Snowflake Shares Surge on AI Growth Projections
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 2 days ago
0mins
Source: Fool
- Strong Earnings Report: Snowflake's first-quarter revenue surged 33% year-over-year to $1.39 billion, demonstrating robust performance in acquiring new clients and increasing sales to existing ones, thereby solidifying its leadership in the data management sector.
- Significant Customer Growth: The number of customers with over $1 million in annual revenue rose by 29% to 779, indicating Snowflake's success in attracting high-value clients, which enhances its competitive position in the market.
- AI-Driven Growth: The CFO noted that AI technology is accelerating the growth of the core data platform business, with increasing urgency from customers to migrate to Snowflake, signaling strong potential for sustained future growth.
- Raised Performance Guidance: Snowflake raised its full-year product revenue forecast to $5.84 billion, reflecting a 31% increase, and adjusted operating margin expectations to 13.5%, showcasing the company's confidence in AI-driven growth and an optimistic market outlook.
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Analyst Views on SNOW
Wall Street analysts forecast SNOW stock price to rise
33 Analyst Rating
30 Buy
3 Hold
0 Sell
Strong Buy
Current: 239.200
Low
237.00
Averages
278.19
High
312.00
Current: 239.200
Low
237.00
Averages
278.19
High
312.00
About SNOW
Snowflake Inc. is an artificial intelligence (AI) data cloud company. The Company provides a platform which powers the AI data cloud, enabling customers to consolidate data into a single source of truth to drive insights, apply AI to solve business problems, build data applications, and share data and data products. Its cloud-native architecture includes three independently scalable but logically integrated layers across storage, compute, and cloud services. The storage layer ingests massive amounts and varieties of structured, semi-structured, and unstructured data. The compute layer provides dedicated resources to enable users to simultaneously access common data sets for many use cases with minimal latency. The cloud services layer enables users to securely use AI within applications, tools, and processes. Its platform supports a wide range of product categories for customers’ business objectives, including analytics, data engineering, AI, applications and collaboration.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Customer Base Expansion: The company saw a 38% year-over-year increase in new customers, adding eight clients spending over $10 million annually, bringing the total to 64, demonstrating success in attracting high-value clients and enhancing future revenue sustainability.
- Improved Profitability: Adjusted earnings per share (EPS) surged 63% year-over-year to $0.39, reflecting successful cost control and operational efficiency improvements, which bolster investor confidence in its long-term growth potential.
- Optimistic Outlook: Snowflake raised its full-year product revenue forecast to $5.84 billion, representing 31% growth, and projected Q2 product revenue between $1.415 billion and $1.420 billion, showcasing confidence in future performance despite a valuation of 14 times forward price-to-sales.
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- Customer Base Expansion: The company saw a 38% year-over-year increase in its customer base, adding eight customers spending over $10 million annually, bringing the total to 64, demonstrating the attractiveness of its products and sustained customer loyalty.
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See More
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- Accelerated Revenue Growth: Snowflake's Q1 revenue grew 33% year-over-year to $13.9 billion, up from 30% in the previous quarter, indicating strong performance in the cloud data warehousing market and likely driving further market share expansion.
- Customer Base Expansion: The company saw a 38% year-over-year increase in new customers, adding eight clients spending over $10 million annually, bringing the total to 64, demonstrating success in attracting high-value clients and enhancing future revenue sustainability.
- Improved Profitability: Adjusted earnings per share (EPS) surged 63% year-over-year to $0.39, reflecting successful cost control and operational efficiency improvements, which bolster investor confidence in its long-term growth potential.
- Optimistic Outlook: Snowflake raised its full-year product revenue forecast to $5.84 billion, representing 31% growth, and projected Q2 product revenue between $1.415 billion and $1.420 billion, showcasing confidence in future performance despite a valuation of 14 times forward price-to-sales.
See More
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- Accelerated Revenue Growth: Snowflake reported a 33% year-over-year revenue increase in Q1, reaching $13.9 billion, up from 30% in Q4 and 29% in Q3, indicating strong performance in the cloud data warehousing market and solidifying its competitive position in the AI sector.
- Customer Base Expansion: The company saw a 38% year-over-year increase in its customer base, adding eight customers spending over $10 million annually, bringing the total to 64, demonstrating the attractiveness of its products and sustained customer loyalty.
- Optimistic Outlook: Snowflake raised its full-year product revenue forecast to $5.84 billion, projecting 31% growth, an increase from the previous estimate of $5.66 billion and 27% growth, reflecting management's confidence in future performance.
- Improved Profitability: Adjusted earnings per share surged 63% year-over-year to $0.39, with a net revenue retention rate of 126%, indicating increased usage among existing customers and further enhancing the company's financial health.
See More
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- Tech Stock Surge: Snowflake's quarterly earnings exceeded expectations and included a $6 billion AI compute deal with Amazon, leading to a more than 36% single-day stock price increase, which reignited enthusiasm across the tech sector and boosted stocks like Dell and Broadcom significantly.
- Cybersecurity Stock Volatility: Zscaler's disappointing earnings report resulted in its worst single-day performance, negatively impacting peers CrowdStrike and Palo Alto Networks; however, Okta's strong earnings report led to a 30% stock price jump, indicating ongoing demand in the cybersecurity sector.
- Middle East Situation's Market Impact: Despite mixed signals from the Middle East, rumors of peace progress between Iran and the U.S. spurred market gains, although the White House dismissed the reports, investor optimism still supported the stock market's upward trajectory.
See More
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- Industry Impact: Snowflake's Q1 results led to a 36% stock increase on May 28, while Dell's earnings revealed a 757% year-over-year growth in AI server revenue, demonstrating that enterprises are deploying AI at scale, driving dual demand for both software and hardware.
- Supportive Market Environment: The 10-year Treasury yield fell to 4.45% following reports of a US-Iran truce extension, reducing the discount rate on long-duration growth stocks, providing additional market support for companies like Datadog.
- Attractive Investment Returns: Datadog's stock has risen 84% since the beginning of the year, reaching a new 52-week high, with investors who bought $1,000 worth of shares five years ago now seeing their investment grow to $2,678, showcasing its strong growth potential.
See More
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- Accelerated Revenue Growth: Snowflake's revenue growth has significantly accelerated, leading to a 7.02% increase in stock price on the afternoon of May 27, 2026, reflecting market optimism about its future performance.
- Positive Market Reaction: Investors are increasingly confident in Snowflake's accelerated growth, as the surge in stock price indicates the company's strengthening competitiveness in the cloud computing sector, potentially attracting more institutional investors.
- Strategic Implications: With rapid revenue growth, Snowflake is poised to further solidify its leadership position in the data cloud services market, enhancing market share and brand influence.
- Optimistic Future Outlook: The accelerated revenue growth not only boosts short-term stock performance but also lays the groundwork for sustained future growth, which may trigger further investment and innovation.
See More
Recent Updates on Snowflake and Salesforce
- Snowflake Stock Surge: On May 28, 2026, Snowflake's stock rose by 7.02%, indicating strong market confidence in its growth potential, which may attract more investor interest in its financial performance.
- Salesforce Updates: Salesforce was mentioned in the video, although specific stock price changes were not provided, its stable position in the market could influence its future business strategies and competitive edge.
- Updates on Nebius and Meta: The video also covered recent updates on Nebius and Meta, though lacking specific details, this indicates their ongoing development in the industry, which may impact related markets.
- Video Overview: Published on May 28, 2026, the video aims to provide the latest information on Snowflake, Salesforce, Nebius, and Meta, encouraging viewers to subscribe and check out special offers, reflecting the content creator's emphasis on audience engagement.
See More
