$SNOW Snowflake Reports Financial Results for the Second Quarter of Fiscal 2023

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Product revenue of $466.3 million in the second quarter, representing 83% year-over-year growth
Remaining performance obligations of $2.7 billion, representing 78% year-over-year growth
6,808 total customers
Net revenue retention rate of 171%
246 customers with trailing 12-month product revenue greater than $1 million

Snowflake (NYSE: SNOW), the Data Cloud company, today announced financial results for its second quarter of fiscal 2023, ended July 31, 2022.

This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20220824005221/en/

Snowflake Q2 FY23 Infographic (Graphic: Snowflake)

Revenue for the quarter was $497.2 million, representing 83% year-over-year growth. Product revenue for the quarter was $466.3 million, representing 83% year-over-year growth. Remaining performance obligations were $2.7 billion, representing 78% year-over-year growth. Net revenue retention rate was 171% as of July 31, 2022. The company now has 6,808 total customers and 246 customers with trailing 12-month product revenue greater than $1 million. See the section titled “Key Business Metrics” for definitions of product revenue, remaining performance obligations, net revenue retention rate, total customers, and customers with trailing 12-month product revenue greater than $1 million.

“During Q2, product revenue grew 83% year-over-year to $466 million dollars. Our non-GAAP product gross margin exceeded 75%, and we continue to generate non-GAAP operating income and free cash flow,” said Frank Slootman, Chairman and CEO, Snowflake. “Snowflake’s next frontier of innovation is aimed at transforming how cloud applications are built, deployed, sold, and transacted. We look forward to executing against this growth opportunity.”

Second Quarter Fiscal 2023 GAAP and Non-GAAP Results:

The following table summarizes our financial results for the second quarter of fiscal 2023:

Second Quarter Fiscal 2023
GAAP Results

Second Quarter Fiscal 2023
Non-GAAP Results(1)

Amount
(millions)

Year/Year
Growth

Product revenue

$466.3

83%

Amount
(millions)

Margin

Amount
(millions)

Margin

Product gross profit

$334.7

72%

$350.4

75%

Operating income (loss)

($207.7)

(42%)

$17.5

4%

Net cash provided by operating activities

$64.4

Free cash flow

$53.8

11%

Adjusted free cash flow

$58.6

12%

(1) We report non-GAAP financial measures in addition to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. See the section titled “Statement Regarding Use of Non-GAAP Financial Measures” for an explanation of non-GAAP financial measures, and the table titled “GAAP to Non-GAAP Reconciliations” for a reconciliation of GAAP to non-GAAP financial measures.

Note: Fiscal year ends January 31. Numbers are rounded for presentation purposes.

Financial Outlook:

Our guidance includes GAAP and non-GAAP financial measures.

The following table summarizes our guidance for the third quarter of fiscal 2023:

Third Quarter Fiscal 2023
GAAP Guidance

Third Quarter Fiscal 2023
Non-GAAP Guidance(1)

Amount
(millions)

Year/Year
Growth

Product revenue

$500 - $505

60 - 62%

Margin

Operating income

2%

Amount
(millions)

Weighted-average shares used in computing net income per share attributable to common stockholders - diluted(2)

358

(1) We report non-GAAP financial measures in addition to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. See the section titled “Statement Regarding Use of Non-GAAP Financial Measures” for an explanation of non-GAAP financial measures.

(2) We may have a non-GAAP net income for the third quarter of fiscal 2023. As a result, we are presenting the weighted-average shares used in computing net income per share attributable to common stockholders - diluted in the non-GAAP column of the table above, giving effect to all dilutive securities (stock options, restricted stock units, and employee stock purchase rights under our 2020 Employee Stock Purchase Plan). These dilutive securities would be excluded from the weighted-average shares used in computing net loss per share attributable to common stockholders - diluted if we are in a non-GAAP net loss position.

