Snowflake Soars on Strong Q1 Results and AI Integration

Snowflake raises annual product revenue forecast

May 21 (Reuters) - Snowflake (SNOW.N), opens new tab raised its fiscal 2026 forecast for product revenue on Wednesday, betting on strong demand for its data analytics services as enterprises prioritize artificial intelligence spending. The company's shares rose 6% to $190.09 in extended trading after it topped first-quarter results estimates and forecast current-quarter revenue above expectations. Snowflake's stock has risen 16% so far this year. Snowflake's push to integrate artificial intelligence into its cloud through partnerships with OpenAI and Anthropic allows customers to build and run more advanced AI models to streamline large swathes of data. The company is also benefiting from higher enterprise spending as firms shift their workloads to the cloud while looking to develop AI applications. Snowflake's AI deals with other startups have helped it cater to a larger cohort of companies looking to build AI agents through its platform, analysts have said. The company forecast product revenue in the range of $1.035 billion to $1.040 billion for the current quarter, compared with estimates of $1.021 billion, according to data compiled by LSEG. Snowflake's first-quarter product revenue rose about 26% to $996.8 million, ahead of estimates of 21.5% growth to $959.2 million. It now targets fiscal 2026 product revenue of $4.325 billion, compared with its prior target of $4.28 billion. On an adjusted basis, the company earned 24 cents per share in the first quarter, compared with estimates of a profit of 21 cents per share. Reporting by Zaheer Kachwala and Juveria Tabassum in Bengaluru; Editing by Vijay Kishore and Alan Barona Our Standards: The Thomson Reuters Trust Principles., opens new tab Suggested Topics:Artificial Intelligence

Snowflake gains momentum with solid earnings and revenue beats - SiliconANGLE

Snowflake gains momentum with solid earnings and revenue beats Snowflake Inc. added to its momentum as it delivered its first quarter financial results for the new fiscal year today, beating expectations on earnings and revenue to send its stock higher in late-trading. The company, which sells cloud-based data warehouse tools for businesses, delivered first-quarter earnings before certain costs such as stock compensation of 24 cents per share, beating the analyst consensus estimate of 21 cents. Revenue for the period topped $1 billion for the first time, coming in at $1.04 billion, up 26% from a year earlier. That was above the Street's view of $1.01 billion. Product revenue, which is derived from Snowflake's customer's consumption of compute, storage and data bandwidth, reached $996.8 million, also up 26% from a year ago and above the forecast of $962 million. Despite being profitable after adjustments, Snowflake is still losing money overall, and it posted a net loss of $429.9 million in the quarter. Snowflake Chief Executive Sridhar Ramaswamy (pictured) said the company remains focused on making its platform easy to use to enable fluid access to date wherever it sits and trusted for enterprise-grade performance. "We see an enormous opportunity ahead as we extend this value throughout the full data lifecycle," he added. For the current quarter, Snowflake is targeting product revenue of between $1.035 billion and $1.04 billion, which would of course be another milestone. The analyst consensus view sits at $1.02 billion. Snowflake's full-year forecast calls for revenue of $4.325 billion at the midpoint, also ahead of the consensus of $4.28 billion. It would represent growth of 25% from the previous year. In a note to clients, Evercore ISI analyst Kirk Materne said the forecast revenue bump, which comes despite ongoing macroeconomic uncertainty, illustrates that Snowflake's management has a lot of confidence in the durability of near-term demand. Snowflake has been making good progress on the product front too. During the quarter, the company announced it's adding full support for the popular Apache Iceberg table format to its platform. It's a key move that allows businesses to work with Iceberg tables on Snowflake's platform without data migration, supporting artificial intelligence development and advanced data analytics. The company also took a key step towards fulfilling its ambitions to compete in the government sector when it achieved Department of Defense Impact Level 5 Provisional Authorization in April. That was a key certification that enables its platform to be used by DOD agencies such as the U.S. Army, Navy, Air Force and Space Force, as well as DOD partners and contractors. It all adds up to some solid momentum for Snowflake and its investors were appreciative, with the company's stock gaining more than 7% in late trading today. In the year to date, Snowflake's share price has climbed 16%, going against the grain with regards to the broader S&P 500, which is flat over the same period. Jeffries analyst Brent Thill believes there's even better to come from Snowflake. "We favor Snowflake as our top AI breakout play, with more meaningful AI upside in the back half of the year," he said in a note to clients prior to today's report.

