Snowflake shares surged about 37% after the cloud data company reported faster first-quarter growth, raised its fiscal 2027 outlook and unveiled a $6 billion multiyear agreement with Amazon Web Services.
The sharp rally reflected renewed confidence in Snowflake’s core data platform and its ability to benefit from rising enterprise demand for artificial intelligence tools. However, the scale of the share-price move also raises the pressure on the company to sustain that growth in the coming quarters.
Key Q1 figures:
Snowflake reported $1.39 billion in total revenue, up 33% from a year earlier. Product revenue increased 34% to $1.33 billion, remaining performance obligations reached $9.21 billion, and net revenue retention stood at 126%.
Why Did Snowflake Stock Jump 37%?
The earnings report gave investors several reasons to reconsider Snowflake after a difficult period for highly valued software stocks.
Product revenue—the figure most closely watched because Snowflake charges customers largely according to platform usage—grew faster than expected. The company also added 616 net new customers during the quarter, bringing its total customer base to more than 13,900.
Snowflake now has 779 customers generating more than $1 million in trailing 12-month product revenue, a 29% increase from the previous year. Of those, 46 crossed the $1 million threshold during the quarter, compared with 26 in the year-earlier period.
The company nevertheless remains unprofitable under generally accepted accounting principles. Snowflake recorded a GAAP net loss of approximately $296 million for the quarter, although that improved from a loss of about $430 million a year earlier.
Investors can review the complete figures in Snowflake’s official quarterly results.
What Does the $6 Billion AWS Agreement Cover?
Snowflake said its expanded AWS collaboration is designed to accelerate enterprise AI adoption worldwide. The multiyear commitment includes increased use of Amazon’s cloud infrastructure and Graviton processors to support Snowflake workloads.
The agreement does not represent $6 billion of revenue flowing into Snowflake. It is a spending commitment connected to the computing infrastructure Snowflake uses to operate and expand its platform.
That distinction matters for investors. The deal signals that management expects substantial future demand, but it also creates a major financial commitment that will need to be supported by continued customer consumption.
The latest rally reverses some of the caution seen when Snowflake and other agentic AI software stocks came under selling pressure. Sentiment has now shifted toward whether AI adoption can produce durable platform usage rather than short-lived experimentation.
Snowflake Reports Wider Use of Its AI Products
Snowflake said more than 13,600 accounts were using its AI capabilities during the measurement period cited in its results.
Cortex Code, the company’s AI coding product, was being used across more than 7,100 accounts. Usage of Snowflake Intelligence, which allows businesses to interact with governed enterprise data through AI, more than doubled from the previous quarter.
CEO Sridhar Ramaswamy described the quarter as an AI “inflection point.” The practical test will be whether that growing adoption translates into recurring consumption and stronger revenue rather than simply increasing the number of accounts trying the products.
Raised FY2027 Guidance Strengthens the Growth Story
Snowflake raised its fiscal 2027 product revenue forecast to $5.84 billion, representing expected annual growth of 31%. Its previous guidance called for $5.66 billion and 27% growth.
The company also increased its forecast for non-GAAP operating margin to 13.5%, up from its earlier target of 12.5%. For the second quarter, management expects product revenue of between $1.415 billion and $1.420 billion.
These projections are forward-looking and could change if customers reduce cloud consumption, AI adoption slows or competition intensifies across the data-platform market.
What Investors Should Watch Next
Snowflake’s Q1 update strengthened its case as an important provider of the data infrastructure required for enterprise AI. Revenue growth accelerated, large-customer spending expanded and management raised its annual forecast.
But a 37% share-price increase can quickly lift expectations. Future results will need to show that AI product adoption is producing sustained consumption, that margins are improving and that the AWS commitment can support profitable long-term growth.
For now, Snowflake has delivered the stronger business performance investors wanted to see. Whether the rally lasts will depend on execution after the initial earnings excitement fades.
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