Snowflake Inc (NYSE:SNOW) Beats Topline Estimates

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Snowflake Inc (NYSE:SNOW) stock surges 13.44% (As on Dec 2, 1:15:38 AM UTC-4, Source: Google Finance) after the company beaten the topline estimates for the third quarter of FY 22 and provided strong product revenue guidance. The company’s net loss decreased to $154.9 million, down from $168.9 million a year prior. The company has recently launched operations in three new countries: Israel, Korea, and the United Arab Emirates. During the quarter, the company announced two industry data clouds. The financial services data cloud brings together the Snowflake platform, partners solutions, and industry data to help financial services organizations mobilize their data. During the quarter, Snowflake invested in Anaconda to bring enterprise-grade Python capabilities to the data cloud. Snowflake’s data marketplace grew 41 percent this quarter, now with more than 900 datasets from over 200 providers. The remaining performance obligations grew to $1.8 billion with our key industries leading net new bookings. In the quarter, SNOW signed a three-year $100 million deal to an existing customer, as well as five additional eight-figure multi-year deals. The company has maintained the strong cash position with approximately $5.1 billion in cash, cash equivalents, and short-term and long-term investments

SNOW in the third quarter of FY 22 has reported the adjusted earnings per share of 4 cents, beating the analysts’ estimates for the adjusted loss per share of 6 cents. The company had reported the adjusted revenue growth of 110 percent to $334.4 million in the third quarter of FY 22, beating the analysts’ estimates for revenue of $305.6 million, according to Refinitiv. The outperformance is fueled by the existing customer base, which is demonstrated by the net revenue retention rate of one 173 percent. Net revenue retention expansion is driven by rapid growth among the largest customers and the addition of six customers to the measurement cohort that have gained greater than $1 million in revenue in the past year. On a non-GAAP basis, the product gross margin was 74.6 percent. Operating margin was 2.5 percent.

Snowflake provided fourth quarter product revenue guidance between $345 million and $350 million. That would represent year-over-year growth between 94% and 96%. The projection came in above the FactSet consensus estimate of $315.9 million.

For the full 2022 fiscal year Snowflake called for $1.126 billion to $1.131 billion in product revenue. That would represent year-over-year growth between 103% and 104%. That guidance was also above the $1.06 billion and $1.07 billion FactSet consensus.

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