Snowflake Stock Soars 23% After AI-Fueled Earnings Beat and Raised Guidance

Snowflake shares surged as much as 23% after the cloud data company posted second-quarter results that beat Wall Street's expectations across the board and raised its outlook for the rest of the fiscal year.

Revenue for the quarter, the company's fiscal second quarter of 2027, came in at $1.55 billion, up 35% from a year earlier and ahead of the $1.48 billion analysts had forecast. Product revenue - the company's core recurring business - grew even faster, up 37% year-over-year to $1.49 billion.

The results mark Snowflake's third consecutive quarter of accelerating growth, a trend management attributed largely to artificial intelligence. Company executives said AI-related products drove roughly half of the quarter's growth acceleration, with the rest coming from customers migrating more of their data workloads onto Snowflake's platform and consuming more of its services over time.

Profitability also improved sharply. Adjusted earnings came in at 62 cents per share, well above the 45 cents analysts expected, while non-GAAP operating margin expanded by more than four percentage points to 15%. The company's net revenue retention rate - a measure of how much existing customers are spending compared to a year earlier - stood at 126%, meaning the average customer is spending noticeably more than it was a year ago.

Looking ahead, Snowflake raised its full-year product revenue guidance to $6.07 billion, implying 36% growth for the year, up from its prior forecast of $5.84 billion and 31% growth. For the current quarter, the company guided to product revenue of between $1.588 billion and $1.593 billion, representing 37% to 38% year-over-year growth - suggesting management sees little sign of the AI-driven acceleration slowing down.

The results add Snowflake to a growing list of enterprise software and cloud companies - including Dell and Broadcom, which also posted strong AI-driven results this earnings season - showing that corporate spending on AI infrastructure and tools is translating into real, accelerating revenue growth rather than just speculative investment.