The following table summarizes our guidance for the full-year fiscal 2023:

Full-Year Fiscal 2023
GAAP Guidance

Full-Year Fiscal 2023
Non-GAAP Guidance(1)

Amount
(millions)

Year/Year
Growth

Product revenue

$1,905 - $1,915

67 - 68%

Margin

Product gross profit

75%

Operating income

2%

Adjusted free cash flow

17%

Amount
(millions)

Weighted-average shares used in computing net income per share attributable to common stockholders - diluted(2)

358

(1) We report non-GAAP financial measures in addition to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. See the section titled “Statement Regarding Use of Non-GAAP Financial Measures” for an explanation of non-GAAP financial measures.

(2) We may have a non-GAAP net income for full-year fiscal 2023. As a result, we are presenting the weighted-average shares used in computing net income per share attributable to common stockholders - diluted in the non-GAAP column of the table above, giving effect to all dilutive securities (stock options, restricted stock units, and employee stock purchase rights under our 2020 Employee Stock Purchase Plan). These dilutive securities would be excluded from the weighted-average shares used in computing net loss per share attributable to common stockholders - diluted if we are in a non-GAAP net loss position.

A reconciliation of non-GAAP guidance measures to corresponding GAAP guidance measures is not available on a forward-looking basis without unreasonable effort due to the uncertainty regarding, and the potential variability of, expenses that may be incurred in the future. Stock-based compensation-related charges, including employer payroll tax-related items on employee stock transactions, are impacted by the timing of employee stock transactions, the future fair market value of our common stock, and our future hiring and retention needs, all of which are difficult to predict and subject to constant change. We have provided a reconciliation of GAAP to non-GAAP financial measures in the financial statement tables for our historical non-GAAP financial results included in this release. Our fiscal year ends January 31, and numbers are rounded for presentation purposes.

Conference Call Details

We will host a conference call today, beginning at 3 p.m. Mountain Time on August 24, 2022. Investors and participants may attend the call by dialing (844) 200-6205 (Passcode: 880899), or if outside the United States, by dialing +1 (833) 950-0062 (Passcode: 880899).

The call will also be webcast live on the Snowflake Investor Relations website.

An audio replay of the conference call and webcast will be available two hours after its completion and will be accessible for 30 days on the Snowflake Investor Relations website.

Investor Presentation Details

An investor presentation providing additional information and analysis can be found at https://investors.snowflake.com.

Statement Regarding Use of Non‑GAAP Financial Measures

We report the following non-GAAP financial measures, which have not been prepared in accordance with generally accepted accounting principles in the United States (GAAP), in addition to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP.

Product gross profit, Operating income (loss), and Net income (loss). Our non-GAAP product gross profit, operating income (loss), and net income (loss) measures exclude the effect of stock-based compensation-related charges, including employer payroll tax-related items on employee stock transactions, amortization of acquired intangibles, expenses associated with acquisitions and strategic investments, and the related income tax effect of these adjustments as well as the non-recurring income tax expense or benefit associated with acquisitions. We believe the presentation of operating results that exclude these non-cash or non-recurring items provides useful supplemental information to investors and facilitates the analysis of our operating results and comparison of operating results across reporting periods.

Free cash flow. Free cash flow is defined as net cash provided by (used in) operating activities reduced by purchases of property and equipment and capitalized internal-use software development costs. Cash outflows for employee payroll tax items related to the net share settlement of equity awards are included in cash flow for financing activities and, as a result, do not have an effect on the calculation of free cash flow. Free cash flow margin is calculated as free cash flow as a percentage of revenue. We believe these measures provide useful supplemental information to investors because they are indicators of the strength and performance of our core business operations.