Snowflake Pops After Solid Quarter: Analysts See Strength In AI, New Workloads - Snowflake (NYSE:SNOW)

Shares of Snowflake Inc SNOW rallied after the company Wednesday reported its first-quarter results. The announcement came amid an exciting earnings season. Here are some key analyst takeaways. Piper Sandler On Snowflake Analyst Brent Bracelin reiterated an Overweight rating, while raising the price target from $175 to $215. Snowflake's total revenue surpassed $1 billion in the first quarter, driven by "another quarter of strong execution and better-than-expected contribution from new products," Bracelin said in a note. Large deal momentum continued, with the company inking two deals worth more than $100 million during the quarter, he added. These deals contributed to Snowflake's healthy backlog metrics, with cRPO (current remaining performance obligation) accelerating to 31% year-on-year, from the previous quarter's 27%, the analyst stated. "Management has not yet witnessed any negative macro impacts, partially attributable to a more mature customer base, and even cited strong customer net adds (451 vs. 357 one year ago)," he further wrote. Stifel On Snowflake Analyst Brad Reback maintained a Buy rating, while lifting the price target from $210 to $220. Snowflake posted a strong quarter, with growth in product revenue accelerating to 4%, from 3% in the previous quarter, Reback said. This was driven by "outperformance from newer products (Snowpark, Dynamic tables), no tangible impact from the macro, and broad-based consumption strength," he added. The company's operating margins came in better than expected, with operating expenses growing only 15% year-on-year, a sharp deceleration from 36% in the first quarter of the last fiscal year, the analyst stated. With Snowflake yet to reap "the full benefits from the R&D hiring changes," the current margin gains appear sustainable, he further wrote. JMP Securities On Snowflake Analyst Patrick Walravens reaffirmed a Market Outperform rating, while raising the price target from $201 to $245. Snowflake reported total revenue of $1.04 billion, beating consensus of $1.01 billion, Walravens said. The company's non-GAAP earnings of 24 cents per share surpassed expectations of 21 cents per share, he added. The company's second-quarter guidance came in better than expected, with product revenue of $1.035-$1.040 billion above consensus $1.021 billion, representing 25% year-on-year growth and non-GAAP operating margin of 8% ahead of consensus of 7%, the analyst stated. "Snowflake addresses a huge opportunity that is expected to double to $342B in 2028 from $152B in 2023," he further wrote. Check out other analyst stock ratings. Truist Securities On Snowflake Analyst Joel Fishbein reiterated a Buy rating, while lifting the price target from $210 to $235. Snowflake delivered a strong beat and raise quarter, "driven by both core momentum and the adoption of new workloads," Fishbein said. Management raised their fiscal 2026 product revenue growth guidance to 25%, from their prior projection of 24%, he added. "We did not hear signs of macro uncertainty impacting consumption on the call and believe that they are establishing the foundation of a strong go to market motion in the emerging AI landscape," the analyst further wrote. Oppenheimer On Snowflake Analyst Ittai Kidron maintained an Outperform rating, while raising the price target from $201 to $225. Snowflake delivered strong quarterly results, driven by "broad-based demand and steady consumption trends," Kidron said. The company's total customers grew by 18.9% year-on-year to 11,578 in the quarter, he added. "In addition, better-than-expected Snowpark and Dynamic Tables activity and strong AI adoption (5,200+ accounts) suggest that newer products are resonating with customers," the analyst wrote. He named Snowflake as a top pick. Rosenblatt Securities On Snowflake Analyst Blair Abernethy reaffirmed a Buy rating, while raising the price target from $205 to $210. Snowflake reported margins of 9%, versus Rosenblatt's 5% estimate, on the back of its revenue beat and ongoing efficiency improvements, Abernethy said. Snowflake had strong renewals during the quarter, including two deals worth over $100 million each, he added. The company's trailing NRR (net revenue retention) remained healthy, at 124%, the analyst stated. "We believe Snowflake's much improved product development cadence last year is clearly resonating with existing customers, driving increasing consumption levels," he further wrote. Needham On Snowflake Analyst Mike Cikos reiterated a Buy rating, while lifting the price target from $215 to $230. Snowflake outperformed its revenue guidance by $36.8 million and raised its full-year outlook by $45 million, Cikos said. For the second quarter, the company's revenue guidance came in $15.1 million above consensus, he added. "Investors are hunting for high-growth companies, and we believe Snowflake's updated FY26 Revenue outlook for 25% yr-yr growth answers the call," the analyst wrote. GenAI is likely to be "a long-term secular tailwind to Snowflake's growth," he further stated. SNOW Price Action: Shares of Snowflake had risen by 10.3% to $197.55 at the time of publication on Thursday. Read More: Snowflake Jumps 8% Pre-Market After Piper Sander Hikes Price Target To $215, Calls It 'High-Conviction Growth Play' Photo: Shutterstock SNOWSnowflake Inc$198.0810.6%Stock Score Locked: Want to See it? Benzinga Rankings give you vital metrics on any stock - anytime. 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Snowflake Stock Is Soaring -- But Is It Too Late to Jump In? | The Motley Fool

