cloudedjudgement.substack.com · 2023-05-26 · 1105d

Clouded Judgement: May 2023 Cloud Software Consumption Trends

Cloud software consumption trends weakened in April-May 2023, driven primarily by customer cost optimization (data retention policy changes) rather than demand destruction, with Snowflake reducing full-year growth guidance from 40% to 34%. Despite headwinds, positive leading indicators include 57% YoY growth in query volume and stronger performance in newer customer cohorts, though visibility on consumption reacceleration timing remains absent. SaaS valuation multiples continue to compress with median NTM EV/Revenue at 5.5x overall and 13.0x for top-growth companies, reflecting uncertainty around 2024 estimates.

16 metrics· Cited 0× in the knowledge base ·Open source ↗

Metrics in this report

CAC Payback Period

41months

median

Public SaaS companies

EV / NTM Revenue Multiple

5.5multiple

median

Overall public SaaS market

EV / NTM Revenue Multiple

13.0multiple

median

Top 5 highest-growth SaaS companies

EV / NTM Revenue Multiple

9.6multiple

median

High-growth SaaS (>30% projected NTM growth)

EV / NTM Revenue Multiple

7.4multiple

median

Mid-growth SaaS (15%-30% projected NTM growth)

EV / NTM Revenue Multiple

3.2multiple

median

Low-growth SaaS (<15% projected NTM growth)

FCF Margin

3percent

median

Public SaaS companies

G&A Expense

18percent

median

Public SaaS companies as % of revenue

Gross Margin

75percent

median

Public SaaS companies

LTM Revenue Growth

25percent

median

Public SaaS companies

NTM Revenue Growth

15percent

median

Public SaaS companies

Net Revenue Retention

115percent

median

Public SaaS companies

Operating Margin

-21percent

median

Public SaaS companies

R&D Expense

27percent

median

Public SaaS companies as % of revenue

Sales & Marketing Expense

46percent

median

Public SaaS companies as % of revenue

Snowflake Full-Year Growth Guidance Reduction

40 to 34percent

target

Snowflake 2023 full-year guidance revision