Adjusted free cash flow. Adjusted free cash flow is defined as free cash flow plus (minus) net cash paid (received) on employer and employee payroll tax-related items on employee stock transactions. Employee payroll tax-related items on employee stock transactions are generally pass-through transactions that are expected to have a net zero impact on free cash flow over time, but that may impact free cash flow in any given fiscal quarter due to differences between the time that we receive funds from our employees and the time we remit those funds to applicable tax authorities. We believe that excluding the effects of these payroll tax-related items will enhance stockholders' ability to evaluate our free cash flow performance, including on a quarter-over-quarter basis. Adjusted free cash flow margin is calculated as adjusted free cash flow as a percentage of revenue. We believe these measures provide useful supplemental information to investors because they are indicators of the strength and performance of our core business operations.

We use these non-GAAP financial measures internally for financial and operational decision-making purposes and as a means to evaluate period-to-period comparisons. Non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP financial measures and should be read only in conjunction with our condensed consolidated financial statements prepared in accordance with GAAP. Our presentation of non-GAAP financial measures may not be comparable to similar measures used by other companies. We encourage investors to carefully consider our results under GAAP, as well as our supplemental non-GAAP information and the reconciliation between these presentations, to more fully understand our business. Please see the tables included at the end of this release for the reconciliation of GAAP to non-GAAP results.

Key Business Metrics

We monitor our key business metrics, including (i) free cash flow starting with the fiscal quarter ended January 31, 2022, and (ii) the other metrics set forth below to help us evaluate our business and growth trends, establish budgets, measure the effectiveness of our sales and marketing efforts, and assess operational efficiencies. See the section titled “Statement Regarding Use of Non-GAAP Financial Measures” for the definition of free cash flow. The calculation of our key business metrics may differ from other similarly titled metrics used by other companies, securities analysts, or investors.

Product Revenue. Product revenue is a key metric for us because we recognize revenue based on platform consumption, which is inherently variable at our customers’ discretion, and not based on the amount and duration of contract terms. Product revenue is primarily derived from the consumption of compute, storage, and data transfer resources, which are consumed by customers on our platform as a single, integrated offering. Customers have the flexibility to consume more than their contracted capacity during the contract term and may have the ability to roll over unused capacity to future periods, generally upon the purchase of additional capacity at renewal. Our consumption-based business model distinguishes us from subscription-based software companies that generally recognize revenue ratably over the contract term and may not permit rollover. Because customers have flexibility in the timing of their consumption, which can exceed their contracted capacity or extend beyond the original contract term in many cases, the amount of product revenue recognized in a given period is an important indicator of customer satisfaction and the value derived from our platform. Product revenue excludes our professional services and other revenue.

Remaining Performance Obligations. Remaining performance obligations (RPO) represent the amount of contracted future revenue that has not yet been recognized, including (i) deferred revenue and (ii) non-cancelable contracted amounts that will be invoiced and recognized as revenue in future periods. RPO excludes performance obligations from on-demand arrangements and certain time and materials contracts that are billed in arrears. Portions of RPO that are not yet invoiced and are denominated in foreign currencies are revalued into U.S. dollars each period based on the applicable period-end exchange rates. RPO is not necessarily indicative of future product revenue growth because it does not account for the timing of customers’ consumption or their consumption of more than their contracted capacity. Moreover, RPO is influenced by a number of factors, including the timing of renewals, the timing of purchases of additional capacity, average contract terms, seasonality, changes in foreign currency exchange rates, and the extent to which customers are permitted to roll over unused capacity to future periods, generally upon the purchase of additional capacity at renewal.

Total Customers. We count the total number of customers at the end of each period. For purposes of determining our customer count, we treat each customer account, including accounts for end-customers under a reseller arrangement, that has at least one corresponding capacity contract as a unique customer, and a single organization with multiple divisions, segments, or subsidiaries may be counted as multiple customers. For purposes of determining our customer count, we do not include customers that consume our platform only under on-demand arrangements. Our customer count is subject to adjustments for acquisitions, consolidations, spin-offs, and other market activity, and we present our total customer count for historical periods reflecting these adjustments.

