Key Takeaways Snowflake posted 19% customer growth in Q2 fiscal 2026, reaching 12,062 clients.Alphabet's Google Cloud revenue jumped 31.7% year over year to $13.62B in Q2 2025.SNOW shares surged 48.5% YTD, outpacing GOOGL's 21.8% gain despite both being seen as overvalued.Snowflake (SNOW) and Alphabet (GOOGL) are major players in the cloud data and analytics space. While Snowflake provides a pure-play cloud data warehousing and analytics platform, Alphabet offers similar capabilities through Google Cloud’s ...

Group 1 - Snowflake Inc. reported first-quarter revenue of $1.04 billion, exceeding analyst estimates of $1.01 billion, and adjusted earnings of 24 cents per share, surpassing expectations of 21 cents per share [1][2] - The company anticipates second-quarter product revenue between $1.035 billion and $1.04 billion, reflecting approximately 25% year-over-year growth, and expects full-year product revenue of $4.33 billion, also representing 25% year-over-year growth [2] - Snowflake's CEO emphasized the company's mission to empower enterprises through data and AI, highlighting the platform's ease of use and enterprise-grade performance, which has attracted over 11,000 customers [2] Group 2 - Following the earnings announcement, Snowflake shares fell by 2.1% to close at $179.12 [3] - Analysts have adjusted their price targets for Snowflake, with Needham raising it from $215 to $230, Rosenblatt from $205 to $210, UBS from $200 to $210, and Morgan Stanley from $185 to $200 [8]

Core Viewpoint - Snowflake is expected to report strong fiscal Q1 2026 results, with projected revenues of $1 billion and earnings of 22 cents per share, indicating significant year-over-year growth [1][2]. Financial Performance - The Zacks Consensus Estimate for Snowflake's Q1 fiscal 2026 revenue is $1 billion, reflecting a year-over-year growth of 21.13% [1]. - The earnings consensus is 22 cents per share, unchanged over the past 30 days, indicating a 57.14% year-over-year growth [1]. - Snowflake's product revenues for Q1 fiscal 2026 are expected to be in the range of $955-$960 million, suggesting a year-over-year growth of 21-22% [5]. Customer Growth and Retention - As of January 31, 2025, Snowflake had 11,159 customers, up from 9,384 a year earlier, with 745 being part of the Forbes Global 2000 [5]. - The net revenue retention rate stood at 126% as of January 31, 2025, indicating strong customer loyalty and expansion [4]. Product and Technology Advancements - Snowflake's investments in AI and machine learning, including the introduction of Cortex AI, have driven customer engagement, with over 4,000 customers using these technologies weekly [6]. - The company has enhanced its AI Data Cloud by integrating core capabilities with Apache Iceberg tables, improving query performance and data sharing [13]. Market Performance - Snowflake shares have increased by 18.5% year-to-date, outperforming the Zacks Computer and Technology sector, which has decreased by 1.4% [7]. - The stock is currently trading at a forward Price/Sales ratio of 12.81X, significantly higher than the sector average of 6.18X, indicating potential overvaluation [10][11]. Strategic Partnerships - Snowflake's partnerships with major companies like Microsoft, Amazon, and NVIDIA are expected to drive growth through enhanced product integrations and collaborative sales efforts [15][16][18]. - The expanded partnership with Microsoft aims to integrate OpenAI's models into Snowflake's offerings, enhancing productivity through AI-driven insights [16]. Challenges and Considerations - The company anticipates a tougher year-over-year revenue comparison due to the impact of the leap year, which may affect top-line growth [19]. - Non-GAAP operating margins for Q1 fiscal 2026 are expected to be impacted by approximately $15 million in expenses related to the annual sales kickoff event [20].