I am preparing for the next earnings call for Snowflake (SNOW), and am reviewing historical data. Sales, QoQ, are slowing down, potentially significantly.
For the last two quarters, Snowflake has guided forward-looking full-year fiscal revenue at $1.02 and $1.035 billion on the upper range of guidance, or YoY full-year revenue increase of 84% and 87%. The most recent quarter was Q1, so assuming they continue to beat each YoY by 3% for the next 3 quarters, full-fiscal revenue increases to YoY of 96% - pretty good. However, extrapolating the data based on actual Q1 revenue of $228.9 million, Q3 and Q4 start to see a substantial slowdown in quarterly revenue to reach 1yr growth of 96% - see table below. The last 3 quarters for the fiscal year estimate sequential revenue gain in the 13-18% range - this seems like a real slowdown for a company that was growing annually at triple digits.
Note, I made approximations based on historical data and am seeking to understand directionally where the revenue is heading, not providing exact values (asterisks in the table are approximations).
During Snowflake’s 2021 Investor Day presentation, they highlighted a goal of $10B by FY29 at ~30% YoY growth. I realize it’s impossible to project that far out but is this an indicator things are about to quickly slow down?
Q Revenue Seq Rev Gain Total Full-Year Rev Growth Guidance Q4 $190.4 19.3% 1.02B = 84% Q1 $228.9 20.2% 1.035B = 87% Q2 $271.2* 18.1%* 90%* Q3 $309.2* 14%* 93%* Q4 $349.4* 13%* 96%*