Snowflake's fiscal second-quarter performance exceeded analyst projections, with adjusted earnings per share of $0.62 and total revenue of $1.55 billion, surpassing estimates of $0.45 per share and $1.48 billion respectively. The firm also lifted its annual product revenue forecast, reporting that expansion had picked up pace for the third consecutive quarter.
The stock climbed 22.37% to $374.25 in extended trading, offsetting a 4.26% loss from the regular session and lifting the price beyond its 52-week peak. Snowflake's quarterly results topped Wall Street forecasts, with per-share earnings coming in 37.8% above projections and revenue exceeding expectations by 4.7%.
Revenue from products climbed 37% year over year to $1.49 billion, extending a run of quarterly acceleration for the third period in a row. According to executives, roughly half of the growth acceleration was driven by AI offerings, with CoCo and CoWork at the forefront. The company lifted its annual product revenue forecast to $6.07 billion, pointing to anticipated growth of 36% year on year.
Shares rose in after-hours trading, with investors responding positively to both the earnings figures and the company's forward guidance. Snowflake reported that its operations maintained growth through the second quarter, driven by rising uptake of its flagship data platform and an accelerating adoption of artificial intelligence offerings.
Revenue from products climbed 37% on an annual basis, with the firm reporting that its expansion rate had gained 7 percentage points across two quarters, up from the 30% pace recorded at the close of the previous fiscal year. The firm additionally highlighted growing uptake of its offerings among customers.
The company posted a net revenue retention rate of 126%, saw remaining performance obligations climb 30% to $9 billion, and brought 692 additional customers onto its platform. The platform's total client base has reached 14,554, with 829 of those drawn from the Forbes Global 2000. The firm's market capitalisation stands at $106.6 billion, supported by 31% revenue growth over the past year, placing its valuation above typical industry benchmarks.
Snowflake's latest figures arrive at a moment when enterprise software firms are under pressure to demonstrate that artificial intelligence investments are translating into tangible revenue rather than remaining confined to experimental programmes. According to executives, artificial intelligence is enabling clients to deploy a greater number of workloads into production environments and apply data across broader areas of their operations, spanning supply chain, finance, sales, and risk management.
Sales from products totalled $1.49 billion, reflecting a 37% increase compared with the prior year. Quarterly earnings reached $1.55 billion, outpacing analyst projections of $1.48 billion. The adjusted earnings per share came in at $0.62, outpacing the projected figure of $0.45.
The adjusted operating margin, excluding generally accepted accounting principles, reached 15%, reflecting a gain of over 400 basis points compared with the prior-year period. The company posted a net revenue retention rate of 126%, while remaining performance obligations totalled $9 billion, reflecting a 30% increase from the prior year.
The company added 692 net new clients over the period, a 32% increase year-on-year, while 829 Forbes Global 2000 firms — representing 41% of that index — are now among its customer base. The company counted 828 accounts each generating over $1 million in annual revenue, a total that grew by 48 during the quarter. Liquid assets, near-cash holdings, and investment positions totalled $4.3 billion.
The company's adjusted earnings per share came in at $0.62, surpassing the Wall Street consensus forecast of $0.45. The result came in $0.17 per share, or 37.8%, above expectations. Quarterly revenue totalled $1.55 billion, outpacing the analyst consensus of $1.48 billion by roughly $70 million, or 4.7%. Profit margins came in ahead of forecasts by a wider margin than revenue did, pointing to stronger-than-anticipated operational performance.
Snowflake's ability to sustain rapid expansion while simultaneously strengthening its profit margins had become a key measure of performance for shareholders. The firm reported a non-GAAP operating margin of 15%, while executives lifted their full-year margin outlook to 14.5%, up from a prior forecast of 13.5%. The combination of accelerated revenue growth and improved profit margins contributed to the rise in the stock's after-hours trading price.
Snowflake stock ended the trading day at $306.19, a decline of 4.26% from the previous closing price of $319.80. Following the earnings release, shares advanced to $374.25, reflecting a $68.41 increase that represented a 22.37% rise over the prior regular-session closing price. Compared with the prior closing price, the stock shifted approximately 17.0% during after-hours trading.
The gain lifted the stock beyond its 52-week ceiling of $341.95. The turnaround also offset the losses recorded earlier in the trading session, with the earnings data and forward guidance appearing to shift investor sentiment within a short timeframe.
The company lifted its annual product revenue outlook to $6.07 billion, a target that would reflect 36% year-on-year expansion. For the third quarter, the firm projected product revenue in a range of $1.588 billion to $1.593 billion, representing anticipated year-over-year expansion of 37% to 38%. The revised outlook, executives noted, was driven by momentum across both the company's core operations and its artificial intelligence offerings.
The firm also raised its annual non-GAAP operating margin forecast to 14.5% from 13.5%, while trimming its non-GAAP product gross margin outlook to 74%, attributing the adjustment to a higher proportion of AI workloads, which presently generate thinner margins. The company is on course to achieve GAAP profitability by the fourth quarter of fiscal 2028, according to leadership. The company was reported to be heading into the latter half of fiscal 2027 with positive operational momentum.
Snowflake's chief executive, Sridhar Ramaswamy, outlined three interconnected dynamics through which artificial intelligence is strengthening the company's position: attracting new workloads to the platform, accelerating uptake of proprietary products, and increasing overall consumption. Ramaswamy noted that the uptick is being driven by a wide range of customers, adding that expansion is not concentrated among AI-native firms, which still account for a relatively small portion of overall revenue.
Chief Financial Officer Brian Robins announced a revision to the company's FY 2027 non-GAAP operating margin target, raising it from 13.5% to 14.5%, while outlining that product development and customer adoption remain the organisation's primary objectives ahead of any focus on margin outcomes. Reduced product gross margin forecasts point to AI expansion potentially weighing on near-term earnings.
The company faces investor pressure to demonstrate that artificial intelligence adoption will generate sustained long-term demand rather than a temporary uplift in spending. Pressure from cloud providers, data warehouse vendors, and AI model developers continues to bear down on the market. The firm continues to weigh portfolio growth against cost discipline. Certain buyers may seek to negotiate reduced pricing, a dynamic that could weigh on demand expansion during periods of broader economic softness.
Questions from analysts covered a range of topics, including the sustainability of artificial intelligence-led expansion, the breakdown of revenue between AI and the core platform, and the firm's approach to remaining agnostic across models. Ramaswamy noted that the uptick in growth is distributed across a wide range of customers rather than driven by a narrow cluster of AI-native accounts. He added that Snowflake's platform enables clients to manage their expenditure more efficiently. He indicated that the growth was divided roughly equally, with artificial intelligence products accounting for approximately half. Accelerated adoption of notebooks, applications, and AI-driven features was also among the areas he highlighted.
The discussion also covered the question of model neutrality. According to company leadership, users are seeking the freedom to move between AI models and manage expenses, with Snowflake's broad compatibility across frontier, open-source, and proprietary systems positioned as a differentiator in the market. Questions from analysts also covered the firm's performance across different regions, the function of the Frontier Engineering initiative, and the extent to which conventional software providers are adopting database-oriented approaches. Executives noted that all regions are delivering positive results, and reaffirmed that clients favour consolidating their data within a single unified platform rather than distributing it across separate systems.
