Why Snowflake's Stock Is Plummeting Thursday

Core Insights - Snowflake's stock has declined over 10% following a disappointing margin forecast despite exceeding analysts' expectations for both earnings and revenue [1][7] - The company reported adjusted earnings of $0.35 per share and a revenue increase of 29% year-over-year to $1.21 billion in the third quarter, surpassing analyst estimates [1][7] Financial Performance - Operating income was reported at $131.3 million, with an operating margin of 11%. However, the company anticipates a decrease to a 7% operating margin for the fourth quarter, which is below the previously guided 9% margin [2][5] - The mean target for Snowflake's shares is approximately $280, with 19 out of 21 analysts issuing "buy" ratings [5] Market Reactions and Analyst Opinions - Concerns have arisen regarding Snowflake's AI-related spending, with analysts from Oppenheimer suggesting that new investments in AI could impact short-term profits. However, they maintain an "outperform" rating with a price target of $295 [3][4] - Despite the recent stock decline, Snowflake's shares have increased over 50% in 2025, indicating strong market interest [6]