CEO Sridhar Ramaswamy dives into Cortex AI and Iceberg customer momentum, the impact of Snowflake’s recent cyberattack and how AI will ‘c ontribute materially to revenue’ in 2025 .

CEO Sridhar Ramaswamy was bullish about his company’s AI future during Snowflake’s Q2 earnings report on Wednesday, while also downplaying his company’s recent cyberattack and unveiling that Snowflake has an AI “war room.”

“We have basically a war room, a top-to-bottom team from engineering to sales, that is focused on how we take AI products to market,” said Snowflake’s CEO Ramaswamy during the company’s Q2 2024 financial earnings report. “And we expect our Notebooks, for example, to hit GA in a few weeks and we will be making an effort around making sure that those get into the hands of data scientists so that they can run the most complex machine-learning algorithms that they want to run on-top of Snowflake.”

A big talking point from Ramaswamy was how a recent cyberattack targeting Snowflake customers did not make any serious impact on the company.

“I would say that there’s not really been any noticeable effect or delay in things like our ability to sign up customers or get existing customers to deploy new projects,” said Snowflake’s CEO regarding the cyberattack. “After multiple investigations by internal and external cybersecurity experts, we found no evidence that our platform was breached or compromised.”

[Related: Forrester’s 10 Biggest Cloud Trends In 2024: Nvidia, VMware And AI]

Snowflake Q2 Earnings Results

Snowflake said it generated $829 million in second-quarter 2024 revenue, representing a 30 percent increase year over year. The Bozeman, Mont.-based company reported an operating loss of $355 million for the quarter.

For its current third quarter, Snowflake is projecting total sales of between $850 million and $855 million. Total 2025 revenue guidance for Snowflake is $3.36 billion, which would represent 26 percent year over year growth.

“In the first half of this year alone, we brought as much product to market as we did all of last year. We are making Snowflake the best cloud for computation, collaboration, and application on our data,” he said. “Our goal is to be relevant. And for me, relevance is lots and lots of our customers, thousands of customers using our products and driving meaningful revenue.”

CRN breaks down six of CEO Ramaswamy’s boldest remarks on AI sales, Snowflake Cortex AI and Iceberg momentum, the impact of the recent cyberattack and much more.

AI Will ‘Contribute Materially To Revenue’ In 2025

With our AI products, we are seeing broad adoption. And we expect that it will begin to contribute materially to revenue next year.

The combinations of our platform on the network effect of collaboration, as well as the innovation we are working on in AI, is Snowflake’s future and creates a huge opportunity ahead.

We just don’t go in and say [to customers] ‘Use AI.’

We talk about how it can be used to derive much better insights or unstructured information, for example, by using an LLM function for doing data transformation like sentiment detection. Also easier access to data, whether it is with the chatbot or text docs or using something like analysts to give a business user access to structured data. Those tend to be the follow-on applications and really we feel comfortable enough to be able to be investing in these in parallel to drive revenue growth.

As of the end of Q2, more than 2,500 accounts were using Snowflake AI on a weekly basis. We expect that option to continue to increase and revenue contribution to follow.

Cyberattack Had ‘No Impact On Us’

The cybersecurity incident … really had no impact on us at all from a consumption standpoint.

Part of the reason why we are slightly muted about this is … the people that got breached, these are our customers, and we want to work closely with them to make sure that they get out of the difficult situation that they are in.

Both existing customers and new customers appreciate that spirit of partnership in helping them get through difficult situations. We had them talk to our CFOs, we had them talk to our security field CTOs, advise them on best practices.

I would say that there’s not really been any noticeable effect or delay in things like our ability to sign up customers or get existing customers to deploy new projects. We just need to be more proactive about having the security conversation and we absolutely do that.

‘No Evidence That Our Platform Was Breached Or Compromised’

We obviously had some rough headlines in the quarter as some of our customers dealt with cybersecurity threat. As extensively reported, the issue wasn’t on the Snowflake site.

After multiple investigations by internal and external cybersecurity experts, we found no evidence that our platform was breached or compromised. However, we understand that when it comes to cybersecurity, we are all in it together.

My one ask of all businesses around the world, whether they are a Snowflake customer or not, is to enable and enforce multi-factor authentication in your organization and ensure that you have network policies that are as strong as possible. Two things we at Snowflake have supported since 2016.

Tabular Has ‘No Impact’ On Iceberg, Now With Over 400 Accounts

Iceberg is enabling us to play offense and address a larger data footprint.

Many of our largest customers have indicated they will now leverage Snowflake for more of their workloads as a result of this functionality. More than 400 accounts are using Iceberg as of end of Q2.

Iceberg is providing one of the largest consumer services and hospitality companies with a more flexible and interoperable deployment model, enabling them to accelerate their migration to the cloud.

It’s important to understand that the acquisition of Tabular, the company has no impact on the Iceberg project, which is an Apache open source project. This has contributors and program committee members from a number of a cloud companies, the hyperscalers, yes, but also other companies.

We very much intend for this to be an industry standard that we take a pretty significant role in shaping.

So from that perspective, we actually feel that the Tabular acquisition in many ways is a vindication of our strategy to bet on Iceberg because that was the format that was truly interoperable — hopefully, this is the end of the Betamax wars with everybody centering around the one format that has broad support.

We will continue to be a key player in this ecosystem to ensure that the format truly serves everybody and moves the industry forward.

Snowflake AI ‘War Room’

We have basically a war room, a top-to-bottom team from engineering to sales, that is focused on how we take AI products to market.

And we expect our Notebooks, for example, to hit GA in a few weeks and we will be making an effort around making sure that those get into the hands of data scientists so that they can run the most complex machine-learning algorithms that they want to run on-top of Snowflake. So we have a pretty methodical approach to how we are taking new products to market.

But across the gamut, whether it is AI or machine learning, or more sophisticated data engineering operations, including with unstructured data or things like Notebooks appealing to a very different persona, that is broad interest. It’s a matter of organizing ourselves to put the right product offering in front of the right customer at the right time.

I would say the change over the previous quarter is that we can tell our customers, we can tell you with confidence that our AI products are world-class, and honestly, that we are much more reliable than building products off of APIs that you can get elsewhere because we pay a lot of meticulous attention to how we craft products.

It’s that combination of reliability and ease-of-use that we are turning into a major strength for us in AI.

‘Strong’ Cortex AI Adoption

We have a number of product capabilities under that Cortex umbrella.

Cortex LLM, which references the different language models that are available, the adoption is quite strong— lots of the use cases that alluded to on tech summarization, tech sentiment analysis. But also we introduced both Cortex Analyst and Cortex Search as a way to enable the users across all types of organizations to be able to chat and integrate their data whether it’s structured or unstructured.

Those two are important for you, but the adoption at this stage is quite strong.

The last one is Snowflake Copilot. We see a lot of usage on customers getting assistance on how to write better SQL queries, which also drives consumption back into Snowflake. So all up, a strong product suite and interest and adoption across all of them.

Our bet is really that AI and machine learning are going to go where the data is, data is going to have strong gravity and this is the reason why we are seeing such broad adoption. And by providing easy-to-use products with Cortex AI, for example, any analyst that knows SQL now is able to use language models.