Snowflake shares surged about 40% on May 28, erasing a 20% year-to-date drop in a single session. The jump came after the cloud data company reported Q1 fiscal 2027 revenue of $1.39 billion — up 33% year-over-year and well above the $1.32 billion analysts had expected.
Revenue beat and raised guidance
Product revenue, the core of Snowflake's business, grew 34% to $1.33 billion. That was the largest sequential dollar addition Snowflake has ever recorded. Non-GAAP earnings per share came in at $0.39, beating the consensus estimate of $0.32.
Net revenue retention held steady at 126%, a sign customers are spending more over time. Remaining performance obligations — a measure of contracted future revenue — expanded 38% to $9.21 billion.
Management also raised its full-year fiscal 2027 product revenue guidance to $5.84 billion, implying 31% growth. That's up from a prior outlook of 27%.
The AWS deal and AI infrastructure
Alongside the earnings, Snowflake announced a five-year, $6 billion deal with Amazon Web Services. It's the company's largest cloud commitment ever. The agreement covers AWS Graviton chips and GPU-accelerated EC2 instances designed for AI training workloads.
The deepened integration targets what the company calls agentic AI infrastructure — systems where AI agents act autonomously on data. Lifetime sales through the AWS Marketplace have now topped $7 billion for Snowflake.
Natoma acquisition and governance
Snowflake also disclosed its intent to acquire Natoma, an enterprise platform built around the Model Context Protocol for governing AI agents. The acquisition extends Snowflake's governance perimeter from traditional data assets to AI actions and interactions across the enterprise.
The move signals Snowflake's push to manage not just the data that feeds AI models but the decisions those models make.
Analyst take
“Snowflake is not even an AI company. It is the data infrastructure that AI runs on,” said Bull Theory, an analyst covering the stock. That framing helps explain why investors piled in after the earnings and deal announcements.
The question now is whether the stock can hold those gains. The company's raised guidance and the AWS deal give it a clearer runway, but the Natoma acquisition still needs to close. Investors will be watching Snowflake's next quarterly report for early signs of how the AI governance platform fits into the product lineup.
