Aah! the great debate about SNOW

Aah, the great debate about SNOW continues…

Are they melting?
Are they sandbagging?
Why are they so “expensive”?
What now? They are helping their customers spend less by improving their product?

Sacre blue!
I love France and Canada, btw…in that order.

With two scotches in my belly, I grabbed a napkin from the bar and did some quick 2nd grade math. Here is what I came up with…please, excuse any alcohol induced mistakes.

NOTE: All numbers below are focused on product revenue. Services revenue is like a 6.25% mosquito bite on the income statement. After six confusing quarterly earnings report, Frank has trained us monkeys that its product, product, product!

Hold on…I am thirsty…need a sip of the sweet Scottish nectar…

RPO total = $2,646M

52% of this is expected to be recognized as revenue in the next 12 months = $1,376M

Current DBNRR = 178%. Slootman says it will not go below 150% at least for the next year.

At 150% DBNRR, annual revenues could be 1376 x 1.5 = $2,064M
At 170% DBNRR, annual revenues could be 1376 x 1.7 = $2,339M

The midpoint of these two revenue projections = $2,202

Subtracting the $97M efficiency revenue impact to customer usage, we get $2,105

FY guidance = $1,900M

Beat could be $2,105 - $1,900 = $205M which is 11%

In Q1 2021, they guided annual revenues at $1,020M.

Final full year beat was $1,142 - $1,020 = $122M…which is…wait for it…12%

Dang, Slootman and his crew are a sly bunch. Their 11-12% game is up!

P.S. I am long SNOW.

Beachman (Beachman.substack.com twitter.com/Iwannabeontheb2)