Snowflake, the data cloud analytics company, reported revenue of $869 million for its fiscal second quarter of 2025, surpassing Wall Street’s estimates of $851 million. However, despite beating revenue expectations, the company experienced a deceleration in product revenue growth compared to previous quarters. Product revenue, which makes up a significant portion of Snowflake’s sales, increased by 30% year over year, a decline from the 34% growth reported in the previous quarter.
Snowflake’s net loss widened to $317 million, resulting in a loss of 95 cents per share, compared to $227 million, or a loss of 69 cents per share, in the same period the previous year. Analysts from Morgan Stanley viewed the results as positive but expressed concerns that the company’s smaller product revenue beat and slower growth rate might not be sufficient to impress investors. They highlighted the potential impact of Snowflake’s new generative artificial intelligence portfolio on future performance.
Analysts at Barclays maintained an equal weight rating on Snowflake’s stock, stating that the second-quarter results were unlikely to significantly influence the company’s investment case. They noted that investors were monitoring whether Snowflake’s product revenue would be affected by external factors such as cyberattacks and service outages, and viewed the 30% year-over-year growth rate as respectable given the circumstances. Despite the slowdown in growth compared to previous quarters, analysts emphasized the company’s continued ability to deliver solid results.
Snowflake’s fiscal second-quarter 2025 earnings report reflects a mixed picture of success and challenges. While the company managed to exceed revenue expectations, the deceleration in product revenue growth and widening net loss raise concerns among investors. However, analysts remain cautiously optimistic about Snowflake’s future performance, citing the company’s core data warehousing business and potential contributions from its artificial intelligence portfolio as factors that could drive positive results in the long term. Snowflake will need to address the slowdown in growth and effectively communicate its strategies to inspire confidence among investors moving forward.
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