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.

Snowflake Inc. (SNOW) Presents at Goldman Sachs Communacopia + Technology Conference 2026 Transcript

Investors yanked $700 million from the top software ETF in a single session, and within hours a major earnings report threatened to make that timing look catastrophic. Whether the selloff was a blunder or a bullet dodged depends on a…

This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.

Investors pulled roughly $700 million from the iShares Expanded Tech-Software Sector ETF (NASDAQ:IGV) in a single session, and within hours, Snowflake (NYSE:SNOW | SNOW Price Prediction) delivered the kind of quarter software bulls had been waiting for.

Product revenue grew 37% year over year to $1.49 billion, and management raised the FY27 product revenue guide to $6.07 billion. CEO Sridhar Ramaswamy told Reuters that roughly half of the recent acceleration in growth came from AI. Snowflake ripped the next session and pulled IGV higher along the way.

The timing looked disastrous for the sellers on September 3, though the picture shifted a day later. Snowflake gave back 5% on September 4, and IGV fell 2% to about $105, leaving the fund down 1% year-to-date and 2% over one year. The real question is whether IGV belongs in your portfolio while software works through an AI-disruption debate that has kept the fund negative all year.

What the Snowflake Earnings Report Actually Proved Snowflake’s Q2 FY27 report landed after the close on September 2, 2026. Non-GAAP operating margin came in at 15.3%, versus 11% a year earlier, and remaining performance obligations reached $9.00 billion, up 30%. Net revenue retention held at 126%, and CoCo surpassed 9,100 accounts.

Snowflake’s consumption pricing is the point. More AI workloads translate directly into more revenue, so the AI wave acts as a tailwind. Over the last year, SNOW has gained 52%, and it is up 54% year to date through September 4.

How IGV Makes Money IGV tracks the S&P North American Expanded Technology Software Index, a market-cap-weighted basket with a 0.38% expense ratio per the July 31, 2026 prospectus. Net assets stood at $13.5 billion on June 30, 2026, spread across 111 positions.

The return engine is top-heavy. On that same date, Palo Alto Networks (NASDAQ:PANW) was the largest holding at 10.37% of net assets, followed by Microsoft (NASDAQ:MSFT) at 8.07%, Palantir (NASDAQ:PLTR) at 7.70%, CrowdStrike (NASDAQ:CRWD) at 7.28%, and Oracle (NYSE:ORCL) at 6.26%. Salesforce (NYSE:CRM) was at 4.81% and Adobe (NASDAQ:ADBE) at 3.13%.

The AI Disruption Argument Weighing on Software The bear case hanging over software all year is straightforward. If AI coding tools compress the cost of building software, seat-based and license-based vendors face pricing pressure. Adobe is down 24% year to date and 23% over one year, and Microsoft has been roughly flat at 4% year to date.

Salesforce also beat expectations, with Agentforce ARR above $1.5 billion, up 240% year over year, yet the stock is 2% lower year to date. One consumption-priced data platform does not clear an index of seat-based vendors. The read-through from Snowflake to the rest of IGV is real but partial.

For broad tech exposure that includes semiconductors and hardware, XLK or VGT diversifies beyond pure software. For software without the mega-cap concentration, XSW takes an equal-weighted approach. For the return engine itself, Microsoft alone is up 877% over ten years, more than double IGV’s 364%.

IGV’s edge over direct ownership is diversification across 111 names and automatic rebalancing. Its weakness is that when top holdings drag, as Adobe has this year, the whole fund suffers.

Where IGV Fits in a Software Portfolio IGV works as a 5% to 10% software sleeve if you want passive exposure to the sector and can accept concentration in a handful of platform, security, and data names. It has compounded 364% over ten years but has been negative in 2026, so recent performance has been unkind.

If you already own Microsoft directly, IGV is largely redundant. For an investor who wants software beta without picking winners, it remains a reasonable core holding at 0.38%. My read is cautious. The bifurcation between consumption-priced winners like Snowflake and seat-based laggards remains unresolved, and paying for the whole index while Adobe compresses is not the best use of capital right now.

Contact [email protected] for any questions or corrections.

The recommendations of Wall Street analysts are often relied on by investors when deciding whether to buy, sell, or hold a stock. Media reports about these brokerage-firm-employed (or sell-side) analysts changing their ratings often affect a stock's price. Do they really matter, though?

Let's take a look at what these Wall Street heavyweights have to say about Snowflake Inc. (SNOW - Free Report) before we discuss the reliability of brokerage recommendations and how to use them to your advantage.

