• Customers +25% Y/Y to 8,537.
• Customers > $1M +62% Y/Y to 402.
• NRR 142% (-9pp Q/Q).
• Revenue +36% Y/Y to $674M ($12M beat).
• Non-GAAP EPS $0.22 ($0.12 beat).
• FY24 Product revenue $2.6B (unchanged).
Snowflake Earnings Q2 FY24
Revenue beat
Earnings beat
Snowflake with a double beat.
During Q2, product revenue grew 37% year-over-year to $640 million. Our non-GAAP adjusted free cash flow was $88 million, representing 50% year-over-year growth
In today's rapidly changing digital landscape, data has become the backbone of modern enterprises. Enter Snowflake. While initially centered around data warehousing, it's morphed into a powerhouse, offering everything from data lakes to avant-garde tools in machine learning and cybersecurity. Its prowess lies in its full-scale cloud reliance, utilizing giants like AWS, Azure, and Google Cloud to offer theoretically limitless scalability. Remember the good old days of traditional data warehouses? They're struggling, especially with data exploding in every direction. The tide is shifting towards cloud-hosted warehouses—a sector that's set to hit ~ $56B by 2028.
Reflect for a moment on Snowflake's IPO – they introduced themselves with a respectable 3,000 clients. Fast forward a couple years, and that number skyrocketed to over 8,000. Dig a bit deeper and you'll find out that they weren't just merely amassing clients, the company was laser-focused on building strong ties with large organizations -- entities that deal with vast troves of data.
You might wonder, is this strategy bearing fruit? An impressive 80% YoY growth rate among high-revenue clients and a solid 29% overall customer growth rate. But what's truly captivating about Snowflake is their flair for not just winning new businesses but nurturing and expanding existing ones. This sentiment is best captured by a metric that investors, like myself, find absolutely wild: a dollar-based net revenue retention rate soaring beyond 150%. That figure is a testament to Snowflake's ability to expand its services among existing clientele, even when potential cancellations loom.
Now, let's touch upon a relationship that's as fascinating as it is complex: Snowflake and AWS ☁️. On one side of the coin, Snowflake heavily leans on AWS’s strong cloud infrastructure. Flip the coin, and it's in direct competition, especially when we talk about services like Amazon Redshift. However, here's where things get interesting. About 85% of Snowflake's revenue is derived from AWS-hosted endeavors. It's a classic case of co-opetition, where two entities cooperate and compete, benefitting both parties.
The recent Snowflake Summit 2023 also highlighted partnerships with Microsoft and Nvidia. The intriguing alliance with Nvidia, in particular, melds Nvidia’s GPU prowess with Snowflake's Data Cloud, positioning Snowflake to woo a clientele hungry for AI -centric solutions.
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