Key Highlights
- Shares of Snowflake surged more than 23% following a Q2 adjusted earnings report showing $0.62 per share versus the $0.45 consensus forecast
- Total revenue reached $1.55 billion, climbing 35% compared to the prior year and exceeding the $1.48 billion projection
- Product revenue increased 37% year over year, representing the third consecutive quarter of accelerating growth
- The company’s AI coding assistant CoCo now has over 9,100 accounts, with more than 2,000 added during the latest quarter
- Annual product revenue outlook increased to $6.07 billion from the previous $5.84 billion forecast
Shares of Snowflake (SNOW) rocketed more than 23% during premarket hours Thursday following the cloud data platform’s impressive Q2 results that exceeded expectations on revenue and earnings while management upgraded its annual forecast.
The shares had already climbed 39% year to date through Wednesday’s close, significantly outperforming the S&P 500’s approximately 12% advance during the same timeframe. If Thursday’s premarket gains hold through the regular session, it would represent the fourth-largest single-session gain since the company’s 2020 initial public offering.
On an adjusted basis, earnings per share registered $0.62, substantially above the $0.45 Wall Street consensus. Total revenue hit $1.55 billion compared to expectations of $1.48 billion, reflecting a 35% year-over-year increase.
Product revenue totaled $1.49 billion, climbing 37% from the year-ago period. This represents the third consecutive quarter where product revenue growth has accelerated—a metric that analysts and investors monitor particularly closely.
Chief Executive Sridhar Ramaswamy highlighted that the company is “powering the enterprise AI revolution” and emphasized a growing “flywheel effect” developing throughout the organization.
AI Offerings Show Strong Momentum
The company’s AI coding assistant CoCo, part of Snowflake’s expanding AI portfolio, reached over 9,100 accounts by quarter’s end, representing an addition of more than 2,000 accounts within the three-month period. Meanwhile, CoWork’s user base expanded to 5,800 accounts.
The platform attracted 692 net new customers during Q2, marking a 32% year-over-year increase. Snowflake’s customer roster now includes 829 organizations from the Forbes Global 2000 list.
BTIG’s Gray Powell characterized the quarter as a “strong beat and raise,” highlighting that the expansion is broadly distributed across the customer base rather than concentrated in specific industries or AI-native enterprises.
Outlook Increased Across All Metrics
Looking ahead to Q3 of fiscal 2027, management projected product revenue between $1.588 billion and $1.593 billion, implying 37% to 38% year-over-year growth. The guidance midpoint of $1.59 billion surpasses the analyst consensus estimate of $1.57 billion.
For the complete fiscal 2027 year, product revenue guidance was elevated to $6.07 billion from the previous $5.84 billion target issued in May. This represents 36% annual growth and exceeds the prior Wall Street consensus of $5.84 billion.
Management also improved its full-year adjusted operating margin forecast to 14.5% from the earlier 13.5% projection.
Chief Financial Officer Brian Robins emphasized that the company successfully achieved accelerating revenue growth while simultaneously expanding profitability margins—a rare combination in the software sector.
On a GAAP basis, Snowflake reported a net loss of $191.7 million, equivalent to $0.55 per share, during Q2. This represents an improvement from the $297.9 million net loss, or $0.89 per share, recorded in the comparable quarter last year.
The second fiscal quarter concluded on July 31. Company leadership held a conference call with analysts at 5 p.m. ET Wednesday to discuss the quarterly performance.
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