Snowflake currently has an average brokerage recommendation (ABR) of 1.37, on a scale of 1 to 5 (Strong Buy to Strong Sell), calculated based on the actual recommendations (Buy, Hold, Sell, etc.) made by 46 brokerage firms. An ABR of 1.37 approximates between Strong Buy and Buy.

Of the 46 recommendations that derive the current ABR, 37 are Strong Buy and three are Buy. Strong Buy and Buy respectively account for 80.4% and 6.5% of all recommendations.

Brokerage Recommendation Trends for SNOW

Check price target & stock forecast for Snowflake here>>>

While the ABR calls for buying Snowflake, it may not be wise to make an investment decision solely based on this information. Several studies have shown limited to no success of brokerage recommendations in guiding investors to pick stocks with the best price increase potential.

Are you wondering why? The vested interest of brokerage firms in a stock they cover often results in a strong positive bias of their analysts in rating it. Our research shows that for every "Strong Sell" recommendation, brokerage firms assign five "Strong Buy" recommendations.

In other words, their interests aren't always aligned with retail investors, rarely indicating where the price of a stock could actually be heading. Therefore, the best use of this information could be validating your own research or an indicator that has proven to be highly successful in predicting a stock's price movement.

Zacks Rank, our proprietary stock rating tool with an impressive externally audited track record, categorizes stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), and is an effective indicator of a stock's price performance in the near future. Therefore, using the ABR to validate the Zacks Rank could be an efficient way of making a profitable investment decision.

Zacks Rank Should Not Be Confused With ABRIn spite of the fact that Zacks Rank and ABR both appear on a scale from 1 to 5, they are two completely different measures.

Broker recommendations are the sole basis for calculating the ABR, which is typically displayed in decimals (such as 1.28). The Zacks Rank, on the other hand, is a quantitative model designed to harness the power of earnings estimate revisions. It is displayed in whole numbers -- 1 to 5.

It has been and continues to be the case that analysts employed by brokerage firms are overly optimistic with their recommendations. Because of their employers' vested interests, these analysts issue more favorable ratings than their research would support, misguiding investors far more often than helping them.

On the other hand, earnings estimate revisions are at the core of the Zacks Rank. And empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

Furthermore, the different grades of the Zacks Rank are applied proportionately across all stocks for which brokerage analysts provide earnings estimates for the current year. In other words, at all times, this tool maintains a balance among the five ranks it assigns.

There is also a key difference between the ABR and Zacks Rank when it comes to freshness. When you look at the ABR, it may not be up-to-date. Nonetheless, since brokerage analysts constantly revise their earnings estimates to reflect changing business trends, and their actions get reflected in the Zacks Rank quickly enough, it is always timely in predicting future stock prices.

Is SNOW a Good Investment?In terms of earnings estimate revisions for Snowflake, the Zacks Consensus Estimate for the current year has increased 2.1% over the past month to $2.01.

Analysts' growing optimism over the company's earnings prospects, as indicated by strong agreement among them in revising EPS estimates higher, could be a legitimate reason for the stock to soar in the near term.

The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #2 (Buy) for Snowflake. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Therefore, the Buy-equivalent ABR for Snowflake may serve as a useful guide for investors.

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.

SNOW stock jumps 16.6% after Q2 second-quarter results as AI adoption, enterprise growth, and higher product revenue guidance fuel momentum.

September 4, 2026 1. The Cheapest AI Yet Squeezes the Companies Selling It

Source: Image created by Jester AI.

Tokens serve as the billing unit that AI models use for their services. On Monday, a million tokens could be purchased for $0.97. That's a record low, and less than half the summer high, according to Silicon Data's index of token prices. Low-priced tokens benefit anyone executing queries but create difficulties for those selling the resulting answers.

Prices fall; bills don't: Cheap Chinese open-source models and price cuts at the biggest labs helped drive the slide. Those labs' computing bills are already committed, so they don't shrink when a query gets cheaper. Two of those labs want to sell shares: Anthropic and OpenAI both filed confidentially for initial public offerings this summer. Each has to pitch investors on a business whose price per unit is falling. Microsoft will soon make volume visible: For the first time, Microsoft (MSFT +2.68%) will report revenue in dollars for Azure, the computing power it rents to other companies. That number moves with how much customers actually use. The build-out pays off in the future only if usage increases faster than the price per unit declines. Microsoft's new Azure line will show whether that's happening.

