Earnings Results: Snowflake breaks its string of guidance cuts, and its stock heads higher

by | Aug 23, 2023 | Stock Market

Snowflake Inc. broke from its pattern of outlook cuts Wednesday afternoon as it kept its forecast for the full year steady, and its shares were moving higher in the aftermarket. The company reported a fiscal second-quarter net loss of $227 million, or 69 cents a share, compared with a loss of $223 million, or 70 cents a share, in the year-prior period. On an adjusted basis, Snowflake
earned 25 cents a share, whereas the FactSet consensus was for 10 cents a share.

Revenue increased to $674 million from $497 million, while analysts were looking for $662 million. Snowflake generated $640 million in product revenue. Snowflake’s stock was headed about 3% higher in Wednesday’s extended session. See also: Autodesk’s stock jumps 7% on revenue, earnings beat Snowflake had a net retention rate of 142% in the fiscal second quarter, compared with 151% in the fiscal first quarter. Chief Executive Frank Slootman said in a release that Snowflake was benefiting from the frenzy around artificial intelligence and machine learning. “Snowflake as the global epicenter of trusted enterprise data is well positioned to enable the growing interest in AI/ML,” he said. “Enterprises and institutions alike are increasingly aware they cannot have an AI strategy without a data strategy.” For the fiscal third quarter, Snowflake expects $670 million to $675 million in product revenue. The FactSet consensus was for $675 million. Opinion: These AI chip startups hope to challenge Nvidia, but it may take some time For the full fiscal year, Snowflake expects $2.6 billion in product revenue, consistent with its prior forecast. In keeping the outlook steady, the company broke its pattern of recent guidance cuts.

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