Snowflake Shares Surge on Strong Earnings and AI-Driven Outlook
Shares of AI cloud company Snowflake (SNOW) experienced a significant rally on Thursday, soaring over 12% to reach a high of $188 per share. The surge comes on the heels of the company’s better-than-expected earnings report and optimistic future guidance, providing a much-needed boost to the stock which had been facing losses since mid-February.
The company’s strong performance is largely attributed to its deepening integration into artificial intelligence (AI) technologies. Over the past year, Snowflake has successfully integrated its tools with large AI language models, enhancing its product offerings and future projections. In a notable development, the company announced an expanded partnership with Microsoft, allowing customers to utilize OpenAI on Snowflake’s platform.
Snowflake’s forward-looking statements have particularly caught investors’ attention. The company anticipates a 24% rise in product revenue for the current fiscal year, projecting it to reach $4.28 billion by January 2026. This forecast surpasses analysts’ consensus estimates of $4.23 billion, further fueling investor confidence.
The positive earnings report and guidance have provided relief to investors after a challenging start to 2024, during which Snowflake’s stock had fallen over 20%. This turnaround also signals a growing trend among investors, who are increasingly viewing software companies as the next frontier in the AI trade.
Notably, Snowflake’s stock performance on Thursday outpaced that of AI industry leader Nvidia. Despite Nvidia’s earnings exceeding estimates, it received a lukewarm reaction from investors, with shares down nearly 3%. Similarly, software competitor Salesforce saw a 4% decline and downplayed AI’s impact on its 2025 revenue through its Agentforce tool.
As the AI landscape continues to evolve, Snowflake’s strong showing demonstrates the potential for cloud and software companies to capitalize on the growing demand for AI-integrated solutions. Investors and industry watchers will be closely monitoring how this trend develops in the coming months.
