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Snowflake (SNOW) Tops Estimates in Q4 Earnings, Revenues Up Y/Y
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Snowflake (SNOW - Free Report) reported fourth-quarter fiscal 2022 non-GAAP earnings of 12 cents per share, beating the Zacks Consensus Estimate of 3 cents. The company had reported a loss of 22 cents in the year-ago quarter. These figures are adjusted for non-recurring items.
Revenues of $383.8 million beat the consensus mark by 3.20% and jumped 117% year over year.
In the reported quarter, Snowflake revenues were positively impacted by the holiday season and platform enhancements, which helped the company attract new customers.
Snowflake’s shares have fallen 11.3% year to date compared with the Zacks Internet Software industry’s decline of 29.6%. Meanwhile, the Computer & Technology sector has tumbled 14.2%.
Snowflake’s product revenues contributed 94% to total revenues. The figure was $360 million in the reported quarter, up 102% year over year.
The growth in product revenues has been supported by Snowflake’s several product developments, like the Snowpark, which helps data scientists and developers transform and program data.
Another contributing factor was Snowflake’s data-sharing business experiencing continued traction as Snowflake Marketplace listings grew 195% with over 1,100 listings from over 230 providers.
Professional Services and other revenues contributed 6% to total revenues. The figure was $24.2 million, up 98.7% year over year.
In the fourth quarter, financial services, retail, advertising and media, healthcare, and technology represented 85% of net new bookings. In the reported quarter, Snowflake closed seven new deals worth $30 million or more, up from just one in the year-ago quarter.
In the fiscal fourth quarter, the company witnessed net revenue retention rate of 178% for existing customers. In the reported quarter, total customers increased 44% year over year and the number of customers with revenues greater than $1 million reached 184, flaunting 139% year-over-year growth.
Non-GAAP gross margin expanded 400 basis points (bps) year over year to 71% compared with 67.1% in the year-ago quarter.
Research & development expenses, as a percentage of revenues, decreased 560 bps on a year-over-year basis to 16%. General & administrative expenses, as a percentage of revenues, were 11%, down 550 bps year over year. Sales and marketing expenses, as a percentage of revenues, reached 40% compared with 53.3% reported in the year-ago quarter.
Total operating expenses, as a percentage of revenues, were 66% compared with 91% reported in the year-ago quarter.
Massive year-over-year increase in revenues and decrease in operating expenses as a percentage of revenues positively impacted the operating income of Snowflakes.
Operating income was $18.1 million in the reported quarter against operating loss of $46 million in the year-ago quarter.
Balance Sheet & Cash Flow
As of Jan 31, 2022, Snowflake had cash, cash equivalents and short-term investments of $5.1 billion.
Adjusted free cash flow was $102.1 million as of Jan 31, 2022.
Guidance
For first-quarter fiscal 2023, Snowflake expects product revenues in the range of $383 million-$388 million.
For fiscal 2023, Snowfall expects product revenues in the range of $1.880 billion-$1.900 billion, suggesting year-on-year growth of 65-67%.
Non-GAAP product gross margin is expected to be 74.5% and non-GAAP operating margin is expected to be 1%.
Non-GAAP adjusted free cash flow is expected to be 15% in fiscal 2023.
Zacks Rank & Stocks to Consider
Snowflake currently has a Zacks Rank #3 (Hold).
Some better-ranked stocks to consider in the same sector are Broadcom (AVGO - Free Report) , Asana (ASAN - Free Report) and Allied Motion Technologies .
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Snowflake (SNOW) Tops Estimates in Q4 Earnings, Revenues Up Y/Y
Snowflake (SNOW - Free Report) reported fourth-quarter fiscal 2022 non-GAAP earnings of 12 cents per share, beating the Zacks Consensus Estimate of 3 cents. The company had reported a loss of 22 cents in the year-ago quarter. These figures are adjusted for non-recurring items.
Revenues of $383.8 million beat the consensus mark by 3.20% and jumped 117% year over year.
In the reported quarter, Snowflake revenues were positively impacted by the holiday season and platform enhancements, which helped the company attract new customers.
Snowflake’s shares have fallen 11.3% year to date compared with the Zacks Internet Software industry’s decline of 29.6%. Meanwhile, the Computer & Technology sector has tumbled 14.2%.
Snowflake Inc. Price, Consensus and EPS Surprise
Snowflake Inc. price-consensus-eps-surprise-chart | Snowflake Inc. Quote
Quarter Details
Snowflake’s product revenues contributed 94% to total revenues. The figure was $360 million in the reported quarter, up 102% year over year.
The growth in product revenues has been supported by Snowflake’s several product developments, like the Snowpark, which helps data scientists and developers transform and program data.
Another contributing factor was Snowflake’s data-sharing business experiencing continued traction as Snowflake Marketplace listings grew 195% with over 1,100 listings from over 230 providers.
Professional Services and other revenues contributed 6% to total revenues. The figure was $24.2 million, up 98.7% year over year.
In the fourth quarter, financial services, retail, advertising and media, healthcare, and technology represented 85% of net new bookings. In the reported quarter, Snowflake closed seven new deals worth $30 million or more, up from just one in the year-ago quarter.
In the fiscal fourth quarter, the company witnessed net revenue retention rate of 178% for existing customers. In the reported quarter, total customers increased 44% year over year and the number of customers with revenues greater than $1 million reached 184, flaunting 139% year-over-year growth.
Non-GAAP gross margin expanded 400 basis points (bps) year over year to 71% compared with 67.1% in the year-ago quarter.
Research & development expenses, as a percentage of revenues, decreased 560 bps on a year-over-year basis to 16%. General & administrative expenses, as a percentage of revenues, were 11%, down 550 bps year over year. Sales and marketing expenses, as a percentage of revenues, reached 40% compared with 53.3% reported in the year-ago quarter.
Total operating expenses, as a percentage of revenues, were 66% compared with 91% reported in the year-ago quarter.
Massive year-over-year increase in revenues and decrease in operating expenses as a percentage of revenues positively impacted the operating income of Snowflakes.
Operating income was $18.1 million in the reported quarter against operating loss of $46 million in the year-ago quarter.
Balance Sheet & Cash Flow
As of Jan 31, 2022, Snowflake had cash, cash equivalents and short-term investments of $5.1 billion.
Adjusted free cash flow was $102.1 million as of Jan 31, 2022.
Guidance
For first-quarter fiscal 2023, Snowflake expects product revenues in the range of $383 million-$388 million.
For fiscal 2023, Snowfall expects product revenues in the range of $1.880 billion-$1.900 billion, suggesting year-on-year growth of 65-67%.
Non-GAAP product gross margin is expected to be 74.5% and non-GAAP operating margin is expected to be 1%.
Non-GAAP adjusted free cash flow is expected to be 15% in fiscal 2023.
Zacks Rank & Stocks to Consider
Snowflake currently has a Zacks Rank #3 (Hold).
Some better-ranked stocks to consider in the same sector are Broadcom (AVGO - Free Report) , Asana (ASAN - Free Report) and Allied Motion Technologies .
Broadcom, Allied Motion Technologies and Asana carry Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Broadcom’s shares have returned 32.1% in the past year.
Broadcom is scheduled to report first-quarter 2022 results on Mar 3.
Asana’s shares have surged 73.7% in the past year.
Asana is scheduled to report fourth-quarter 2022 results on Mar 9.
Allied Motion Technologies’ shares have appreciated 15.5% in the past year.
AMOT is scheduled to report fourth-quarter 2021 results on Mar 9.