Snowflake stock soars over 17% after large revenue beat

Snowflake’s revenue rose to $497 million from $272 million, while the FactSet consensus was for $467 million. The company logged $466 million in product revenue, above the $439 million that analysts had been modeling.

The company disclosed that it had 6,808 total customers, including 246 customers with trailing 12-month product revenue upwards of $1 million.

Chief Executive Frank Slootman highlighted that Snowflake operates under a consumption model rather than a software-as-a-service (SaaS) model, meaning that customers can “throttle” how much they use Snowflake after signing a contract.

“We think it’s an advantage in the type of times we’re living in,” he said on the company’s earnings call.

The stock was up more than 17% in after-hours trading.

For the fiscal third quarter, executives at Snowflake expect $500 million to $505 million in product revenue, whereas the FactSet consensus called for $502 million.

Chief Financial Officer Mike Scarpelli said on the company’s earnings called that amid macroeconomic uncertainty, “the guidance is prudent that we put out.”

Looking at the full fiscal year, Snowflake’s management anticipates $1.905 billion to $1.915 billion in product revenue, while analysts were forecasting $1.897 billion. The company’s prior outlook called for $1.885 billion to $1.900 billion.

“We believe taking a conservative view is rewarded in this tape, and that’s reflected in the stock in the after-market,” Evercore ISI analyst Kirk Materne wrote following the report.

The earnings come as several analysts have taken more cautious views of Snowflake’s stock this month, with at least two downgrading the shares amid concerns about competition from privately held Databricks as well as the potential for macroeconomic pressure to impact customer spending.

Analysts were more upbeat earlier in the summer, as at least three upgraded Snowflake shares during the month of June.