2. Nvidia Is Spending Like the Easy Years Are Over Nvidia (NVDA +1.80%) confirmed on Thursday that it will spend $13 billion to buy Hugging Face, the hub where developers publish and test open-source AI models. Nvidia once sold every chip it made to buyers with no alternative. Now those buyers have one, so Nvidia is spending to stay central anyway.

The seller made the first call: Hugging Face CEO Clément Delangue said he approached Nvidia over the summer, not the reverse; even a thriving platform felt it needed a giant's backing. The deal is expected to close in the first half of 2027, pending regulatory approval. Nvidia wrote another check on Monday: It put $3.5 billion into Taiwanese chip designer MediaTek, whose parts will plug into Nvidia systems. That keeps Nvidia in the chain even when a buyer picks a rival chip. Nvidia holds the lease under someone else's deal: Hut 8 (HUT +9.18%) will develop the Texas data center behind the $35 billion Anthropic-Lambda deal. Nvidia backs Lambda, leases the site, and sells the chips that fill it. More of Nvidia's sales now come from customers it helped fund. Owning it from here means trusting Nvidia to earn its keep across the whole stack.

3. Nvidia's Beat and a Telling Purchase Nvidia (NVDA +1.80%) beat again. Revenue topped $96 billion, more than double a year ago, and the stock is up 9% since reporting. What lifted its shares? The CFO guiding for 70% revenue growth in 2028. But our analyst Emily Flippen calls Nvidia "a lagging indicator of the AI buildout, not a leading one." Its reported revenue just confirms spending that the market already knew about. But the more revealing news came Thursday, when Nvidia revealed what's on its shopping list.

The deal: Nvidia reportedly agreed to buy Hugging Face, the open-source hub where developers publish and test AI models, for about $13 billion. It's Nvidia's largest acquisition ever, at roughly 86 times the target's sales. Why that price isn't incredibly high: Nothing is expensive against Nvidia's scale. Flippen notes Nvidia could buy Hugging Face seven times over using cash already set aside to repurchase its own stock. She also flags this as a defensive hedge. Nvidia's biggest customers are starting to design their own chips. Whoever owns the platform developers download models from can steer them toward rival hardware. Nvidia is paying to keep that door shut. We've recommended Nvidia more than 30 times and never sold. In fact, a $10,000 stake invested in 2005, when we first recommended Nvidia in Stock Advisor, is worth about $13 million today. But the build-out that made it can't grow forever, and this deal is a tell that Nvidia knows the easy years are behind it. What we're watching now is whether it can defend its lead as well as it once extended it.

3. Snowflake, Sezzle, and FIGS All Sounded Like Bad Ideas Three of this week's Breakfast News statements went back to an earlier recommendation. We issued each one before the market came around.

Snowflake went nowhere for five years. Our first Rule Breakers recommendation of Snowflake (SNOW +16.55%), May 2021 at $245.15, is up 45% and trails the S&P 500. Hidden Gems recommended it in June 2022 at $138.24. That call is up about 158%. It's still a Buy in Hidden Gems and Rule Breakers. Sezzle carried its industry's stigma. Wall Street treated buy now, pay later as a subprime accident waiting to happen. We first recommended Sezzle (SEZL +1.20%) in August 2024 at $21.32, and shares have more than quintupled. It turns 61% of revenue into free cash flow, a software-like rate. FIGS is the newest of the three. Scrubs maker FIGS (FIGS +1.33%) disappointed for years after its 2021 IPO. We recommended it in Rule Breakers in June 2026 at $12.22. Revenue rose nearly 29% year over year in the second quarter. Sezzle paid for its industry's reputation. Snowflake and FIGS had their own bad years. None of that told you what any of those businesses is worth today.

4. Uber Is Lobbying Against the Robotaxis It's Funding Uber (UBER -0.64%) said Wednesday that it will cut 10% of its workforce, roughly 3,300 jobs, to flatten management. CEO Dara Khosrowshahi framed it as freeing capacity for a planned $10 billion-plus push into autonomous vehicles. He didn't blame AI, unlike most tech CEOs who cut staff this year.

Then Uber lobbied to slow robotaxis down: It joined driver unions in New Jersey and Washington, D.C., to push for rules that keep human drivers in most self-driving rides. In New Jersey, it wants at least 85% of rides to have a person behind the wheel. Alphabet's (GOOG +1.59%) Waymo says the 85% minimum solves a problem that doesn't exist. The rule would bite Waymo hardest: One tracker counts just over 200 Tesla (TSLA +5.42%) vehicles registered as unsupervised, against Waymo's 4,000 across 14 cities. Tesla teased a Cybercab event Wednesday, and shares rose 5.5% that day. The Rule Breakers recommendation is outperforming the S&P 500 by more than 250% since July 2022. Uber is spending $10 billion on a fleet it doesn't have yet. The thesis needs the rules to slow Waymo down long enough for Uber to close that gap.

