Snowflake Stock Is Heating Up: What's Going On?

Snowflake Inc SNOW reported better-than-expected quarterly results after the bell on Wednesday, but shares didn't push higher until NVIDIA Corp NVDA blew away estimates for the second quarter in a row on accelerated AI demand. 

What To Know: Snowflake said second-quarter revenue increased 36% year-over-year to $674.02 million, which beat the consensus estimate of $662.24 million, according to Benzinga Pro. The company reported quarterly earnings of 25 cents per share, which beat analyst estimates of 10 cents per share.

Snowflake said it expects third-quarter product revenue to be between $670 million and $675 million versus $640.2 million in the second quarter. The company expects full-year product revenue of $2.6 billion. 

"During Q2, product revenue grew 37% year-over-year to $640 million. Our non-GAAP adjusted free cash flow was $88 million, representing 50% year-over-year growth," said Frank Slootman, chairman and CEO of Snowflake.

"Snowflake as the global epicenter of trusted enterprise data is well positioned to enable the growing interest in AI/ML. Enterprises and institutions alike are increasingly aware they cannot have an AI strategy without a data strategy," Slootman added. 

That solid positioning in AI is what's really behind the move. Nvidia is the best barometer for AI demand and the chipmaker's blowout report sent several AI-related names surging on Wednesday. Snowflake was among the stocks moving on the company's report. 

See Also: 'Pivotal Moment For AI': Morgan Stanley Reveals Its Favorite Global Stocks, Including Nvidia

Several analysts also came out with updates following the print. 

• Piper Sandler analyst Brent Bracelin maintained Snowflake with an Overweight and lowered the price target from $210 to $205.
• Needham analyst Mike Cikos reiterated Snowflake with a Buy and maintained a $216 price target.
• Barclays analyst Raimo Lenschow maintained Snowflake with an Overweight and lowered the price target from $190 to $183.
• Raymond James analyst Simon Leopold maintained Snowflake with an Outperform and lowered the price target from $180 to $170.
• Wells Fargo analyst Michael Turrin maintained Snowflake with an Overweight and raised the price target from $195 to $200.

SNOW Price Action: Snowflake shares were up 2.76% at $160.01 at the time of writing, according to Benzinga Pro.

Photo: Bethany Drouin from Pixabay.