Track market-moving stories before they get noisy

Key Takeaways Snowflake's fiscal Q2 product revenues rose 37% year over year to $1.49 billion on strong demand. Snowflake ended fiscal Q2 with 14,554 customers, while net new customer additions rose 32% year over year. Snowflake raised fiscal 2027 product revenue guidance to $6.07 billion, implying 36% year-over-year growth. Snowflake (SNOW - Free Report) is benefiting from strong enterprise adoption of AI and the rapid expansion of cloud analytics. The company’s AI Data Cloud combines governed enterprise data, AI models, applications and workflows, positioning the company to capture rising demand for analytics and agentic AI.

The expanding capabilities of the platform are also strengthening Snowflake’s competitive position against Dell Technologies (DELL - Free Report) and Oracle (ORCL - Free Report) across enterprise data infrastructure, cloud analytics and AI-driven workloads. Snowflake’s product revenues increased 37% year over year to $1.49 billion in the second quarter of fiscal 2027, reflecting strong demand across its core data platform and AI offerings.

Snowflake’s expanding cloud analytics footprint is supported by continued customer additions and deeper adoption among existing clients. The company ended the fiscal second quarter with 14,554 customers and added 692 net new customers, including 14 Global 2000 companies. Net new customer additions increased 32% year over year. In the fiscal second quarter, 65 customers generated more than $10 million in trailing 12-month product revenues, highlighting greater adoption among large enterprises. The company’s 126% net revenue retention rate and $9 billion in remaining performance obligations further indicate healthy expansion within its customer base.

The adoption of Snowflake’s AI offerings remains noteworthy. In the second quarter of fiscal 2027, CoCo surpassed 9,100 accounts after adding more than 2,000 during the quarter, while CoWork expanded to 5,800 accounts, up nearly 11% sequentially. Customers including 1Password and Indeed are deploying these solutions to accelerate data and AI initiatives.

SNOW’s accelerating customer adoption and a robust pipeline of AI-driven products position the company to capture a significant share of the cloud analytics market. For fiscal 2027, the company raised product revenue guidance to $6.07 billion, implying 36% year-over-year growth compared with its previous outlook of $5.84 billion and 31% growth. Fiscal third-quarter product revenues are expected to be between $1.588 billion and $1.593 billion, indicating 37-38% growth.

How Competitors Fare Against SNOWSnowflake is facing stiff competition from major players like Dell Technologies and Oracle. Both companies are expanding their footprint in the AI space.

Dell Technologies is benefiting from surging demand for AI infrastructure. The company continues to see AI server demand exceed available supply as customers expand deployments across neocloud, sovereign and enterprise environments. In the second quarter of fiscal 2027, Dell Technologies booked a record $60.9 billion of AI orders and recognized $16.4 billion of AI server revenues. Orders totaled $131.7 billion over the past 12 months, while backlog rose to $95 billion from $51.3 billion at the end of the first quarter of fiscal 2027.

Oracle’s expanding portfolio has been noteworthy. In June 2026, Oracle introduced Oracle OPERA Cloud Assistant, a suite of AI-powered capabilities built into OPERA Cloud that automates guest room assignments, generates AI-driven rate descriptions, supports multilingual operations across 230 countries and territories and gives hotel staff real-time operational guidance.

SNOW’s Share Price Performance, Valuation, and EstimatesSnowflake shares have gained 53.7% year to date, outperforming the broader Zacks Computer & Technology sector’s 18.2% appreciation. The Internet Software industry has declined 0.2% in the same time frame.

SNOW Stock Performance
Image Source: Zacks Investment Research

Snowflake stock is trading at a premium, with a forward 12-month Price/Sales ratio of 16.19X compared with the Internet Software industry’s 4.07X. SNOW has a Value Score of F.

SNOW's Valuation
Image Source: Zacks Investment Research

The Zacks Consensus Estimate for SNOW’s fiscal 2027 earnings is pegged at $2.01 per share, which has increased 2.55% over the past 30 days. The figure indicates a 60.80% year-over-year increase.

Snowflake currently carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

Data is the lifeblood of every artificial intelligence (AI) software application. The more information a business can feed into its AI models, the smarter and more useful its software will be. But since most large organizations host their valuable digital assets across multiple different cloud platforms like Amazon Web Services and Microsoft Azure, their AI models often draw information from fragmented data sets.

Snowflake's (SNOW -5.41%) Data Cloud solves this problem by bringing data together from across different cloud environments, and it offers an expanding portfolio of tools and services to help businesses turn it into powerful AI software.

The stock is up 67% in 2026 and is closing in on a fresh record high for the first time in five years, but despite the company's spectacular operating results over the last few quarters, here's why investors might want to think twice about adding it to their portfolio.

Image source: Getty Images.

At the center of the enterprise AI revolution Snowflake built a flagship AI platform called Cortex AI, where companies can pair their internal data with leading AI models from third-party developers like Anthropic and Meta Platforms to create AI agents, chatbots, and other software applications. The platform includes a series of ready-made tools to make the process easier, including CoCo (formerly Cortex Code), an AI-powered coding assistant.

Then there is CoWork, a powerful AI assistant that can help every knowledge worker -- even those in nontechnical jobs -- extract value from an organization's data. It even plugs into every major email and customer-relationship management platform so employees can use it to accelerate workflows, whether they want to identify sales trends or summarize meeting notes.

Cortex AI also features processing tools to help pull data from unstructured sources like contracts and invoices, which can be useful when training and deploying AI models.

Snowflake had a record 14,554 total customers at the conclusion of its fiscal 2027 second quarter (ended July 31), and 9,100 of them had deployed CoCo, while 5,800 were using CoWork, so there is clear demand for these new AI products.

Accelerating revenue growth Product revenue was $1.49 billion during the second quarter, a 37% increase from the year-ago period. That growth accelerated from 34% in the first quarter, highlighting the company's strong momentum. This great result prompted management to lift its product revenue guidance for fiscal 2027 by $230 million to $6.07 billion.

However, the company is spending heavily in areas like marketing and research and development to deliver that top-line growth, making it difficult to achieve profitability on the basis of generally accepted accounting principles (GAAP). The company lost $487 million during the first half of fiscal 2027 alone, and while that was an improvement from its year-ago net loss of $727 million, profitability still seems way out of reach for now.

Premium Feature

Moneyball Superscore

80/100

Today's Change

(

-5.41

%) $

-19.29

Current Price

$

337.18

On a positive note, Snowflake did generate an adjusted first-half profit of $383 million after excluding one-off and noncash expenses, which included $890 million in stock-based compensation. Although stock-based comp isn't a cash expense, investors still pay for it by way of dilution; every time Snowflake issues new shares to its employees, every existing share held by investors becomes slightly less valuable, so this cost can't be dismissed.

In my opinion, Snowflake must find a way to turn the AI tailwind into consistent GAAP profits, because the company's history suggests it will otherwise wind up with billions of dollars in annual losses once its revenue growth inevitably slows down at some point in the future. That won't be good for its stock price.

Upside could be limited from here Following its recent gains, the stock is now trading at a sky-high price-to-sales ratio (P/S) of 23.1, making it almost four times as expensive as the Nasdaq-100 index, which has a P/S of 6.1. In other words, it looks overvalued compared to a basket of America's largest technology companies.

There aren't many good comparisons to Snowflake in the public markets because of its unique product portfolio, but its stock is substantially more expensive than other cloud giants like Amazon, Microsoft, and Alphabet, which also offer broad portfolios of AI services.

SNOW PS Ratio data by YCharts.

Amazon, Microsoft, and Alphabet operate many different businesses outside of cloud computing, so they aren't the perfect companies to compare with Snowflake in terms of valuation. But Amazon Web Services grew its revenue by 37% during its most recent quarter, while Azure's revenue jumped by 43%, and Google Cloud's revenue surged by 82%. And they each generated significantly more revenue than Snowflake did, making their growth rates even more impressive.

Therefore, it's difficult to justify Snowflake's premium valuation relative to those cloud giants, and I actually think it will limit the potential upside of its stock from current levels. As a result, it probably isn't a great buy right now.

MENLO PARK, Calif.--(BUSINESS WIRE)--Snowflake (NYSE: SNOW), the AI Data Cloud company, today announced financial results for its second quarter of fiscal 2027, ended July 31, 2026.

"Snowflake delivered another strong quarter, with product revenue of $1.49 billion, up 37% year-over-year, as Snowflake continues to power the enterprise AI revolution,” said Sridhar Ramaswamy, CEO of Snowflake. “AI continues to compound our advantages, creating a flywheel effect across the business. CoWork and CoCo are driving transformational outcomes for our customers, while fueling rapid adoption, user growth, new workloads, and overall platform consumption. Our rapid pace of innovation, tight go-to-market execution, and operational discipline position us well to capture the opportunity ahead. The Agentic Enterprise runs on Snowflake, and we're just getting started."