5. MongoDB Beat, Raised Guidance, and Fell 15% MongoDB (MDB +2.41%) sells the database where applications keep their data. Its Atlas cloud service is now where AI coding agents read and write live data, too. Our Rule Breakers recommendation reported Tuesday night. The quarter beat estimates, management raised its full-year outlook, and shares fell almost 15%.

Growth accelerated, and margins followed: Revenue rose 30% year over year in the fiscal second quarter, the best in several years. Adjusted operating margin reached 24%, up from 15%. Then management forecast a slower third quarter: That gave investors an excuse to sell after a string of blowout quarters. The payoff runs a step behind the build-out. Software like MongoDB's gets used after the servers are installed. It launched a service connecting coding agents like Claude Code and OpenAI's Codex to live Atlas data. Contracted future revenue climbed 91% to $1.52 billion, so the demand is booked. These results show that the market has stopped paying in advance for AI demand. It wants revenue collected rather than contracted. Holding MongoDB means trusting those signed commitments to arrive on schedule.

6. The Week Ahead The August jobs report landed this morning. Strong hiring makes a rate hike more likely, and higher rates hit expensive AI stocks hardest. Those stocks are priced on profits that won't arrive for years. Federal Reserve Governor Christopher Waller said on Thursday that he'd lean toward holding steady this month. Odds of a September hike fell to 50.4% from 63.2% a day earlier, close to a coin flip.

Oil keeps inflation in the picture: Crude near $92 keeps the pressure on, and consumer and producer price reports land next week. Then management forecast a slower third quarter: That gave investors an excuse to sell after a string of blowout quarters. Four recommendations report: Chewy (CHWY -0.87%) reports on Wednesday morning and AeroVironment (AVAV +1.25%) on Wednesday afternoon. Oracle (ORCL +5.69%) and Adobe (ADBE +2.13%) follow on Thursday afternoon. 7. Your Take MongoDB beat estimates this week, and its stock fell 15% anyway. When a company's payoff keeps sliding further out, how do you decide whether to keep holding or revisit your thesis?

Debate with friends and family, or become a member to hear what your fellow Fools are saying!

The Motley Fool has positions in and recommends Adobe, AeroVironment, Alphabet, Chewy, Figs, Microsoft, MongoDB, Nvidia, Oracle, Sezzle, Snowflake, and Tesla. The Motley Fool recommends Uber Technologies and recommends the following options: long January 2028 $330 calls on Adobe and short January 2028 $340 calls on Adobe. The Motley Fool has a disclosure policy.

Information in Investor’s Business Daily is for informational and educational purposes only and should not be construed as an offer, recommendation, solicitation, or rating to buy or sell securities. The information has been obtained from sources we believe to be reliable, but we make no guarantee as to its accuracy, timeliness, or suitability, including with respect to information that appears in closed captioning. Historical investment performances are no indication or guarantee of future success or performance. Authors/presenters may own the stocks they discuss. We make no representations or warranties regarding the advisability of investing in any particular securities or utilizing any specific investment strategies. Information is subject to change without notice. For information on use of our services, please see our Terms of Use.

*Real-time prices by Nasdaq Last Sale. Real-time quote and/or trade prices are not sourced from all markets. Ownership data provided by LSEG and Estimate data provided by FactSet.

IBD, IBD Digital, IBD Live, IBD Weekly, Investor's Business Daily, Leaderboard, MarketDiem, MarketSurge and other marks are trademarks owned by Investor's Business Daily, LLC.

©2026 Investor’s Business Daily, LLC. All Rights Reserved.

Snowflake stock is surging on signs that enterprise AI demand is driving big gains for its business.

CNBC's Seema Mody reports on news regarding the software trade.

The Investment Committee debate the investability of software stocks after Snowflake surges on a blowout Q2 earnings report.

Snowflake shares rose 22% in extended trading on Wednesday after the data analytics software maker reported results and guidance that surpassed expectations. Sridhar Ramaswamy, Snowflake CEO, joins 'Squawk on the Street' to discuss.

Snowflake Inc (NYSE:SNOW) analysts highlight the company’s second-quarter financial results and guidance and see the stock trading higher, even after hitting new multi-year highs.

