Live Updates
AI Updates
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6,100+ accounts using AI features weekly, up from ~5,200 in Q1.
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Cortex AI has moved from pilot-stage to “enterprise core,” with reference customers including Kraft Heinz, Siemens, and Samsung Ads embedding it into workflows.
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Management emphasized that AI inference costs are being offset, keeping gross margins stable at ~76%.
AI is beyond the experimental phase, costumers are using it.
My Take on the Quarter
Snowflake showed it can scale AI workloads profitably while maintaining growth above 30%, removing the biggest bear case.
Strong execution quarter, with AI adoption translating into real dollars.
- Bullish: Re-acceleration in consumption, RPO strength, and margin stability.
- Bearish: Slightly conservative FY26 revenue guide.
- Neutral: Net retention dip.
What Changed This Quarter
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Consumption growth outpaced expectations, especially in AI workloads.
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RPO acceleration (+33% YoY) highlights confidence in future growth.
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Margins stable at ~76% non-GAAP gross margin despite AI inference costs.
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Net revenue retention dipped slightly (125% vs. 128% prior), but still elite.
Key Operating Highlights
| KPI | Q2 FY26 | YoY | Note |
|---|---|---|---|
| Net Rev. Retention | 125% | ↓ from 128% | Still best-in-class |
| $1M+ Customers | 654 | +30% | Large deal momentum intact |
| Forbes Global 2000 Cust. | 751 | +5% | Slower expansion but very sticky |
| RPO | $6.9B | +33% | Strong forward pipeline |
Stock Approaching 13% After-Hours
Guidance implies sustained mid-20s% growth into Q3. FY26 top-line guide is slightly conservative vs. Street, but the cash flow margin uplift offsets. Big reason the stock popped 12% after-hours.
| Metric | Guidance | Consensus | Change |
|---|---|---|---|
| Q3 FY26 Product Rev. | $1.125B–$1.130B (+25–26% YoY) | ~$1.12B | Raised inline |
| FY26 Product Rev. | $4.395B (+27% YoY) | $4.53B est. |  Flat to slightly below |
| FY26 Op. Margin (Non-GAAP) | 9% | 9% est. | Flat |
| FY26 Adj. FCF Margin | 25% | ~24% est. | Raised |
C-Suite Commentary
CEO Sridhar Ramaswamy:
“Snowflake delivered yet another strong quarter, with product revenue of $1.09 billion, up 32% year-over-year, and remaining performance obligations totaling $6.9 billion.”
Management is leaning heavily on momentum in AI adoption (over 6,100 weekly AI-active accounts), signaling that Snowflake’s AI Data Cloud is scaling beyond pilot projects into enterprise-wide workflows.
Guidance
Guidance (Q3 FY26)
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Product Revenue: $1.125B–$1.130B (+25–26% YoY)
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Operating Margin: 9% (non-GAAP)
Full-Year FY26 Outlook:
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Product Revenue: $4.395B (+27% YoY)
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Non-GAAP Operating Margin: 9%
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Adj. Free Cash Flow Margin: 25%
Snowflake delivered a clean beat on both top- and bottom-line metrics, easing fears around consumption pacing. Product revenue growth of +32% YoY and a non-GAAP EPS beat by 30% demonstrate that AI-driven workloads are scaling without pressuring margins. With RPO up 33% and guidance implying sustained mid-20s growth, management has convincingly reset the narrative after prior volatility.
This reaction (+12% AH) reflects relief that Snowflake is executing under new leadership while maintaining momentum in AI adoption.
Big Beat and Shares Spike
Shares are up 12% immediately after the release after-hours.
| Metric | Reported | Consensus | Beat/Miss |
|---|---|---|---|
| Revenue | $1.10B (+32% YoY) | $1.09B |  Beat |
| EPS (Non-GAAP) | $0.35 | $0.27 | Beat |
| Product Revenue | $1.09B (+32% YoY) | $1.08B est. | Beat |
| RPO | $6.9B (+33% YoY) | N/A | — |
How Snowflake Performed After Recent Earnings
On average over the past year, SNOW stock jumped 7.77% after the first week of trading following an earnings release.
| Quarter | EPS Surprise | 1-Day Move | 7-Day Move | 14-Day Move |
|---|---|---|---|---|
| Q1 2026 | +14.3% | +13.43% | +17.33% | +16.46% |
| Q4 2025 | +66.7% | +4.51% | –4.38% | –7.12% |
| Q3 2025 | +33.3% | +32.71% | +33.53% | +33.18% |
| Q2 2025 | +12.5% | –14.70% | –15.42% | –17.07% |
Snowflake (NASDAQ: SNOW) will report fiscal Q2 2026 earnings after the close. The stock has been a lightning rod for the AI data platform trade, swinging double-digits after recent earnings as investors debate whether Snowflake can sustain growth while scaling profitability. After posting $1.04 billion in Q1 revenue (+26% YoY) and raising full-year guidance, expectations remain high heading into tonight’s results.
What to Expect When Snowflake Reports Tonight
- Revenue: $1.09 billion
- EPS (Normalized): $0.27
- FY 2026 Revenue: $4.53 billion
- FY 2026 EPS: $1.11
- FY 2027 Revenue: $5.58 billion
- FY 2027 EPS: $1.58
That implies +25% YoY revenue growth this quarter, with EPS set to jump nearly 50% YoY.
Key Areas to Watch
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AI Data Cloud & Cortex Momentum- Over 5,200 accounts using AI weekly; Cortex has evolved from niche to enterprise core. Customers like Kraft Heinz, Siemens, and Samsung Ads are embedding Snowflake AI into critical workflows.
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Snowpark, Dynamic Tables & Data Engineering- Strong adoption across unstructured data, ML workloads, and pipelines. EVP Kleinerman highlighted Snowpark’s role in unlocking new analytics and AI applications.
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Government & Regulated Sector Expansion- Launch of Snowflake Public Sector, Inc. with DoD provisional authorization. Expect updates on federal pipeline and sovereign cloud opportunities.
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Bookings & Consumption Trends- Q1 saw two $100M+ renewals; CFO Scarpelli emphasized strong RPO growth (+34% YoY) and stable consumption despite macro uncertainty.
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Competitive Dynamics vs. Hyperscalers- Analysts pressed on Microsoft Fabric and Databricks competition; management positioned Snowflake as the neutral enterprise data backbone, increasingly coexisting with Azure
The post Live: Will Snowflake (SNOW) Pop After Q2 Earnings Today? appeared first on 24/7 Wall St..
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Author: Joel South
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