Snowflake (NYSE:SNOW – Get Free Report) issued its quarterly earnings data on Wednesday. The company reported $0.62 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $0.45 by $0.17, FiscalAI reports. The firm had revenue of $1.55 billion during the quarter, compared to the consensus estimate of $1.48 billion. Snowflake had a negative net margin of 20.07% and a negative return on equity of 47.20%. The company’s revenue for the quarter was up 35.1% compared to the same quarter last year. During the same quarter in the previous year, the firm posted $0.35 EPS.
Here are the key takeaways from Snowflake’s conference call:
- Product revenue accelerated 37% year over year to $1.49 billion, marking the third consecutive quarter of growth acceleration and record sequential dollar growth. Management attributed the momentum to strength in the core data platform, migrations, and rapidly expanding AI workloads.
- Snowflake raised its FY2027 product revenue guidance to $6.07 billion, or 36% year-over-year growth, and lifted its non-GAAP operating margin outlook from 13.5% to 14.5%. Third-quarter product revenue is expected to grow 37%-38% year over year.
- AI adoption continued to broaden, with CoCo surpassing 9,100 accounts after adding more than 2,000 in the quarter, while CoWork reached 5,800 accounts. Management said AI adopters consume more of Snowflake’s core platform and that AI contributed roughly half of the recent growth acceleration.
- Customer expansion and engagement remained strong, including a 126% net revenue retention rate, 692 net new customers, 48 customers newly exceeding $1 million in trailing 12-month spend, and an 89% year-over-year increase in production use cases.
- Non-GAAP product gross margin guidance was reduced to 74% because fast-growing AI workloads currently carry lower contribution margins. Snowflake said it remains focused on improving economics over time while prioritizing product adoption and overall operating leverage.
Snowflake Price Performance
Shares of Snowflake stock opened at $356.78 on Friday. The firm has a market cap of $123.66 billion, a PE ratio of -112.19 and a beta of 1.33. The stock has a 50 day moving average of $295.85 and a 200 day moving average of $219.50. The company has a current ratio of 1.05, a quick ratio of 1.05 and a debt-to-equity ratio of 1.18. Snowflake has a 12 month low of $118.30 and a 12 month high of $384.56.
Insider Activity at Snowflake
Institutional Trading of Snowflake
Hedge funds and other institutional investors have recently bought and sold shares of the stock. Kemnay Advisory Services Inc. purchased a new position in Snowflake during the fourth quarter worth $28,000. Greenline Wealth Management LLC bought a new stake in shares of Snowflake in the 4th quarter worth about $29,000. JPL Wealth Management LLC purchased a new position in shares of Snowflake during the 3rd quarter worth about $39,000. Strive Financial Group LLC bought a new position in Snowflake during the 4th quarter valued at about $59,000. Finally, Geneos Wealth Management Inc. grew its holdings in Snowflake by 29.7% during the 1st quarter. Geneos Wealth Management Inc. now owns 319 shares of the company’s stock valued at $47,000 after purchasing an additional 73 shares during the last quarter. Hedge funds and other institutional investors own 65.10% of the company’s stock.
Key Snowflake News
Here are the key news stories impacting Snowflake this week:
- Positive Sentiment: Quarterly beat: Snowflake reported adjusted EPS of $0.62 versus the $0.45 consensus estimate. Revenue increased 35.1% year over year to $1.55 billion, exceeding expectations of $1.48 billion, while product revenue rose 37% to approximately $1.49 billion. Snowflake spikes on healthy results and AI coding momentum
- Positive Sentiment: AI is accelerating growth: Management said AI products contributed roughly half of the recent growth acceleration. Snowflake’s CoCo coding agent added more than 2,000 accounts, supporting the company’s strategy of expanding data-platform consumption through enterprise AI workloads. Snowflake Stock Soars as Surging AI Demand Boosts Earnings
- Positive Sentiment: Higher forecast: Snowflake raised fiscal 2027 product-revenue guidance to $6.07 billion from $5.84 billion. Management also indicated it remains on track to reach break-even next year, improving confidence in the company’s growth trajectory.
- Positive Sentiment: Analyst optimism: UBS, Citi, JPMorgan, TD Cowen, Bank of America and other firms raised their targets, with several Buy or Overweight ratings and targets ranging from the low $400s to $500. The consensus rating is Moderate Buy. Wall Street analyst views
- Positive Sentiment: Customer adoption: Sayari selected Snowflake to rebuild its Commercial World Model, potentially reducing its data-infrastructure costs by more than 50%, providing an additional example of enterprise use of the platform. Sayari selects Snowflake
Analyst Ratings Changes
Several analysts have issued reports on SNOW shares. TD Cowen boosted their price target on Snowflake from $370.00 to $450.00 and gave the company a “buy” rating in a report on Thursday. Stifel Nicolaus lifted their price target on shares of Snowflake from $350.00 to $450.00 and gave the company a “buy” rating in a report on Thursday. Morgan Stanley raised their price objective on shares of Snowflake from $300.00 to $470.00 and gave the company an “overweight” rating in a research report on Thursday. The Goldman Sachs Group restated a “buy” rating and set a $436.00 target price on shares of Snowflake in a research note on Thursday. Finally, KeyCorp upped their target price on shares of Snowflake from $285.00 to $325.00 and gave the stock an “overweight” rating in a report on Thursday, July 16th. Thirty-four equities research analysts have rated the stock with a Buy rating, five have assigned a Hold rating and one has given a Sell rating to the company. According to data from MarketBeat.com, the company presently has an average rating of “Moderate Buy” and a consensus price target of $410.19.
Get Our Latest Research Report on SNOW
About Snowflake
Snowflake Inc is a cloud-native data platform company that provides a suite of services for storing, processing and analyzing large volumes of data. Its core offering, often described as the Snowflake Data Cloud, combines data warehousing, data lake and data sharing capabilities in a single managed service delivered across major public cloud providers. The platform is designed to support analytics, data engineering, data science and application workloads with a focus on scalability, concurrency and simplified administration.
Key products and capabilities include a multi-cluster, shared-data architecture that separates compute from storage; continuous data ingestion and streaming; support for structured and semi-structured data formats; tools for data governance, security and compliance; and developer frameworks for building data applications.
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