Snowflake Results Top Estimates as Its Stock Rises
Snowflake stock rises in late trading as it surpasses earnings expectations, although its outlook for the current quarter is slightly below expectations.
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Posted 8/23/2023, 8:43:00 PM
barrons.com
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Software company Snowflake is expected to deliver solid financial results in its upcoming report, with analysts predicting increased earnings and revenue driven by positive consumption trends and improved sales momentum in a challenging budget environment.
Cloud-data platform provider, Snowflake, reported strong second-quarter earnings, exceeding analyst expectations with a 36% increase in revenue, leading to a 3% rise in their stock value.
Stocks rise as markets shift focus from the Federal Reserve to corporate and economic reports, with the S&P 500 and Dow Jones Industrial Average both experiencing gains, while investors await upcoming economic data and inflation updates.
Berkshire Hathaway's investment in Snowflake, an unprofitable cloud computing company, may raise eyebrows, but Snowflake's role in the data business and its potential in the AI industry make it an attractive investment opportunity for long-term investors.
Snowflake's stock, despite being a fast-growing company in the AI industry, is burdened by its lack of profitability and excessive stock-based compensation, which dilutes shareholder value and reduces long-term gains.