“Q2 marks our third consecutive quarter of product revenue growth acceleration, driven by strength in both our core data platform and a meaningful step-up in AI revenue,” said Brian Robins, CFO of Snowflake. “Importantly, we delivered this accelerating growth while expanding operating margin. Balancing growth with discipline remains a top priority, and we are raising our full-year product revenue growth guidance to 36% year-over-year.”

Snowflake Business Highlights:

AI Momentum: CoCo surpassed 9,100 accounts1, adding more than 2,000 accounts in the quarter alone, while CoWork expanded to 5,800 accounts1. Accelerated Product Velocity: Launched over 330 product capabilities to general availability in the first half of fiscal 2027, up 35% year-over-year, and recently introduced Cortex Sense for business context and Cortex AI Gateway, which extends AI from insight to action through its integration of Natoma. AI Customer Wins: Customers like 1Password and Indeed chose Snowflake as the foundation for their data and AI transformation. Sayari cut costs by more than half and is using CoCo to accelerate the migration of 12 billion records. Customer Growth: Added 692 net new customers in the quarter, up 32% year-over-year, including 14 net new Forbes Global 2000 customers. See the section titled “Key Business Metrics” for definitions of product revenue, net revenue retention rate, customers with trailing 12-month product revenue greater than $1 million, Forbes Global 2000 customers, and remaining performance obligations.

Financial Outlook:

Our guidance includes GAAP and non-GAAP financial measures.

For the third quarter of fiscal 2027, the company expects:

Product revenue of $1,588 million to $1,593 million, representing 37% to 38% year-over-year growth Non-GAAP operating margin2 of 15.5% Non-GAAP weighted-average shares used in computing net income per share attributable to common stockholders—diluted2,3 of 382 million For the full-year of fiscal 2027, the company expects:

Product revenue of $6,070 million, representing 36% year-over-year growth, up from previous guidance of $5,840 million, or 31% year-over-year growth Non-GAAP product gross margin2 of 74.0% Non-GAAP operating margin2 of 14.5%, up from previous guidance of 13.5% Non-GAAP adjusted free cash flow margin2 of 23.0% Non-GAAP weighted-average shares used in computing net income per share attributable to common stockholders—diluted2,3 of 380 million A reconciliation of GAAP guidance measures to corresponding non-GAAP guidance measures is not available on a forward-looking basis without unreasonable effort due to the uncertainty regarding, and the potential variability of, expenses that may be incurred in the future. Stock-based compensation-related charges, including employer payroll tax-related items on employee stock transactions, are impacted by the timing of employee stock transactions, the future fair market value of our common stock, and our future hiring and retention needs, all of which are difficult to predict and subject to constant change. These factors could be material to our results computed in accordance with GAAP. Our fiscal year ends January 31, and numbers are rounded for presentation purposes.

Second Quarter Fiscal 2027 GAAP and Non-GAAP Results:

The following table summarizes our financial results for the second quarter of fiscal 2027:

Second Quarter Fiscal 2027

GAAP Results

Second Quarter Fiscal 2027

Non-GAAP Results(1)

Amount

(millions)

Year/Year

Growth

Product revenue

$1,491.9

37%

Amount

(millions)

Margin

Amount

(millions)

Margin

Product gross profit

$1,057.4

70.9%

$1,114.1

74.7%

Operating income (loss)

($263.0)

(17.0%)

$237.0

15.3%

Net cash provided by operating activities

$91.4

5.9%

(2)

Free cash flow

$83.8

5.4%

Adjusted free cash flow

$92.3

6.0%

  (1) We report non-GAAP financial measures in addition to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. See the section titled “Statement Regarding Use of Non-GAAP Financial Measures” for an explanation of non-GAAP financial measures, and the table titled “GAAP to Non-GAAP Reconciliations” for a reconciliation of GAAP to non-GAAP financial measures.

(2) Calculated as net cash provided by operating activities as a percentage of revenue.

Note: Fiscal year ends January 31. Numbers are rounded for presentation purposes.

Conference Call Details

The conference call will begin at 2 p.m. Pacific Time on September 2, 2026. Investors and participants may attend the call by dialing 1-800-330-6730 for domestic callers and 1-646-769-9500 for international callers (Access code: 102163).

The call will also be webcast live on the Snowflake Investor Relations website at https://investors.snowflake.com.

An audio replay of the conference call and webcast will be available two hours after its completion and will be accessible for 30 days on the Snowflake Investor Relations website.

Investor Presentation Details

An investor presentation providing additional information and analysis can be found at https://investors.snowflake.com.

Statement Regarding Use of Non‑GAAP Financial Measures

We report the following non-GAAP financial measures, which have not been prepared in accordance with generally accepted accounting principles in the United States (GAAP), in addition to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP.

Non-GAAP Product gross profit, Operating income, Net income, Net income attributable to Snowflake Inc., and Net income per share attributable to Snowflake Inc. common stockholders—basic and diluted. Non-GAAP product gross profit, operating income, net income, and net income attributable to Snowflake Inc. are each defined as the respective GAAP measure, excluding, as applicable, the effect of (i) stock-based compensation-related charges, including employer payroll tax-related items on employee stock transactions, (ii) amortization of acquired intangibles, (iii) expenses associated with acquisitions and strategic investments, (iv) amortization of debt issuance costs, (v) restructuring charges or recoveries, net, (vi) asset impairment related to office facility exits, net of associated sublease income, if any, (vii) adjustments attributable to noncontrolling interest, if any, and (viii) the related income tax effect of these adjustments as well as the non-recurring income tax expense or benefit associated with acquisitions. Non-GAAP product gross margin is calculated as non-GAAP product gross profit as a percentage of product revenue. Non-GAAP operating margin is calculated as non-GAAP operating income as a percentage of revenue. Our non-GAAP net income per share attributable to Snowflake Inc. common stockholders—basic is calculated by dividing non-GAAP net income attributable to Snowflake Inc. by the weighted-average number of shares of common stock outstanding during the period. Our non-GAAP net income per share attributable to Snowflake Inc. common stockholders—diluted is calculated by dividing non-GAAP net income attributable to Snowflake Inc. by the non-GAAP weighted-average number of diluted shares outstanding, which includes (a) the effect of all potentially dilutive common stock equivalents (stock options, restricted stock units, employee stock purchase rights under our 2020 Employee Stock Purchase Plan), (b) the potential dilutive effect of the shares issuable upon conversion of the Notes using the if-converted method, and (c) the antidilutive impact, if any, of the Capped Calls entered into in connection with the Notes. The Capped Calls are expected to reduce the potential dilution to our common stock upon any conversion of the Notes under certain circumstances. Under GAAP, the antidilutive impact of the Capped Calls is not reflected in diluted shares outstanding until exercised. The potential dilutive effect of outstanding restricted stock units with performance conditions not yet satisfied is included in the non-GAAP weighted-average number of diluted shares at forecasted attainment levels to the extent we believe it is probable that the performance conditions will be met. The potential dilutive effect of outstanding restricted stock units with market conditions is included in the non-GAAP weighted-average number of diluted shares to the extent the market conditions are met. Amounts attributable to noncontrolling interest were zero or not material for all periods presented. Beginning with the fourth quarter of fiscal 2026, the Company no longer attributes a portion of non-GAAP net income to noncontrolling interest as it no longer controls a majority-owned subsidiary. The calculation of non-GAAP basic and diluted net income per share attributable to common stockholders for the fourth quarter of fiscal 2026 and subsequent periods aligns with the methodology used to calculate non-GAAP basic and diluted net income per share attributable to Snowflake Inc. common stockholders as described above. We believe the presentation of operating results that exclude these items that are (i) non-cash items, (ii) non-recurring items, or (iii) items that have highly variable amounts due to factors beyond our control and are unrelated to our core operations such that management does not consider them in evaluating the business performance or making operating plans, provides useful supplemental information to investors and facilitates the analysis of our operating results and comparison of operating results across reporting periods. Free cash flow. Free cash flow is defined as net cash provided by operating activities reduced by purchases of property and equipment and any capitalized software development costs. Cash outflows for employee payroll tax items related to the net share settlement of equity awards are included in cash flow for financing activities and, as a result, do not have an effect on the calculation of free cash flow. Free cash flow margin is calculated as free cash flow as a percentage of revenue. We believe these measures provide useful supplemental information to investors because they are indicators of the strength and performance of our core business operations. Adjusted free cash flow. Adjusted free cash flow is defined as free cash flow plus (minus) net cash paid (received) on employer and employee payroll tax-related items on employee stock transactions. Employee payroll tax-related items on employee stock transactions are generally pass-through transactions that are expected to have a net zero impact on free cash flow over time, but that may impact free cash flow in any given fiscal quarter due to differences between the time that we receive funds from our employees and the time we remit those funds to applicable tax authorities. We believe that excluding the effects of these payroll tax-related items will enhance investors' ability to evaluate our free cash flow performance, including on a quarter-over-quarter basis. Adjusted free cash flow margin is calculated as adjusted free cash flow as a percentage of revenue. We believe these measures provide useful supplemental information to investors because they are indicators of the strength and performance of our core business operations. We use these non-GAAP financial measures internally for financial and operational decision-making purposes and as a means to evaluate period-to-period comparisons. Non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP financial measures and should be read only in conjunction with our condensed consolidated financial statements prepared in accordance with GAAP. Our presentation of non-GAAP financial measures may not be comparable to similar measures used by other companies. We encourage investors to carefully consider our results under GAAP, as well as our supplemental non-GAAP information and the reconciliation between these presentations, to more fully understand our business. Please see the tables included at the end of this release for the reconciliation of GAAP to non-GAAP results.

