Snowflake Shares Soar After Company Reports 119 Percent Q3 Sales Growth

Cloud data services provider reports 84 growth in its customer base, “neutral” impact from the economic fallout of the COVID-19 pandemic.

Snowflake’s stock is climbing high today after the data cloud services company reported fiscal third quarter sales that more than doubled from the same quarter one year ago.

As of 2:15 p.m. EST Snowflake shares were trading at $327.65, up about 12 percent from their $292.69 per share Wednesday close. The company’s shares were as high as $342.50 per share around 1 p.m.(Snowflake shares closed at $253.93 on Sept. 16, the day the company’s shares began trading.) Snowflake’s market cap now stands at around $90.5 billion.

The earnings announcement for Snowflake’s fiscal 2021 third quarter, ended Oct. 31, was the company’s first financial results report since the red-hot startup went public on Sept. 16 in the IT industry’s biggest IPO of 2020.

[Related: Snowflake’s IPO: The Details You Need To Know]

“Our growth is driven by long-term secular trends in data science and analytics enabled by cloud scale computing,” said Snowflake CEO Frank Slootman on the company’s earnings call with analysts Wednesday. “With the onslaught of digital transformation, data operations have become the beating heart of the modern enterprise.”

Snowflake, founded in 2012, got its start by offering cloud-based data warehouse services. The San Mateo, Calif.-based company has since expanded into providing its cloud-based platform for a range of big data operations including data warehouse and data lake systems, data science and data engineering tasks, data sharing and data-intensive applications.

For its fiscal 2021 third quarter (ended Oct. 31) Snowflake reported revenue of $159.6 million, up nearly 119 percent from $73.0 million in the third quarter of fiscal 2020.

For the first nine months of fiscal 2021 Snowflake has recorded revenue of $401.6 million, up nearly 129 percent from $177.1 million in the first nine months of fiscal 2020.

Product revenue for the quarter was $148.5 million, up 115 percent year-over-year. (The balance comes from professional services and other sources.)

Snowflake reported a $168.9 million loss for the fiscal third quarter compared to a $88.1 million loss reported one year before.

Snowflake now has 3,554 customers, up 84 percent year over year, including 165 among the Fortune 500. The customer roster includes 65 customers with trailing 12-month product revenue greater than $1 million, more than double one year earlier.

“Over the past year Snowflake has augmented it‘s selling motion to campaign [for] some of the largest enterprises and institutions in the world,” Slootman said on the earnings call, according to a transcript on the Seeking Alpha website. “Snowflake is well represented now in 8 of the Fortune 10 and we added 12 Fortune 500 customers in Q3, including Fiserv and GEICO.”

The CEO also addressed the current business climate given the COVID-19 pandemic and its negative impact on the U.S. and global economies.

“The pandemic has been more or less neutral to our business,” Slootman said. “Some businesses were negatively affected in terms of demand sentiment, but other stepped up their data strategy given the new complexities of the health crisis and economic effects.”

“It bears repeating that Snowflake is not a SaaS business model. We‘re consumption company and our reported revenue has a direct relationship with the consumption of our platform during the period,” Slootman said.

For all of fiscal 2021 Snowflake is forecasting revenue in the range of $538 million and $543 million, representing year-over-year growth of 113 to 115 percent.