Snowflake Inc. has completed a private offering of convertible senior notes, raising a total of $3.75 billion in aggregate principal amount. The company sold $2.0 billion of 0.00% Convertible Senior Notes due 2029 and $1.75 billion of 0.00% Convertible Senior Notes due 2031. The notes were issued pursuant to separate indentures dated October 1, 2026, with U.S. Bank Trust Company, National Association, acting as trustee.
The offering included an option for the initial purchasers to purchase additional notes. They may buy up to an additional $300.0 million of the 2029 Notes and $250.0 million of the 2031 Notes within 13 days of issuance. The notes are general, senior unsecured obligations of Snowflake and do not bear regular interest; the principal amount will not accrete.
Key terms of the notes include:
- Maturity: The 2029 Notes mature on October 15, 2029, and the 2031 Notes mature on October 15, 2031.
- Conversion: Holders may convert the notes prior to maturity under specific conditions, including if the stock price meets certain thresholds. The initial conversion rate is 1.9985 shares per $1,000 principal amount for the 2029 Notes (approximately $500.38 per share) and 2.0662 shares per $1,000 principal amount for the 2031 Notes (approximately $483.98 per share).
- Redemption: Snowflake may redeem the notes for cash under certain conditions, with the earliest redemption date for the 2029 Notes being April 20, 2028, and for the 2031 Notes being October 22, 2029.
Snowflake intends to use the net proceeds from the offering to pay for capped call transactions, repurchase a portion of its 2027 notes, and for general corporate purposes, which may include stock repurchases, acquisitions, or strategic investments.
