Snowflake Sees Promising Future with AI Services
SAN FRANCISCO, Calif. — Snowflake (SNOW) is anticipating more dynamic quarters as clients invest in additional AI services. CEO Sridhar Ramaswamy expressed optimism during a conversation with Yahoo Finance at the Goldman Sachs Communacopia & Tech Conference, stating, “This is the culmination of several quarters of AI really accelerating but turning into more of a flywheel for Snowflake.”
He emphasized that “all the ingredients are there” for the cloud-based data platform to thrive in what he called a “back-to-basics era.” Ramaswamy pointed out that advancements now allow engineers to achieve more with existing resources. The integration of Snowflake’s data platform with applications has also significantly improved, enabling rapid application development.
On September 2, Snowflake reported impressive fiscal second-quarter results, with revenue reaching $1.55 billion—a 35% year-over-year increase. Product revenue also saw a notable surge, jumping 37% to $1.49 billion, marking the company’s third consecutive quarter of accelerating growth. Adjusted earnings per share rose 77% to $0.62, surpassing Wall Street expectations.
Driving this strong performance was the swift adoption of generative AI products like Cortex Code. Consequently, the company has raised its full-year product revenue forecast to $6.07 billion. Following these results, Snowflake’s stock surged over 20%, reflecting a 55% year-to-date increase.
Analyst Brad Reback from Stifel has noted, “With significant AI/ML product growth in front of Snowflake, we now see sustained 30%+ annual product-revenue growth in the coming years.”
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