Net Revenue Retention Rate. To calculate net revenue retention rate, we first specify a measurement period consisting of the trailing two years from our current period end. Next, we define as our measurement cohort the population of customers under capacity contracts that used our platform at any point in the first month of the first year of the measurement period. Starting with the fiscal quarter ended October 31, 2021, the cohorts used to calculate net revenue retention rate include end-customers under a reseller arrangement. We then calculate our net revenue retention rate as the quotient obtained by dividing our product revenue from this cohort in the second year of the measurement period by our product revenue from this cohort in the first year of the measurement period. Any customer in the cohort that did not use our platform in the second year remains in the calculation and contributes zero product revenue in the second year. Our net revenue retention rate is subject to adjustments for acquisitions, consolidations, spin-offs, and other market activity, and we present our net revenue retention rate for historical periods reflecting these adjustments. Since we will continue to attribute the historical product revenue to the consolidated contract, consolidation of capacity contracts within a customer’s organization typically will not impact our net revenue retention rate unless one of those customers was not a customer at any point in the first month of the first year of the measurement period.

Customers with Trailing 12-Month Product Revenue Greater than $1 Million. To calculate the number of customers with trailing 12-month product revenue greater than $1 million, we count the number of customers under capacity arrangements that contributed more than $1 million in product revenue in the trailing 12 months. Our customer count is subject to adjustments for acquisitions, consolidations, spin-offs, and other market activity, and we present our customer count for historical periods reflecting these adjustments.

Use of Forward‑Looking Statements

This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, regarding our performance, including but not limited to statements in the section titled “Financial Outlook.” The forward-looking statements contained in this release and the accompanying oral presentation are subject to known and unknown risks, uncertainties, assumptions, and other factors that may cause actual results or outcomes to be materially different from any future results or outcomes expressed or implied by the forward-looking statements. These risks, uncertainties, assumptions, and other factors include, but are not limited to, those related to our business and financial performance, the effects of COVID-19 or other public health crises on our business, results of operations, and financial condition, general market and business conditions, downturns, or uncertainty, the effects of the recent and developing armed conflict in Ukraine on our business, results of operations, and financial condition, our ability to attract and retain customers, our ability to develop new products and services and enhance existing products and services, our ability to respond rapidly to emerging technology trends, our ability to execute on our business strategy, including our strategy related to the Data Cloud, our ability to increase and predict customer consumption of our platform, our ability to compete effectively, and our ability to manage growth.

Further information on these and additional risks, uncertainties, and other factors that could cause actual outcomes and results to differ materially from those included in or contemplated by the forward-looking statements contained in this release are included under the caption “Risk Factors” and elsewhere in our Form 10-Q for the fiscal quarter ended April 30, 2022 and other filings and reports we make with the Securities and Exchange Commission from time to time, including our Form 10-Q that will be filed for the fiscal quarter ended July 31, 2022.

Moreover, we operate in a very competitive and rapidly changing environment, and new risks may emerge from time to time. It is not possible for us to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results or outcomes to differ materially from those contained in any forward-looking statements we may make. Forward-looking statements speak only as of the date the statements are made and are based on information available to us at the time those statements are made and/or management's good faith belief as of that time with respect to future events. Except as required by law, we undertake no obligation, and do not intend, to update these forward-looking statements, to review or confirm analysts’ expectations, or to provide interim reports or updates on the progress of the current financial quarter.

About Snowflake

Snowflake enables every organization to mobilize their data with Snowflake’s Data Cloud. Customers use the Data Cloud to unite siloed data, discover and securely share data, and execute diverse analytic workloads. Wherever data or users live, Snowflake delivers a single data experience that spans multiple clouds and geographies. Thousands of customers across many industries, including 510 of the 2022 Forbes Global 2000 (G2K) as of July 31, 2022, use Snowflake Data Cloud to power their businesses. Learn more at snowflake.com.

Source: Snowflake Inc.

Snowflake Inc.

