With shares of data cloud technology company Snowflake (NYSE: SNOW) getting hammered this week following its fiscal second-quarter earnings report, some investors may be wondering if this is a good opportunity to buy the dip in the growth stock. After all, shares are not only down more than 40% over the last 12 months, but they are trading far below the $245 price the stock started trading at on its public debut in 2020.

But investors shouldn't let a falling stock price fool them into automatically concluding the data cloud platform provider's shares are a bargain. A close look at Snowflake's earnings report reveals several major concerns about the company -- particularly in the context of the stock's sky-high valuation.

Reacceleration in product revenue (about 95% of total revenue) earlier this year didn't last long. The company, which provides a platform for companies to access, manipulate, and share their data in a unified and seamless digital environment, reported a product revenue growth rate of 34% in the first quarter of fiscal 2025, up from 33% in the quarter ended three months earlier. But this key metric fell to 30% in Snowflake's just-reported quarter.

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Source Fool.com