Cloud Stocks: Snowflake Focuses On The Financial Services Sector

The global Data Warehouse as a Service (DWaaS) market is expected to grow at 22% CAGR to $12.9 billion by 2026 from $4.7 billion in 2021 driven by the expansion of business intelligence and data analytics in enterprise management, the growing dependence on data-driven decision-making to improve business performance, and the requirement of regulatory governance and security. San Mateo-based Snowflake (NYSE:SNOW) is a leading data warehouse solution provider that recently announced its quarterly results.

Snowflake’s Financials

For the recently reported second quarter, Snowflake’s revenues grew 104% to $272.2 million. Product revenues grew 103% to $254.6 million. Remaining performance obligations grew 122% to $1.5 billion. Net revenue retention rate was 169%. For the quarter, Snowflake had 116 customers with a trailing twelve-month revenue of more than $1 million.

Non-GAAP net loss per share was $0.64, compared to non-GAAP net loss per share of $1.31 a year ago. It fell behind the market’s forecast of a loss of $0.16 per share.

For the third quarter of fiscal 2022, the company expects product revenues of $280-$285 million and product revenues of $1.06-$1.07 billion for the year.

Snowflake’s Financial Services Focus

Snowflake announced the launch of Financial Services Data Cloud, a service that integrates Snowflake’s industry-tailored platform governance capabilities, Snowflake- and partner-delivered solutions, and industry-critical datasets, to help Financial Services organizations revolutionize how they use data to drive business growth and deliver better customer experiences. The platform will allow financial services organizations to securely collaborate on data across the enterprise while efficiently meeting regulatory requirements, securely share data across multiple public clouds with support for sharing from multi-tenant environments to Virtual Private Snowflake (VPS) environments coming in a future release, and leverage Snowflake as the first company achieving the new Cloud Data Management Capabilities (CDMC) financial industry standard.

Within the platform, Snowflake also released several partner-delivered solutions that leverage Snowflake’s global and cross-cloud data sharing capabilities to connect customers across the financial services ecosystem. Some of these partners include names like BlackRock, Cognizant, EY, and Deloitte to name a few. The solutions released by these partners range from data management, analytics, normalization to asset management and even regulatory reporting capabilities.

As part of its financial services focus, Snowflake also recently announced its partnership with Citi that will combine Snowflake’s powerful secure data sharing and multi-party permission capabilities with Citi’s extensive market expertise. The partnership will provide a unique solution to control data models and how end-to-end transaction data flows across businesses to meet the requirements of clients.

Snowflake has more than 45,000 developers on its platform that can access an ecosystem to share knowledge, seek help, exchange ideas, and collaborate. It competes with a slew of big tech players like Amazon Web Services, Google, Oracle, and SAP along with niche players like Cloudera and TeraData.

Its stock is currently trading at $316.47 with a market capitalization of $95.23 billion. It hit a 52-week high of $429 in November last year and a 52-week low of $184.71 in May this year. Snowflake went public in September last year at a list price of $120 a share. The stock soon soared to $308.71. It raised $3.4 billion from its IPO at a valuation of $33.2 billion.