Snowflake Inc Q4 2025 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Sanjit Singh - Morgan Stanley - Analyst : This is Sanjit Singh for Keith. I want to extend my congrats. Not many software companies at scale are growing 30% in this environment. And then, Mike, congrats on a stellar distinctive career in software. With that, maybe just some of the questions, maybe Mike to start with you. On your comment on these large customers in Q4 exhausting their commitments, but not necessarily renewing going on demand. How usual or unusual is that? And do you expect these customers just to sign a commitment contract in due course?

Question: Sanjit Singh - Morgan Stanley - Analyst : Yeah, that makes complete sense. And then Sridhar for you, Mike also sort of tagged the guidance where the new products probably shows some more muster in the second half of this year. You've done a lot of work. The team has done a lot of work accelerating the pace of product innovation. Could you give us some color on the adoption trends within the data engineering portfolio and showing one bucket? And then looking at sort of the AI/ML application platform side with some of the announcements supporting both OpenAI models and Anthropic models. When do you think that starts to unlock more workloads, more customer adoption, and ultimately a greater revenue as we look to the balance of this year?

Question: Kirk Materne - Evercore ISI - Analyst : Congrats on a great quarter. Mike, congrats on a great run at Snowflake. Sridhar, I don't know if it's for you or Christian, but over the last 6 to 12 months, we've seen a lot of new announcements from data companies sort of partnering up with enterprise software vendors like ServiceNow or Salesforce and you guys have partnered with them. One of your competitors just partnered with SAP. I guess what's the best way to interpret these announcements in terms of where the center of gravity from a data perspective lives? I was just wondering if you guys could comment on that. And then, Mike, really quickly for you. Just any adjustments to the sales comp model that we should be aware of this year?

Question: Raimo Lenschow - Barclays - Analyst : Congrats from my end for the quarter and for Mike as well as in a working with you over the last few years. Two questions. One for Sridhar and one for Mike. Sridhar, how do we think about adjacencies for your offering that you kind of might want to consider? Or how do you think about them? Like, for example, this quarter, there was a big debate about streaming and how that might fit into you. So maybe can you kind of talk about like how you see the product evolving from your perspective? And then, Mike, for you on guidance, how conservative are the assumptions this year in the guidance versus kind of what you -- for example, did last year when you had the CEO change, obviously, how did the economy also play into the guidance for this year?

Question: Raimo Lenschow - Barclays - Analyst : It's just more -- if you think about adjacencies for where you want to play versus where you want partner and there think about streaming, for example, as one of the kind of areas?

Question: Brad Zelnick - Deutsche Bank - Analyst : Great. Maybe first for Sridhar, with Cortex agents announced for agent orchestration, can you talk a little bit more about what differentiates your offering versus many other agent offerings out there and maybe where the product vision came from? Was this something customers were asking for? And are there any early adopters maybe that you're working with out there?

Question: Brad Zelnick - Deutsche Bank - Analyst : That's really helpful. And Mike, just for you, with Q4 being such a bonanza bookings quarter, where you do a lot of big deals with large customers. Can you talk more about the trends you're seeing with your largest customers, maybe the momentum and expansion rates and the services that they're embracing and plan to consume this year?

Question: Brent Bracelin - Piper Sandler Companies - Analyst : Mike, happy to learn you're not leaving anytime soon here. We'll save the current graphs. But I did want to ask you a question around product growth. The guide implies an acceleration for the first time into the second half in 3.5 years. what's driving the optimism on acceleration? Is it all new products? Or are you feeling better about consumption activity across the base?

Question: Brent Bracelin - Piper Sandler Companies - Analyst : Helpful color there. And then Sridhar, just as you think about growth levers to the business, one area you flagged with this idea of Snowflake role in AI-powered advertising. You clearly know the advertising market well. I never really thought of the large ad market as a as a meaningful opportunity for Snowflake. Can you just double click into when you think about the AI-powered ad market, is there an unlock that you see there for Snowflake in that kind of new workload scenario?

Question: Alex Zukin - Wolfe Research - Analyst : Mike, I look forward to our banter for at least a few more quarters.

Question: Alex Zukin - Wolfe Research - Analyst : Sridhar, maybe just on looking at the spend intensity in your market, it seems like something has changed to the positive over the past six months. It seems like it's gotten better. You've been meeting with a lot of customers. Mike mentioned the tech and financial services verticals outperforming. But maybe can you talk to how much of this is a broader demand environment versus sales execution improvements versus confidence in kind of like better product innovation velocity, releasing of new products? Anything you can do there I think it would be helpful. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 26, 2025 / 10:00PM, SNOW.N - Q4 2025 Snowflake Inc Earnings Call

Question: Alex Zukin - Wolfe Research - Analyst : Super helpful and really clear. Mike, maybe one for you, while we still have you. The guide for next year, it does seem like it's starting. I think you've gotten this question in a few different ways. It's starting at a stronger place than if I look at a year ago. If we look a year ago, when you were incorporating maybe some iceberg risk. So to the extent that you can put finer point on that confidence that you have to put that guide out there, again, implying some acceleration. You mentioned some -- Sridhar mentioned some new products potentially ramping in the second half from a contribution standpoint. How do we think about iceberg as a tailwind or a headwind in that guide? How do we think about NRR stabilization at 126% in the context of that guide. Any finer point you put on it? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 26, 2025 / 10:00PM, SNOW.N - Q4 2025 Snowflake Inc Earnings Call

Question: Matthew Martino - Goldman Sachs - Analyst : This is Matt Martino on for Kash Rangan. Sridhar, one for you. I know Snowflake is recently coming off their sales kickoff. So it would just be great to get some of your takeaways from the event and kind of what the key message was to the sales force, whether it's around prosecuting new use cases or pushing some of the newer products Snowflake is bringing to market?

Question: Joel Fishbein - Truist Securities - Analyst : I guess it's a two-part. One for Sridhar and one for Mike, but same topic. Mike, you had an expansion with your partnership with Microsoft and relates to Open AI. I would love to just get a little more granular about what that means for you guys for Snowflake? And Mike, if you can potentially quantify what that could mean from a revenue standpoint in the future?