Snowflake reports Q3 product revenue up 29% YoY to $1.16B, and forecasts Q4 adjusted operating income margin below estimates; SNOW drops 7%+ after hours (Brody Ford/Bloomberg)
NegativeArtificial Intelligence
- Snowflake Inc. reported a 29% year-over-year increase in Q3 product revenue, reaching $1.16 billion. However, the company forecasted a Q4 adjusted operating income margin that fell below analysts' expectations, leading to a more than 7% drop in its stock price after hours. This outlook has raised concerns about the profitability of its artificial intelligence initiatives.
- The disappointing margin forecast is significant for Snowflake as it may impact investor confidence and the company's ability to attract future investments. The market's reaction suggests that investors are wary of the financial sustainability of Snowflake's growth strategy, particularly in the competitive AI landscape.
- This development reflects broader investor anxieties regarding the financial health of major tech companies involved in AI. Many firms are grappling with rising debts and operational costs associated with AI investments, leading to increased scrutiny from investors. The situation highlights a growing concern about potential supply shortages in the tech sector, as companies like Dell and HP warn of memory-chip shortages driven by AI demand.
— via World Pulse Now AI Editorial System
