Snowflake Inc (NYSE:SNOW) stock fell 16.40% (As on Mar 3, 11:22:43 AM UTC-4, Source: Google Finance) after the company prefers to give conservative guidance, saying the way it recognizes revenue creates a considerable amount of uncertainty when putting together a forecast. Snowflake expects product revenue to increase between 65% to 67% in the fiscal year to about $1.9 billion. This is right around the 66% growth analysts expected, according to FactSet. That would represent a sizable slowdown from previous years. The outlook suggests Snowflake may also be getting hurt by the rising competition in the data storage and analytics sector. Product revenue makes up almost 95% of the company’s total sales. The company delivered Product revenue of $359.6 million in the fourth quarter, representing 102% year-over-year growth. Snowflake expects 79% to 81% product revenue growth in the fiscal first quarter. Analysts polled by StreetAccount had predicted 78% product revenue growth.

Further, Snowflake continues to drive additional spending from existing users. Its net revenue retention rate was 178% in the quarter, significantly above the industry average. That figure, however, is expected to drop in the coming quarters, partially a result of the product enhancements. Meanwhile, the company’s net loss narrowed to $132.1 million, or 43 cents a share, from a loss of $198.9 million, or 70 cents, in the period a year earlier. Snowflake has also agreed to acquire Streamlit, a company that helps developers build and share data applications, in a stock-and-cash deal for $800 million

SNOW in the fourth quarter of FY 22 has reported the adjusted earnings per share of 12 cents, beating the analysts’ estimates for the adjusted earnings per share of 3 cents, according to the Zacks Consensus Estimate. The company had reported the adjusted revenue growth of 101 percent to $383.8 million in the fourth quarter of FY 22, beating the analysts’ estimates for revenue of $372 million. Remaining performance obligations were $2.6 billion, representing 99% year-over-year growth. Net revenue retention rate was 178% as of January 31, 2022. The company now has 5,944 total customers and 184 customers with trailing 12-month product revenue greater than $1 million. Its adjusted gross margin of 70% came in below the StreetAccount consensus of 70.9%, although it’s up from 62% two years ago, in part thanks to discounts on the third-party cloud infrastructure it relies on to deliver its service to customers.