Snowflake Inc.SNOW
Snowflake Inc. Commitments Disclosure
Commitments and Contingencies
Operating Leases
The Company leases its facilities for office space under non-cancelable operating leases with various expiration dates through fiscal 2039. Certain lease agreements include options to renew or terminate the lease, which are not reasonably certain to be exercised and therefore are not factored into the determination of lease payments.
During the fiscal year ended January 31, 2026, the Company recognized impairment charges of $87.9 million for operating lease right-of-use assets, and $20.8 million for property and equipment, net, primarily relating to the cease-use of its San Mateo office facility. These impairment charges represent the amounts by which the carrying values of the asset groups exceeded their estimated fair values, and were recorded as general and administrative expenses on the consolidated statement of operations. The fair values of the impaired asset groups were estimated using discounted cash flow models (income approach) based on market participant assumptions, including the expected downtime prior to the commencement of future subleases, projected sublease income over the remaining lease periods, and discount rates to reflect the level of risk associated with receiving future cash flows. These assumptions are classified within Level 3 inputs of the fair value hierarchy. The fair values of the impaired asset groups are not material.
In addition, the Company subleases certain of its unoccupied facilities to third parties with various expiration dates through fiscal 2033. Such subleases have all been classified as operating leases.
The components of lease costs and other information related to leases were as follows (in thousands):
| Fiscal Year Ended January 31, | |||||||||||||||||
| 2026 | 2025 | 2024 | |||||||||||||||
| Operating lease costs | $ | 66,463 | $ | 59,943 | $ | 52,892 | |||||||||||
| Variable lease costs | 23,083 | 14,477 | 11,667 | ||||||||||||||
| Sublease income | (5,839) | (7,539) | (11,943) | ||||||||||||||
| Total lease costs | $ | 83,707 | $ | 66,881 | $ | 52,616 | |||||||||||
Supplemental cash flow information and non-cash activity related to the Company’s operating leases were as follows (in thousands):
| Fiscal Year Ended January 31, | |||||||||||||||||
| 2026 | 2025 | 2024 | |||||||||||||||
Cash payments included in the measurement of operating lease liabilities—operating cash flows | $ | 26,949 | $ | 47,711 | $ | 40,498 | |||||||||||
| Operating lease liabilities arising from obtaining right-of-use assets | $ | 43,737 | $ | 148,181 | $ | 56,037 | |||||||||||
Weighted-average remaining lease term and discount rate for the Company’s operating leases were as follows:
| January 31, 2026 | January 31, 2025 | ||||||||||
Weighted-average remaining lease term (years) | 7.4 | 7.7 | |||||||||
Weighted-average discount rate | 6.1 | % | 6.2 | % | |||||||
The total remaining lease payments under non-cancelable operating leases and lease receipts for subleases as of January 31, 2026 were as follows (in thousands):
Operating Leases | Subleases | Total | |||||||||||||||
| Fiscal Year Ending January 31, | |||||||||||||||||
| 2027 | $ | 73,052 | $ | (6,039) | $ | 67,013 | |||||||||||
| 2028 | 80,553 | (7,025) | 73,528 | ||||||||||||||
| 2029 | 69,573 | (7,224) | 62,349 | ||||||||||||||
| 2030 | 78,112 | (4,107) | 74,005 | ||||||||||||||
| 2031 | 72,384 | (872) | 71,512 | ||||||||||||||
| Thereafter | 216,896 | (1,344) | 215,552 | ||||||||||||||
Total lease payments (receipts) | $ | 590,570 | $ | (26,611) | $ | 563,959 | |||||||||||
| Less: imputed interest | (129,283) | ||||||||||||||||
| Present value of operating lease liabilities | $ | 461,287 | |||||||||||||||
Lease payments presented above exclude $39.1 million of legally-binding lease commitments for leases signed but not yet commenced as of January 31, 2026. These leases will commence on various dates starting in fiscal 2027 with lease terms ranging from 5.0 years to 5.9 years.
In February 2026, the Company entered into agreements for new office facilities located in the United States and Germany, with a total commitment of $85 million, net of tenant incentives expected to be received. These leases will commence on various dates starting in fiscal 2027 with lease terms ranging from 7.2 years to 12.3 years. The Company will recognize the related right-of-use assets and lease liabilities, which have not yet been determined, at the respective lease commencement dates.
Other Contractual Commitments
Other contractual commitments relate mainly to third-party cloud infrastructure agreements and subscription arrangements used to facilitate the Company’s operations at the enterprise level.
