Snowflake stock surged 37% after the cloud data platform delivered a stronger Q1 report, lifted its full-year forecast and announced a $6 billion multiyear Amazon Web Services agreement that put fresh momentum behind its artificial intelligence story.
The move marked a sharp reversal for SNOW shares, which had been under pressure before the earnings update. Investors reacted to a combination of stronger revenue growth, better-than-expected earnings, rising enterprise AI usage and a large AWS commitment that gives Snowflake a clearer infrastructure runway for expanding data and AI workloads.
Snowflakeâs Q1 highlights: Product revenue reached $1.33 billion, up 34% year over year. Total revenue came in at $1.39 billion. Non-GAAP earnings per share were $0.39, above expectations of $0.32. Remaining performance obligations rose to $9.21 billion, up 38%, while net revenue retention stood at 126%.
Snowflake Rally Builds on Earnings Beat and AWS Deal
Snowflakeâs rally was driven by more than a headline earnings beat. The companyâs new $6 billion agreement with AWS is tied to Amazon Graviton CPUs and is expected to support Snowflakeâs long-term compute needs as enterprise customers increase usage across data, analytics and AI applications.
That matters because AI workloads require large amounts of efficient computing power. For Snowflake, the AWS deal signals that management is preparing for heavier platform demand. For Amazon, the agreement adds another major enterprise customer to its cloud infrastructure base at a time when AI-related spending remains one of the most closely watched areas of the technology market.
Snowflakeâs investor update pointed to strong product revenue growth, improving customer activity and a larger revenue outlook. The companyâs latest financial materials are available through Snowflakeâs investor relations site.
The company also reported 616 net new customers, while customers generating more than $1 million in trailing 12-month product revenue increased to 779. Those numbers helped ease concerns that large enterprises were slowing cloud software spending too sharply.
AI Demand Puts SNOW Stock Back in Focus
CEO Sridhar Ramaswamy described the quarter as an AI inflection point for Snowflake, a phrase that resonated with investors because the market has been searching for software companies that can turn AI interest into measurable business activity.
Snowflake said more than 13,600 accounts are using its AI capabilities, including Cortex Code and Snowflake Intelligence. Cortex Code is now used across more than 7,100 accounts, while Snowflake Intelligence accounts more than doubled sequentially.
The rally also follows a period when investors had been cautious toward software names tied to the AI trade. Earlier weakness in Snowflakeâs agentic AI software stock setup showed how quickly sentiment can shift when valuation pressure meets uncertainty around AI monetization.
This latest update changed that discussion. Snowflake is now trying to position itself as a key data layer for enterprise AI, where companies need secure access to structured information before they can deploy agentic tools, code assistants and production AI workflows at scale.
Raised Guidance Adds Fuel to the 37% Surge
Snowflake raised its full-year FY2027 product revenue guidance to $5.84 billion, implying 31% growth. That was up from the previous forecast of $5.66 billion, which had implied 27% growth. The company also lifted its non-GAAP operating margin target to 14% from 13%.
The guidance increase gave the rally more weight. A one-quarter earnings beat can attract short-term buying, but a higher full-year outlook suggests management sees stronger demand extending beyond the latest report.
Before the results, Snowflake had been trading below key technical levels and remained far from its earlier highs. That setup made the earnings surprise even more powerful, as short covering and momentum buying likely added pressure to the upside move.
The valuation debate is now likely to become more intense. Bulls will point to faster product revenue growth, expanding AI adoption and the AWS deal as reasons for renewed confidence. Bears may argue that a 37% single-day surge leaves less room for error if Snowflake fails to show continued AI-driven revenue momentum in future quarters.
For now, Snowflakeâs Q1 report has given investors a much stronger growth narrative. The combination of a revenue beat, higher guidance, rising enterprise AI usage and a multibillion-dollar AWS agreement has turned SNOW stock back into one of the most closely watched AI-linked software names on Wall Street.
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