Condensed Consolidated Statements of Operations

(in thousands, except per share data)

(unaudited)

Three Months Ended July 31,

Six Months Ended July 31,

2022

2021

2022

2021

Revenue

$

497,248

$

272,198

$

919,619

$

501,112

Cost of revenue

173,232

106,121

321,162

203,467

Gross profit

324,016

166,077

598,457

297,645

Operating expenses:

Sales and marketing

274,645

182,903

518,557

349,707

Research and development

183,748

118,087

334,546

227,883

General and administrative

73,355

65,228

141,852

125,791

Total operating expenses

531,748

366,218

994,955

703,381

Operating loss

(207,732

)

(200,141

)

(396,498

)

(405,736

)

Interest income

11,692

2,190

16,451

4,802

Other income (expense), net

(22,920

)

8,746

(31,401

)

8,258

Loss before income taxes

(218,960

)

(189,205

)

(411,448

)

(392,676

)

Provision for (benefit from) income taxes

3,846

514

(22,848

)

263

Net loss

$

(222,806

)

$

(189,719

)

$

(388,600

)

$

(392,939

)

Net loss per share attributable to common stockholders - basic and diluted

$

(0.70

)

$

(0.64

)

$

(1.23

)

$

(1.33

)

Weighted-average shares used in computing net loss per share attributable to common stockholders - basic and diluted

318,356

297,717

316,392

294,604

Snowflake Inc.

Condensed Consolidated Balance Sheets

(in thousands)

(unaudited)

July 31, 2022

January 31, 2022

Assets

Current assets:

Cash and cash equivalents

$

906,663

$

1,085,729

Short-term investments

3,046,477

2,766,364

Accounts receivable, net

304,964

545,629

Deferred commissions, current

57,908

51,398

Prepaid expenses and other current assets

187,685

149,523

Total current assets

4,503,697

4,598,643

Long-term investments

1,086,684

1,256,207

Property and equipment, net

130,082

105,079

Operating lease right-of-use assets

222,240

190,356

Goodwill

502,614

8,449

Intangible assets, net

172,254

37,141

Deferred commissions, non-current

129,222

124,517

Other assets

317,322

329,306

Total assets

$

7,064,115

$

6,649,698

Liabilities and Stockholders’ Equity

Current liabilities:

Accounts payable

$

20,286

$

13,441

Accrued expenses and other current liabilities

209,772

200,664

Operating lease liabilities, current

26,605

25,101

Deferred revenue, current

1,144,773

1,157,887

Total current liabilities

1,401,436

1,397,093

Operating lease liabilities, non-current

215,152

181,196

Deferred revenue, non-current

8,793

11,180

Other liabilities

12,411

11,184

Stockholders’ equity

5,426,323

5,049,045

Total liabilities and stockholders’ equity

$

7,064,115

$

6,649,698

Snowflake Inc.

Condensed Consolidated Statements of Cash Flows

(in thousands)

(unaudited)

Three Months Ended July 31,

Six Months Ended July 31,

2022

2021

2022

2021

Cash flows from operating activities:

Net loss

$

(222,806

)

$

(189,719

)

$

(388,600

)

$

(392,939

)

Adjustments to reconcile net loss to net cash provided by (used in) operating activities:

Depreciation and amortization

16,172

5,384

26,113

10,068

Non-cash operating lease costs

11,148

8,531

21,239

17,040

Amortization of deferred commissions

13,770

8,841

26,971

17,157

Stock-based compensation, net of amounts capitalized

209,181

163,991

381,674

315,005

Net amortization of premiums on investments

4,678

12,332

12,876

25,351

Net unrealized losses (gains) on strategic investments in equity securities

23,173

(8,060

)

32,032

(8,060

)

Deferred income tax

(26,664

)

Other

313

1,568

2,074

2,782

Changes in operating assets and liabilities, net of effects of a business combination:

