Snowflake Inc., a software maker that debuted with the year’s biggest US initial public offering, gave a lacklustre product sales forecast for the current quarter, signalling fierce competition in cloud computing. Shares declined about 5% in extended trading.

Product revenue, which makes up more than 90% of sales, will be US$162 million ($216.8 million) to US$167 million in the period ending in January, the San Mateo, California-based company said Wednesday in a statement. Analysts, on average, estimated US$166 million, according to data compiled by Bloomberg.

Snowflake’s data-warehouse software is like a vacuum sucking up information strewn across different systems, so that businesses can analyze it all together. The company competes against the cloud-computing divisions of Amazon.com Inc., Microsoft Corp. and Alphabet Inc., as well as open-source vendor Cloudera Inc. and database stalwart Oracle Corp. Snowflake has chased major deals with banks, including an agreement with Capital One Financial Corp. valued around US$100 million and a major deal with Goldman Sachs Group Inc., Bloomberg has reported.

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