Snowflake’s Stock Soars as Revenue and Guidance Cheer Up Investors

Snowflake Inc.’s shares surged 9% in after-hours trading on Wednesday after the company reported stronger-than-expected fiscal fourth-quarter revenue and provided an optimistic outlook for fiscal 2026.

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The data-software company announced that revenue for the quarter ending January 31 rose to $986.8 million, a significant increase from $774.7 million in the same period a year earlier. This figure exceeded the $957 million analysts had projected, according to FactSet.

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Product revenue, which makes up the bulk of Snowflake’s business, also beat expectations, reaching $943.3 million compared to the FactSet consensus of $914 million.

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Snowflake’s Chief Executive Sridhar Ramaswamy highlighted the company’s expanding customer base, noting that more than 11,000 businesses now use its platform. He also pointed to a net revenue retention rate of 126%, indicating that existing customers continue to spend more on Snowflake’s services over time.

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The company reported that its remaining performance obligations (RPO) grew by 33% year-over-year, reaching $6.9 billion. This metric reflects the value of future revenue from customer contracts that has yet to be recognized, suggesting strong forward momentum.

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Despite the robust revenue growth, Snowflake posted a net loss of $327.5 million for the quarter, or 99 cents per share, widening from a loss of $169.4 million, or 51 cents per share, a year earlier. On an adjusted basis, excluding one-time costs, the company earned 35 cents per share, which was significantly higher than the 18 cents per share analysts had forecast.

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Looking ahead, Snowflake provided guidance that was slightly below analyst expectations for the upcoming fiscal first quarter. The company projects product revenue between $955 million and $960 million, while analysts had anticipated $961 million, according to FactSet.

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For the full fiscal year 2026, Snowflake expects product revenue to reach $4.28 billion, reflecting a 24% increase from the previous year. This projection also surpasses the $4.234 billion analysts had forecast.

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The company’s stock has faced challenges over the past year, declining by 28%, while the broader S&P 500 index has gained 17.5% during the same period.

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Snowflake’s positive financial performance and optimistic forward guidance suggest the company remains a major player in the data-cloud market. Ramaswamy emphasized the strength of customer engagement and continued demand for Snowflake’s offerings, reinforcing the company’s growth trajectory despite recent market headwinds.

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The company’s ability to exceed revenue estimates and deliver stronger-than-expected earnings reflects its focus on expanding customer relationships and increasing product adoption. Snowflake’s rising RPO signals a healthy pipeline of future revenue, which could support long-term growth.

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Investors appeared encouraged by Snowflake’s latest results, driving the after-hours stock surge. The company’s ability to sustain growth in a competitive market and its plans to achieve significant revenue gains in fiscal 2026 suggest it is positioning itself for continued expansion.

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While Snowflake’s net loss widened, the stronger-than-expected adjusted earnings highlight operational improvements and effective cost management. The company’s high net revenue retention rate also underscores its ability to maintain and grow its customer base.

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Snowflake’s fiscal outlook for 2026 reflects confidence in its business model and market position. The projected 24% product revenue growth indicates the company expects ongoing demand for its data solutions.

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In a challenging economic environment, Snowflake’s performance stands out as a positive indicator of resilience and innovation. As the company continues to scale and enhance its offerings, it remains well-positioned to capture a larger share of the data cloud market.

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Overall, the latest earnings report reassured investors of Snowflake’s growth potential despite recent stock declines. The company’s ability to consistently deliver strong financial results and its positive outlook for the future suggest a promising trajectory moving forward.

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