Snowflake (NYSE: SNOW) shares rocketed more than 30% in after-hours trading on Wednesday after the cloud data company posted a strong first-quarter fiscal 2027 earnings report, smashing Wall Street’s consensus estimates.
The AI Data Cloud company reported total revenue of $1.39 billion, a 33% year-over-year increase and well above the analyst consensus of $1.32 billion tracked by Yahoo Finance/Zacks.
Product revenue — the company’s primary performance metric — came in at $1.33 billion, a 34% increase year-on-year, comfortably surpassing the consensus estimate of approximately $1.26–1.27 billion and representing the strongest sequential dollar growth in Snowflake’s history.
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On the bottom line, non-GAAP earnings per share reached $0.39 diluted, trouncing the Street’s consensus expectation of $0.32 per share per Yahoo Finance/Zacks estimates.
AI the Key Driver
CEO Sridhar Ramaswamy attributed the outperformance to a powerful AI tailwind, declaring Q1 “a clear inflection point.” Over 13,600 accounts are now using Snowflake AI capabilities, with accounts using its Snowflake Intelligence product more than doubling quarter-over-quarter. The company also disclosed a new $6 billion multi-year agreement with AWS and a deepened partnership with OpenAI.
Customer Growth Accelerates
Snowflake added 616 net new customers in the quarter, up 38% year-over-year, and now counts 779 customers spending more than $1 million on a trailing 12-month basis — 46 of which crossed that threshold in Q1 alone, compared to just 26 a year ago. The net revenue retention rate held strong at 126%, while remaining performance obligations surged 38% year-over-year to $9.21 billion.
Guidance Raised
Looking ahead, Snowflake raised its full-year fiscal 2027 product revenue guidance to $5.84 billion — up sharply from prior guidance of $5.66 billion — and lifted its non-GAAP operating margin outlook to 13.5% from 12.5%, sending a clear signal that AI is not just driving growth but also improving profitability.
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