• While Snowflake beat revenue expectations for its fiscal first-quarter results, its adjusted operating margin forecast was lighter than expected.
• Management maintained its guidance for the full year.
• The company is looking to add business by offering tools designed for companies in the retail and health-care industries.

Snowflake shares fell as much as 16% in extended trading on Wednesday after the data analytics software maker disappointed analysts by saying it doesn't expect a positive adjusted operating margin for the current quarter.

Here's how the company did:

• Earnings: Loss of 53 cents per share
• Revenue: $422.4 million, vs. $412.8 million as expected by analysts, according to Refinitiv.

The company's revenue grew about 85% year over year in the quarter, which ended on April 30, according to a statement. In the prior quarter, revenue grew 101%. Almost all of Snowflake's revenue comes from product revenue, which jumped by 84%, compared with 102% in the prior quarter. The figure accounts for use of Snowflake's software for storing and executing queries on data stored in its system.

Snowflake reported having no adjusted operating margin, while analysts surveyed by StreetAccount had predicted a -1.2% margin. Snowflake's net loss came to $165.8 million, compared with $203.2 million in the year-ago quarter.

"Last year, we saw certain customers experienced much higher-than-expected consumption their own businesses were growing extremely fast," Mike Scarpelli, Snowflake's finance chief, said on a conference call with analysts.

"Today, some customers face a more challenging operating environment specific customers consume less than we anticipated, amid shifting economic circumstances, we believe are unique to their businesses, most notably consumer-facing cloud companies. Although these customers are still growing, we believe as long as they are impacted by macroeconomic headwinds, the consumption will be impacted."

One analyst brought up Facebook parent Meta Platforms, Netflix or Peloton, all of which posted lower-than-expected first-quarter revenue, along with retailers Amazon, Target and Walmart, none of which were as profitable as analysts had thought they would be. Scarpelli said none of the companies the analyst asked about were among those dragging down Snowflake's results.

The slowdown came in April in particular, leading executives to reset their forecasts for specific customers for the full fiscal year, Scarpelli said. The past two weeks of May were very strong, but macroeconomic concerns now have leaders feeling more cautious, Scarpelli said.

In the quarter Snowflake took steps to become more relevant in specific industries. It announced a Retail Data Cloud that draws on an expanded partnership with Amazon, as well as a Healthcare and Life Sciences Data Cloud. One of Snowflake's rivals, privately held Databricks, has begun focusing on industries as well. Snowflake shifted to a vertical rather than geographical approach in part of its sales organization, Scarpelli said.

Snowflake had 6,322 customers as of quarter end, up from 5,944 at the end of January.

With respect to guidance, management called for 71% to 73% fiscal second-quarter product revenue growth and an adjusted operating margin of -2%. Analysts polled by StreetAccount had expected 72% growth and an adjusted margin of 0.3%.

For the full fiscal year, Snowflake continues to see 65% to 67% product revenue growth and a 1% adjusted operating margin. The StreetAccount consensus was about 66% product revenue growth and an adjusted operating margin of 1%.

Snowflake's software was quickly expanding, with 120% revenue growth, when it debuted on the New York Stock Exchange in September 2020, and the growth hasn't slowed down much. But investors have become less favorable on the stock, along with other technology companies that grow fast but don't generate income. Leaving out the after-hours move, Snowflake shares have fallen about 61% since the start of the year, compared with a decline of 16% for the S&P 500 U.S. stock index over the same period.

Salesforce, through its corporate-venture arm, sold the remainder of the Snowflake stake it picked up through the initial public offering during the first quarter. Given the reduction of Snowflake's stock price, Rosenblatt Securities upgraded it to a buy rating from the equivalent of hold on Monday.

"Snowflake is not a growth-at-all-costs company, and we only invest with defined expectations in terms of return business impact," CEO Frank Slootman said on the conference call. "Research and development investments must lead to innovation and differentiation. Sales and marketing investments must lead to productive growth, and G&A investment is focused on system and process efficiency. Our strategic focus on continued growth informs all of our investments, coupled with improving free-cash-flow generation."

But Slootman said the company has a big opportunity ahead, and so it's not completely shutting down investment for future growth. Scarpelli said Snowflake still plans to add over 1,500 employees in the full fiscal year.

"There's no reason for us to be in a battening-the-hatches mode, because the investments that we are making are continuing to yield," Slootman said.

And there could be opportunities to acquire companies to add talent.

"I do think the next six months, if things stay where they are, there could be interesting opportunities on the M&A front, not necessarily big M&A, but I do think the -- there's going to be some valuation resets on some of the private companies out there," Scarpelli said.

WATCH: Why Citi's Tyler Radke says it's time to be selective with software stocks