Snowflake shares fall on slower product revenue growth forecast for fourth quarter

Dec 4 (Reuters) - Snowflake shares slumped 8% successful premarket trading connected Thursday aft the unreality information analytics institution forecast slower merchandise ​revenue maturation for the 4th quarter, partially deed by discounts offered ‌on the large, semipermanent deals.

Chief Executive Officer Sridhar Ramaswamy said connected Wednesday that the institution ‌provides much favorable pricing for larger volumes oregon longer-term contracts, noting that these "don't thin to person an contiguous interaction connected revenue."

However, astatine slightest 13 brokerages raised their terms targets connected the stock, encouraged by the signs of adoption successful ⁠the company's AI offerings.

If premarket ‌losses hold, Snowflake could suffer astir $7 cardinal from its marketplace worth of astir $90 billion. The company's shares person risen ‍over 70% truthful acold this year.

The institution besides announced a $200 cardinal multi-year statement with Anthropic to bring Claude models to its platform.

Snowflake's merchandise gross was "undoubtedly decent" but was ​slightly beneath capitalist expectations aft peers similar Datadog, Confluent and MongoDB ‌showed awesome performance, analysts astatine Scotiabank said successful a note.

The institution said implicit 7,300 businesses prosecute with its AI features weekly, portion its agentic AI solution, Snowflake Intelligence, has attracted astir 1,200 customers wrong a period of launch.

"While it remains precise aboriginal innings, we are encouraged by the signs of ⁠traction SNOW is showing with AI usage ​cases," said analysts astatine Truist Securities.

Its third-quarter gross ​of $1.21 cardinal exceeded LSEG-compiled estimates of $1.18 billion.

The institution expects fourth-quarter merchandise gross maturation of 27%, portion it reported 29% maturation ‍in the October quarter.

Products ⁠offered by companies similar Snowflake assistance clients to store, process and consolidate information that helps successful producing concern insights.

Snowflake trades astatine 165.11 ⁠times the estimates of its net for the adjacent 12 months, compared with 65.86 times ‌for peers Datadog and 76.07 times for MongoDB.

(Reporting by Jaspreet Singh ‌in Bengaluru; Editing by Vijay Kishore)