Snowflake soars 20% on earnings beat and raised guidance

Investing.com -- Snowflake Inc (NYSE: SNOW) reported second quarter results that exceeded analyst expectations and raised its full-year outlook, sending shares up 20% in after-hours trading Wednesday as investors responded positively to accelerating growth driven by artificial intelligence products.

The AI Data Cloud company posted adjusted earnings per share of $0.62, beating the analyst consensus of $0.45 by $0.17. Revenue reached $1.55 billion, surpassing the estimate of $1.48 billion and representing 35% growth YoY. Product revenue totaled $1.49 billion, up 37% YoY, marking the company's third consecutive quarter of product revenue growth acceleration.

"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."

For the third quarter of fiscal 2027, Snowflake expects product revenue of $1.588 billion to $1.593 billion, representing 37% to 38% YoY growth. The midpoint of $1.59 billion exceeds the analyst consensus of $1.57 billion. The company also raised its full-year fiscal 2027 product revenue guidance to $6.07 billion, representing 36% YoY growth, up from previous guidance of $5.84 billion. This significantly surpasses the analyst consensus of $5.84 billion.

The company's AI products showed strong momentum, with CoCo surpassing 9,100 accounts and adding more than 2,000 accounts in the quarter, while CoWork expanded to 5,800 accounts. Snowflake added 692 net new customers in the quarter, up 32% YoY, and now serves 829 Forbes Global 2000 customers.

CFO Brian Robins noted the company delivered accelerating growth while expanding operating margin, with full-year adjusted operating margin guidance raised to 14.5% from 13.5% previously.

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