Snowflake shares jumped nearly 25% on Thursday after the cloud data company reported stronger-than-expected quarterly results and raised its full-year revenue outlook. Growing demand for artificial intelligence services played a major role in the strong performance and gave investors more confidence about Snowflake’s future growth.
For the second quarter of fiscal 2027, Snowflake reported total revenue of $1.55 billion, an increase of 35% compared with the same period a year earlier. Product revenue, one of the company’s most closely watched measurements, reached $1.49 billion and grew 37% year over year.
The results showed that companies are spending more on Snowflake’s cloud platform as they build and expand AI applications. Snowflake said artificial intelligence is not only creating demand for newer AI-focused services but is also increasing usage of its main data platform.
CEO Sridhar Ramaswamy said AI was responsible for roughly half of the recent acceleration in Snowflake’s growth. Businesses increasingly need large amounts of organized and accessible data to train AI systems, build intelligent applications and use AI tools across their operations. That trend is helping Snowflake position its platform as an important part of enterprise AI infrastructure.
Customer growth was also strong during the quarter. Snowflake added 692 net new customers, while the number of customers generating more than $1 million in trailing 12-month product revenue reached 828, up 27% from a year earlier. The company also reported $9 billion in remaining performance obligations, which represents contracted business that has not yet been recognized as revenue.
Following the stronger quarter, Snowflake raised its fiscal 2027 product revenue forecast to $6.07 billion, up from its previous estimate of $5.84 billion. The new outlook represents approximately 36% annual product revenue growth and signals that management expects strong customer demand to continue.
For the third quarter, Snowflake expects product revenue between $1.588 billion and $1.593 billion. That would represent growth of around 37% to 38% compared with the previous year.
Investors reacted strongly to the improved outlook, sending Snowflake shares up nearly 25%. The results also helped lift confidence in other enterprise software companies because they suggest that AI spending can create new growth opportunities for cloud software providers rather than only benefiting semiconductor and hardware companies.
Snowflake’s latest performance highlights a wider change taking place across the technology industry. As businesses move from experimenting with artificial intelligence to using it in daily operations, demand for cloud computing, data management and AI infrastructure is growing.
For Snowflake, the key question will be whether this AI-driven momentum can continue over the coming quarters. Its latest results and higher revenue forecast suggest that enterprise AI adoption is already becoming a meaningful source of business growth rather than simply a future opportunity.