• Snowflake stock is approaching key resistance levels. How is SNOW doing now?

Rosenblatt analyst Blair Abernethy maintained a Buy rating on Snowflake and raised the price target from $345 to $370.

Needham analyst Mike Cikos maintained a Buy rating and raised the price target from $330 to $450.

Cantor Fitzgerald analyst Thomas Blakey maintained an Overweight rating and raised the price target from $405 to $430.

Canaccord Genuity analyst Kingsley Crane maintained a Buy rating and raised the price target from $325 to $450.

BITG analyst Gray Powell reiterated a Buy rating and raised the price target from $340 to $424.

DA Davidson analyst Gil Luria reiterated a Buy rating and raised the price target from $300 to $450.

JPMorgan analyst Samik Chatterjee reiterated an Overweight rating and raised the price target from $285 to $426.

Read Next

Rosenblatt on SNOW StockSnowflake’s second quarter showed continued AI product adoption, Abernethy said in an investor note.

The analyst highlighted strong results with data warehouse migration and strong data cloud consumption.

"We also see the healthy NRR of 126% as demonstrating strong customer renewals and uptake of the core platform," Abernethy said.

The analyst said new agentic AI products are helping customers build solutions and get more out of the Snowflake platform, leading to enterprises moving more and more data to Snowflake.

Needham on SNOW StockSnowflake’s third consecutive quarter of product revenue growth acceleration was a highlight for Cikos.

"AI adoption builds a flywheel for greater core consumption," Cikos said.

The analyst said Snowflake’s CoCo and CoWork are bringing new users to Snowflake.

"Snowflake is offsetting increased Cloud costs with slowing salary expense as AI is driving greater efficiency and reducing reliance on headcount growth."

Cantor Fitzgerald on SNOW StockAI demand helped growth accelerate in the quarter, Crane said in a new investor note.

The analyst said second-quarter results were strong, highlighted by pre-cut revenue growth of 37% year-over-year.

"We continue to view Snowflake as a leading beneficiary of secular AI growth trends with a unique position tied to new AI-related products that drive additive token-based revenue and increased consumption."

Canaccord Genuity on SNOW StockA highlight from Snowflake’s quarterly results was AI products contributing half of revenue acceleration, Crane said in a new investor note.

"Snowflake’s Q2 materially strengthens our confidence that the reacceleration is becoming a durable consumption cycle rather than a one-quarter AI surge," Crane said.

The analyst said AI monetization is now showing up in the P&L statement.

"We have greater confidence in the durability of consumption."

BTIG on SNOW StockSnowflake beat estimates in the quarter and raised guidance, items highlighted by Powell in a new investor note.

"We thought it was another great quarter," Powell said.

The analyst highlighted net new product revenue growth hitting another record.

"AI is driving urgency to consolidate data on SNOW, CoCo and CoWork are reaching broader adoption and monetization."

DA Davidson on SNOW StockSecond quarter results were highlighted by "accelerating product revenue," Luria said in an investor note.

"Management noted that they continue to see strong momentum across the core business and that their AI products such as CoCo and CoWork are working to drive further consumption," Luria said.

JPMorgan on SNOW StockProduct revenue acceleration in the quarter shows AI and Core upside, Chatterjee said in a new investor note.

The analyst said AI products, the core data platform and customer adoption of AI products all contributed to the strong quarter.

"Led by the materially stronger outlook, with increasing proof points around acceleration in both core and AI revenues, we reiterate our OW [Overweight] rating."

SNOW Stock Price ActionSnowflake stock is up 21.5% to $371.50 on Thursday, with the stock hitting a new 52-week high of $384.56 earlier in the intraday trading session. Snowflake stock is up 71% year-to-date in 2026, with shares trading at their highest level since December 2021. The stock is also inching higher to an all-time high of $429 set in December 2020.

Read Next

Image via Shutterstock

© 2026 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

Snowflake Inc (NYSE:SNOW) shares jumped more than 20% on Thursday following a blowout second-quarter earnings report, driven by accelerating product revenue growth and surging enterprise adoption of its AI offerings.

Bank of America raised its price objective on the stock to $470 from $395, citing accelerating product revenue growth and reiterating a Buy rating.

Snowflake's product revenue growth accelerated to 37% year-over-year in the second quarter of fiscal 2027, up from 34% in the first quarter, according to BofA. The company's guidance for the third quarter calls for product revenue growth of 37-38%, implying further acceleration.

