Instacart filed an up to date IPO prospectus Monday and clarified how its contract works with knowledge storage and analytics firm Snowflake, after the preliminary submitting appeared to point out a dramatic decline in spending on Snowflake’s know-how.

Snowflake CEO Frank Slootman is an Instacart board member, a relationship that requires the grocery supply firm to reveal particulars of the enterprise ties between the businesses.

The unique prospectus confirmed that Instacart’s funds for Snowflake’s “cloud-based knowledge warehousing providers” jumped from $28 million in 2021 to $51 million in 2022, however had been anticipated to drop to $15 million this yr. The obvious slippage led to confusion and spurred staff at rival Databricks to recommend on-line that it was selecting up that enterprise.

Snowflake revealed a four-paragraph weblog put up explaining that the numbers had been being misconstrued and that on this case, fee does not equal utilization due to how the contract is written. Instacart spelled out how that contract works in Monday’s submitting.

“These money funds, together with the funds we made in 2022, usually characterize prepayments for future providers which, in lots of circumstances, span a number of fiscal durations,” Instacart wrote. “As such, these funds are usually not indicative of precise cloud-based knowledge warehousing providers offered to and utilized by us within the interval during which any such fee is made, because the bills associated to utilization are acknowledged over time as providers are offered to us.”

To grasp utilization of the know-how, the perfect quantity to take a look at is working bills. For each 2021 and 2022, Instacart stated it incurred working bills tied to the cloud know-how of $28 million.

Nevertheless, as a way to see the place that quantity stands in 2023, an investor would nonetheless must reference a footnote a lot later within the submitting. There, Instacart says that within the first half of the yr it incurred $11 million in working bills to be used of Snowflake’s know-how. On an annualized foundation, that might nonetheless recommend a drop of 21%.

In Snowflake’s Aug. 30 weblog put up, the corporate says it is serving to Instacart “optimize for effectivity,” a phrase that suggests doing extra with much less. Whereas which will clarify some or the entire drop, it is also true that Instacart has been pushing extra enterprise to Databricks, significantly for its promoting infrastructure.

Instacart is not required to reveal its relationship with Databricks, however each firms revealed current posts concerning the implementation on their web sites. They deleted these posts shortly after Instacart’s preliminary submitting.

Snowflake shares rose 2.2% on Monday, lifting its market cap to $55.9 billion. Databricks continues to be personal and was final valued in at $38 billion in 2021.

Instacart additionally stated within the replace that it is looking for to promote shares within the preliminary public providing for $26 to $28, which might worth the corporate at as a lot as $9.3 billion. That is a steep drop from its peak personal market valuation of $39 billion and exhibits what could also be required as a way to go public in an IPO market that hasn’t seen a notable venture-backed providing since December 2021.

WATCH: Instacart slashes valuation