Snowflake Inc. posted second‑quarter results that exceeded most forecasts, prompting a wave of price‑target upgrades from sell‑side analysts. Rosenblatt lifted its target price to $370 from $345, maintaining a Buy rating. Other houses also raised outlooks: Mizuho to $425, Stifel and Canaccord Genuity to $450 each, and Cantor Fitzgerald to $430, while Cantor kept an Overweight stance and Guggenheim reiterated a Neutral view.
Product revenue surged 37% year‑over‑year, including roughly 1% contributed by recent acquisitions, and came in 4.8% above Rosenblatt’s estimate. Total revenue reached $1,547 million, topping the firm’s own forecast of $1,487 million and the consensus $1,483 million. The company reported a net revenue retention rate of 126% for the quarter.
Operating margins expanded to 15%, outpacing Rosenblatt’s 12.7% estimate and well above the 11% recorded in the prior year. Product gross margins stood at 75%. Management attributed the outperformance to accelerated migrations of legacy data warehouses, driven by AI‑enabled Snowflake features such as CoCo and CoWork, which together accounted for about half of the revenue beat.
Looking ahead, Snowflake guided third‑quarter product revenue growth between 37% and 38%, revising up from a prior 31% estimate. For fiscal 2027, the firm raised its guidance by roughly 5% to a 36% growth rate, again reflecting about 1% from the Observe acquisition. Analysts project earnings per share of $2.07 for fiscal 2027.
Snowflake’s market capitalization climbed to approximately $106 billion following the results. An InvestingPro note flagged the stock as overvalued relative to its fair‑value estimate, though it noted expectations of profitability for the year.
The consensus of upgrades underscores confidence in Snowflake’s AI‑driven data cloud strategy, even as valuation concerns linger among some analysts.
