Databricks Now Valued At Over 2X Snowflake As Software Valuations Come Under Scrutiny

• Databricks raised $5 billion in a private round from Goldman Sachs, Glade Brook Capital, Morgan Stanley, Neuberger Berman, and the Qatar Investment Authority.
• The privately held analytics firms compete with Snowflake and the cloud units of Amazon and Google.
• Markets rebounded in the last two sessions, offering some respite amid a massive selloff in software stocks.

Data analytics firm Databricks said on Monday it raised $5 billion in funding and another $2 billion in new debt capacity, taking its valuation to $134 billion, or over twice as much as its closest publicly-listed competitor, Snowflake.

Databricks reported that its annualized revenue exceeded $5.4 billion in the January quarter, up 65% year over year. That’s also higher than Snowflake's $3.6 billion estimated revenue for 2025. 

Through its main cloud product, Lakehouse, Databricks helps companies store, process, and analyze data and build AI and ML models at scale. Its services overlap with Palantir, Amazon Web Services, Google BigQuery, Microsoft Fabric, and Cloudera.

Software Stocks In Focus

The milestone carries added significance, as it comes amid heightened market churn and a broader downturn in software stocks. Investors are reassessing whether the significant investment in AI will translate into meaningful revenue gains and whether AI tools from OpenAI and Anthropic will offset demand for enterprise software.

In the past month, software-as-a-service (SaaS) stocks from Adobe to Salesforce and Intuit plunged amid fears exacerbated by updates from Anthropic on its new powerful AI platform, Claude Cowork. Stocktwits recently published an analysis showing that, post-selloff, some names had become attractive bets.
 

Databricks has also scaled its AI portfolio, and annualized revenue from AI products now exceeds $1.4 billion, the company said. 

Databricks IPO?

Given the strong numbers, there is interest in whether Databricks will IPO soon. CEO Ali Ghodsi told CNBC that the company is prepared to go public “when the time is right.”

“If this correction hasn’t bottomed out yet, and it’s just going to continue, we’re just going to continue as a private company,” Ghodsi said, calling the software selloff an “overreaction.”

Investors have received some respite as the market rebounded in the last two days. The Invesco QQQ Trust Series 1 (QQQ), which tracks technology stocks, gained 3% in this period, although it is still down 3.4% from its peak on Oct. 29.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

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