Snowflake’s shares surged over 8% on Thursday following a stronger-than-expected earnings report. The data analytics firm posted adjusted earnings of 30 cents per share on $987 million in revenue, outpacing analyst forecasts of 17 cents and $956 million, respectively. This represents a robust 27% year-over-year revenue growth.
AI Expansion and Microsoft Partnership
The company continues its aggressive push into artificial intelligence, announcing an enhanced collaboration with Microsoft Azure to extend access to OpenAI models. Snowflake CEO Sridhar Ramaswamy emphasized the firm’s pivotal role in AI, calling it the “most consequential data and AI company in the world.”
Strong Product Revenue Growth
Product revenue, a key measure for investors, grew 28% to $943 million, surpassing the $914 million projected by analysts. The company anticipates $4.28 billion in product revenue for the year, ahead of expectations set at $4.21 billion.
Market Outlook and Guidance
Despite strong annual projections, Snowflake’s Q1 guidance slightly missed estimates, forecasting product revenue between $955 million and $961 million, compared to the $961 million Wall Street expected.
Positioning as a Long-Term AI Leader
Analysts remain optimistic about Snowflake’s growing AI capabilities. Goldman Sachs analyst Kash Rangan believes the company is well-positioned to capitalize on the AI boom, citing more than 4,000 accounts utilizing Snowflake’s AI/ML services.
Expanding Customer Base and Leadership Changes
Snowflake’s customer count increased to 11,159, exceeding analyst estimates of 10,987. Additionally, the company announced that Chief Financial Officer Michael Scarpelli will retire but will remain in his role until a successor is named.
As Snowflake strengthens its AI footprint and deepens partnerships, investors remain confident in its long-term growth trajectory.
