© Reuters. The company logo for Snowflake Inc. is displayed on a banner to celebrate the company’s IPO at the New York Stock Exchange (NYSE) in New York, U.S., September 16, 2020. REUTERS/Brendan McDermid/file photo
(Reuters) – Cloud data analytics company Snowflake beat second-quarter revenue and profit estimates on Wednesday, boosted by rising data management and storage needs of businesses amid a surge in the use of generative artificial intelligence.
Shares of the company rose more than 3% in trading after the bell.
Enterprises are increasingly moving their data and infrastructure to the cloud to improve efficiency, helping cloud-related services companies.
Snowflake offers products and services that clients can use to store, process and consolidate data that helps in producing business insights.
The Bozeman, Montana-based company’s revenue rose about 36% to $674 million for the quarter ended July 31, above analysts’ average estimate of $662.2 million, according to Refinitiv data.
Excluding items, the second-quarter adjusted profit per share was 22 cents, compared with analysts’ average estimate of 10 cents.
Snowflake’s second-quarter product revenue rose 37% to $640.2 million, above market estimates of $623 million.
Snowflake is well-positioned to enable the growing interest in artificial intelligence or machine learning, CEO Frank Slootman said, adding that enterprises “cannot have an AI strategy without a data strategy”.
The company forecast third-quarter product revenue in the range of $670 million to $675 million, compared with analysts’ average estimate of $670.8 million, according to Refinitiv data.
Snowflake had announced a partnership in June with chip company Nvidia (NASDAQ:) to allow customers ranging from financial institutions to healthcare and retail to build AI models using their own data.
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