Snowflake shares surged 22% after Q2 earnings and revenue exceeded estimates, driven by AI product adoption and revised full-year guidance. The data analytics company reported $1.55 billion in revenue, a 35% year-over-year increase, while raising product revenue forecasts to $6.07 billion.
Snowflake (NYSE:SNOW) delivered a blockbuster second-quarter report, sending its stock soaring 22% in after-hours trading. The cloud data platform provider posted revenue of $1.55 billion for the fiscal quarter ending July 31, 2026—above analyst expectations—and raised its full-year product revenue outlook to $6.07 billion, up from $5.84 billion in May. Adjusted earnings per share reached 62 cents, surpassing the 45-cent consensus. The results marked the fourth-largest post-IPO stock jump since 2020, with shares trading at $305.84 following the report.
Snowflake Stock: Snowflake Earnings, Revenue, Guidance Top Estimates
The company’s fiscal second-quarter performance underscored its accelerating momentum in the AI-driven software sector. Product revenue increased 37% year-over-year to $1.49 billion, outpacing the $1.42 billion analyst estimate. Snowflake’s adjusted operating margin expanded to 14.5%, up from 13.5% in prior guidance, reflecting improved cost management. The results came as the firm raised its full-year revenue forecast to $6.07 billion, citing stronger-than-expected demand for its AI-powered tools.
Snowflake’s Q2 earnings and stock surge were bolstered by the rapid adoption of its AI coding assistant, CoCo. The tool now serves 9,100 customer accounts, an increase of more than 2,000 during the quarter, according to the company. This growth contributed to the firm’s 39% year-to-date stock performance, outpacing the S&P 500’s 12% return. Analysts noted the market’s enthusiasm for Snowflake’s AI initiatives, with Yi Fu Lee of Benchmark Co. stating, Investors are likely to focus on the durability of AI-driven consumption trends.
The company’s data shows its AI coding assistant, CoCo, now serves 9,100 customer accounts, a 2,000-account increase from the previous quarter.
Snowflake’s AI products are reshaping its revenue model. The firm reported $1.55 billion in total revenue, with product sales accounting for 95% of the total. Remaining performance obligations—a measure of future bookings—reached $9 billion, slightly below the $9.37 billion analyst average. Despite this, the company’s net revenue retention rate held steady at 126%, indicating strong customer loyalty.
Snowflake Jumps on Revenue Outlook, Uptake of AI Assistant
The AI boom has intensified competition in the cloud data sector. Databricks, Snowflake’s biggest rival, closed a new funding round at a valuation of $190 billion last month and reported that it has crossed $7 billion in revenue run-rate, representing growth of more than 80% in the second quarter from the year-earlier period. Snowflake highlighted the rapid adoption of its AI-assisted coding tool, with CoCo driving significant growth.
Snowflake’s Q2 results included specific financial metrics: total revenue increased 35% from a year earlier in the fiscal second quarter ended July 31, while adjusted earnings per share were 62 cents. Adjusted Operating Income reached $237 million vs analyst estimates of $185.9 million. The company’s net loss for the quarter was $191.7 million, or 55 cents per share, compared to a net loss of $297.9 million, or 89 cents per share, a year ago. For the fiscal third quarter, Snowflake expects $1.59 billion in product revenue, topping the $1.50 billion consensus among analysts polled by StreetAccount.
Snowflake’s customer base includes 828 customers paying more than $1 million annually, with a net revenue retention rate of 126%. Billings for the quarter reached $1.27 billion, a 15.1% year-over-year increase. The company’s free cash flow margin was down from 16.7% in the previous quarter. Snowflake’s Market Capitalization was $110.8 billion. The firm’s long-term revenue growth has averaged 44.9% compounded annual growth rate over the past five years, with annualized revenue growth of 30.2% over the last two years.
Snowflake shares jump after Q2 earnings beat lifts revenue
Snowflake’s AI initiatives have drawn attention from investors, with sell-side analysts projecting revenue to grow 26.3% over the next 12 months. The company attributed part of its momentum to CoCo, its artificial intelligence coding agent, which now has 9,100 accounts.
Snowflake’s results reflect broader trends in the technology sector, where AI adoption is reshaping revenue models and investor expectations.
The company’s ability to scale its business while expanding AI offerings will determine its long-term success. With its revised guidance and AI-driven growth, Snowflake remains a key player in the evolving data analytics landscape.
