Snowflake Looks to AI to Bolster Growth
Investors in Snowflake breathed a sigh of relief this week when the cloud data warehouser reported solid revenue growth for its first quarter and raised its guidance for the rest of the year. But questions still remain over its long-term growth, which the company is hoping that artificial intelligence will power.
Cloud data warehousing
Snowflake on Wednesday reported $829 million in total GAAP revenues for the quarter ended April 30, 2024, representing a 33% increase over the same period last year. It reported 14 cents per share, which was 6% increase over last year’s first quarter figure, but below analyst expectations. Its shares, which are traded on the New York Stock Exchange, are down about 4% from Wednesday’s close.
“We finished our first quarter with strong performance across many of our key metrics,” said Sridhar Ramaswamy, CEO, Snowflake. “Our core business is very strong. Our AI products, now generally available, are generating strong customer interest. They will help our customers deliver effective and efficient AI-powered experiences faster than ever.”
Snowflake today also announced its intent to acquire certain technology assets and hire key employees from TruEra, an AI observability platform. TruEra provides capabilities to evaluate and monitor large language model (LLM) applications and machine learning models in production.
AI observability platform
Like most data companies, Snowflake is betting on generative AI to help drive sales. Last month, the company launched Arctic, a mixture of experts (MoE) LLM that customers can use to train models using data they have stored in Snowflake. These models can then be used to build GenAI applications, such as chatbots and AI copilots.
Arctic, a mixture of experts (MoE) LLM
Companies are rushing to adopt GenAI technology to help them serve customers more efficiently, to build new experiences for consumers, and to empower employees with access to more information. However, a score of issues, ranging from data governance concerns to the tendency for LLMs to “hallucinate” answers to questions, has slowed the rollout of GenAI apps from internal testing to production.
GenAI technology
Snowflake’s acquisition of TruEra’s assets and talent will help the company to further develop its AI capabilities, enabling it to provide more effective and efficient AI-powered experiences to its customers. As the company continues to invest in AI, it is likely to play a significant role in shaping the future of data warehousing and analytics.
Snowflake’s AI-powered future
