Snowflake Soars 8.31% on Strong Q1 Earnings, Raised Guidance

On May 22, 2025, Snowflake's stock price surged by 8.31% in pre-market trading, reflecting a strong market response to the company's recent financial performance and outlook.

Snowflake reported impressive first-quarter results for Fiscal Year 2026, with adjusted earnings of $0.26 per share, surpassing analysts' estimates of $0.21 per share. The company's revenue increased by 25.5% to $1.04 billion, exceeding expectations of $1.01 billion. This growth was driven by a 34% increase in remaining performance obligations to $6.7 billion and a net revenue retention rate of 124%. Additionally, Snowflake now has 606 customers generating over $1 million in product revenue over the past 12 months, a 27% increase from the previous year.

The company's strong financial performance was further highlighted by a 26% year-over-year increase in product revenue for the first quarter, totaling $996.8 million. This exceeded the previous guidance of $955 million to $960 million. Snowflake's optimistic outlook for the upcoming quarter includes an expected product revenue range of $1.035 billion to $1.040 billion, higher than the previous guidance of $955 million to $960 million. The company also anticipates an 8% operating margin for the full year.

Looking ahead, Snowflake has raised its full-year product revenue forecast to $4.33 billion, up from $4.28 billion, surpassing the estimate of $4.29 billion. This positive outlook, combined with the company's strong financial performance, has contributed to the surge in Snowflake's stock price. Analysts have a Strong Buy consensus rating on SNOW stock, with an average price target of $204.97 per share, reflecting the market's confidence in the company's future prospects.