Key operational metrics unpacked
Though Snowflake’s core business is undeniably complex from a technical perspective – its product offering has proven increasingly attractive to a number of medium and large enterprises. This, in turn, has seen Snowflake’s operational metrics surge in recent times, with revenue and net retention figures, proving especially impressive.
Indeed, according to analysts from Forrester Research, when ‘compared over a dozen vendors, Snowflake has been positioned as a Leader. Enterprises like Snowflake’s ease of use, low cost, scalability and performance capabilities. Unlike many cloud data warehouses, Snowflake can run on multiple clouds such as Amazon, Google or Azure, giving enterprises choices to choose their preferred provider’ – via TechCrunch.
Looking at the company’s most recent operational metrics, as part of the IPO prospectus, Snowflake reported:
- Second quarter revenues of $133 million, up 121% year-over year
- A net retention rate of 158%
- 3,117 customers, 56 of which contributed over $1 million in revenue
- A gross margin of 66%, for the six months ending 31 July, 2020
- 500 million daily queries
Snowflake’s net retention rate appears particularly impressive, with management noting that customers typically expand their usage of the platform after being onboarded. The implications of such stickiness is equally important, with the company touting the implications of these network effects, saying:
‘The more customers adopt our platform, the more data can be exchanged with other Snowflake customers, partners, and data providers, enhancing the value of our platform for all users.’
Some of Snowflake’s largest and most prominent customers include: Adobe, DocuSign, Dropbox, Micron, Sony, Office Depot and Logitech.
Beyond attracting customers, Snowflake’s product offering and operational performance has attracted a bevy of high profile investors in the lead-up to its IPO – with the company’s raising some $479 million during its latest funding round – valuing the company at $12.4 billion, on a pre-public basis.
All up, Snowflake has raised a total of $1.4 billion across eight funding rounds.
Some of Snowflake’s key investors include, Salesforce, Dragoneer Investment Group, ArdenPoint Ecommerce, Human Capital and Meritech Capital, according to PitchBook.
Despite Snowflake’s impressive growth, the company remains loss making – reporting a net loss of $171 million for the six months ending 31 July.
