Snowflake’s stock experienced a remarkable surge of 30% on Thursday, following the release of its third-quarter earnings, which exceeded analysts’ expectations. The data software company reported a substantial revenue increase of 28% compared to the same quarter last year, totaling $942.1 million. This figure surpassed analyst predictions of $900.3 million, according to data from Visible Alpha.
While Snowflake did report a net loss of $327.9 million, which is larger than the $214.7 million loss from the previous year, it was slightly lower than the anticipated loss of $329.5 million. After accounting for one-time costs related to stock-based compensation and restructuring, Snowflake’s adjusted net income stood at $73.3 million, down from $89.7 million year-over-year, yet notably above the expected $55.3 million.
In a notable development, Snowflake raised its product revenue outlook for the full fiscal year. The company now anticipates product revenues around $3.43 billion for fiscal 2025, an increase from the previous estimate of $3.36 billion. This growth is particularly noteworthy as Snowflake’s revenue model is usage-based, meaning the revenue reflects actual customer engagement with its data products.
Additionally, Snowflake announced the acquisition of Datavolo, a data integration platform, and formed a new partnership with Anthropic, an Amazon-backed firm, to enhance its products with advanced AI capabilities using Claude large language models.
Despite the recent stock increase, Snowflake’s shares remain approximately 15% below their value at the beginning of the year, indicating potential for further growth as the company continues to evolve its offerings and expand its market reach.
This positive trajectory not only illustrates Snowflake’s resilience but also its commitment to innovation in the data management industry, creating optimistic prospects for investors and stakeholders alike.
In summary, Snowflake’s strong financial performance, coupled with strategic partnerships and acquisitions, positions the company for future growth and drives enthusiasm in the tech investment community.