Snowflake (SNOW -1.50%) shares continued their recent upward momentum following a strong fiscal first-quarter earnings report and increased guidance from the company. The stock is now trading up about 32% on the year, as of this writing, and up nearly 57% since early April. Let's take a closer look at the company's most recent earnings results to see if its momentum can continue. For those unfamiliar with Snowflake, it is a cloud-based data warehousing and analytics company. Customers use its solutions to store and analyze large amounts of data. Its system separates storage from computing and works across cloud providers, allowing users to securely share data in real time. There has been some worry that artificial intelligence (AI) could disrupt its business. Snowflake thrives at handling and analyzing structured data, while AI excels at analyzing unstructured data. As such, there has been some concern that AI would reduce the need for structured data, since it can extract meaning and context from unstructured data. However, thus far there hasn't been less need for structured data, while Snowflake has embraced AI to expand its services to unstructured data. The company's Cortex AI platform, which incorporates AI tools directly into its data platform, has been a hit with customers. It said that over 5,200 accounts use its AI and machine learning capabilities weekly. Meanwhile, it has been able to improve its connectivity capabilities and integration with platforms like Google Drive following its acquisition of Datavolo. This helped power 26% year-over-year revenue growth as the company topped $1 billion in quarterly revenue for the first time. Its $1.04 billion in total revenue also topped the $1.01 billion analyst consensus, as compiled by LSEG. Product revenue jumped 26% to $996.8 million. Adjusted earnings per share (EPS) climbed to $0.24 from $0.14 a year ago, which was well ahead of the $0.21 consensus. Its net revenue retention rate stood at 124% over the past 12 months. This metric measures the growth of existing customers after churn and shows both strong retention and the company's ability to continue to expand within its customer base. Any number over 100% indicates expansion. Importantly, two large customers that ran out of capacity last quarter and elected to delay their renewals signed $100 million-plus contracts in the quarter. Snowflake is also doing a good job of adding new customers. It added 451 net new customers in fiscal Q1, which was a 19% year-over-year increase. Looking ahead, Snowflake increased its guidance for full-year product revenue to approximately $4.325 billion, up from a prior outlook of $4.28 billion. The new forecast represents 25% year-over-year growth. It is looking for an 8% operating income margin. For fiscal Q2, it forecast product revenue of between $1.035 billion to $1.045 billion, representing growth of about 25%. It projected an 8% operating income margin. Snowflake is starting to change the narrative around how AI will impact its long-term growth. It's doing more than just holding onto customers; it's consistently adding new ones and expanding relationships with existing clients. A big part of that growth is coming from upselling solutions like Cortex AI and other new products, which are helping drive revenue growth. While the stock has had a strong 2025 so far, it's still down about 50% from the fall of 2021. However, it is probably fair to say that the stock was overvalued at that time, with a trailing price-to-sales (P/S) multiple of over 100 times back then. With a forward P/S multiple of over 12x this fiscal year's analyst estimates, the stock is not in the bargain bin, but it's not a crazy valuation for a software-as-a-service (SaaS) company with high gross margins growing its revenue between 25% to 30%. Given its valuation and the opportunity in front of it, I think the stock looks fairly valued at this time. As such, I wouldn't chase the rally in the stock, but I also wouldn't be a seller if I owned it either. The key will be for the company to continually prove that AI is helping its business and not hurting it. That will take time, but it's been doing a great job so far.