Key Highlights
- Shares of Snowflake rallied more than 23% following a second-quarter adjusted earnings per share of $0.62, significantly exceeding the $0.45 Wall Street forecast
- The company generated $1.55 billion in revenue, representing a 35% year-over-year increase and surpassing the $1.48 billion projection
- Product revenue expanded 37% compared to the prior year, achieving its third consecutive quarter of accelerating growth
- The AI-powered coding assistant CoCo reached 9,100 user accounts, with more than 2,000 additions during the three-month period
- Management elevated its full-year product revenue forecast to $6.07 billion from the previous $5.84 billion projection
Shares of Snowflake (SNOW) climbed more than 23% during Thursday’s premarket session following the cloud data platform’s release of second-quarter results that exceeded expectations on both earnings and revenue metrics while upgrading its annual financial outlook.
Prior to Thursday’s rally, the stock had climbed 39% since the beginning of the year through Wednesday’s close, significantly outperforming the S&P 500’s approximately 12% advance during the same timeframe. If Thursday’s gains persist, this would represent the fourth-largest single-session increase since the company’s 2020 initial public offering.
The company delivered adjusted earnings per share of $0.62, substantially exceeding the Wall Street consensus estimate of $0.45. Total revenue reached $1.55 billion compared to analyst projections of $1.48 billion, marking a 35% year-over-year expansion.
Product revenue totaled $1.49 billion, climbing 37% from the year-ago period. This performance represents the third consecutive quarter where product revenue growth has accelerated, a metric that equity analysts typically monitor most carefully.
Chief Executive Sridhar Ramaswamy stated that the company is “powering the enterprise AI revolution” and highlighted a “flywheel effect” that continues to build momentum throughout the organization.
Artificial Intelligence Offerings See Strong Adoption
During the quarter, CoCo, Snowflake’s artificial intelligence coding agent, surpassed 9,100 user accounts, with over 2,000 new accounts established in the three-month period alone. Meanwhile, CoWork expanded its reach to 5,800 accounts.
The company welcomed 692 net new customers during the second quarter, representing a 32% year-over-year increase. Snowflake’s client roster now includes 829 organizations from the Forbes Global 2000 list.
BTIG equity analyst Gray Powell characterized the results as a “strong beat and raise” and observed that growth is becoming increasingly diversified throughout the customer base, without significant concentration in any particular industry vertical or among AI-native enterprises.
Financial Outlook Elevated Significantly
Looking ahead to the third quarter of fiscal 2027, Snowflake projected product revenue between $1.588 billion and $1.593 billion, implying year-over-year growth of 37% to 38%. The midpoint of $1.59 billion surpasses the Wall Street consensus estimate of $1.57 billion.
The company raised its full fiscal 2027 product revenue outlook to $6.07 billion, a significant increase from the $5.84 billion target established in May. This updated guidance implies 36% annual growth and exceeds the previous analyst consensus of $5.84 billion.
Management also elevated its adjusted operating margin projection for the full year, increasing it to 14.5% from the prior 13.5% forecast.
Chief Financial Officer Brian Robins emphasized that the company successfully delivered accelerating revenue growth while simultaneously expanding profitability margins, a dual achievement that rarely occurs simultaneously.
Snowflake reported a net loss of $191.7 million, equivalent to $0.55 per share, during the second quarter. This represents an improvement from the $297.9 million loss, or $0.89 per share, recorded during the comparable quarter one year earlier.
The second fiscal quarter concluded on July 31. Company leadership reviewed the quarterly performance with Wall Street analysts during a conference call held at 5 p.m. Eastern Time on Wednesday evening.
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