Earnings

Snowflake says Frank Slootman is retiring as CEO, stock plunges more than 20%

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Frank Slootman, CEO of Snowflake, on the day of the company’s initial public offering on Sept. 16, 2020.
CNBC

Snowflake said Wednesday that CEO Frank Slootman, 65, is retiring, and will be replaced by former Google ad chief Sridhar Ramaswamy. The shares plunged 20% in extended trading.

Ramaswamy, 57, spent 15 years at Google, most recently leading Ads and Commerce until 2018. He then left to co-found Neeva in 2019, a consumer search engine he hoped to rival Google until last year, when he announced he was shutting it down. 

Snowflake acquired Neeva in June for $185 million, according to a filing.

“There is no better person than Sridhar to lead Snowflake into this next phase of growth and deliver on the opportunity ahead in AI and machine learning,” Slootman said in a statement. “He is a visionary technologist with a proven track record of running and scaling successful businesses.”

Snowflake also released its fourth-quarter financial results, in which sales grew 32% year-over-year to $774.7 million in the period. Product revenue for the fourth quarter was $738.1 million, which was a 33% increase from the previous year.

Operating losses for the fourth quarter were $275.5 million, up from $239.8 million during the fourth quarter of the previous year.

The company said that guidance for product revenue in the first quarter would come in between $745 million to $750 million, lower than the $759 million that analysts were expecting. Additionally, Snowflake said that first-quarter adjusted operating margin would be 3%, topping analyst estimates of 7.2%.

Slootman’s total compensation in 2023 amounted to $23.7 million, almost entirely from stock and option awards. As of the company’s last proxy filing in 2023, he owned almost 13 million Snowflake shares, or 3.8% of the stock outstanding. At Wednesday’s close that stake would be worth about $3 billion.

This is breaking news. Please check back for updates.

Jennifer Elias and Jordan Novet contributed reporting

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