Snowflake Fiscal Year End January 2023 - Act Now

These days the whole world sometimes feels like a Snowflake… and by that we mean that growth is slowing, and stocks are generally down as reality sets in. Snowflake, the company, is still growing but nowhere near the breakneck speed of the good (?) old days. Macroeconomic factors may be contributing to that, but we believe that, like our clients, the market for Snowflake has figured out that deployments need to be actively managed so that the negotiated costs are not exceeded.

Early Snowflake customers learned the hard way that their first agreement would ultimately set the floor for what they would spend, eventually understanding that their spending could, and often did, radically exceed expected consumption. If the business value received also exceeded expectations, then that may be OK, but more often than not those value propositions were not realized.

This issue is not unique to Snowflake as customers of other consumption-based suppliers like AWS and Microsoft’s Azure also find themselves burning through their multi-year commitments very early in the term.

NET(net) identified this problem early (read more) and we have helped our clients negotiate market leading agreements with Snowflake and the consumption based cohort of suppliers (AWS, Azure, etc.), and then actively manage consumption to ensure that the business value intended from the investment is fully realized.

The Market

Snowflake’s stock performance has been reflective of the wider market having lost at least 60% of its market value over the last year. Consensus seems to be that the stock is still overvalued as compared to other similar firms in the software market. As of this writing, their stock is only trading around $18 over their five-year low of $119 a share.

snowflake graphic stock

Revenue growth is still impressive over the last four years, nearly doubling from 2021 to 2022:

  • 2019: $97M
  • 2020: $265M
  • 2021: $592M
  • 2022: $1.2B

The risk for Snowflake appears to the same issue that has made them the darling of Wall Street, the consumption-based model. As the recession gets deeper, their customers will slow down that consumption and thus their billings.

Snowflake’s Leadership

Frank Slootman has been the Chairman and CEO of Snowflake since 2019 and took the company public in 2020. Before his current role, he also served as Chairman and CEO of ServiceNow, as well as Sr. Leadership roles with EMC, Borland Software, and Data Domain (acquired by EMC).

His recent book published in 2022 titled, “Amp It Up: Leading for Hypergrowth by Raising Expectations, Increasing Urgency, and Elevating Intensity”, probably gives you a sense for the kind of working environment he has created. In the book, he emphasizes many key points not the least of which is creating a working environment where people leave at the end of the day with a smile on their face having been fulfilled by the work they are doing and excited to go back the next day. It may be working, as they have a Glassdoor rating from current and past employees of 4.3 out of 5. They also carry an 86% ‘Recommend to a Friend’ rating and a 96% approval of CEO. Those are pretty good scores overall.

Why do we care what the employees think? That’s usually a good indicator of what it will be like to work with them as your supplier. Happy employees typically make better partners and people to do business with.

Snowflake Pricing

As you likely already know and we’ve discussed, Snowflake has taken full advantage of the consumption model. We have had great success in working with Snowflake customers to optimize their spend, but the first step is knowing how they charge.  They will bill you based on two pieces (taken from their Pricing Guide):

  • Storage – charged per TB/per month (range of $25 to $40/TB/Month). From their datasheets: A monthly fee for data stored in Snowflake is calculated using the average amount of storage used per month, after compression, for data ingested into Snowflake. Depending on file types, compression can reduce the total storage needs substantially.
  • Compute – Usage is charged per second based on Snowflake credits (their unit of consumption measurement) or processing units, and is dependent on the size of the ‘warehouse’ being utilized. From their datasheet: A virtual warehouse is one or more compute clusters that enable customers to load data and perform queries. Customers pay for virtual warehouses using Snowflake credits. Snowflake supports a wide range of virtual warehouse sizes: X-Small, Small, Medium, Large, X-Large, 2X-Large, 3X-Large, and 4X-Large. The size of the virtual warehouse determines how fast queries will run. When a virtual warehouse is not running (that is, when it is set to sleep mode), it does not consume any Snowflake credits. The different sizes of virtual warehouses consume Snowflake credits at the following rates, billed by the second with a one-minute minimum.



































  • Cloud Services – From their datasheet: The cloud services layer provides all permanent state management and overall coordination of Snowflake. Customers pay for cloud services using Snowflake credits.

Data storage prices range from $25-$40/TB per month, and it accrues daily. Compute usage is billed per-second, based their unit of measure, “credits”. The number of credits used is based on the size of the warehouse selected.

Knowing the mechanics of their pricing schedules is just part of the picture, however. Given our experience, most companies do not yet have the experience to negotiate a Snowflake deal that will truly optimize price while at the same time mitigating over-consumption risks.

Call to Action

Contact us today to learn more about how we can help you save 32-60% on all your SaaS investments, including those with Snowflake or Sign up now for a Savings Cloud subscription, and we will get started right away helping you minimize costs and risks, and maximize the realization of value and benefit.

About NET(net) 

Founded in 2002, NET(net) is the world’s leading IT Investment Optimization firm, helping clients find, get, and keep more economic and strategic value in their technology supply chains. With over 2,500 clients around the world in nearly all industries and geographies, and with the experience of over 25,000 field engagements with over 250 technology suppliers in XaaS, Cloud, Hardware, Software, Services, Healthcare, Outsourcing, Infrastructure, Telecommunications, and other areas of IT spend, NET(net) has the expertise you need, the experience you want, and delivers the performance you demand, resulting in incremental client captured value in excess of $250 billion since 2002. Contact us today at, visit us online at, or call us at +1-616-546-3100 to see if we can help you capture more value in your IT investments, agreements, and relationships. 

NET(net)’s Website/Blogs/Articles and other content is subject to NET(net)’s legal terms offered for general information purposes only, and while NET(net) may offer views and opinions regarding the subject matter, such views and opinions are not intended to malign or disparage any other company or other individual or group.

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