Key Business Metrics

We monitor our key business metrics, including (i) free cash flow and (ii) the other metrics set forth below to help us evaluate our business and growth trends, establish budgets, measure the effectiveness of our sales and marketing efforts, and assess operational efficiencies. See the section titled “Statement Regarding Use of Non-GAAP Financial Measures” for the definition of free cash flow. The calculation of our key business metrics may differ from other similarly titled metrics used by other companies, securities analysts, or investors.

Product Revenue. Product revenue is a key metric for us because we recognize revenue based on platform consumption, which is inherently variable at our customers’ discretion, and not based on the amount and duration of contract terms. Product revenue is primarily derived from the consumption of compute, storage, and data transfer resources by customers on our platform. Customers have the flexibility to consume more than their contracted capacity during the contract term and may have the ability to roll over unused capacity to future periods, generally upon the purchase of additional capacity at renewal. Our consumption-based business model distinguishes us from subscription-based software companies that generally recognize revenue ratably over the contract term and may not permit rollover. Because customers have flexibility in the timing of their consumption, which can exceed their contracted capacity or extend beyond the original contract term in many cases, the amount of product revenue recognized in a given period is an important indicator of customer satisfaction and the value derived from our platform. While customer use of our platform in any period is not necessarily indicative of future use, we estimate future revenue using predictive models based on customers’ historical usage to plan and determine financial forecasts. Product revenue excludes our professional services and other revenue. Net Revenue Retention Rate. To calculate net revenue retention rate, we first specify a measurement period consisting of the trailing two years from our current period end. Next, we define as our measurement cohort the population of customers under capacity contracts that used our platform at any point in the first month of the first year of the measurement period. The cohorts used to calculate net revenue retention rate include end-customers under a reseller arrangement. We then calculate our net revenue retention rate as the quotient obtained by dividing our product revenue from this cohort in the second year of the measurement period by our product revenue from this cohort in the first year of the measurement period. Any customer in the cohort that did not use our platform in the second year remains in the calculation and contributes zero product revenue in the second year. Our net revenue retention rate is subject to adjustments for acquisitions, consolidations, spin-offs, and other market activity, and we present our net revenue retention rate for historical periods reflecting these adjustments. Since we will continue to attribute the historical product revenue to the consolidated contract, consolidation of capacity contracts within a customer’s organization typically will not impact our net revenue retention rate unless one of those customers was not a customer at any point in the first month of the first year of the measurement period. Customers with Trailing 12-Month Product Revenue Greater than $1 Million. To calculate the number of customers with trailing 12-month product revenue greater than $1 million, we count the number of customers under capacity arrangements that contributed more than $1 million in product revenue in the trailing 12 months. For purposes of determining our customer count, we treat each customer account, including accounts for end-customers under a reseller arrangement, that has at least one corresponding capacity contract as a unique customer, and a single organization with multiple divisions, segments, or subsidiaries may be counted as multiple customers. We do not include customers that consume our platform only under on-demand arrangements for purposes of determining our customer count. Our customer count is subject to adjustments for acquisitions, consolidations, spin-offs, and other market activity, and we present our customer count for historical periods reflecting these adjustments. Forbes Global 2000 Customers. Our Forbes Global 2000 customer count is a subset of our customer count based on the 2026 Forbes Global 2000 list. Our Forbes Global 2000 customer count is subject to adjustments for annual updates to the list by Forbes, as well as acquisitions, consolidations, spin-offs, and other market activity with respect to such customers, and we present our Forbes Global 2000 customer count for historical periods reflecting these adjustments. Remaining Performance Obligations. Remaining performance obligations (RPO) represent the amount of contracted future revenue that has not yet been recognized, including (i) deferred revenue and (ii) non-cancelable contracted amounts that will be invoiced and recognized as revenue in future periods. RPO excludes performance obligations from on-demand arrangements and certain time and materials contracts that are billed in arrears. Portions of RPO that are not yet invoiced and are denominated in foreign currencies are revalued into U.S. dollars each period based on the applicable period-end exchange rates. RPO is not necessarily indicative of future product revenue growth because it does not account for the timing of customers’ consumption or their consumption of more than their contracted capacity. Moreover, RPO is influenced by a number of factors, including the timing and size of renewals, the timing and size of purchases of additional capacity, average contract terms, seasonality, changes in foreign currency exchange rates, and the extent to which customers are permitted to roll over unused capacity to future periods, generally upon the purchase of additional capacity at renewal. Due to these factors, it is important to review RPO in conjunction with product revenue and other financial metrics disclosed elsewhere herein. Use of Forward‑Looking Statements

This release and the accompanying oral presentation contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, regarding our performance, including but not limited to statements in the section titled “Financial Outlook.” Words such as “guidance,” “outlook,” “expect,” “anticipate,” “should,” “believe,” “hope,” “target,” “project,” “plan,” “goals,” “estimate,” “potential,” “predict,” “forecast,” “position,” “see,” “on track,” “may,” “will,” “might,” “could,” “intend,” “shall,” “future,” and variations of these terms or the negative of these terms and similar expressions are intended to identify these forward-looking statements. Other than statements of historical fact, all statements contained in this release and accompanying oral presentation are forward-looking statements, including statements regarding (i) our future operating results, targets, or financial position, including expectations regarding revenue recognition; (ii) our business strategy, plans, opportunities, or priorities, including with respect to strategic transactions; (iii) the release, adoption, and use of our new or enhanced products, services, and technology offerings, including those that are under development or not generally available; (iv) market size and growth, trends, and competitive considerations; (v) our vision, strategy, and expected benefits relating to artificial intelligence (AI), the enterprise AI revolution, Snowflake Cortex AI, Snowpark, Snowflake Marketplace, the AI Data Cloud, and AI Data Clouds for specific industries or product categories, including the expected benefits and network effects of the AI Data Cloud; and (vi) the integration, interoperability, and availability of our products, services, and technology offerings with and on third-party products and platforms, including public cloud platforms and AI models.

The forward-looking statements contained in this release and the accompanying oral presentation are subject to known and unknown risks, uncertainties, assumptions, and other factors that may cause actual results or outcomes to be materially different from any future results or outcomes expressed or implied by the forward-looking statements. These risks, uncertainties, assumptions, and other factors include, but are not limited to, those related to our business and financial performance; general market and business conditions, downturns, or uncertainty, including higher inflation, tariffs and trade wars, extended federal government shutdowns, higher interest rates, fluctuations or volatility in capital markets, energy markets, or foreign currency exchange rates, and geopolitical instability; our ability to attract and retain customers that use our platform to support their end-to-end data lifecycle; our ability to execute on our business strategy, including our strategy across our product categories and an effective AI strategy; our ability to respond rapidly and effectively to emerging technology trends, including the adoption and use of AI, and the extent to which our investments in new technologies are successful; the extent to which customers continue to optimize consumption, including with respect to AI features; our ability to compete effectively in a continually evolving market in which enterprises are increasingly adopting AI to perform core functions and significant disruption is being driven by AI; our ability to attract, recruit, and retain qualified personnel to support our operations and growth; the impact of new or optimized product features and pricing strategies on consumption, including AI credit pricing, Iceberg tables, tiered storage pricing, and adaptive warehouses; our ability to consummate and realize the anticipated benefits of any acquisitions, strategic investments, partnerships, or alliances; unforeseen technical, operational, or business challenges impacting the timing, scope, or success of strategic partnerships; the extent to which customers continue to rationalize budgets and prioritize cash flow management, including through shortened contract durations; our ability to develop new products and services and enhance existing products and services; the extent to which customer adoption of new product capabilities results in durable consumption; the growth of successful native applications on the Snowflake Marketplace; our ability to increase and predict customer consumption of our platform, particularly in light of the impact of holidays on customer consumption patterns; our ability to increase our penetration into existing markets and enter and grow new markets, including highly-regulated markets such as financial services, healthcare, and the public sector; the effectiveness of our security measures designed to protect against security incidents and the impact of cybersecurity threat activity directed at us or our customers and any resulting reputational or financial damage; success of our sales and marketing efforts and our ability to promote our brand; our ability to protect our intellectual property rights and the extent to which they provide us with a competitive advantage; our ability to manage growth; our ability to sublease or terminate certain of our office facility commitments and the impact of related asset impairment; the impact and timing of stock repurchases under our stock repurchase program; our ability to reduce stock-based compensation as a percentage of our revenue; our ability to achieve GAAP profitability; and our ability to meet the requirements of the Notes and the settlement timing and method for the Notes and the Capped Calls.