Future minimum payments under the Company’s non-cancelable purchase commitments with a remaining term in excess of one year as of January 31, 2026 are presented in the table below (in thousands):
| Amount | ||||||||
| Fiscal Year Ending January 31, | ||||||||
| 2027 | $ | 656,283 | ||||||
| 2028 | 796,737 | |||||||
| 2029 | 660,845 | (1) | ||||||
| 2030 | 50,000 | |||||||
| 2031 and thereafter | 518,020 | (2) | ||||||
| Total | $ | 2,681,885 | ||||||
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(1)Includes $530.5 million of remaining non-cancelable contractual commitments as of January 31, 2026 related to one of the Company’s third-party cloud infrastructure agreements, under which the Company committed to spend an aggregate of at least $1.0 billion between June 2023 and May 2028 with no minimum purchase commitment during any year. The Company is required to pay the difference if it fails to meet the minimum purchase commitment by May 2028 and such payment can be applied to qualifying expenditures for cloud infrastructure services for up to twelve months after May 2028.
(2)Includes $518.0 million of remaining non-cancelable contractual commitments as of January 31, 2026 related to another one of the Company’s third-party cloud infrastructure agreements, under which the Company committed to spend an aggregate of at least $530.0 million between November 2025 and October 2030 with no minimum purchase commitment during any year. The Company is required to pay the difference if it fails to meet the minimum purchase commitment by October 2030. Up to $100.0 million of such payments can be applied to qualifying spending on cloud infrastructure services for up to one year after October 2030, subject to certain conditions.
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401(k) Plan—The Company sponsors a 401(k) defined contribution plan covering all eligible U.S. employees. Contributions to the 401(k) plan are discretionary. The Company did not make any matching contributions to the 401(k) plan for each of the fiscal years ended January 31, 2026, 2025, and 2024.
Legal Matters—On March 23, 2021, a former employee filed a charge with the National Labor Relations Board (NLRB) claiming that he was terminated in retaliation for engaging in concerted activity protected under the National Labor Relations Act. On September 15, 2023, following a hearing before a NLRB administrative law judge, the administrative law judge issued his ruling in favor of the former employee and ordered that he be awarded certain compensatory and other damages. The Company is appealing the ruling to the Board of the NLRB. The Company believes it is reasonably possible that a loss could ultimately result from an unfavorable outcome and that an estimate of the potential range of loss is between zero and $25 million, plus interest. No material loss accrual was recorded on the Company’s consolidated balance sheets as of each of January 31, 2026 and January 31, 2025, because management believes the likelihood of material loss resulting from this charge is not probable given the further appellate proceedings that are due to take place.
On February 29, 2024, a stockholder class action lawsuit was filed against the Company, the Company’s former Chief Executive Officer, and the Company’s former Chief Financial Officer in the United States District Court for the Northern District of California, alleging violations under Sections 10(b) and 20(a) of the Exchange Act. On April 7, 2025, the lead plaintiff filed a second amended complaint seeking an unspecified amount of damages, attorneys’ fees, expert fees, and other costs. On February 17, 2026, the Court granted the Company’s motion to dismiss the second amended complaint, but granted the lead plaintiff leave to file a third amended complaint. In addition, since the filing of the class action lawsuit, five additional complaints containing securities derivative claims have been filed in the Chancery Court of the State of Delaware, United States District Court for the District of Delaware, and United States District Court for the Northern District of California, respectively, against the Company and certain of the Company’s directors and executive officers alleging similar violations. The derivative claims had been stayed pending resolution of the motion to dismiss the class action lawsuit and the parties have agreed to extend the stays through the resolution of the anticipated motion to dismiss the third amended complaint. The Company is unable to estimate any reasonably possible loss, or range of loss, with respect to these matters at this time. The Company and the other defendants intend to vigorously defend against the claims in these actions.