BofA said newer customer cohorts are ramping toward purchased capacity faster than prior cohorts, with recent cohorts reaching 80% of purchased consumption materially sooner.

The bank pointed to faster deployments, AI-enabled migrations, and growing adoption of Snowflake's CoCo and CoWork offerings as drivers of the stronger trends.

Current remaining performance obligations grew 42% year-over-year, marking the fourth consecutive quarter of accelerating cRPO growth, BofA said. The company also added 48 net new customers with trailing 12-month spend surpassing $1 million.

BofA said AI adoption is contributing meaningfully to the growth acceleration, though the company has not quantified the consumption uplift from AI adopters specifically. The bank said a key debate going forward is whether AI is driving higher customer lifetime value or simply pulling forward existing workloads.

BofA's new price objective is based on 22.4 times enterprise value to estimated calendar year 2027 revenue, up from 19.4 times previously, a premium to infrastructure software peers that the bank said is warranted given Snowflake's accelerating growth, execution, and expanding AI-driven consumption. The new target implies 54% potential upside, according to the bank.

The $25k Day Trading Barrier is Gone. It's Time to Put Your Capital to Work.

For years, the PDT rule put a major roadblock in front of active traders. The barrier is no longer standing in the way.

But having more freedom doesn't mean every trade is worth taking. 

With Dynamite Day Trading Signals, you'll receive up to 2 options trade alerts per week, each targeting 50%+ gains in a single session.

NO holding positions overnight.

NO waiting weeks for a trade to develop.

Just focused options trades designed to capitalize on opportunities as they emerge.

👉 Get Access to Dynamite Day Trading Signals

Snowflake (NYSE: SNOW) is surging 20% Thursday morning after the cloud data company delivered better-than-expected second-quarter results and lifted its full-year outlook.

3.9.2026 16:23, AVGO, PFG, SNOW, META

Index Dow Jones +0,87 % na 53525,61 b. S&P 500 +0,63 % na 7714,65 b. Nasdaq Composite +0,89 % na 26450,71 b.

Nejsledovanější americké indexy se nachází v kladném teritoriu, pozornost trhu dnes směřuje k výsledkům, které včera reportoval výrobce čipů a infrastrukturního softwaru Broadcom (-6,07 %).

Daří se i akciím softwarové společnosti Snowflake (+24,02 %) poté, co její výsledky za druhé čtvrtletí překonaly očekávání. Softwarová firma zároveň zvýšila celoroční výhled tržeb z produktů, jejichž růst táhne poptávka spojená s umělou inteligencí.

Americká společnost Meta Platforms, provozovatel Facebooku, Instagramu a dalších platforem, představila svůj dosud nejvýkonnější model umělé inteligence. Její akcie rostou přibližně o 3 %.

Podle Korea Economic Daily usiluje Samsung Life o získání 15% podílu ve společnosti Principal Financial Group (+8,4 %). 

Index S&P 500 +0,63 % na 7714,65 b. Nejsilnější sektory S&P Změna Nejslabší sektory S&P Změna Komunikační služby +2,1 % Zdravotní péče -0,6 % Zbytná spotřeba +1,6 % Nezbytná spotřeba -0,3 % Finanční sektor +1,4 % Základní materiály 0 % Nejsilnější akcie S&P Změna Nejslabší akcie S&P Změna Robinhood Markets (HOOD) +13 % Ciena Corp (CIEN) -9,7 % Principal Financial Group (PFG) +8,4 % Tyson Foods (TSN) -7,4 % Coinbase Global (COIN) +7,7 % Broadcom (AVGO) -5,7 % ServiceNow (NOW) +6,2 % Hewlett Packard Enterprise (HPE) -5,3 % Palantir Technologies (PLTR) +6,0 % Western Digital Corp (WDC) -4,5 % Zdroj: Bloomberg

Jan Prokeš
Fio banka, a.s.
Prohlášení

7.51K Followers

Analyst’s Disclosure: I/we have a beneficial long position in the shares of IGV either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Snowflake's (SNOW.N) shares surged more than 24% before the bell on Thursday as investors cheered a stronger ​annual revenue forecast and signs that the company's AI products are gaining traction.

The ‌cloud data platform provider lifted its fiscal 2027 product revenue forecast on Wednesday to $6.07 billion from $5.84 billion and posted a 37% jump in second-quarter product revenue. Its AI offerings accounted for "approximately half of the ​acceleration" in growth, according to CEO Sridhar Ramaswamy.

