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Snowflake stock plunges, Okta soars on Q4 reports

Shares of Snowflake (SNOW) are dropping sharply Thursday morning after the company issued a downward revision to the fiscal year 2025 guidance and announced that CEO Frank Slootman would be stepping down. Meanwhile, shares of Okta (OKTA) are trading higher as the company posted its fourth quarter earnings, easily beating Wall Street expectations with $0.63 per share versus an expected $0.51 per share. The stock is currently on its way to a 52-week high.

Yahoo Finance Reporter Madison Mills joins the Live show from the New York Stock Exchange to break down the latest developments for these companies.

For more expert insight and the latest market action, click here to watch this full episode of Yahoo Finance Live.

Editor's note: This article was written by Nicholas Jacobino

Video Transcript

SEANA SMITH: Two trending tickers on Yahoo Finance this morning that are moving actually in opposite direction. Snowflake up first. You're looking at losses of just about 20% falling sharply after the company projected annual revenue below the Street's expectations. Also disclosed the surprise retirement of its long time CEO Frank Slootman.

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Now, on the flip side, taking a look at Okta, we're looking at a surge of just about 22%. The company posting a huge earnings beat and also raised its outlook. Madison Mills joining us now from the floor of the New York Stock Exchange with more on these moves. And Maddie, let's start with the negative and then get to the positive, this move lower first that we're seeing in Snowflake.

MADISON MILLS: Hey, if you're the CEO retiring, there's no better compliment than the stock heading for its worst day ever after you announced that you're leaving the company. And that's exactly what we're seeing with Snow heading into the market open. They are expecting to have their worst day ever.

Now, this comes a couple of years after this company became the most successful cloud IPO ever right here on the New York Stock Exchange. So this indicates a little bit of the expectations for forward guidance that we've seen on Wall Street playing out on this earnings print. Their earnings for the last quarter were pretty good.

They beat on sales. They beat on revenue. Both of those metrics up by over 30%. Still seeing the stocks plunging this morning off of that downward revision to the fiscal year 2025 guidance. That downward revision for something like product revenue though only missed by $9 million. So just think about how small that revision is.

And the Street's reaction is so severe. It indicates to me this broader picture that we've been seeing throughout this earnings cycle. Any name that's going to be relevant to this big tech rally that we've been seeing and any name that's related to AI is really going to have to prove growth on top of growth on top of growth.

And that's what their competitor Okta was able to do. That's why we're seeing that stock heading for their 52-week high. If you take a look at this name on the Yahoo Finance platform listed on the NASDAQ, that digital security company issuing really strong guidance for the year ahead.