Cloud-computing companies have shown that they are not recession-proof, with many reporting either disappointing earnings or a weaker outlook in the past few days as quarterly earnings season nears its conclusion. While results for the slew of companies reporting were mixed, there were two main themes to emerge from cloud-computing providers and some security software firms: a slowing of spending by corporate customers and, leading to the second theme, belt-tightening by all.
Read also: The cloud boom is coming back to earth. Snowflake Inc.
SNOW,
+7.80%
and Salesforce.com Inc.
CRM,
-8.27%
each reported some slowing of revenue growth, and talked about customers slowing spending in certain areas. Snowflake, the data analytics cloud-software firm, still showed high double-digit revenue growth of 67% in its fiscal third quarter, but then forecast revenue growth of just 47% for fiscal 2023, which will also include a slowdown in its hiring. Read more about Snowflake’s results and the debate among analysts. Snowflake’s admission that its outlook was conservative probably helped investors adjust to the slower growth rate. “If things turn around, that’s upside for us,” said Snowflake Chief Financial Officer Mike Scarpelli. Snowflake’s shares, which tumbled more than 10% in after-hours trading Wednesday immediately following the report, climbed 8% on Thursday, after a wide-ranging catch of comments from Wall Street. “Just a quarter after Snowflake downplayed t …