Snowflake (SNOW) Reports Earnings Tomorrow: What To Expect

Data warehouse-as-a-service Snowflake (NYSE:SNOW) will be announcing earnings results tomorrow after market hours. Here’s what to look for.

Snowflake beat analysts’ revenue expectations by 5.4% last quarter, reporting revenues of $828.7 million, up 32.9% year on year. It was a weaker quarter for the company, with a miss of analysts’ billings estimates and a decline in its gross margin. It added 24 enterprise customers paying more than $1m annually to reach a total of 485.

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 26.1% year on year to $850 million, slowing from the 35.5% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.16 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 3.3% on average.

Looking at Snowflake’s peers in the data and analytics software segment, some have already reported their Q2 results, giving us a hint as to what we can expect. Commvault Systems delivered year-on-year revenue growth of 13.4%, beating analysts’ expectations by 4.2%, and DigitalOcean reported revenues up 13.3%, topping estimates by 2%. Commvault Systems traded up 24.1% following the results while DigitalOcean was also up 11.9%.

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

Investors in the data and analytics software segment have had steady hands going into earnings, with share prices flat over the last month. Snowflake’s stock price was unchanged during the same time and is heading into earnings with an average analyst price target of $184.1 (compared to the current share price of $131.61).

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