusted for certain non-cash items, primarily consisting of (i) stock-based compensation, net of amounts capitalized, (ii) depreciation and amortization of property and equipment and amortization of acquired intangible assets, (iii) amortization of deferred commissions, (iv) amortization of operating lease right-of-use assets, (v) asset impairment related to office facility exit,exits, (vi) net realized and unrealized losses (gains and losses) on strategic investments, (vii) deferred income tax benefit or expense, and (viii) net amortization (accretion) of premiums (discounts) on investments, and (viii) deferred income tax benefit or expense, and changes in operating assets and liabilities during each period.

For the threesix months ended AprilJuly 30,31, 2026, net cash provided by operating activities was $243.2$334.6 million, consisting of our net loss of $295.6$487.3 million, adjusted for non-cash charges of $569.0$1.1 million,billion, and net cash outflows of $30.2$285.8 million resulting from changes in our operating assets and liabilities, net of the effects of a business combination.combinations. The main driver of the changes in operating assets and liabilities during the threesix months ended AprilJuly 30,31, 2026 was (i) a $528.5$807.2 million decrease in deferred revenue due to revenue recognition outpacing invoicing for prepaid capacity agreements, (ii) a $89.7 million decrease in accounts payable due to timing of invoices and payments, (iii) a $80.8 million decrease in accrued expenses and other liabilities primarily due to purchases under our 2020 ESPP and the timing of accruals and payments, (iv) a $36.8$106.3 million increase in deferred commissions primarily earned upon the origination, expansion, or renewal of customer contracts, and (viii) a $22.3 million increase in prepaid expenses and other assets primarily driven by prepayments related to our sales, marketing and business development programs, including our user conferences, and (vi) a $19.2$41.8 million decrease in operating lease liabilities due to payments related to our operating lease obligations, partially offset by (a) a $747.2$600.6 million decrease in accounts receivable due to timing of billings and collections, as we have historically received a higher volume of customer orders in the fourth fiscal quarter of each year.year, (b) a $41.2 million increase in accounts payable due to timing of invoices and payments, and (c) a $28.1 million increase in accrued expenses and other liabilities primarily due to timing of accruals and payments.

For the threesix months ended AprilJuly 30,31, 2025, net cash provided by operating activities was $228.4$303.3 million, consisting of our net loss of $430.0$727.9 million, adjusted for non-cash charges of $597.3$1.1 million,billion, and net cash inflowsoutflows of $61.0$76.8 million provided by changes in our operating assets and liabilities.liabilities, net of the effects of a business combination.

Net cash provided by operating activities increased $14.9$31.3 million for the threesix months ended AprilJuly 30,31, 2026, compared to the threesix months ended AprilJuly 30,31, 2025, primarily due to an increase in cash collected from customers resulting from increased sales, partially offset by increased expenditures due to an increase in headcount and growth in our business. We expect to generate positive net cash flows from operating activities for fiscal 2027.

Net cash used in investing activities for the threesix months ended AprilJuly 30,31, 2026 was $604.5$953.9 million, primarily driven by $341.6$681.5 million in net purchases of investments and $252.5$254.4 million in cash paid for the Observe and Natoma business combination,combinations, net of cash, cash equivalents, and restricted cash acquired.