On June 13, 2024, a class action was filed in the United States District Court for the District of Montana against the Company alleging that the Company failed to take reasonable measures to secure systems that contained consumer data, thereby allowing threat actors to access and exfiltrate personally identifiable information. In the months that followed, numerous additional class actions making the same or similar allegations were filed in the United States and Canada against the Company and/or customers whose consumer or employee data was exfiltrated. Among other claims, the complaints assert common law claims for negligence, breach of fiduciary duty, breach of implied contract, and unjust enrichment, as well as statutory claims, and seek an unspecified amount of damages, attorneys’ fees and costs, as well as injunctive relief. On October 4, 2024, an order was issued by the United States Judicial Panel on Multidistrict Litigation combining the class actions filed in the United States into a multidistrict litigation in the District of Montana. On February 3, 2025, plaintiffs filed their representative complaint on behalf of the consumer plaintiffs. On February 14, 2025, the Court created a separate financial institution track to represent the interests of certain financial institutions (FI Plaintiffs) and an FI Plaintiff representative complaint was subsequently filed. On May 20, 2025, the plaintiffs filed an amended representative complaint on behalf of the consumer plaintiffs that asserted additional claims regarding the breach of a Snowflake customer account containing personally identifiable information from the Los Angeles Unified School District. On October 28 and 29, 2025, the Court denied the Company’s motions to dismiss the claims of the consumer plaintiffs and FI Plaintiffs. On December 19, 2025, the Company filed its answers to the complaints and the matter is currently in discovery. In addition to the multidistrict litigation, a class action is pending in the Supreme Court of British Columbia. The Company is unable to estimate any reasonably possible loss, or range of loss, with respect to these matters at this time. The Company intends to vigorously defend against the claims in these actions.
On November 21, 2025, a class action lawsuit was filed against the Company in the United States District Court for the District of Montana alleging copyright infringement on behalf of a putative class of individuals and entities that own a United States copyright in any work that was allegedly copied, stored, or used without authorization to train our large language model. The complaint seeks an award of statutory and other damages, attorneys’ fees, and all appropriate legal and equitable relief. On January 22, 2026, the Company filed its answer to the complaint and the matter is currently in discovery. The Company is unable to estimate any reasonably possible loss, or range of loss, with respect to this matter at this time. The Company intends to vigorously defend against the claims in this action.
On February 24, 2026, a stockholder class action lawsuit was filed against the Company, the Company’s former Chief Executive Officer, and the Company’s former Chief Financial Officer in the United States District Court for the Northern District of California, alleging violations under Sections 10(b) and 20(a) of the Exchange Act. The complaint seeks an unspecified amount of damages, attorneys’ fees, and other costs. The Company is unable to estimate any reasonably possible loss, or range of loss, with respect to this matter at this time. The Company and the other defendants intend to vigorously defend against the claims in this action.
In addition, the Company is involved from time to time in various claims and legal actions arising in the ordinary course of business. While it is not feasible to predict or determine the ultimate outcome of these matters, the Company believes that none of its current legal proceedings will have a material adverse effect on its financial position, results of operations, or cash flows.
Letters of Credit—As of January 31, 2026, the Company had a total of $24.6 million in cash collateralized letters of credit outstanding, substantially in favor of certain landlords for the Company’s leased facilities. These letters of credit renew annually and expire at various dates through fiscal 2039.
Indemnification—The Company enters into indemnification provisions under agreements with other parties in the ordinary course of business, including business partners, investors, contractors, customers, and the Company’s officers, non-employee directors, and certain employees. The Company has agreed to indemnify and defend the indemnified party for claims and related losses suffered or incurred by the indemnified party from actual or threatened third-party claims due to the Company’s activities or non-compliance with certain representations and warranties made by the Company. It is not possible to determine the maximum potential loss under these indemnification provisions due to the Company’s limited history of prior indemnification claims and the unique facts and circumstances involved in each particular provision. For each of the fiscal years ended January 31, 2026, 2025, and 2024, losses recorded in the consolidated statements of operations in connection with the indemnification provisions, where the Company is an indemnifying party, were not material.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2026 | Mar 20, 2026 | Showing above |
| 2025 | Mar 21, 2025 | |
| 2024 | Mar 26, 2024 | |
| 2023 | Mar 29, 2023 | |
| 2022 | Mar 30, 2022 | |
| 2021 | Mar 31, 2021 | |
About Commitments Disclosures
Commitments and contingencies disclosures catalog a company's off-balance-sheet obligations and legal exposures — purchase commitments, guarantee arrangements, pending litigation, and regulatory proceedings. These items represent potential future cash outflows that may not appear as liabilities on the balance sheet until they become probable and estimable.
Key signals: litigation reserves and disclosed loss ranges quantify management's estimate of legal exposure, but unquantified "reasonably possible" losses often represent the larger risk. Watch for changes in language around pending cases — shifts from "remote" to "reasonably possible" or increases in estimated loss ranges signal deteriorating outcomes. Unconditional purchase obligations and take-or-pay contracts create fixed cost structures that reduce operational flexibility. Guarantee arrangements for subsidiaries or joint ventures can create cascading obligations. Compare the total commitment schedule against projected free cash flow to assess whether the company can meet its obligations without additional financing.