Accounts receivable

(27,087

)

(71,283

)

239,569

55,896

Deferred commissions

(23,188

)

(19,182

)

(39,906

)

(33,931

)

Prepaid expenses and other assets

29,358

(15,731

)

(28,177

)

(70,088

)

Accounts payable

2,067

4,967

6,225

3,722

Accrued expenses and other liabilities

24,672

30,287

10,455

23,720

Operating lease liabilities

(9,810

)

(8,159

)

(18,186

)

(15,992

)

Deferred revenue

12,792

70,122

(8,649

)

66,012

Net cash provided by (used in) operating activities

64,433

(6,111

)

249,046

15,743

Cash flows from investing activities:

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Purchases of property and equipment

(3,848

)

(3,497

)

(11,261

)

(9,927

)

Capitalized internal-use software development costs

(6,736

)

(2,344

)

(11,540

)

(4,824

)

Cash paid for a business combination, net of cash and cash equivalents acquired

(177,925

)

Purchases of intangible assets

(700

)

(722

)

(700

)

(11,182

)

Purchases of investments

(1,027,966

)

(842,963

)

(1,925,257

)

(1,988,633

)

Sales of investments

32,958

7,929

43,932

392,312

Maturities and redemptions of investments

809,845

877,635

1,696,512

1,394,223

Net cash provided by (used in) investing activities

(196,447

)

36,038

(386,239

)

(228,031

)

Cash flows from financing activities:

Proceeds from exercise of stock options

8,520

24,463

23,796

65,865

Proceeds from issuance of common stock under employee stock purchase plan

26,094

26,398

Taxes paid related to net share settlement of equity awards

(30,893

)

(84,109

)

Net cash provided by (used in) financing activities

(22,373

)

24,463

(34,219

)

92,263

Effect of exchange rate changes on cash, cash equivalents, and restricted cash

(2,290

)

196

(7,388

)

215

Net increase (decrease) in cash, cash equivalents, and restricted cash

(156,677

)

54,586

(178,800

)

(119,810

)

Cash, cash equivalents, and restricted cash—beginning of period

1,080,411

660,797

1,102,534

835,193

Cash, cash equivalents, and restricted cash—end of period

$

923,734

$

715,383

$

923,734

$

715,383

Snowflake Inc.

GAAP to Non-GAAP Reconciliations

(in thousands, except percentages)

(unaudited)

Three Months Ended July 31, 2022

GAAP amounts

GAAP amounts
as a % of
revenue

Stock-based
compensation-
related
charges(1)

Amortization of
acquired
intangibles

Expenses
associated
with
acquisitions
and strategic
investments

Non-GAAP
amounts

Non-GAAP
amounts as a
% of revenue

Revenue:

Product revenue

$

466,268

94

%

Professional services and other revenue

30,980

6

%

Revenue

497,248

100

%

Year-over-year growth

83

%

Cost of revenue:

Cost of product revenue

131,606

27

%

$

(15,122

)

$

(566

)

$

$

115,918

23

%

Cost of professional services and other revenue

41,626

8

%

(12,572

)

29,054

6

%

Total cost of revenue

173,232

35

%

(27,694

)

(566

)

144,972

29

%

Gross profit (loss):

Product gross profit

334,662

15,122

566

350,350

Professional services and other gross profit (loss)

(10,646

)

12,572

1,926

Total gross profit

324,016

65

%

27,694

566

352,276

71

%

Product gross margin

72

%

3

%

%

%

75

%

Professional services and other gross margin

(34

%)

40

%

%

%

6

%

Total gross margin

65

%

6

%

%

%

71

%

Operating expenses:

Sales and marketing

274,645

55

%

(62,173

)

(7,555

)

204,917

41

%

Research and development

183,748

37

%

(97,839

)

(1,759

)

84,150

17

%

General and administrative

73,355

15

%

(26,576

)

(417

)

(614

)

45,748

9

%

Total operating expenses

531,748

107

%

(186,588

)

(9,731

)

(614

)

334,815

67

%

Operating income (loss)

$

(207,732

)

(42

%)

$

214,282

$

10,297

$

614

$

17,461

4

%

Operating margin

(42

%)

44

%

2

%

%

4

%

(1) Stock-based compensation-related charges included approximately $3.9 million of employer payroll tax-related expenses on employee stock transactions.

