Software solutions provider Snowflake Inc. SNOW came out with quarterly earnings of $0.30 per share, beating the Zacks Consensus Estimate of $0.17 per share. This compares to earnings of $0.35 per share a year ago. These figures are adjusted for non-recurring items.
Snowflake, which belongs to the Zacks Internet - Software industry, posted revenues of $986.77 million for the quarter ended January 2025, surpassing the Zacks Consensus Estimate by 3.58%. This compares to year-ago revenues of $774.7 million. The company has topped consensus revenue estimates four times over the last four quarters.
Snowflake projected its fiscal 2026 product revenue to grow by 24%, reaching $4.28 billion—surpassing analysts' expectations of $4.21 billion, as per LSEG data, as quoted on CNBC. For the first quarter, Snowflake forecasts product revenue between $955 million and $960 million, outperforming analysts’ projection of $949.3 million. Snowflake’s shares jumped 9% in extended trading, reflecting investor confidence in the company’s growth trajectory.
AI Integration Fuels Cloud Service Expansion
The company has integrated OpenAI’s models directly into Snowflake Cortex AI, its managed AI service. This move strengthens its appeal to firms leveraging AI-powered solutions for data management.
Rising Adoption of Snowflake’s Data Cloud
Businesses continue shifting toward cloud-based solutions, driving increased demand for Snowflake’s services. The company’s fourth-quarter revenue hit $986.8 million, exceeding the estimated $955.9 million.
CFO Transition Announced
Chief Financial Officer Michael Scarpelli will retire but will remain in his role until a successor is appointed. He will then transition into an advisory position.
Upbeat Price Target
Based on short-term price targets offered by 37 analysts, the average price target for Snowflake Inc. was $191.89, before the release of the earnings results. The forecasts ranged from a low of $115.00 to a high of $225.00. The price of the SNOW stock was $181.20 in after hours.
Broker Rating
Snowflake Inc. currently has an average brokerage recommendation (ABR) of 1.63 on a scale of 1 to 5 (Strong Buy to Strong Sell), calculated based on the actual recommendations (Buy, Hold, Sell etc.) made by 43 brokerage firms. The current ABR compares to an ABR of 1.72 a month ago based on 43 recommendations.
Of the 43 recommendations deriving the current ABR, 29 are Strong Buy and three are Buy. Strong Buy and Buy respectively account for 67.44% and 6.98% of all recommendations. A month ago, Strong Buy made up 65.12%, while Buy represented 6.98%.
ETFs in Focus
Against this backdrop, below we highlight a few exchange-traded funds (ETFs) that have a decent exposure to Snowflake and may benefit in the near term, if Snowflake rises further on AI push. Snowflake-heavy ETFs include Spear Alpha ETF SPRX, TrueShares Technology, AI & Deep Learning ETF LRNZ and Global X Cloud Computing ETF CLOU.
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Global X Cloud Computing ETF (CLOU): ETF Research Reports
TrueShares Technology, AI and Deep Learning ETF (LRNZ): ETF Research Reports
Spear Alpha ETF (SPRX): ETF Research Reports
This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