Further information on these and additional risks, uncertainties, assumptions, and other factors that could cause actual outcomes and results to differ materially from those included in or contemplated by the forward-looking statements contained in this release are included under the caption “Risk Factors” and elsewhere in our Form 10-Q for the fiscal quarter ended April 30, 2026 and other filings and reports we make with the Securities and Exchange Commission from time to time, including our Form 10-Q that will be filed for the fiscal quarter ended July 31, 2026.

Moreover, we operate in a very competitive and rapidly changing environment, and new risks may emerge from time to time. It is not possible to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor(s) may cause actual results or outcomes to differ materially from those contained in any forward-looking statements we may make. As a result of these risks, uncertainties, assumptions, and other factors, you should not rely on any forward-looking statements as predictions of future events. Forward-looking statements speak only as of the date the statements are made and are based on information available to us at the time those statements are made and/or management's good faith belief as of that time with respect to future events. Except as required by law, we undertake no obligation, and do not intend, to update these forward-looking statements, to review or confirm analysts’ expectations, or to provide interim reports or updates on the progress of the current financial quarter.

About Snowflake

Snowflake is the platform for the AI era, making it easy for enterprises to innovate faster and get more value from data. More than 14,500 customers around the globe, including hundreds of the world’s largest companies, use Snowflake’s AI Data Cloud to build, use and share data, applications and AI. With Snowflake, data and AI are transformative for everyone. Learn more at snowflake.com (NYSE: SNOW).

Source: Snowflake Inc.

Snowflake Inc.

Condensed Consolidated Statements of Operations

(in thousands, except per share data)

(unaudited)

  Three Months Ended July 31,

Six Months Ended July 31,

2026

2025

2026

2025

Revenue

$

1,546,793

$

1,144,969

$

2,937,744

$

2,187,043

Cost of revenue

510,075

371,815

974,575

720,601

Gross profit

1,036,718

773,154

1,963,169

1,466,442

Operating expenses:

Sales and marketing

611,615

501,957

1,200,567

960,511

Research and development

567,476

492,003

1,102,413

964,407

General and administrative

120,594

119,470

249,310

329,057

Total operating expenses

1,299,685

1,113,430

2,552,290

2,253,975

Operating loss

(262,967

)

(340,276

)

(589,121

)

(787,533

)

Interest income

41,996

49,467

83,141

102,630

Interest expense

(2,081

)

(2,074

)

(4,161

)

(4,145

)

Other income (expense), net

34,762

(4,985

)

25,191

(33,043

)

Loss before income taxes

(188,290

)

(297,868

)

(484,950

)

(722,091

)

Provision for income taxes

3,430

62

2,341

5,791

Net loss

(191,720

)

(297,930

)

(487,291

)

(727,882

)

Less: net income attributable to noncontrolling interest

—

87

—

227

Net loss attributable to Snowflake Inc.

$

(191,720

)

$

(298,017

)

$

(487,291

)

$

(728,109

)

Net loss per share attributable to Snowflake Inc. common stockholders—basic and diluted

$

(0.55

)

$

(0.89

)

$

(1.40

)

$

(2.18

)

Weighted-average shares used in computing net loss per share attributable to Snowflake Inc. common stockholders—basic and diluted

349,257

335,215

347,356

333,957

  Snowflake Inc.

Condensed Consolidated Balance Sheets

(in thousands)

(unaudited)

  July 31, 2026

January 31, 2026

Assets

Current assets:

Cash and cash equivalents

$

1,707,187

$

2,828,163

Short-term investments

637,508

1,201,523

Accounts receivable, net

718,464

1,303,740

Deferred commissions, current

222,084

214,058

Prepaid expenses and other current assets

208,593

195,128

Total current assets

3,493,836

5,742,612

Long-term investments

1,984,482

755,013

Property and equipment, net

207,981

248,611

Operating lease right-of-use assets

285,019

274,897

Goodwill

1,639,003

1,194,367

Intangible assets, net

426,527

246,916

Deferred commissions, non-current

222,581

241,759

Other assets

431,030

428,320

Total assets

$

8,690,459

$

9,132,495

Liabilities and Stockholders’ Equity

Current liabilities:

Accounts payable

$

185,250

$

145,559

Accrued expenses and other current liabilities

908,005

879,537

Operating lease liabilities, current

59,787

49,598

Deferred revenue, current

2,568,489

3,346,997

Total current liabilities

3,721,531

4,421,691

Convertible senior notes, net

2,283,985

2,279,827

Operating lease liabilities, non-current

420,043

411,689

Deferred revenue, non-current

27,756

14,440

Other liabilities

87,480

80,746

Stockholders’ equity

2,149,664

1,924,102

Total liabilities and stockholders’ equity

$

8,690,459

$

9,132,495

  Snowflake Inc.

Condensed Consolidated Statements of Cash Flows

(in thousands)

(unaudited)

  Three Months Ended July 31,

Six Months Ended July 31,

2026

2025

2026

2025

Cash flows from operating activities:

Net loss

$

(191,720

)

$

(297,930

)

$

(487,291

)

$

(727,882

)

Adjustments to reconcile net loss to net cash provided by operating activities:

Depreciation and amortization

68,629

54,837

136,234

103,641

Non-cash operating lease costs

17,669

16,156

35,551

33,998

Amortization of deferred commissions

59,743

33,158

117,473

58,954

Stock-based compensation, net of any amounts capitalized

423,582

404,217

826,052

783,677

Net accretion of discounts on investments

(1,081

)

(5,717

)

(3,286

)

(13,369

)

Net realized and unrealized losses (gains) on strategic investments

(34,755

)

5,580

(25,257

)

35,265

Amortization of debt issuance costs

2,081

2,074

4,161

4,145

Asset impairment related to office facility exits

112

2,131

17,836

108,619

Deferred income tax

(1,927

)

(3,445

)

(8,489

)

(3,445

)

Other

4,534

1,685

7,355

(3,489

)

Changes in operating assets and liabilities, net of effects of business combinations:

Accounts receivable

(146,587

)

(117,606

)

600,630

276,051

Deferred commissions

(69,521

)

(53,750

)

(106,320

)

(84,864

)

Prepaid expenses and other assets

22,104

(4,486

)

(351

)

(22,338

)

Accounts payable

130,904

11,771

41,231

7,348

Accrued expenses and other liabilities

108,847

93,291

28,056

97,226

Operating lease liabilities

(22,635

)

(14,559

)

(41,842

)

(26,397

)

Deferred revenue

(278,622

)

(52,511

)

(807,163

)

(323,871

)

Net cash provided by operating activities

91,357

74,896

334,580

303,269

Cash flows from investing activities:

Purchases of property and equipment

(7,554

)

(16,665

)

(18,005

)

(61,654

)

Cash paid for business combinations, net of cash, cash equivalents and restricted cash acquired

(1,992

)

(164,230

)

(254,449

)

(164,230

)

Purchases of intangible assets

—

(1,311

)

—

(1,311

)

Purchases of investments

(919,669

)

(636,469

)

(1,816,116

)

(1,649,044

)

Sales of investments

128,762

1,476

238,456

18,875

Maturities and redemptions of investments

451,016

517,947

896,186

1,502,129

Net cash used in investing activities

(349,437

)

(299,252

)

(953,928

)

(355,235

)

Cash flows from financing activities:

Proceeds from exercise of stock options

67,845

28,186

74,424

34,446

Proceeds from issuance of common stock under employee stock purchase plan

—

—

66,987

53,193

Taxes paid related to net share settlement of equity awards

(184,896

)

(161,999

)

(327,742

)

(294,497

)

Repurchases of common stock

—

—

(300,003

)

(490,638

)

Payments of deferred purchase consideration for business combinations

—

(226

)

(2,250

)

(600

)

Net cash used in financing activities

(117,051

)

(134,039

)

(488,584

)

(698,096

)

Effect of exchange rate changes on cash, cash equivalents, and restricted cash

(1,860

)

(175

)

(4,684

)

12,222

Net decrease in cash, cash equivalents, and restricted cash

(376,991

)

(358,570

)

(1,112,616

)

(737,840

)

Cash, cash equivalents, and restricted cash—beginning of period

2,128,678

2,319,408

2,864,303

2,698,678

Cash, cash equivalents, and restricted cash—end of period

$

1,751,687

$

1,960,838

$

1,751,687

$

1,960,838

  Snowflake Inc.