The results show AI ​is beginning to translate into tangible demand for Snowflake's core platform ⁠rather than simply creating a new product opportunity, underscoring how the tech spending boom can ​benefit software firms traditionally seen as more vulnerable to AI disruption.

"AI continues to compound ​our advantages, creating a flywheel effect across the business," Ramaswamy said.

Snowflake's coding assistant, Cortex Code, topped 9,100 accounts after adding more than 2,000 customers during the quarter, while enterprise chatbot CoWork ​expanded to 5,800 accounts.

"There was some nervousness around whether investor expectations were getting ​too high into the print. (But) we can see the positive sentiment gains continuing," Barclays analysts ‌wrote.

Snowflake ⁠has outperformed the broader market this year, rising 39% through Wednesday versus a 12% gain for the S&P 500 (.SPX). If premarket gains hold, the stock will be headed for its biggest daily jump since May.

Its shares are trading at roughly ​15 times forward revenue, ​compared with 7.4 ⁠times for the broader iShares Expanded Tech-Software Sector ETF . The stock is also priced at 121.8 times forward earnings, well ​above peer Datadog's (DDOG.O) 72.7 times and MongoDB's (MDB.O) 52.1 times.

Jefferies analysts ​said Snowflake's ⁠premium valuation remains supported by its position as a leading enterprise data cloud provider, with AI helping drive new workloads, expanding its user base and boosting consumption ⁠on its ​platform.

Following its second-quarter results, at least 22 ​brokerages raised their price objectives, with Wells Fargo issuing a Street-high target of $525, according to data compiled ​by LSEG.

Analysts see the software company continuing to benefit from the artificial-intelligence revolution.

Snowflake Inc (NYSE:SNOW), the American cloud data analytics company, saw its shares jump 23% in after-hours trading on Wednesday after it posted results that beat Wall Street expectations.

The company reported adjusted earnings per share of 62 cents, well ahead of the 45 cents forecast by analysts.

Revenue for the quarter came in at $1.55 billion, above the $1.48 billion consensus estimate.

Total revenue rose 35% year on year for the three months to 31 July, which forms the group's fiscal second quarter.

Losses narrow sharply

Snowflake's net loss shrank to $191.7 million, or 55 cents per share, down from a loss of $297.9 million, or 89 cents per share, in the same period last year.

AI coding tool drives momentum

Investors were particularly encouraged by growth in CoCo, Snowflake's artificial intelligence coding agent, which helps developers write and manage software automatically.

The number of accounts using CoCo rose by more than 2,000 during the quarter to reach 9,100.

Guidance raised for the year ahead

Snowflake said it now expects product revenue of $1.59 billion for the current quarter, comfortably above the $1.50 billion analysts had pencilled in.

Management also lifted its full-year product revenue forecast to $6.07 billion, up from the $6.07 billion...

Correction: up from the $5.84 billion it had guided to in May.

The company raised its projected adjusted operating margin to 14.5%, from an earlier estimate of 13.5%.

Shares already up sharply this year

Even before Wednesday's after-hours move, Snowflake shares had climbed 39% since the start of the year, far outpacing the S&P 500 index's roughly 12% gain over the same period.

Should the stock rise by a similar margin when regular trading resumes on Thursday, it would mark one of the largest single-day gains since Snowflake listed on the New York Stock Exchange in 2020.

The strong guidance suggests demand for Snowflake's data and AI tools is accelerating even as the broader software sector faces scrutiny over the pace of AI-driven spending.

Snowflake Inc. (SNOW - Free Report) reported $1.55 billion in revenue for the quarter ended July 2026, representing a year-over-year increase of 35.1%. EPS of $0.62 for the same period compares to $0.35 a year ago.

The reported revenue represents a surprise of +4.91% over the Zacks Consensus Estimate of $1.47 billion. With the consensus EPS estimate being $0.45, the EPS surprise was +37.78%.

While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street expectations to determine their next move, some key metrics always offer a more accurate picture of a company's financial health.

Since these metrics play a crucial role in driving the top- and bottom-line numbers, comparing them with the year-ago numbers and what analysts estimated about them helps investors better project a stock's price performance.

