TLDR
- Snowflake stock fell 11.8% on Thursday, trading down to around $132 from a prior close of $149.99
- Trading volume was 152% above average, with over 15 million shares changing hands
- A securities-fraud class-action deadline of April 27, 2026 is adding legal pressure
- Customer data theft linked to a third-party integrator raised security concerns
- A broader market selloff hit software stocks on fears that AI agents could disrupt traditional SaaS models
Snowflake (SNOW) had a rough Thursday. The stock dropped 11.8%, falling from $149.99 to around $132, with trading volume running more than 150% above its daily average. That kind of volume spike usually means something is going on â and in this case, several things were.
The selling wasn’t driven by one single event. It was a pile-on.
First, law firms are circling. Multiple investor alerts have been issued tied to a securities-fraud class action covering a period from June 2023 to February 2024. The deadline for lead plaintiffs is April 27, 2026, and those headlines are back in rotation, reminding investors of the legal cloud hanging over the company.
Second, there are fresh reports of customer data theft. The incidents were linked to a breach at a third-party integrator, not Snowflake’s core platform directly â but the company confirmed it saw “unusual activity.” That’s not the kind of phrase investors want to read.
Software Sector Gets Hit Broadly
SNOW wasn’t alone on Thursday. The broader software sector took a beating, with analysts pointing to growing fears that AI agents could replace or reduce demand for traditional enterprise software. Cloudflare (NET) fell around 12%, ServiceNow (NOW) dropped about 7%, and Snowflake was caught in the same wave.
The idea is straightforward: if AI agents can automate workflows that SaaS tools currently handle, those tools become less valuable. That repricing fear has been building for months, and Thursday looked like a pressure release valve going off.
Insider selling has also been adding to the jittery mood. Over the last quarter, insiders have sold roughly $108 million worth of stock. Director Michael Speiser cut his position by over 62% in early March. EVP Christian Kleinerman sold 10,000 units in February. These aren’t small moves.
What the Bulls Still See
Despite the drop, most analysts haven’t turned bearish. The consensus rating remains “Moderate Buy” with an average price target of around $249.62 â nearly double where the stock is trading now.
The bull case centers on Cortex AI, Snowflake’s in-platform AI product, and the growing number of developers building on top of it. Healthcare company Penguin AI is one example, building workflow apps directly on the Snowflake AI Data Cloud.
Snowflake also recently added Iceberg V3 support, a move that improves data portability and could ease concerns about vendor lock-in for large enterprise customers.
Revenue growth remains strong. In its most recent quarter, Snowflake posted $1.28 billion in revenue, up 30.1% year over year, beating estimates. Earnings per share came in at $0.32, topping the $0.27 consensus.
The problem is profitability. The company still carries a negative net margin of 28.43% and a negative return on equity of 50.61%. The stock is down over 31% year to date, and now sits well below both its 50-day moving average of $169.90 and its 200-day moving average of $213.12.
Rosenblatt Securities reaffirmed a Buy rating with a $275 target as recently as late February. DA Davidson kept its Buy rating but trimmed its target from $300 to $250. TD Cowen did the same, moving from $270 to $255.
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