Shares of Snowflake (SNOW) slipped in after-hours trading after the data warehousing giant reported third-quarter results for Fiscal Year 2026. Adjusted earnings of $0.35 per share beat analysts’ consensus estimate of $0.31 per share. Furthermore, the company saw a 28.4% increase in revenue to $1.21 billion, which beat estimates of $1.18 billion. This could be attributable to a 37% increase in remaining performance obligations to $7.88 billion and a net revenue retention rate of 125%.
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Interestingly, the firm’s product revenue grew by 29% from the previous year, with 688 customers having trailing 12-month product revenue that exceeded $1 million. This is greater than last quarter’s figure of 654 and continues the firm’s trend of steadily growing this metric, as shown below.
Outlook for 2026
Looking forward, the company anticipates the following for 2026:
- FY26 Product revenue of $4.446 billion, above the previous estimate of $4.325 billion.
- FY26 operating margin of 9%
- Q426 Product revenue of between $1.195 billion and $1.2 billion
As we can see, the outlook came in better than previously anticipated. However, shares fell anyway because investors had already priced in the good results, as evidenced by the rally into earnings.
Is SNOW a Good Buy Right Now?
Turning to Wall Street, analysts have a Strong Buy consensus rating on SNOW stock based on 23 Buys, two Holds, and zero Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average SNOW price target of $286 per share implies 7.4% upside potential. However, it’s worth noting that estimates will likely change following today’s earnings report.
