Snowflake Earnings: What To Look For From SNOW

Data warehouse-as-a-service Snowflake (NYSE:SNOW) will be reporting results tomorrow after market close. Here's what to expect.

Snowflake beat analysts' revenue expectations by 2% last quarter, reporting revenues of $774.7 million, up 31.5% year on year. It was a good quarter for the company, with a solid beat of analysts' billings estimates. It added 25 enterprise customers paying more than $1m annually to reach a total of 461.

Is Snowflake a buy or sell going into earnings? Read our full analysis here, it's free.

This quarter, analysts are expecting Snowflake's revenue to grow 26% year on year to $785.9 million, slowing from the 47.6% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.17 per share.

The majority of analysts covering the company have reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Snowflake has a history of exceeding Wall Street's expectations, beating revenue estimates every single time over the past two years by 2.9% on average.

Looking at Snowflake's peers in the data and analytics software segment, some have already reported their Q1 results, giving us a hint as to what we can expect. Commvault Systems delivered year-on-year revenue growth of 9.7%, beating analysts' expectations by 5.1%, and DigitalOcean reported revenues up 11.9%, topping estimates by 1.2%. Commvault Systems traded up 3.2% following the results while DigitalOcean was also up 15.7%.

Read our full analysis of Commvault Systems's results here and DigitalOcean's results here.

There has been positive sentiment among investors in the data and analytics software segment, with share prices up 6.5% on average over the last month. Snowflake is up 11.9% during the same time and is heading into earnings with an average analyst price target of $205.2 (compared to the current share price of $164.8).

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