CNBC's Bob Pisani discusses the biggest software IPOs and what this trend means for the tech sector as Snowflake becomes the biggest software IPO ever. For access to live and exclusive video from CNBC subscribe to CNBC PRO: https://cnb.cx/2NGeIvi
Cloud company Snowflake shares surged more than 111% in its market debut on the New York Stock Exchange on Wednesday in the largest ever software IPO.
The stock began trading at $245 per share and closed at $253.93. A day earlier, Snowflake priced shares at $120, higher than the $100 to $110 range it estimated on Monday, and a huge bump from the $75 to $85 range it proposed last week.
Snowflake was worth $70.4 billion at the end of trading, more than five times its $12.4 billion valuation in February.
“A stock is worth exactly what somebody wants to pay for it,” CEO Frank Slootman told CNBC just after the stock began trading. “It’s like talking about the weather, it is what it is. Tomorrow’s another day, we’ll see what it brings.”
The company raised more $3 billion based on its opening price, the most ever for a software company. The stock trades under the symbol SNOW.
Investors had anticipated a blockbuster opening for the company, which is generating over $500 million in annualized revenue and grew over 130% in the first half of 2020. The stock received a vote of confidence last week, when Snowflake revealed in a filing that Warren Buffett’s Berkshire Hathaway and Salesforce each agreed to buy $250 million of stock at the IPO price in a concurrent private placement. Berkshire Hathaway also agreed to buy 4.04 million shares in a secondary transaction.
Snowflake is growing alongside the major public cloud vendors by providing technology that allows clients to quickly analyze and share vast amounts of data and increase capacity as needed, rather than relying on databases that are tied to hardware. It’s the first of several technology companies to go public this week in one of the busiest stretches of the year, despite the ongoing Covid-19 pandemic.
» Subscribe to CNBC TV: https://cnb.cx/SubscribeCNBCtelevision
» Subscribe to CNBC: https://cnb.cx/SubscribeCNBC
» Subscribe to CNBC Classic: https://cnb.cx/SubscribeCNBCclassic
Turn to CNBC TV for the latest stock market news and analysis. From market futures to live price updates CNBC is the leader in business news worldwide.
Connect with CNBC News Online
Get the latest news: http://www.cnbc.com/
Follow CNBC on LinkedIn: https://cnb.cx/LinkedInCNBC
Follow CNBC News on Facebook: https://cnb.cx/LikeCNBC
Follow CNBC News on Twitter: https://cnb.cx/FollowCNBC
Follow CNBC News on Instagram: https://cnb.cx/InstagramCNBC
For info on the best credit cards go to CNBC Select: