Snowflake (SNOW) on Wednesday reported third quarter earnings and revenue that topped estimates amid stabilizing growth at cloud computing partner Amazon.com (AMZN). Guidance for SNOW stock came in above expectations.
The company released its Snowflake earnings report after the market close. Revenue climbed 32% to $734.2 million, the enterprise software maker said. Analysts projected Q3 revenue of $713.8 million.
Snowflake reported a loss of 65 cents using generally accepted accounting principles, or GAAP. That compares with a loss of 63 cents a year earlier. Analysts polled by FactSet expected Snowflake to report a loss of 76 cents on a GAAP basis.
On an adjusted basis, analysts estimated Snowflake would report a profit of 16 cents per share. But the company does not break out adjusted earnings in its releases.
SNOW Stock: Q4 Outlook Above Views
For the current quarter ending in January, Snowflake expects product revenue in the range of $716 million to $721 million. Analysts had expected $696 million.
On the stock market today, SNOW stock popped 9.5% to near 192 in extended trading.
SNOW stock had advanced 19% in 2023 heading into the Snowflake earnings report. Most of the gain came after Nov. 7 following Datadog‘s (DDOG) better-than-expected Q3 results. Datadog also is a cloud partner of Amazon.
Because Snowflake’s business model is consumption-based rather than subscription-based, investors have raised concerns over a slowing U.S. economy curbing demand.
Snowflake garners about 95% of total sales from product revenue. That’s revenue that comes from cloud-based data analytical and storage services. Snowflake also generates revenue from professional services, such as consulting and training.
SNOW stock holds a Relative Strength Rating of 87 out of a best-possible 99, according to IBD Stock Checkup.
Follow Reinhardt Krause on X, formerly called Twitter, @reinhardtk_tech for updates on artificial intelligence, cybersecurity and cloud computing.
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