Here is how Snowflake performed in the just reported quarter in terms of the metrics most widely monitored and projected by Wall Street analysts:

Remaining performance obligations: $9 billion versus $9.48 billion estimated by five analysts on average.Customers with trailing 12-month product revenue greater than $1 million: 828 compared to the 818 average estimate based on two analysts.Revenue- Product revenue: $1.49 billion versus the nine-analyst average estimate of $1.42 billion. The reported number represents a year-over-year change of +36.8%.Revenue- Professional services and other revenue: $54.93 million versus $60.04 million estimated by nine analysts on average. Compared to the year-ago quarter, this number represents a +0.8% change.Non-GAAP product gross profit: $1.11 billion compared to the $1.06 billion average estimate based on seven analysts.Non-GAAP professional services and other revenue gross profit (loss): $-4.24 million versus $1.1 million estimated by five analysts on average.GAAP product gross profit: $1.06 billion versus the two-analyst average estimate of $1.01 billion.GAAP professional services and other revenue gross loss: $-20.73 million versus the two-analyst average estimate of $-14.57 million.View all Key Company Metrics for Snowflake here>>>

Shares of Snowflake have returned +1% over the past month versus the Zacks S&P 500 composite's +2% change. The stock currently has a Zacks Rank #3 (Hold), indicating that it could perform in line with the broader market in the near term.

Snowflake Inc. (SNOW) Q2 2027 Earnings Call September 2, 2026 5:00 PM EDT

Company Participants

Katherine McCracken - Head of Investor Relations
Sridhar Ramaswamy - CEO & Director
Brian Robins - Chief Financial Officer
Christian Kleinerman - Executive Vice President of Product Management

Conference Call Participants

Sanjit Singh - Morgan Stanley, Research Division
S. Kirk Materne - Evercore ISI Institutional Equities, Research Division
Karl Keirstead - UBS Investment Bank, Research Division
Raimo Lenschow - Barclays Bank PLC, Research Division
Ryan MacWilliams - Wells Fargo Securities, LLC, Research Division
Matthew Hedberg - RBC Capital Markets, Research Division
Koji Ikeda - BofA Securities, Research Division
Brent Thill - Jefferies LLC, Research Division
Daniel Knauff - Deutsche Bank AG, Research Division
Aleksandr Zukin - Wolfe Research, LLC
Tyler Radke - Citigroup Inc., Research Division
Samik Chatterjee - JPMorgan Chase & Co, Research Division

Presentation

Operator

Good day, and welcome to the Second Quarter FY '27 Snowflake Earnings Presentation. Today's conference is being recorded.

At this time, I would like to turn the conference over to Katherine McCracken. Please go ahead.

Katherine McCracken
Head of Investor Relations

Good afternoon, and thank you for joining us on Snowflake's Second Quarter Fiscal 2027 Earnings Call.

Joining me on the call today are Sridhar Ramaswamy, our Chief Executive Officer; Brian Robins, our Chief Financial Officer; and Christian Kleinerman, our Executive Vice President of Product, who will participate in the Q&A session. During today's call, we will review our financial results for the second quarter of fiscal 2027 and discuss our guidance for the third quarter and full year fiscal 2027.

During today's call, we will make forward-looking statements, including statements related to our business operations and financial performance. These statements are subject to risks and uncertainties, which could cause them to differ materially from our actual results. Information concerning these risks and uncertainties is available in our earnings press release, our most recent Forms 10-K

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.

More News From Snowflake Inc.

Snowflake shares rose 22% in extended trading on Wednesday after the data analytics software maker reported results and guidance that surpassed expectations.

Here's how the company performed relative to LSEG consensus:

Earnings per share: 62 cents adjusted vs. 45 cents expectedRevenue: $1.55 billion vs. $1.48 billion expectedSnowflake's revenue jumped 35% year over year in the fiscal second quarter, which ended on July 31, according to a statement. The company recorded a net loss of $191.7 million, or 55 cents per share, smaller than the net loss of $297.9 million, or 89 cents per share, one year ago.

The company pointed to gains from the CoCo artificial intelligence coding agent, which now has 9,100 accounts, an increase of over 2,000 during the quarter.

For the fiscal third quarter, Snowflake said it sees $1.59 billion in product revenue, above the $1.50 billion consensus among analysts polled by StreetAccount. Management pushed up its product revenue forecast for the fiscal year, calling for $6.07 billion, compared with $5.84 billion in May. It's now forecasting a 14.5% adjusted operating margin, wider than the 13.5% figure it had projected in May.

As of Wednesday's close, Snowflake shares were up 39%, while the S&P 500 index had gained about 12% in the same period. If the stock moves as high on Thursday as it did after hours on Wednesday, it would represent the fourth highest jump since Snowflake went public in 2020.

Executives will discuss the results with analysts on a conference call starting at 5 p.m. ET.

watch now