Why Snowflake, Datadog, and CrowdStrike Are Plunging Today
Shares of enterprise software stocks Snowflake (NYSE: SNOW), Datadog (NASDAQ: DDOG), and CrowdStrike (NASDAQ: CRWD) were plunging today, down 13%, 7.6%, and 9.9%, respectively, as of 1:42 p.m. ET.
Datadog reported solid earnings yesterday morning, but despite that, it wasn't enough to offset broader concerns over the killer combination of higher interest rates and slower growth on the software sector. Last night, a slew of other SaaS stocks reported slowing growth outlooks, and therefore the entire sector sold off hard today.
The losses in these companies weren't so much the result of company-specific factors today, but rather their relationship to other peers who reported last night. On the enterprise software front, both Twilio (NYSE: TWLO) and Atlassian (NASDAQ: TEAM) had disappointing reports, as Twilio lowered its long-term growth forecast from 30% to 15%-25%, and Atlassian cut its fiscal 2023 guidance. Meanwhile, even though cybersecurity software company Cloudflare (NYSE: NET) beat on revenue and losses per share and raised its guidance, it wasn't enough to offset Wall Street's dour mood on unprofitable software stocks with high valuations, and the stock plunged nearly 20% today.
Source Fool.com
