The Numbers Behind the Move
Snowflake reported first-quarter revenue of $1.39 billion, up 33% year over year, beating the $1.32 billion consensus. Adjusted earnings came in at $0.39 per share against a $0.32 estimate. Product revenue, the metric investors watch closest, reached $1.33 billion, a 34% increase that topped the $1.30 billion to $1.31 billion range analysts expected.
The stock closed the regular session at $175.26, still down 37% from its 52-week high of $280.67. Shares had been drifting lower as investors questioned whether AI spending would actually flow through Snowflake's platform or bypass it entirely. After the report, the stock jumped to around $238, adding roughly $22 billion in market capitalization. Even at that level, it remains about 15% below where it traded at its peak.
$6 Billion and a New Data Architecture
The headline number is the five-year, $6 billion commitment to Amazon Web Services. Snowflake will spend roughly $1.2 billion a year on AWS Graviton compute and AI workloads, making this the company's largest infrastructure deal in its history.
The partnership is built around pushing agentic AI capabilities directly into enterprise data environments. Snowflake also announced the acquisition of Natoma, an enterprise platform for the Model Context Protocol that lets AI agents connect to and govern data across systems. The logic is simple: enterprises will not move their data to AI models. They need the AI layer to come to the data. Snowflake is positioning its platform as the place where that happens.
For Amazon, the deal validates that its custom Graviton ARM-based chips are pulling significant data workloads away from traditional x86 processors. The $6 billion in committed spending over five years gives AWS revenue visibility that most cloud partnerships do not provide.
The Guidance Raise Changes the Trajectory
Management lifted full-year product revenue guidance to $5.84 billion from $5.66 billion, implying 31% growth instead of the 27% previously forecast. Operating margin guidance moved to 13.5% from 12.5%. Those two numbers together answer the question that has weighed on the stock all year: whether Snowflake can grow faster while also expanding profitability.
Remaining performance obligations reached $9.21 billion, up 38% from a year ago. The company now has 779 customers spending more than $1 million annually, a 29% increase. Net revenue retention held at 126%, meaning existing customers are spending more each quarter without Snowflake needing to acquire new ones.
The market cap at the after-hours price sits around $82 billion. At roughly 14 times the new full-year product revenue target, the valuation is not cheap. But it is lower than where Snowflake traded for most of 2024, and the growth rate is now accelerating rather than decelerating.
A Split Verdict on Enterprise Software Tonight
Snowflake was not the only enterprise name reporting after the close. Salesforce beat on revenue at $11.13 billion and delivered adjusted earnings of $3.88 per share against a $3.12 estimate. But full-year guidance came in slightly below expectations and the backlog disappointed. Shares were roughly flat in extended trading.
Marvell Technology beat estimates with $2.42 billion in revenue, up 28%, and raised its full-year outlook to approach $11 billion. The company also projected FY2028 revenue near $15 billion, implying roughly 40% growth from the higher FY2027 base.
Thursday morning at 8:30 AM brings April core PCE, the first inflation reading under new Fed Chair Kevin Warsh. A hot print pushes the 10-year yield higher and puts pressure on growth valuations at these after-hours levels. A cool number gives the AI infrastructure trade more room to run.
