Snowflake SNOW is benefiting from accelerating product revenue growth, rising AI adoption and expanding consumption of its AI Data Cloud. This momentum strengthens the company’s position in enterprise data and AI markets while improving its ability to compete for technology spending against Dell Technologies DELL and Oracle ORCL. In the first quarter of fiscal 2027, product revenues increased 34% year over year to $1.33 billion, marking Snowflake’s strongest sequential dollar growth on record.
Growth is being fueled by both Snowflake’s core data platform and increasing monetization of AI offerings. Cortex Code and Snowflake Intelligence are encouraging customers to migrate more workloads and consume more platform resources. Snowflake Intelligence accounts more than doubled sequentially, while Cortex Code is already being used across over 7,100 accounts.
The company’s AI capabilities are attracting new customers and deepening engagement with existing ones. The company added 616 net new customers in the first quarter of fiscal 2027, up 38% year over year, including 13 new Global 2000 clients. Large enterprises such as Holiday Inn Club Vacations, Houzz and Nestle are leveraging Snowflake to modernize data and AI operations. SNOW highlighted that 64 customers now spend more than $10 million annually on its AI Data Cloud platform.
Customer expansion provides another catalyst. The company now serves 13,912 customers, including 813 Forbes Global 2000 firms and 779 customers generating more than $1 million in trailing 12-month product revenues, a 29% increase from the prior year. Its net revenue retention rate stands at an impressive 126%, reflecting deepening relationships and upsell success within its customer base. The company also strengthened its ecosystem through expanded partnerships with AWS, OpenAI and SAP, broadening the reach of its AI Data Cloud.
The momentum prompted Snowflake to raise fiscal 2027 product revenue guidance to $5.84 billion, implying 31% growth, from the previous 27% projection. For the fiscal second quarter, Snowflake expects product revenues between $1.415 billion and $1.42 billion, representing approximately 30% year-over-year growth. Continued AI adoption, workload migration and customer expansion should support SNOW’s competitive position against Dell Technologies and Oracle.
How Competitors Fare Against SNOW
Snowflake is facing stiff competition from major players like Dell Technologies and Oracle. Both companies are expanding their footprint in the AI space.
Dell Technologies is benefiting from surging demand for AI infrastructure. In the first quarter of fiscal 2027, Dell Technologies reported record revenues of $43.8 billion, up 88% year over year, with AI server revenues reaching $16.1 billion and a record AI backlog of $51.3 billion. This robust performance is driven by customers across neocloud, sovereign and enterprise segments seeking to secure supply and modernize their IT environments.
Oracle’s expanding portfolio has been noteworthy. In June 2026, Oracle introduced Oracle OPERA Cloud Assistant, a suite of AI-powered capabilities built into OPERA Cloud that automates guest room assignments, generates AI-driven rate descriptions, supports multilingual operations across 230 countries and territories, and gives hotel staff real-time operational guidance.
SNOW’s Share Price Performance, Valuation, and Estimates
Snowflake shares have gained 43.8% year to date, outperforming the broader Zacks Computer & Technology sector’s 15.4% appreciation. The Internet Software industry has declined 3.9% in the same time frame.
SNOW Stock Performance
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Snowflake stock is trading at a premium, with a forward 12-month Price/Sales ratio of 15.78X compared with the Internet Software industry’s 3.93X. SNOW has a Value Score of F.
SNOW Valuation
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The Zacks Consensus Estimate for SNOW’s fiscal 2027 earnings is pegged at $1.97 per share, which has increased by a penny over the past 30 days. The figure indicates a 57.60% year-over-year increase.
Snowflake Inc. Price and Consensus
Snowflake Inc. price-consensus-chart | Snowflake Inc. Quote
Snowflake currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
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This article originally published on Zacks Investment Research (zacks.com).