GAAP to Non-GAAP Reconciliations

(in thousands, except per share data and percentages)

(unaudited)

  Three Months Ended July 31,

Six Months Ended July 31,

2026

2025

2026

2025

Amount

Amount as a

% of Revenue

Amount

Amount as a

% of Revenue

Amount

Amount as a

% of Revenue

Amount

Amount as a

% of Revenue

Revenue:

Product revenue

$

1,491,861

96%

$

1,090,496

95%

$

2,826,190

96%

$

2,087,309

95%

Professional services and other revenue

54,932

4%

54,473

5%

111,554

4%

99,734

5%

Revenue

$

1,546,793

100%

$

1,144,969

100%

$

2,937,744

100%

$

2,187,043

100%

Year-over-year growth

35

%

32

%

34

%

29

%

Cost of revenue:

GAAP cost of product revenue

$

434,418

$

302,316

$

821,292

$

587,592

Adjustments:

Stock-based compensation-related charges

(31,217

)

(31,899

)

(62,863

)

(62,751

)

Amortization of acquired intangibles

(25,424

)

(13,552

)

(49,018

)

(25,287

)

Non-GAAP cost of product revenue

$

377,777

$

256,865

$

709,411

$

499,554

GAAP cost of professional services and other revenue

$

75,657

$

69,499

$

153,283

$

133,009

Adjustments:

Stock-based compensation-related charges

(14,663

)

(15,019

)

(29,259

)

(29,660

)

Amortization of acquired intangibles

(1,824

)

(1,663

)

(3,588

)

(3,271

)

Non-GAAP cost of professional services and other revenue

$

59,170

$

52,817

$

120,436

$

100,078

GAAP cost of revenue

$

510,075

33%

$

371,815

32%

$

974,575

33%

$

720,601

33%

Adjustments:

Stock-based compensation-related charges

(45,880

)

(46,918

)

(92,122

)

(92,411

)

Amortization of acquired intangibles

(27,248

)

(15,215

)

(52,606

)

(28,558

)

Non-GAAP cost of revenue

$

436,947

28%

$

309,682

27%

$

829,847

28%

$

599,632

27%

Gross profit (loss):

GAAP product gross profit

$

1,057,443

$

788,180

$

2,004,898

$

1,499,717

Adjustments:

Stock-based compensation-related charges

31,217

31,899

62,863

62,751

Amortization of acquired intangibles

25,424

13,552

49,018

25,287

Non-GAAP product gross profit

$

1,114,084

$

833,631

$

2,116,779

$

1,587,755

GAAP professional services and other revenue gross loss

$

(20,725

)

$

(15,026

)

$

(41,729

)

$

(33,275

)

Adjustments:

Stock-based compensation-related charges

14,663

15,019

29,259

29,660

Amortization of acquired intangibles

1,824

1,663

3,588

3,271

Non-GAAP professional services and other revenue gross profit (loss)

$

(4,238

)

$

1,656

$

(8,882

)

$

(344

)

GAAP gross profit

$

1,036,718

67%

$

773,154

68%

$

1,963,169

67%

$

1,466,442

67%

Adjustments:

Stock-based compensation-related charges

45,880

46,918

92,122

92,411

Amortization of acquired intangibles

27,248

15,215

52,606

28,558

Non-GAAP gross profit

$

1,109,846

72%

$

835,287

73%

$

2,107,897

72%

$

1,587,411

73%

Gross margin:

GAAP product gross margin

71

%

72

%

71

%

72

%

Adjustments:

Stock-based compensation-related charges as a % of product revenue

2

%

3

%

2

%

3

%

Amortization of acquired intangibles as a % of product revenue

2

%

1

%

2

%

1

%

Non-GAAP product gross margin

75

%

76

%

75

%

76

%

GAAP professional services and other revenue gross margin

(38

%)

(28

%)

(37

%)

(33

%)

Adjustments:

Stock-based compensation-related charges as a % of professional services and other revenue

27

%

28

%

26

%

30

%

Amortization of acquired intangibles as a % of professional services and other revenue

3

%

3

%

3

%

3

%

Non-GAAP professional services and other revenue gross margin

(8

%)

3

%

(8

%)

—

%

GAAP gross margin

67

%

68

%

67

%

67

%

Adjustments:

Stock-based compensation-related charges as a % of revenue

3

%

4

%

3

%

5

%

Amortization of acquired intangibles as a % of revenue

2

%

1

%

2

%

1

%

Non-GAAP gross margin

72

%

73

%

72

%

73

%

Operating expenses:

GAAP sales and marketing expense

$

611,615

40%

$

501,957

44%

$

1,200,567

41%

$

960,511

44%

Adjustments:

Stock-based compensation-related charges

(109,272

)

(100,528

)

(213,170

)

(193,439

)

Amortization of acquired intangibles

(12,923

)

(9,326

)

(26,131

)

(17,086

)

Non-GAAP sales and marketing expense

$

489,420

32%

$

392,103

34%

$

961,266

33%

$

749,986

35%

GAAP research and development expense

$

567,476

36%

$

492,003

44%

$

1,102,413

38%

$

964,407

44%

Adjustments:

Stock-based compensation-related charges

(256,303

)

(242,156

)

(504,932

)

(473,101

)

Amortization of acquired intangibles

(2,027

)

(2,723

)

(3,987

)

(5,368

)

Restructuring recoveries, net(1)

—

—

—

8

Non-GAAP research and development expense

$

309,146

20%

$

247,124

22%

$

593,494

20%

$

485,946

22%

GAAP general and administrative expense

$

120,594

8%

$

119,470

10%

$

249,310

8%

$

329,057

15%

Adjustments:

Stock-based compensation-related charges

(44,908

)

(46,580

)

(79,796

)

(85,953

)

Amortization of acquired intangibles

(32

)

(543

)

(64

)

(880

)

Expenses associated with acquisitions and strategic investments

(1,378

)

(2,191

)

(1,440

)

(2,569

)

Restructuring recoveries, net(1)

2

464

22

1,214

Asset impairment related to office facility exits, net of sublease income(2)

17

(2,132

)

(17,633

)

(108,620

)

Non-GAAP general and administrative expense

$

74,295

5%

$

68,488

6%

$

150,399

5%

$

132,249

6%

GAAP total operating expenses

$

1,299,685

84%

$

1,113,430

98%

$

2,552,290

87%

$

2,253,975

103%

Adjustments:

Stock-based compensation-related charges

(410,483

)

(389,264

)

(797,898

)

(752,493

)

Amortization of acquired intangibles

(14,982

)

(12,592

)

(30,182

)

(23,334

)

Expenses associated with acquisitions and strategic investments

(1,378

)

(2,191

)

(1,440

)

(2,569

)

Restructuring recoveries, net(1)

2

464

22

1,222

Asset impairment related to office facility exits, net of sublease income(2)

17

(2,132

)

(17,633

)

(108,620

)

Non-GAAP total operating expenses

$

872,861

57%

$

707,715

62%

$

1,705,159

58%

$

1,368,181

63%

Operating income (loss):

GAAP operating loss

$

(262,967

)

(17%)

$

(340,276

)

(30%)

$

(589,121

)

(20%)

$

(787,533

)

(36%)

Adjustments:

Stock-based compensation-related charges(3)

456,363

436,182

890,020

844,904

Amortization of acquired intangibles

42,230

27,807

82,788

51,892

Expenses associated with acquisitions and strategic investments

1,378

2,191

1,440

2,569

Restructuring recoveries, net(1)

(2

)

(464

)

(22

)

(1,222

)

Asset impairment related to office facility exits, net of sublease income(2)

(17

)

2,132

17,633

108,620

Non-GAAP operating income

$

236,985

15%

$

127,572

11%

$

402,738

14%

$

219,230

10%

Operating margin:

GAAP operating margin

(17

%)

(30

%)

(20

%)

(36

%)

Adjustments:

Stock-based compensation-related charges as a % of revenue

29

%

39

%

30

%

39

%

Amortization of acquired intangibles as a % of revenue

3

%

2

%

3

%

2

%

Expenses associated with acquisitions and strategic investments as a % of revenue

—

%

—

%

—

%

—

%

Restructuring recoveries, net as a % of revenue

—

%

—

%

—

%

—

%

Asset impairment related to office facility exits, net of sublease income as a % of revenue

—

%

—

%

1

%

5

%

Non-GAAP operating margin

15

%

11

%

14

%

10

%

Net income (loss):

GAAP net loss

$

(191,720

)

(12%)

$

(297,930

)

(26%)

$

(487,291

)

(17%)

$

(727,882

)

(33%)

Adjustments:

Stock-based compensation-related charges(3)

456,363

436,182

890,020

844,904

Amortization of acquired intangibles

42,230

27,807

82,788

51,892

Expenses associated with acquisitions and strategic investments

1,378

2,191

1,440

2,569

Restructuring recoveries, net(1)

(2

)

(464

)

(22

)

(1,222

)

Asset impairment related to office facility exits, net of sublease income(2)

(17

)

2,132

17,633

108,620

Amortization of debt issuance costs

2,081

2,074

4,161

4,145

Income tax effect related to the above adjustments and acquisitions

(75,005

)

(43,006

)

(125,426

)

(66,468

)

Non-GAAP net income

$

235,308

15%

$

128,986

11%

$

383,303

13%

$

216,558

10%

Net income (loss) attributable to Snowflake Inc.(4):

GAAP net loss attributable to Snowflake Inc.

