Snowflake shares plunge 12% on guidance miss, acquisition of search startup Neeva

The New York Inventory Trade welcomes Snowflake (NYSE:SNOW), on Tues. Dec twenty first, 2021, to usher within the first day of winter.


Shares of cloud knowledge platform supplier Snowflake slid greater than 12% in prolonged buying and selling on Wednesday after the corporate issued weak guidance in its earnings report and stated it will acquire search startup Neeva for an undisclosed quantity.

This is how the corporate did:

  • Earnings per share: 15 cents, adjusted, vs. 5 cents anticipated by analysts, in line with Refinitiv
  • Income: $624 million vs. $608 million anticipated by analysts, in line with Refinitiv

The corporate’s income grew 48% 12 months over 12 months within the fiscal first quarter, however that progress was decrease than the 85% improve 12 months over 12 months. The majority of Snowflake gross sales come from product income, which expanded 50% 12 months over 12 months. Product income accounts to be used of Snowflake’s software program for storing and operating queries on knowledge saved in its system.

Snowflake stated it anticipates product income will likely be between $620 million and $625 million within the fiscal second quarter. That may characterize year-over-year progress between 33% and 34%.The projection got here in nicely under the StreetAccount estimate of $649 million.

For the 2024 fiscal 12 months, Snowflake known as for product income of $2.6 billion. The StreetAccount consensus was $2.7 billion.

Snowflake additionally introduced it plans to amass Neeva, the privacy-focused search firm co-founded by former Google govt Sridhar Ramaswamy. Benoit Dageville, Snowflake’s co-founder and president of merchandise, wrote in a weblog put up that the corporate intends to “infuse and leverage” Neeva’s AI-equipped search merchandise throughout its cloud companies. Phrases of the deal weren’t disclosed.

“Neeva permits us to faucet into a number of the most cutting-edge search applied sciences obtainable to convey search and dialog in Snowflake to a brand new degree,” Dageville wrote.

The acquisition comes days after Neeva, which was founded in 2019, stated it will shut down its client search engine to concentrate on creating use instances for AI and huge language fashions.

The corporate will maintain its quarterly name with buyers Wednesday at 5 p.m. ET.

— CNBC’s Ashley Capoot contributed reporting to this text.

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