Snowflake has quietly become one of the loudest AI-software rebounds of the year. Shares changed hands at $260 on Wednesday, up ~54% from the $169 close on February 25, when the Q4 print landed into a nervous SaaS tape. The recovery accelerated after May, when management delivered a quarter that changed the conversation from “consumption headwinds” to “AI inflection.” Eric Bleeker of 24/7 Wall St had already added Snowflake (NYSE:SNOW | SNOW Price Prediction) to his AI portfolio before that reset.
The quarter that flipped the script
Q1 FY27, reported May 27, was the kind of print bulls had been waiting two years for. Revenue rose 33.5% to $1.39 billion, and non-GAAP EPS of $0.39 cleared the $0.32 consensus for a fourth straight beat. The number that mattered most, though, was remaining performance obligations of $9.21 billion, up 38%. In a consumption business, RPO growth outrunning revenue growth means customers are pre-committing to workloads they have not yet run. That is the signal the market kept demanding.
CEO Sridhar Ramaswamy called it “the strongest sequential dollar growth in our history” and pointed at the AI stack as the reason. More than 13,600 accounts are now using Snowflake AI features, Cortex Code sits inside 7,100+ accounts, and Snowflake Intelligence usage more than doubled quarter over quarter. Net revenue retention held at 126%, meaning every dollar of last year’s customer is now spending $1.26.
The AWS handshake and the AI ecosystem trade
The other headline was a $6 billion multi-year collaboration with Amazon (NASDAQ:AMZN) covering AWS infrastructure, co-selling, and enterprise AI deployments. Snowflake runs on AWS, Azure, and Google Cloud, but Amazon is the anchor tenant, and a commitment this size tells you AWS is willing to fund Snowflake’s growth to keep AI-native data workloads inside its walls rather than losing them to Microsoft (NASDAQ:MSFT) Fabric. Snowflake also deepened its OpenAI partnership and closed a deal to buy Natoma, an enterprise Model Context Protocol platform for AI agents. Read together, these are the pieces of a platform trying to become, as Ramaswamy put it, “the control plane for the Agentic Enterprise.”
What has to keep working
Management raised full-year FY27 product revenue guidance to $5.84 billion, or 31% growth, and lifted the non-GAAP operating margin target to 13.5% from 12.5%. The counterweight is real: Snowflake still ran a $326 million GAAP operating loss in the quarter, and consumption revenue can wobble if customers throttle usage.
The next earnings release will show whether the AI account count keeps climbing above 13,600, whether RPO growth stays north of revenue growth, and whether operating margin walks toward the raised 13.5% mark. Bleeker added Snowflake to the AI Investor portfolio and layered on again on February 28, 2025, after an earlier position taken on December 20, 2024. The rebound has done its work. The open question is whether the agentic pitch converts into another leg of consumption, and the analyst who called it early is still watching.
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