$

(191,720

)

(12%)

$

(298,017

)

(26%)

$

(487,291

)

(17%)

$

(728,109

)

(33%)

Adjustments:

Stock-based compensation-related charges(3)

456,363

436,182

890,020

844,904

Amortization of acquired intangibles

42,230

27,807

82,788

51,892

Expenses associated with acquisitions and strategic investments

1,378

2,191

1,440

2,569

Restructuring recoveries, net(1)

(2

)

(464

)

(22

)

(1,222

)

Asset impairment related to office facility exits, net of sublease income(2)

(17

)

2,132

17,633

108,620

Amortization of debt issuance costs

2,081

2,074

4,161

4,145

Income tax effect related to the above adjustments and acquisitions

(75,005

)

(43,006

)

(125,426

)

(66,468

)

Adjustments attributable to noncontrolling interest, net of tax

—

390

—

243

Non-GAAP net income attributable to Snowflake Inc.

$

235,308

15%

$

129,289

11%

$

383,303

13%

$

216,574

10%

Net income (loss) per share attributable to Snowflake Inc. common stockholders—basic and diluted(4):

GAAP net loss per share attributable to Snowflake Inc. common stockholders—basic and diluted

$

(0.55

)

$

(0.89

)

$

(1.40

)

$

(2.18

)

Weighted-average shares used in computing GAAP net loss per share attributable to Snowflake Inc. common stockholders—basic and diluted

349,257

335,215

347,356

333,957

Non-GAAP net income per share attributable to Snowflake Inc. common stockholders—basic

$

0.67

$

0.38

$

1.10

$

0.65

Weighted-average shares used in computing non-GAAP net income per share attributable to Snowflake Inc. common stockholders—basic

349,257

335,215

347,356

333,957

Non-GAAP net income per share attributable to Snowflake Inc. common stockholders—diluted

$

0.62

$

0.35

$

1.02

$

0.58

GAAP weighted-average shares used in computing GAAP net loss per share attributable to Snowflake Inc. common stockholders—basic and diluted

349,257

335,215

347,356

333,957

Add: Effect of potentially dilutive common stock equivalents

18,345

25,939

16,895

24,986

Add: Effect of convertible senior notes

14,603

14,603

14,603

14,603

Less: Effect of antidilutive impact of capped call transactions

(4,327

)

(3,374

)

(2,812

)

(2,074

)

Non-GAAP weighted-average shares used in computing non-GAAP net income per share attributable to Snowflake Inc. common stockholders—diluted(5)

377,878

372,383

376,042

371,472

Free cash flow and adjusted free cash flow:

GAAP net cash provided by operating activities

$

91,357

6%

$

74,896

7%

$

334,580

11%

$

303,269

14%

Adjustments:

Purchases of property and equipment

(7,554

)

(16,665

)

(18,005

)

(61,654

)

Non-GAAP free cash flow

83,803

5%

58,231

5%

316,575

11%

241,615

11%

Adjustments:

Net cash paid on payroll tax-related items on employee stock transactions(6)

8,500

9,534

41,242

32,419

Non-GAAP adjusted free cash flow

$

92,303

6%

$

67,765

6%

$

357,817

12%

$

274,034

13%

Non-GAAP free cash flow margin

5

%

5

%

11

%

11

%

Non-GAAP adjusted free cash flow margin

6

%

6

%

12

%

13

%

GAAP net cash used in investing activities

$

(349,437

)

$

(299,252

)

$

(953,928

)

$

(355,235

)

GAAP net cash used in financing activities

$

(117,051

)

$

(134,039

)

$

(488,584

)

$

(698,096

)

(1) Restructuring recoveries, net represent recoveries on certain costs incurred by us in connection with a restructuring plan for a majority-owned subsidiary.

(2) Asset impairment related to office facility exits, net of sublease income for the six months ended July 31, 2025 primarily relates to our San Mateo office facility.

(3) Stock-based compensation-related charges included employer payroll tax-related expenses on employee stock transactions of approximately $23.6 million and $45.0 million for the three and six months ended July 31, 2026, respectively, and $22.2 million and $41.7 million for the three and six months ended July 31, 2025, respectively.

(4) Beginning with the fourth quarter of fiscal 2026, the Company no longer attributes a portion of GAAP and non-GAAP net income (loss) to noncontrolling interest as it no longer controls a majority-owned subsidiary. As such, for the three and six months ended July 31, 2026, the calculations of GAAP and non-GAAP basic and diluted net income (loss) per share attributable to common stockholders align with the methodologies used to calculate the corresponding metrics for Snowflake Inc. common stockholders.

(5) The non-GAAP weighted-average shares used in computing non-GAAP net income per share attributable to Snowflake Inc. common stockholders—diluted included (a) the effect of all potentially dilutive common stock equivalents (stock options, restricted stock units, and employee stock purchase rights under our 2020 Employee Stock Purchase Plan) and (b) the potential dilutive effect of shares issuable upon conversion of the Notes using the if-converted method, starting from the beginning of the period or the issuance date of the Notes, if later. The potential dilutive effect of outstanding restricted stock units with performance conditions not yet satisfied is included in the non-GAAP weighted-average number of diluted shares at forecasted attainment levels to the extent we believe it is probable that the performance conditions will be met. The potential dilutive effect of outstanding restricted stock units with market conditions is included in the non-GAAP weighted-average number of diluted shares to the extent market conditions are met.

(6) Amounts exclude employee payroll taxes on net share settlement of equity awards, which are reflected as financing cash outflows. For the three and six months ended July 31, 2026, the excluded amounts were $184.9 million and $327.7 million, respectively; for the three and six months ended July 31, 2025, the excluded amounts were $162.0 million and $294.5 million, respectively.

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Earnings ResultsCompanies looking to build AI tools on top of their data are turning to Snowflake, driving robust revenue growthUpdated

Snowflake has established itself as a major software winner in the age of artificial intelligence. And after posting an earnings beat and lifting its revenue forecast for a key segment Wednesday, investors now have more reason to be upbeat about the cloud-based data-storage provider.

CEO Sridhar Ramaswamy attributed the strong quarter to growing adoption of Snowflake’s SNOW AI products “The results demonstrate how the AI transformation that’s sweeping enterprises is compounding Snowflake’s advantage,” he told MarketWatch. “More and more customers are migrating their data and data work onto Snowflake so that they have an AI-ready data foundation.”

About the Author

Christine Ji is a reporter covering Big Tech.

Hannah Pedone is a New York–based technology reporter for MarketWatch.

Snowflake reports September 2 with shares near all-time highs and a beat already baked into the price, so the real question is whether AI agent activity on its platform reflects paid production workloads or just well-funded experiments that could quietly…

Snowflake (NYSE:SNOW | SNOW Price Prediction) reports its next quarter on Wednesday, September 2, 2026, after the market closes, and the stock walks in hot. Shares closed at $322.78 on Monday, just under the 52-week high of $341.95 and up 47.15% year to date, compared with the S&P 500’s 11.96%.

The rally is a bet on one specific idea. Enterprise AI agents generate more queries, move more data, and burn more compute, and Snowflake gets paid every time that happens because its revenue model is consumption-based rather than seat-based.

The Setup Into September 2 Last quarter, Snowflake posted product revenue of $1.334 billion, up 34% year over year, which was the strongest sequential dollar growth in the company’s history. Total revenue came in at $1.39 billion; non-GAAP EPS reached $0.39, beating the $0.32 estimate; and management raised full-year product revenue guidance to $5.84 billion, or 31% growth, from $5.66 billion and 27%.

The market has already paid for that acceleration. Snowflake is up 64.01% over the past year and 20.41% in the last month alone, and it now trades at 22.92 times sales with a forward earnings multiple of 169.

Polymarket traders are extremely confident in the report, assigning a 0.947 probability that Snowflake will beat quarterly earnings. That is not a controversial view given five straight beats from Q1 fiscal 2026 through Q1 fiscal 2027.

The catch is that a beat is priced in, and the analyst consensus target is $321.35, roughly where the stock already trades. That means the report has to do more than beat. It has to justify the rally’s last leg.

How Consumption Pricing Turns Agents Into Revenue Consumption pricing means Snowflake bills customers for the compute they use and the data they store, not for a fixed subscription per user. A customer signs a multi-year commitment for a pool of credits and then draws down those credits as workloads run against the platform.

An AI agent, by design, is a workload that runs continuously. When it answers a business question, it queries tables, retrieves context, invokes a model, and often writes the results back to the warehouse; each of those steps consumes credits.

