In case anyone is still in or thinking of getting into Snowflake, this is a good by the numbers review:
Over 10k customers and over 500 $1m+ customers
He points out that stock buybacks are essentially replacing SBC, so not the good news they often are perceived as.
New AI-based products/services at least 2 more quarters away.
Snowflake is buying Nvidia chips for its AI products/services, and so cost of revenue is going up now.
That graphic shows the 3% operating margin guidance as a “beat” but I believe that low margin forecast is at least partially responsible for the shares being down about -15% today.
The market was probably hoping to see more improvement in margins in the near term.
I had a few percent of my portfolio in SNOW but sold in the after hours yesterday when the results came out.
I listened to the earnings call as well and there just wasn’t much that got me excited especially over the next few quarters.
They’ll probably do well when their customers AI stuff starts to go live but that probably wont start to ramp consumption until at least the second half of next year and I already have a decent stake in MDB which will hopefully benefit then too.
I was betting that the high expenses initially post-slootman SNOW did a kitchen sink of anything they could expense so that we would see more profit afterwards sooner.
That didn’t happen yet and I’m more comfortable being on the sideline now.
-mekong
“a couple of quarters away…”
We’ve been hearing that from snow for years, now.
On the Cube today, they talked about ‘the harmonization layer’ for the future armies of AI agents taking the largest stake in this value chain here https://youtu.be/oISpS_4DDJA?si=L7XNWC-7iY-Ce5o1
It could be Snowflake developing Snowpark into this harmonization layer, perhaps. The ‘experts’ in this Cube episode think that the players doing this harmonization layer will be known ‘at least by this time next year.
Any thoughts?
SNOW 12.1% of my portfolio, currently.
Palantir has grown to 13.2%
