Computed from published fixed rules, not a model's judgement — though one input, the count of high-severity risks, comes from the AI analysis below.
Not investment advice and not a price target: it scores the quarter's fundamentals, not the stock. Full methodology →
AI Takeaway
Snowflake's fiscal Q2 2027 results reflect continued rapid expansion of its AI Data Cloud, with net revenue retention holding at 126%. Management attributes the growth to strong platform consumption, new AI product adoption, and expansion among large enterprises, while acknowledging that customers are optimizing usage amid macro uncertainty. The company narrowed its operating and net losses, and generated positive free cash flow of $83.8M for the quarter, though this was lower than the seasonally stronger first quarter. Gross margin slipped slightly to 67.0% as infrastructure and AI-related costs grew slightly faster than revenue, a key tension to monitor. Acquisitions of Observe and Natoma Labs during the first half of fiscal 2027 expanded Snowflake's observability and AI agent capabilities.
Revenue
$1.55B
+35.09% YoY
EPS (Diluted)
-$0.55
+38.20% YoY
Gross Margin
67.0%
-0.5 pts YoY
Operating Income
-$262.97M
+22.72% YoY
Source: SEC XBRL
Snowflake (SNOW) reported Q2 FY2027 revenue of $1.55B, up 35.1% year over year. Operating margin was -17.0%, against -29.7% a year earlier. SNOW's fiscal Q2 FY2027 corresponds to calendar Q3 2026.
Last 4 quarters: 4 beats
| Quarter | Actual EPS (USD) | Consensus (USD) | Result |
|---|---|---|---|
| Sep 2026This filing | 0.62 | 0.46 | Beat +36.2% |
| Jun 2026 | 0.39 | 0.32 | Beat +20.1% |
| Mar 2026 | 0.32 | 0.28 | Beat +15.6% |
| Dec 2025 | 0.35 | 0.32 | Beat +10.6% |
Adjusted (non-GAAP) EPS of $0.62 versus the $0.46 analyst consensus — a +36.2% beat for Sep 2026. Analyst consensus is quoted on the adjusted (non-GAAP) basis the street uses. GAAP diluted EPS for this quarter was -$0.55.
Compiled by AI from 10-Q Item 2 of this filing
During the first half of fiscal 2027, Snowflake acquired Observe, Inc. for preliminary consideration of $595.8 million and Natoma Labs, Inc. for $128.3 million, adding AI-powered observability and enterprise Model Context Protocol capabilities.
Source: 10-Q Item 2 MD&A
Total customers reached 14,554 as of July 31, 2026, up from 13,245 at January 31, 2026; net revenue retention rate held at 126%; and 829 Forbes Global 2000 customers contributed approximately 41% of revenue for the six months ended July 31, 2026.
Source: 10-Q Item 2 MD&A
RPO was $9.0 billion as of July 31, 2026, with approximately 54% expected to be recognized as revenue in the 12 months ending July 31, 2027; the weighted-average remaining life of capacity contracts was 2.4 years.
Source: 10-Q Item 2 MD&A
Management reiterated that revenue is recognized on consumption rather than ratably, with on-demand arrangements representing about 3% of revenue and capacity contracts entered during the quarter having a weighted-average term of about 2.1 years, reducing near-term revenue visibility.
Source: 10-Q Item 2 MD&A
The MD&A notes that customers are rationalizing budgets, prioritizing cash flow management, and optimizing consumption, including reducing storage and AI usage, which may cause revenue fluctuations.
Source: 10-Q Item 2 MD&A
Compiled by AI from 10-Q Item 1A of this filing · 5 high, 0 medium, 0 low
Snowflake generally recognizes revenue based on customer consumption rather than ratably, and customers have flexibility in timing of consumption. This reduces visibility into future revenue and can cause actual results to differ materially from forecasts, especially as customers optimize usage in response to macro conditions.
Source: 10-Q Item 1A Risk Factors
The company has experienced net losses in every period since inception, including $191.7 million in Q2 FY2027, and an accumulated deficit of $10.3 billion as of July 31, 2026. Continued heavy investment in R&D, AI, and acquisitions may keep the company unprofitable or make profitability unsustainable.
Source: 10-Q Item 1A Risk Factors
Snowflake competes with AWS, Azure, and GCP, which also host its platform, as well as legacy database vendors and emerging AI providers. These competitors have greater resources and may use their cloud control to disadvantage Snowflake, potentially reducing revenue and margins.
Source: 10-Q Item 1A Risk Factors
Snowflake relies on third-party frontier AI models from providers like Anthropic and OpenAI and must secure GPUs for AI offerings. Pricing and access terms may compress margins, and any loss of access or underutilized GPU commitments could harm operations and financial results.
Source: 10-Q Item 1A Risk Factors
Snowflake and its third-party providers face evolving cyber threats, including AI-enabled attacks, that could lead to data breaches, service disruptions, and reputational harm. New product features and expanded AI offerings increase the attack surface, and security incidents could result in significant liabilities.
Source: 10-Q Item 1A Risk Factors
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue $B | 1.55 $B | 1.14 $B | +35.09% |
Cost of Revenue $M | 510.08 $M | 371.82 $M | +37.19% |
Gross Profit $B | 1.04 $B | 0.77 $B | +34.09% |
Operating Income $M | -262.97 $M | -340.28 $M | +22.72% |
Net Income $M | -191.72 $M | -298.02 $M | +35.67% |
EPS (Basic) $ | -0.55 $ | -0.89 $ | +38.20% |
EPS (Diluted) $ | -0.55 $ | -0.89 $ | +38.20% |
R&D Expense $M | 567.48 $M | 492.00 $M | +15.34% |
Answers draw on this SEC filing and the data on this page
Snowflake Inc. delivered 33.5% year-over-year revenue growth to $1.4B in Q1 FY2027, improved its operating loss and generated $232.8M of free cash flow, but remained GAAP unprofitable and faces consumption-volatility, cloud-competition, AI-execution, and cybersecurity risks. Source: 10-Q Item 2 MD&A, pp.43-46; 10-Q Income Statement (XBRL).
Snowflake delivered strong FY2026 revenue growth of 29.2% to $4.68B, improved its gross margin to 67.2% and operating cash flow to $1.22B, but continued to post significant net losses of $1.33B amid heavy R&D investment and rising liabilities.