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Call sheet · Q3'25

Snowflake (SNOW)

Q3'25 earnings call · held November 20, 2024 · compared with the Q2'25 call · management-credibility review
7/12
Disclosure score
3 medium, 4 low flags
Financial quality
Bottom line
The sleeper story is data engineering's $200M run rate - that's 6% of revenue from products launched in the past two years, yet everyone's fixated on AI timeline confusion. The Iceberg narrative completely flipped from storage headwind to growth catalyst without adequate explanation. The binding constraint isn't demand or competition - it's management's inconsistent messaging eroding credibility just as operational execution accelerates. Sridhar's best quote: 'AI needs to be a business accelerant, not a hobby' - they're prioritizing sustainable value over AI hype. My view changes if Q4 shows actual Iceberg storage revenue decline or if data engineering growth rates disappoint despite the $200M disclosure.

The 30-second version

  • Data engineering features hit $200M run rate while everyone obsesses over AI
  • Iceberg storage headwinds evaporated - customers bringing NEW data instead of moving existing
  • Operational rigor = margin expansion disguised as efficiency talk

What changed this quarter

MetricQ2'25Q3'25Change
Product Revenue$829M (+30% YoY)$900M (+29% YoY)Strong sequential acceleration, raised FY guide again
Non-GAAP Operating Margin5% (beat 3% guide)6% (beat guidance)+100bps sequential, margin expansion accelerating
Remaining Performance Obligations$5.2B (+48% YoY)$5.7B (+55% YoY)+700bps acceleration in RPO growth
Net Revenue Retention127% (stabilized)127% (stable)Held flat, no further deterioration
Storage as % of Revenue~11%11%No decline despite Iceberg rollout
Data Engineering FeaturesNot disclosed>$200M run rateFirst disclosure of combined data engineering revenue
AI Deployed Use CasesNot disclosed separately1,000+ deployedSpecific production deployment metric introduced
AI/ML Account Adoption2,500+ weekly active3,200+ accounts using+28% growth in AI customer base
Iceberg Account Adoption400+ accounts~500 accounts+25% sequential growth in Iceberg usage
Large Deals ($50M+ TCV)2 nine-figure deals3 deals $50M+ TCVContinued large deal momentum

Accountability tracked

8 new promises made5 narrative shifts flagged6 prior promises scored
Inside the full report
The complete write-up covers the full promise ledger with kept/missed calls, disclosure-quality scoring, the metrics-vanished check, verification items, and the questions to ask next quarter.
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Scores, kept-promise rates, and flags on this site reflect the author's opinion, applying a stated methodology to statements management made on public earnings calls. Informational and educational purposes only - not investment advice, a recommendation, or an offer to buy or sell any security. Sources believed reliable but not guaranteed; the author may hold positions in the securities discussed.

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