Three Months Ended July 31, 2021

GAAP amounts

GAAP amounts
as a % of
revenue

Stock-based
compensation-
related
charges(1)

Amortization of
acquired
intangibles

Expenses
associated
with
acquisitions
and strategic
investments

Non-GAAP
amounts

Non-GAAP
amounts as a
% of revenue

Revenue:

Product revenue

$

254,623

94

%

Professional services and other revenue

17,575

6

%

Revenue

272,198

100

%

Year-over-year growth

104

%

Cost of revenue:

Cost of product revenue

81,048

30

%

$

(13,226

)

$

(566

)

$

$

67,256

25

%

Cost of professional services and other revenue

25,073

9

%

(9,877

)

15,196

5

%

Total cost of revenue

106,121

39

%

(23,103

)

(566

)

82,452

30

%

Gross profit (loss):

Product gross profit

173,575

13,226

566

187,367

Professional services and other gross profit (loss)

(7,498

)

9,877

2,379

Total gross profit

166,077

61

%

23,103

566

189,746

70

%

Product gross margin

68

%

6

%

%

%

74

%

Professional services and other gross margin

(43

%)

57

%

%

%

14

%

Total gross margin

61

%

9

%

%

%

70

%

Operating expenses:

Sales and marketing

182,903

68

%

(57,626

)

125,277

46

%

Research and development

118,087

43

%

(65,841

)

(942

)

51,304

19

%

General and administrative

65,228

24

%

(29,839

)

(401

)

75

35,063

13

%

Total operating expenses

366,218

135

%

(153,306

)

(1,343

)

75

211,644

78

%

Operating loss

$

(200,141

)

(74

%)

$

176,409

$

1,909

$

(75

)

$

(21,898

)

(8

%)

Operating margin

(74

%)

65

%

1

%

%

(8

%)

(1) Stock-based compensation-related charges included approximately $12.1 million of employer payroll tax-related expenses on employee stock transactions.

Six Months Ended July 31, 2022

GAAP amounts

GAAP amounts
as a % of
revenue

Stock-based
compensation-
related
charges(1)

Amortization of
acquired
intangibles

Expenses
associated
with
acquisitions
and strategic
investments

Non-GAAP
amounts

Non-GAAP
amounts as a
% of revenue

Revenue:

Product revenue

$

860,702

94

%

Professional services and other revenue

58,917

6

%

Revenue

919,619

100

%

Year-over-year growth

84

%

Cost of revenue:

Cost of product revenue

243,017

27

%

$

(28,263

)

$

(1,133

)

$

$

213,621

23

%

Cost of professional services and other revenue

78,145

8

%

(24,321

)

53,824

6

%

Total cost of revenue

321,162

35

%

(52,584

)

(1,133

)

267,445

29

%

Gross profit (loss):

Product gross profit

617,685

28,263

1,133

647,081

Professional services and other gross profit (loss)

(19,228

)

24,321

5,093

Total gross profit

598,457

65

%

52,584

1,133

652,174

71

%

Product gross margin

72

%

3

%

%

%

75

%

Professional services and other gross margin

(33

%)

42

%

%

%

9

%

Total gross margin

65

%

6

%

%

%

71

%

Operating expenses:

Sales and marketing

518,557

57

%

(119,797

)

(10,101

)

388,659

43

%

Research and development

334,546

36

%

(173,623

)

(3,525

)

157,398

17

%

General and administrative

141,852

15

%

(51,519

)

(829

)

(2,523

)

86,981

9

%

Total operating expenses

994,955

108

%

(344,939

)

(14,455

)

(2,523

)

633,038

69

%

Operating income (loss)

$

(396,498

)

(43

%)

$

397,523

$

15,588

$

2,523

$

19,136

2

%

Operating margin

(43

%)

43

%

2

%

%

2

%

(1) Stock-based compensation-related charges included approximately $14.1 million of employer payroll tax-related expenses on employee stock transactions.

