Snowflake (NYSE: SNOW) upsizes convertible note deal to $3.75 billion

What happened

Snowflake Inc. (NYSE: SNOW) priced a $3.75 billion private placement of 0.00% convertible senior notes on September 28, 2026. The deal includes $2.0 billion due 2029 and $1.75 billion due 2031, and Snowflake said the size was upsized from a previously announced $3.5 billion offering.

The notes will not pay regular interest and the principal will not grow over time. They will be general unsecured obligations. If the notes convert, Snowflake can pay cash, issue shares of common stock, or use a mix of both at its election.

The 2029 notes mature on October 15, 2029, and the 2031 notes mature on October 15, 2031. The initial purchasers can buy up to an additional $300.0 million of the 2029 notes and up to an additional $250.0 million of the 2031 notes. The sale is expected to close on October 1, 2026, subject to customary closing conditions.

Key numbers

Metric	Latest	Change	Source
Aggregate principal amount of offering	$3.75 billion	from $3.5 billion, +$250.0 million	Calculated from SEC 8-K
2029 notes	$2.0 billion		SEC 8-K pricing press release
2031 notes	$1.75 billion		SEC 8-K pricing press release
Estimated net proceeds	$3.70 billion		SEC 8-K pricing press release
Capped call cost	$383.5 million		SEC 8-K pricing press release
2027 notes repurchase cost	$548.3 million		SEC 8-K pricing press release

Read more: Snowflake (SNOW) stock analysis and investment case

Why it matters

The filing says Snowflake expects about $3.70 billion of net proceeds, or about $4.24 billion if the extra-note options are used in full. Snowflake plans to spend about $383.5 million on capped calls and about $548.3 million to repurchase about $261.8 million of 2027 notes.

It said the rest can go to general corporate purposes, including stock repurchases, more note repurchases, acquisitions or strategic investments. If the extra-note proceeds are used, Snowflake said they can fund more capped calls, with the balance going to those same uses.

OptimistFi's comparison shows the priced deal is 7.1% larger than the original $3.5 billion plan. The capped calls are meant to limit dilution if the notes convert, but the filing says that protection stops at an initial $820.30 per share, 150% above the last reported sale price. That keeps attention on whether the new cash outweighs the added debt and conversion risk.

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What's next

The sale is expected to close on October 1, 2026, subject to customary closing conditions.

The 13-day option window starts when the notes are first issued. The options cover up to $550.0 million of additional principal if fully used.

If those options are exercised in full, Snowflake estimates net proceeds of about $4.24 billion. If fewer options are used, the company gets less cash and keeps more of the financing at the lower estimate.

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