Snowflake Stock Jumps On Better-Than-Expected Revenue, Sales Guidance

Snowflake Stock Jumps On Better-Than-Expected Revenue, Sales Guidance

Snowflake stock surged Wednesday evening, after the data analytics company released a mixed first-quarter report. Profits fell short of analysts’ expectations, but revenues beat consensus. Snowflake (SNOW) improved its sales outlook for the rest of the year.




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The software company said it earned an adjusted 14 cents per share on revenue of $828.7 million for the quarter ending in April. On average, analysts expected Bozeman, Mont.-based Snowflake to post adjusted earnings of 18 cents. per share on sales of $787 million, according to FactSet.

Adjusted profit declined 6% year over year while sales increased 33%.

On the stock market todaySnowflake stock is up 6% to 173 in recent after-hours action.

Snowflake Improves Tips

For the current quarter, Snowflake expects product revenue of $807.5 million, in the middle of its range. Analysts predicted the company would bring in $793 million of product revenue for the quarter ending in July, according to FactSet.

Snowflake also raised its full-year product revenue forecast to $3.3 billion from the previously reported $3.25 billion. Product revenue represents the majority of Snowflake’s overall revenue.

“Our core business is very strong,” Sridhar Ramaswamy, chief executive of Snowflake, said in a statement. Press release. “Our AI products, now available to everyone, are attracting strong interest from customers. They will help our customers deliver effective and efficient AI-powered experiences, faster than ever. »

In the first quarter, Snowflake product revenue increased 34% to $789.6 million.

Raimo Lenschow, a software stock analyst at Barclays, called this first quarter a strong one for Snowflake. He holds an equal-weight Neutral rating on the stock.

“The guidance for the first quarter was very conservative, so a beat was expected, but the more than $50 million in new product revenue added was better than expected and helped beat consensus by (approximately) 5%. something we haven’t seen in a while,” Lenschow wrote to customers.

Meanwhile, Snowflake said it now has 485 customers who each generate more than $1 million in annual revenue for the company, up 30% from the previous year.

It’s Snowflake Day first report under Ramaswamy. Actions sank after the company’s fourth quarter earnings report in February, when former CEO Frank Slootman announced plans to retire and Snowflake lowered its sales forecast for its current 2025 fiscal year.

Snowflake stock: technical notes

In 2023, Snowflake gained 38%, surpassing the S&P 500. The company strives to offer a wide range of enterprise services to prepare and leverage data for generative artificial intelligence.

Entering the report, Snowflake the stock had a meager IBD Composite Rating of 52 out of 99, according to Checking ITN stocks. The score combines five separate proprietary ratings into a single rating. The best growth stocks have a Composite Rating of 90 or better.

Additionally, Snowflake’s ITN Relative Strength Index was 18 out of 99.

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