It may still be summer dog days, but it was a snowstorm on Wall Street on Wednesday. Shares of Snowflake, a cloud storage company backed by Salesforce (CRM) and Warren Buffett’s Berkshire Hathaway (BRKB), doubled on their first day of trading in the biggest software IPO.
On Tuesday evening, the snowflake estimated its initial public offering at $ 120 per share, which exceeds the expected range from $ 100 to $ 110. The price range has been revised upwards from the expected $ 75 to $ 85 earlier this month. It is currently being traded on the NYSE under the “SNOW” brand.
But demand was so strong that stocks finally ended early Wednesday afternoon at $ 245 a share, rising rapidly from $ 300 to 150%. Shares retreated slightly as the day went on, but it still ended up almost 112%.
The company sold 28 million shares հավաք raised nearly $ 3.4 billion from the IPO. An impressive debut makes Snowflake the largest software IPO ever, easily overtaking Dell (DELL) -supported VMWare (VMW) 2007. The IPO, which raised almost $ 1 billion.
With a closing price of just under $ 254, Snowflake is valued at $ 70 billion.
That makes Snowflake, founded in 2012, more valuable than companies listed on the S&P 500, such as Bank of New York Mellon (BK), Hershey (HSY), Allstate, as well as Dow components Walgreens ( WBA) և Travelers (TRV): .
However, Snowflake’s debut will not be close to being one of the biggest IPOs of all time.
According to research by Renaissance Capital, last year’s Saudi Aramco debut was the largest, raising almost $ 26 billion. The Uber IPO also raised more than $ 8 billion in 2019, making it the 25th largest IPO ever.
Snowflake is one of several startups expected to be released by the end of 2020, a list that includes Airbnb, Palantir and DoorDash. Another small developer of Smaller software tools, JFrog, was also released on Wednesday.
Snowflake helps blue chip companies analyze and share data in the cloud.
In its latest regulatory document to the Securities and Exchange Commission, the company said it now has more than 3,100 customers, more than double the previous year’s figure. That includes 146 of the Fortune 500 companies.
Snowflake CEO Frank Slotman այլ Other executives are among the company’s best individual investors. The well-known companies Altimeter Capital, ICONIQ Capital, Redpoint Ventures, Sequoia and Sutter Hill Venture Capital also have significant shares in the company.
Last week, Snowflake revealed that Salesforce, a cloud giant recently added to the Dow, և Buffett’s Berkshire Hathaway, each with $ 250 million worth of snowflake shares in a private equity after the IPO.
Partnering with Snowflake could help Salesforce compete more effectively against Amazon (AMZN), Microsoft (MSFT) and Google-owned Alphabet (GOOGL). Snowflake competes with Amazon (AMZN) AWS, Microsoft (MSFT) Azure և Google Cloud platforms.
Berkshire’s contribution is Buffett’s rare breakthrough in the world of technology startups. Berkshire tends to invest more in mature companies such as Apple (AAPL), which is now the leading Omacle Holding in Omaha. Berkshire also made a bet on Amazon last year.
Snowflake is not a typical Berkshire play, as it is not yet profitable, although sales are growing rapidly.
Revenue has more than doubled in the last six months to $ 242 million. However, the company suffered a net loss of $ 171 million, which is slightly less than the loss recorded in the same period a year ago.