Futu Mao Junhao: Snowflake: Data Cloud Leader in the AI Era and Market Outlook

In the rapidly evolving digital economy, data has become the most valuable asset for businesses, and the rise of AI has further elevated the value of data. As a leader in AI data cloud technology, Snowflake (NYSE: SNOW) has secured a key position in the market with its innovative platform and strong financial performance.

Snowflake demonstrated impressive financial strength in Q4 of fiscal year 2026. According to its earnings report, revenue reached $1.28 billion, a 30% increase year-over-year. Product revenue also grew 30%, totaling $1.23 billion. This growth was primarily driven by significant expansion of the customer base, with over 740 new net customers spending more than $1 million annually, a 40% increase. Additionally, the net revenue retention rate was as high as 125%, indicating high reliance and continued growth in existing customer usage. Moreover, remaining performance obligations (RPO) surged 42% to $9.77 billion, signaling strong future demand for its AI data cloud services. Looking ahead to FY2027, Snowflake expects product revenue to reach approximately $5.66 billion, a 27% increase, with non-GAAP gross margin for products estimated at 75%, and adjusted free cash flow profit margin at 23%. These figures not only demonstrate the company’s solid profitability but also lay a strong foundation for future growth.

Snowflake’s core competitive advantage lies in its AI data cloud platform, which enables customers to consolidate scattered data into a single source, gain meaningful business insights, develop data applications, share data products, and leverage AI to solve business problems. The company actively invests in AI feature development, having launched over 430 new features, with Cortex Code AI coding assistant being particularly notable.

To further strengthen its AI ecosystem, Snowflake strategically acquired Observe and TensorStax, integrating observability and AI-driven data engineering into its platform. Collaborations with industry giants such as Anthropic, Google Cloud (GOOG.US), and OpenAI have also expanded the range of models available to users, helping Snowflake maintain a central role in the enterprise AI revolution. Currently, over 9,100 accounts utilize Snowflake’s AI features, and more than 2,500 accounts use Snowflake Intelligence, demonstrating widespread adoption and recognition of its AI solutions.

Research from Snowflake reveals its platform’s enormous potential in specific industries. For example, in healthcare, 85% of industry leaders believe data interoperability is fundamental to expanding AI applications. Additionally, 77% of healthcare organizations have invested or plan to invest in generative or agent-based AI technologies, prioritizing high-impact use cases such as process automation, clinical documentation, and revenue cycle management. This indicates that Snowflake’s AI data cloud offers significant value in addressing industry pain points and improving efficiency.

Overall, with its strong financial performance, forward-looking AI data cloud strategy, expanding customer base, and positive analyst outlook, Snowflake has established a leadership position in data management in the AI era. Despite short-term market volatility in software stocks, Snowflake’s efforts in technological innovation and market expansion give it long-term growth potential. As AI technology continues to deepen its application, Snowflake is poised to lead enterprise data transformation and create greater value for its customers.

(Source: Zhitong Finance, The Motley Fool, Snowflake, Business Wire, PR Newswire, Market Perspective, China International Capital Corporation)

Analyst Profile: Graduated from the University of Nottingham in the UK with a Master’s degree in Finance. Currently a senior analyst at Futu, with over 12 years of experience in the financial industry and investments. Specializes in Hong Kong and U.S. new economy sectors, with a primarily conservative and opportunistic investment style.