Snowflake reports widening losses but raises full-year guidance
Summary
Snowflake shares fell as much as 8% in extended trading on Wednesday after the data-analytics software company barely met analysts expectations for product revenue, the companys main source of total revenue, for the full fiscal year. He said that in April Snowflake implemented a storage compression change that will widen margins. Excluding the after-hours move, Snowflake shares are down about 17% year to date, while the S&P 500 index is up almost 12% over the same period. Earlier this month Goldman Sachs analysts upgraded their rating on Snowflake stock to buy from the equivalent of hold. "With the stock ~50% off its highs from December 2020 relative to a 1% decline for our broader software coverage and +4% for the Nasdaq over the same time period, we believe investor expectations have become more balanced and see a path towards outperformance, as we believe the durability of growth is not fully reflected in the companys current valuation," the analysts wrote.