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Snowflake (SNOW) Q4 Earnings Top Estimates, Revenues Up Y/Y
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Snowflake (SNOW - Free Report) reported fourth-quarter fiscal 2024 non-GAAP earnings of 35 cents per share, beating the Zacks Consensus Estimate of 17 cents per share. The company reported earnings of 14 cents per share in the year-ago quarter.
Revenues of $774.7 million beat the consensus mark by 1.95% and rallied 31.5% year over year. Americas, EMEA and APJ contributed 80%, 15% and 5% to revenues, respectively.
In the fourth quarter, Snowflake added 83 customers, with product revenues exceeding $5 million in the trailing 12 months, increasing from 75 customers in the third quarter.
Snowflake’s shares have returned 15.6% compared with the Zacks Computer & Technology sector’s growth of 7.9%.
Snowflake’s product revenues contributed 95.3% to total revenues. The figure was $738.1 million, up 32.9% year over year.
Professional Services and other revenues contributed 4.7% to total revenues. The figure was $36.6 million, up 8.7% year over year.
In the fiscal fourth quarter, Snowflake witnessed a net revenue retention rate of 131% for existing customers, down from 135% reported in the previous quarter.
The company reported 21.9% year-over-year growth in the number of customers, reaching 9,437 in the reported quarter.
It now has 461 customers with trailing 12-month product revenues greater than $1 million (up 39% year over year) and 691 Forbes Global 2000 customers (up 8% year over year).
Snowflake announced and launched several new technologies during the quarter, such as Cortex, a new fully-managed service making AI simple and secure.
Additionally, the company introduced features like Streamlit in Snowflake, Snowpark ML Modeling API, and Cortex ML functions, all of which are now generally available.
Snowflake achieved FedRAMP High authorization on the AWS GovCloud, enabling the company to handle sensitive and classified data for the Federal Government. This accomplishment enhances Snowflake's credibility in serving government entities.
Operating Details
The non-GAAP gross margin expanded 380 basis points (bps) year over year to 74.7%.
The product gross margin continued to expand, driven by product improvements, favorable cloud agreement pricing, improving scale and a growing enterprise customer base.
Research & development expenses, as a percentage of revenues, increased 410 bps on a year-over-year basis to 23.2%.
General & administrative expenses, as a percentage of revenues, were 6.6%, down 140 bps year over year.
Sales and marketing expenses, as a percentage of revenues, declined 250 bps on a year-over-year basis to 35.7%.
Total operating expenses, as a percentage of revenues, were 65.5% compared with 65.3% reported in the year-ago quarter.
Operating income was $71 million in the reported quarter, up 116.5% year over year.
Balance Sheet & Cash Flow
As of Jan 31, 2024, Snowflake had cash, cash equivalents and short-term investments of $3.84 billion compared with $3.55 billion as of Oct 31, 2023.
The remaining performance obligations at the end of the fourth quarter of fiscal 2024 were $5.2 billion, up 41% year over year. Snowflake expects nearly 50% to be recognized as revenues over the next 12 months.
The adjusted free cash flow was $324.3 million in the reported quarter compared with the previous quarter’s $110.8 million.
Guidance
For the first quarter of fiscal 2025, Snowflake expects product revenues in the range of $745-$750 million. The projection range indicates year-over-year growth of 26-27%.
The operating margin is expected to be 3% for the fiscal first quarter.
Image: Bigstock
Snowflake (SNOW) Q4 Earnings Top Estimates, Revenues Up Y/Y
Snowflake (SNOW - Free Report) reported fourth-quarter fiscal 2024 non-GAAP earnings of 35 cents per share, beating the Zacks Consensus Estimate of 17 cents per share. The company reported earnings of 14 cents per share in the year-ago quarter.
Revenues of $774.7 million beat the consensus mark by 1.95% and rallied 31.5% year over year. Americas, EMEA and APJ contributed 80%, 15% and 5% to revenues, respectively.
In the fourth quarter, Snowflake added 83 customers, with product revenues exceeding $5 million in the trailing 12 months, increasing from 75 customers in the third quarter.
Snowflake’s shares have returned 15.6% compared with the Zacks Computer & Technology sector’s growth of 7.9%.
Snowflake Inc. Price, Consensus and EPS Surprise
Snowflake Inc. price-consensus-eps-surprise-chart | Snowflake Inc. Quote
Top-Line Details
Snowflake’s product revenues contributed 95.3% to total revenues. The figure was $738.1 million, up 32.9% year over year.
Professional Services and other revenues contributed 4.7% to total revenues. The figure was $36.6 million, up 8.7% year over year.
In the fiscal fourth quarter, Snowflake witnessed a net revenue retention rate of 131% for existing customers, down from 135% reported in the previous quarter.
The company reported 21.9% year-over-year growth in the number of customers, reaching 9,437 in the reported quarter.
It now has 461 customers with trailing 12-month product revenues greater than $1 million (up 39% year over year) and 691 Forbes Global 2000 customers (up 8% year over year).
Snowflake announced and launched several new technologies during the quarter, such as Cortex, a new fully-managed service making AI simple and secure.
Additionally, the company introduced features like Streamlit in Snowflake, Snowpark ML Modeling API, and Cortex ML functions, all of which are now generally available.
Snowflake achieved FedRAMP High authorization on the AWS GovCloud, enabling the company to handle sensitive and classified data for the Federal Government. This accomplishment enhances Snowflake's credibility in serving government entities.
Operating Details
The non-GAAP gross margin expanded 380 basis points (bps) year over year to 74.7%.
The product gross margin continued to expand, driven by product improvements, favorable cloud agreement pricing, improving scale and a growing enterprise customer base.
Research & development expenses, as a percentage of revenues, increased 410 bps on a year-over-year basis to 23.2%.
General & administrative expenses, as a percentage of revenues, were 6.6%, down 140 bps year over year.
Sales and marketing expenses, as a percentage of revenues, declined 250 bps on a year-over-year basis to 35.7%.
Total operating expenses, as a percentage of revenues, were 65.5% compared with 65.3% reported in the year-ago quarter.
Operating income was $71 million in the reported quarter, up 116.5% year over year.
Balance Sheet & Cash Flow
As of Jan 31, 2024, Snowflake had cash, cash equivalents and short-term investments of $3.84 billion compared with $3.55 billion as of Oct 31, 2023.
The remaining performance obligations at the end of the fourth quarter of fiscal 2024 were $5.2 billion, up 41% year over year. Snowflake expects nearly 50% to be recognized as revenues over the next 12 months.
The adjusted free cash flow was $324.3 million in the reported quarter compared with the previous quarter’s $110.8 million.
Guidance
For the first quarter of fiscal 2025, Snowflake expects product revenues in the range of $745-$750 million. The projection range indicates year-over-year growth of 26-27%.
The operating margin is expected to be 3% for the fiscal first quarter.
Zacks Rank & Stocks to Consider
Currently, Snowflake has a Zacks Rank #4 (Sell).
Crowdstrike (CRWD - Free Report) , SEMrush (SEMR - Free Report) and Adobe (ADBE - Free Report) are some better-ranked stocks that investors can consider in the broader sector.
CRWD currently sports Zacks Rank#1(Strong Buy), while SEMR and ADBE have a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Crowdstrike shares have returned 25.8% year to date. CRWD is scheduled to release fourth-quarter and fiscal year 2024 results on Mar 5.
SEMrush’s shares have declined 6.7% year to date. SEMR is set to report its first-quarter 2024 results on Mar 4.
Adobe’s shares have declined 7.4% year to date. ADBE is set to release its fourth-quarter fiscal 2024 results on Mar 14.