Six Months Ended July 31, 2021

GAAP amounts

GAAP amounts
as a % of
revenue

Stock-based
compensation-
related
charges(1)

Amortization of
acquired
intangibles

Expenses
associated
with
acquisitions
and strategic
investments

Non-GAAP
amounts

Non-GAAP
amounts as a
% of revenue

Revenue:

Product revenue

$

468,453

93

%

Professional services and other revenue

32,659

7

%

Revenue

501,112

100

%

Year-over-year growth

107

%

Cost of revenue:

Cost of product revenue

153,128

31

%

$

(25,394

)

$

(1,133

)

$

$

126,601

25

%

Cost of professional services and other revenue

50,339

10

%

(22,033

)

28,306

6

%

Total cost of revenue

203,467

41

%

(47,427

)

(1,133

)

154,907

31

%

Gross profit (loss):

Product gross profit

315,325

25,394

1,133

341,852

Professional services and other gross profit (loss)

(17,680

)

22,033

4,353

Total gross profit

297,645

59

%

47,427

1,133

346,205

69

%

Product gross margin

67

%

6

%

%

%

73

%

Professional services and other gross margin

(54

%)

67

%

%

%

13

%

��

Total gross margin

59

%

10

%

%

%

69

%

Operating expenses:

Sales and marketing

349,707

70

%

(111,871

)

237,836

48

%

Research and development

227,883

45

%

(126,653

)

(1,797

)

99,433

20

%

General and administrative

125,791

25

%

(57,956

)

(798

)

(396

)

66,641

13

%

Total operating expenses

703,381

140

%

(296,480

)

(2,595

)

(396

)

403,910

81

%

Operating loss

$

(405,736

)

(81

%)

$

343,907

$

3,728

$

396

$

(57,705

)

(12

%)

Operating margin

(81

%)

68

%

1

%

%

(12

%)

(1) Stock-based compensation-related charges included approximately $28.3 million of employer payroll tax-related expenses on employee stock transactions.

Three Months Ended July 31,

Six Months Ended July 31,

2022

2021

2022

2021

Revenue

$

497,248

$

272,198

$

919,619

$

501,112

GAAP net cash provided by (used in) operating activities

$

64,433

$

(6,111

)

$

249,046

$

15,743

Less: purchases of property and equipment

(3,848

)

(3,497

)

(11,261

)

(9,927

)

Less: capitalized internal-use software development costs

(6,736

)

(2,344

)

(11,540

)

(4,824

)

Non-GAAP free cash flow

53,849

(11,952

)

226,245

992

Add: net cash paid on payroll tax-related items on employee stock transactions(1)

4,796

14,764

13,841

25,209

Non-GAAP adjusted free cash flow

$

58,645

$

2,812

$

240,086

$

26,201

Non-GAAP free cash flow margin

11

%

(4

%)

25

%

%

Non-GAAP adjusted free cash flow margin

12

%

1

%

26

%

5

%

(1) The amounts for the three and six months ended July 31, 2022 do not include employee payroll taxes of $30.9 million and $84.1 million, respectively, related to net share settlement of employee restricted stock units, which were reflected as cash outflows for financing activities. No equity awards were net settled prior to the six months ended July 31, 2022.

View source version on businesswire.com: https://www.businesswire.com/news/home/20220824005221/en/

Contacts

Investor Contact
Jimmy Sexton
IR@snowflake.com

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Eszter Szikora
Press@snowflake.com