Snowflake's Growth Bottlenecked by On-Prem Renewal Cycles

Snowflake's growth in the large enterprise market is hampered by the renewal cycles of older, on-premises data warehouse and analytics technology, according to its VP of Finance, Jimmy Sexton. While Snowflake's Q1 revenue hit nearly $1 billion, up 26 percent year-over-year, and they secured two deals exceeding $100 million in the financial services sector, growth is constrained by the lengthy migration process from on-prem systems. Customers typically only initiate migrations near contract renewals, limiting Snowflake's ability to rapidly expand in this market segment. This reliance on renewal cycles applies to various legacy systems, not just Teradata, hindering faster adoption.