Snowflake second quarter results see steady stabilization

Frank-Slootman-CEO | Snowflake Q2

Snowflake has announced financial results for its second quarter of fiscal 2024 for the period ending July 31, revealing product revenue growth has exceeded previous Q1 expectations at $640.2m, a 37 percent year-on-year (YoY) growth.

The company now has 402 customers with trailing 12-month product revenue greater than $1m and 639 Forbes Global 2000 customers. Net revenue retention rate was 142 percent for the second quarter, a decline in comparison to Q1’s 151 percent.

2023 has been successful for the company. In June the company announced its partnership with NVIDIA as well as unveiling latest product enhancements and generally availability of its Native App Framework. Additionally, in July, the company announced the appointment of James Petter as VP of EMEA sales as he takes responsibility for business growth across EMEA.

Frank Slootman, chairman and CEO, Snowflake, said: “During Q2, product revenue grew 37 percent YoY to $640m. Our non-GAAP adjusted free cash flow was $88m, representing 50 percent YoY growth.

“Snowflake as the global epicenter of trusted enterprise data is well positioned to enable the growing interest in AI/ML. Enterprises and institutions alike are increasingly aware they cannot have an AI strategy without a data strategy.”

In the company’s earning call, Mike Scarpelli, chief financial officer, said: “In May, we saw a return to growth with strength continuing into June and July. From a booking standpoint, we saw promising signs of stabilization with new bookings outperforming our expectations.

“However, we believe productivity has room for further improvement. Q2 remaining performance obligations grew 30 percent year over year, totaling $3.5bn. Of the $3.5bn in RPO, we expect approximately 57 percent to be recognized as revenue in the next 12 months. This represents a 32 percent increase compared to our estimate as of the same quarter last year.

“Our net revenue retention rate of 142 percent includes six new customers with $1m in trailing 12-month product revenue. We now have 402 customers with trailing 12-month product revenue greater than $1m. We continue to focus on growth and efficiency. We generated 88 million in non-GAAP adjusted free cash flow outperforming our Q2 target.”