Snowflake’s own numbers describe this feedback loop. More than 13,600 accounts now use Snowflake AI capabilities, Cortex Code sits in over 7,100 accounts, and Snowflake Intelligence accounts more than doubled quarter over quarter.

CEO Sridhar Ramaswamy tied the growth directly to that dynamic, saying “AI is compounding Snowflake’s advantage in data” and that Cortex Code and Snowflake Intelligence are seeing “the fastest adoption of any new products in our history.” The bull case is that this flywheel is now the dominant driver of growth without requiring a new sales cycle for each incremental workload, and it is why the picks-and-shovels layer of enterprise AI keeps showing up in our free report on seven AI-boom stocks that aren’t chipmakers.

What Would Prove Production Usage, Not Pilots The real problem is that pilots and production workloads look identical in a headline growth number, because a well-funded pilot can burn real credits for a quarter or two before anyone asks whether it delivered value. That is why I care less about whether Snowflake beats and more about four specific things in this release.

The first is product revenue against management’s own guide of $1.415 billion to $1.420 billion, or roughly 30% growth. A modest beat looks like a company clearing a conservatively set bar, while a large beat suggests observed consumption is running ahead of the model management built after last quarter.

The second is the pace of large-customer additions. Snowflake added 46 customers that crossed the $1 million trailing 12-month threshold, up from 26 a year earlier, and 8 customers that surpassed $10 million in a single quarter. Continued acceleration there is the cleanest signal that agent workloads are landing in production budgets rather than innovation budgets.

The third is breadth. Net revenue retention of 126% is strong, but the question is whether consumption growth is distributed across the base or concentrated in a handful of accounts running expensive experiments.

The fourth is guidance, because a third full-year raise this cycle would tell you management is watching the same acceleration that shareholders are paying for.

$6 Billion AWS Commitment as Confidence and Exposure Snowflake signed a five-year, $6 billion contract with AWS that more than doubles its prior commitment, and management has framed it as go-to-market alignment for agentic AI workloads. A commitment of that size is a real vote of confidence in what the platform will consume.

It is also a fixed cost incurred before revenue that has not yet been booked. If agent workloads scale as management expects, the AWS commitment locks in favorable unit economics and, per management, helps offset the lower gross margin of AI products, so that the 75% FY27 non-GAAP product gross margin target remains intact.

If workloads scale more slowly, that same commitment becomes a drag on the free cash flow margin target of 23%. My read is that this is a confident bet, but it does convert a variable-cost story into one with a floor of committed spend, and that is worth naming out loud.

Risk elsewhere is real too. Stock-based compensation continues to drive GAAP operating losses of $326 million a quarter, insider activity across 206 recent transactions is net selling, and competitive pressure from cloud providers and data-platform vendors is intensifying.

Verdict Going Into the Report The setup favors owning Snowflake into the report only if you already believe the agent thesis and can accept that a beat is largely priced in. The average one-week move after the last five beats was 5.79%, but Q1, Q2, and Q3 of fiscal 2026 all showed negative one-day reactions despite beats, which tells you the market is stingy when expectations are elevated.

What I am watching is whether product revenue outpaces the $1.42 billion guide by enough to signal that observed AI consumption is still running ahead of the model, and whether the full-year guide gets raised again. Those two together would be the cleanest evidence that agent activity is paid production usage rather than a well-funded experiment.

If either shows softness, the AWS commitment and the 169 forward multiple start looking like exposure rather than confidence, and the stock has room to give back a chunk of its 20.41% one-month gain quickly. That is the trade-off you are accepting if you own it Wednesday.

Contact [email protected] for any questions or corrections.

The upcoming report from Snowflake Inc. (SNOW - Free Report) is expected to reveal quarterly earnings of $0.45 per share, indicating an increase of 28.6% compared to the year-ago period. Analysts forecast revenues of $1.47 billion, representing an increase of 28.8% year over year.

Over the past 30 days, the consensus EPS estimate for the quarter has remained unchanged. This demonstrates the covering analysts' collective reassessment of their initial projections during this period.

Before a company reveals its earnings, it is vital to take into account any changes in earnings projections. These revisions play a pivotal role in predicting the possible reactions of investors toward the stock. Multiple empirical studies have consistently shown a strong association between trends in earnings estimates and the short-term price movements of a stock.

While investors typically rely on consensus earnings and revenue estimates to gauge how the business may have fared during the quarter, examining analysts' projections for some of the company's key metrics often helps gain a deeper insight.

That said, let's delve into the average estimates of some Snowflake metrics that Wall Street analysts commonly model and monitor.

The average prediction of analysts places 'Revenue- Product revenue' at $1.42 billion. The estimate suggests a change of +30% year over year.

The consensus among analysts is that 'Revenue- Professional services and other revenue' will reach $60.04 million. The estimate suggests a change of +10.2% year over year.

The collective assessment of analysts points to an estimated 'Remaining performance obligations' of $9.48 billion. The estimate is in contrast to the year-ago figure of $6.90 billion.

Analysts' assessment points toward 'Total customers' reaching 14,399 . The estimate is in contrast to the year-ago figure of 12,062 .

Analysts expect 'Customers with trailing 12-month product revenue greater than $1 million' to come in at 818 . Compared to the current estimate, the company reported 654 in the same quarter of the previous year.

According to the collective judgment of analysts, 'Non-GAAP product gross profit' should come in at $1.06 billion. The estimate is in contrast to the year-ago figure of $833.63 million.

It is projected by analysts that the 'GAAP product gross profit' will reach $1.01 billion. Compared to the present estimate, the company reported $788.18 million in the same quarter last year.

View all Key Company Metrics for Snowflake here>>>

Shares of Snowflake have demonstrated returns of +10.4% over the past month compared to the Zacks S&P 500 composite's +4.3% change. With a Zacks Rank #2 (Buy), SNOW is expected to beat the overall market performance in the near future. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>> .

UBS is telling clients that artificial intelligence is translating into real, growing spend on Snowflake, and the bank remains Buy-rated on the stock heading into its fiscal second-quarter results on September 2.

The bank's analysts spoke with seven enterprise partners and customers to gauge demand trends, adoption of Snowflake's Cortex Code and Coco tools, and the risk that large language models could eat into spending on established data software vendors.

The checks came back strong, according to UBS, with customers and partners largely expecting their Snowflake spend to accelerate, helped by continued Coco adoption.

Companies are increasingly focused on their data layer as new AI applications and agents need access to corporate data, UBS said, a dynamic that is making Snowflake, along with Databricks, Microsoft and others, more essential to enterprise infrastructure.

On competition, UBS said Databricks came up most often as the company taking share, with Microsoft also mentioned.

UBS also flagged a growing push among enterprises to better operationalize their data with AI models to improve returns, which typically requires a data ontology layer such as a semantic layer or knowledge graph. The bank called this a direct positive for Palantir.

One investor worry UBS tested directly: that frontier AI models are getting good enough at data tasks that companies could bypass data software vendors altogether and use the models on their own. UBS said its checks found little evidence of this happening, concluding that very few enterprises are using LLMs' data capabilities in a way that is cutting into spending on Snowflake, Palantir or Databricks.

Still, UBS acknowledged the setup into the print is not simple. Investors are pricing in revenue growth of 36 to 37% for the fiscal second quarter, with growth expected to exit fiscal 2027 in the high-30s to 40% range. UBS said its demand checks support those targets.

Snowflake shares are up more than 50% year to date and trade at 15 times revenue and 62 times free cash flow on calendar 2027 and fiscal 2028 estimates, a valuation UBS described as leaving little room for error.

UBS raised its price target on Snowflake to $425 from $370, based on roughly 15.5 times calendar 2028 estimated EV/sales and 62 times EV/free cash flow, down from its prior 17.5 times and 73 times multiples on calendar 2027 estimates. The bank kept its Buy rating, citing confidence in the durability of the current data investment cycle.

The company logo for Snowflake Inc. is displayed on a banner to celebrate the company's IPO at the New York Stock Exchange (NYSE) in New York, U.S., September 16, 2020. REUTERS/Brendan... Purchase Licensing Rights, opens new tab Read more

CompaniesJuly 16 (Reuters) - Snowflake (SNOW.N), opens new tab on Thursday unveiled a compensation package worth up to roughly $448 million for CEO Sridhar Ramaswamy, ​hinging on the cloud-based data analytics platform's ‌market value almost doubling to $184 billion in seven years.

Ramaswamy's award, totaling 1 million shares, is structured into five tranches, each ​with escalating stock price milestones, and is ​designed to retain him as CEO until September 15, 2030.

Learn about the latest breakthroughs in AI and tech with the Reuters Artificial Intelligencer newsletter. Sign up here.

Snowflake ⁠has been benefiting from clients shifting their workloads to its cloud ​platform as they invest to develop AI tools.

The company's stock price would ​need to climb to $531 by July 15, 2033 from Wednesday's closing price of $271.87 for the final tranche, adding up to $100 billion to its market ​capitalization.

Snowflake offers a platform where clients store and ​integrate their data in one place to generate business insights, ‌build ⁠AI tools and solve operational problems.

Ramaswamy must remain CEO through September 15, 2029 for the first two tranches and September 15, 2030 for the ​last three ​to meet ⁠the service-based requirement, the company said.

The compensation package also includes clawback clauses for misconduct ​or accounting restatements, according to a ​regulatory filing.

Snowflake ⁠shares have risen about 24% this year.

In May, the company raised its annual product revenue forecast and announced a ⁠five-year ​deal worth $6 billion with Amazon ​Web Services (AMZN.O), opens new tab to use AWS's Graviton processors and AI infrastructure.

Reporting by ​Jaspreet Singh in Bengaluru; Editing by Sahal Muhammed

Our Standards: The Thomson Reuters Trust Principles., opens new tab

© Public Domain / Wikimedia

Snowflake’s title bet references an $80 billion data opportunity, but the number in the Q1 FY27 filing that actually validates the thesis is the size of the contracted backlog. That contracted figure is what long-term holders should anchor on.

The Number Snowflake (NYSE:SNOW | SNOW Price Prediction) closed Q1 FY27 with $9.21 billion in remaining performance obligations, up 38% year over year. The company reported the figure on May 27, 2026. RPO represents contracted business Snowflake has booked with customers but has not yet recognized as revenue. This figure grew faster than the 33.48% quarterly revenue increase, which is the tell.

What It Means RPO is the backlog. When this number accelerates past revenue growth, customers are signing longer, larger contracts. Product revenue for the quarter came in at $1.33 billion, up 34% year over year, which management described as the strongest sequential dollar growth in the company’s history. Net revenue retention held at 126%, meaning existing customers spent 26% more than a year ago.

Perhaps more important is the count of customers generating more than $1 million in trailing product revenue. This figure reached 779 this past quarter (up 29% YoY), with Snowflake adding 616 net new customers (up 38% YoY), and showcasing 13,600+ accounts are now using Snowflake AI capabilities.

Market Reaction Shares closed at $260.15 on July 2, 2026, up 18.6% year to date from a start of $219.36 on December 31, 2025. On a one-week view, SNOW rose 14.57%, moving from $227.06 on June 25, 2026 to $260.15 on July 2, 2026. On the one-year view, the stock is up 19.7% from $217.34 on July 2, 2025. Following the Q1 earnings report, shares moved from $177.4949 at filing to $255.55 one day after.

Bull Case The $9.21 billion backlog is the foundation. Management raised full-year FY27 product revenue guidance to $5.84 billion, implying 31% growth, up from prior guidance of $5.66 billion at 27%. Non-GAAP operating margin guidance rose to 13.5%, from 12.5%, and non-GAAP adjusted free cash flow margin is guided at 23.0%. Q2 FY27 product revenue is guided to $1,415 million to $1,420 million, or 30% growth.

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AI adoption is doing the work behind those raises. Cortex Code is now inside 7,100+ accounts, and Snowflake Intelligence accounts more than doubled quarter over quarter. Some of Snowflake’s strategic moves included a $6 billion multi-year AWS agreement, a deepened OpenAI partnership, general availability of SAP partnership capabilities, and the acquisition of Natoma, an enterprise Model Context Protocol platform for AI agents.

CEO Sridhar Ramaswamy called Q1 “a milestone quarter” and framed the company’s AI product suite as the company becoming “the control plane for the Agentic Enterprise.” Non-GAAP EPS came in at $0.39 versus a $0.3198 estimate, a 21.95% beat, the fourth consecutive quarter of beating consensus. Free cash flow reached $232.77 million, up 26.93% YoY, and Snowflake repurchased $300.03 million of its own stock in the quarter. TD Cowen reiterated a Buy rating with a $300 price target on June 2, 2026.

Bottom Line For retirement-focused holders, RPO growing faster than revenue is the metric that matters most. It signals longer contract durations and stronger customer conviction, and it gives management visibility to keep raising guidance.

The AI attach rate across 13,600+ accounts is converting into contracted dollars on the balance sheet. Shares have already caught a bid, up 18.6% year to date, but Snowflake’s backlog compounds independent of any single quarter’s headlines. The next catalyst is the Q2 FY27 report, and the number to keep an eye on is whether RPO growth stays ahead of product revenue growth. If it does, the raised full-year outlook is unlikely to be the last one this fiscal year.

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Contact [email protected] for any questions or corrections.

It has been about a month since the last earnings report for Snowflake Inc. (SNOW - Free Report) . Shares have lost about 5.1% in that time frame, underperforming the S&P 500.

Will the recent negative trend continue leading up to its next earnings release, or is Snowflake due for a breakout? Well, first let's take a quick look at the latest earnings report in order to get a better handle on the recent catalysts for Snowflake Inc. before we dive into how investors and analysts have reacted as of late.

Snowflake Q1 Earnings Top Estimates, Revenues Increase Y/YSnowflake reported first-quarter fiscal 2027 non-GAAP earnings of 39 cents per share, which beat the Zacks Consensus Estimate by 21.88%. The company reported earnings of 24 cents per share in the year-ago quarter.

Revenues were $1.39 billion, up 33% year over year and beat the Zacks Consensus Estimate by 5.23%.

SNOW Top-line DetailsSNOW’s fiscal first quarter was driven by consumption across its core platform, with product revenue representing the majority of results. Product revenues totaled $1.33 billion, which accounted for 96% of total revenues. Professional Services and other revenues were $56.6 million, which contributed 4% of total revenues, representing a 25.1% year-over-year increase.

Geographically, results remained concentrated in the Americas, which represented 78% of revenue, with EMEA and APJ contributing 16% and 6%, respectively. The steady regional mix suggests Snowflake is scaling internationally without materially changing its revenue concentration.

Snowflake’s AI-Led Momentum and PartnershipsSnowflake framed the quarter as an inflection point in its AI roadmap, citing accelerating adoption of first-party AI products alongside core platform demand. Management pointed to strong sequential product revenue dollar growth and emphasized the role of offerings such as Cortex Code and Snowflake Intelligence in broadening usage across the installed base.

The company also underscored ecosystem moves aimed at extending distribution and deepening enterprise relevance. It expanded collaboration with AWS through a new $6 billion multi-year agreement, highlighted ongoing work with OpenAI, and noted that capabilities from its SAP partnership reached general availability. Snowflake also signed a definitive agreement to acquire Natoma in May 2026 to strengthen secure connections for AI agents across tools and workflows.

SNOW's Customer Scale Supports Durable ExpansionSNOW ended the quarter with 13,912 total customers and added 616 net new customers, including 13 new Forbes Global 2000 customers. Large-customer depth continued to improve, with 779 customers above the $1 million trailing product revenue threshold, representing 29% year-over-year growth in that cohort.

Retention remained a key support for the consumption model. Net revenue retention rate was 126%, reflecting continued expansion from existing customers, even as usage patterns can vary quarter to quarter. Contracted demand also stayed healthy, with remaining performance obligations of $9.21 billion, up 38% from the year-ago period.

Snowflake’s Operating DetailsThe non-GAAP gross margin contracted 40 basis points (bps) year over year to 71.8%. Product gross margin was 75.1% in the reported quarter.

Research & development expenses, as a percentage of revenues, decreased 250 bps on a year-over-year basis to 20.4%. General & administrative expenses, as a percentage of revenues, were 5.5%, down 60 bps year over year. Sales and marketing expenses, as a percentage of revenues, contracted 40 bps on a year-over-year basis to 33.9%.

Operating margin expanded 300 bps on a year-over-year basis to 11.9%.

SNOW’s Balance Sheet & Cash Flow DetailsThe balance sheet remained liquid. As of April 30, 2026, Snowflake reported $2.08 billion in cash and cash equivalents and $870.3 million in short-term investments.

SNOW produced $243.2 million of net cash from operating activities in the quarter. Free cash flow was $232.8 million, and adjusted free cash flow was $265.5 million.

Snowflake Raises Full-Year Product Revenue OutlookSnowflake expects second-quarter fiscal 2027 product revenues in the range of $1.415-$1.420 billion, implying 30% year-over-year growth, with a non-GAAP operating margin expected to be 12.5%.

For fiscal 2027, the company raised its product revenue outlook to $5.84 billion, representing 31% growth. Snowflake also lifted its full-year non-GAAP operating margin target to 13.5% and reiterated a 75% non-GAAP product gross margin assumption alongside a 23% non-GAAP adjusted free cash flow margin.

How Have Estimates Been Moving Since Then?In the past month, investors have witnessed a upward trend in fresh estimates.

The consensus estimate has shifted 5.83% due to these changes.

VGM ScoresCurrently, Snowflake has a great Growth Score of A, though it is lagging a bit on the Momentum Score front with a B. However, the stock has a grade of F on the value side, putting it in the lowest quintile for this investment strategy.

Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.

OutlookEstimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Snowflake has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.