Observed Signal · May 27, 2026 · Earnings Report · Source: CNBC Technology · Impact: 4/5 · Sentiment: Positive
Snowflake Jumps 35% After Earnings; $6B AWS Deal
Snowflake reported stronger-than-expected fiscal first-quarter results and announced a five-year, $6 billion commitment to purchase Amazon Web Services products and services, including AWS’s Arm-based Graviton CPUs and cloud GPUs for AI workloads. The company reported $0.39 adjusted EPS on $1.39 billion revenue (33% year-over-year), beating LSEG analyst estimates of $0.32 and $1.32 billion. Snowflake guided to a 12.5% fiscal second-quarter adjusted operating margin on $1.415–$1.420 billion in product revenue, above StreetAccount expectations. The stock rose as much as 35% in after-hours trading. Snowflake also said it is acquiring AI startup Natoma for an undisclosed sum. The AWS commitment underscores growing hyperscaler demand for AI infrastructure and reinforces Snowflake’s ongoing reliance on Amazon’s cloud ecosystem.
Major cloud spending commitment to AWS from a leading cloud data warehouse vendor coupled with an earnings beat and strong guidance signals accelerating enterprise AI infrastructure demand and affects cloud economics and vendor relationships across the industry.
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Key Takeaways & Evidence Grounding
- Snowflake committed to spend $6 billion with Amazon Web Services over five years.
- Snowflake reported adjusted EPS of $0.39 and revenue of $1.39 billion for its fiscal first quarter (ended April 30), up 33% year-over-year.
- Analysts polled by LSEG expected $0.32 per share and $1.32 billion in revenue; Snowflake beat those estimates.
- Snowflake guided to a 12.5% fiscal second-quarter adjusted operating margin on $1.415–$1.420 billion in product revenue (StreetAccount expected 11.9% and $1.37 billion).
- Snowflake said it will expand use of AWS Graviton chips and cloud GPUs and announced the acquisition of AI startup Natoma (price undisclosed).
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Snowflake Jumps 35% on AI Momentum
Snowflake shares surged about 35% on May 28, 2026 after the company beat fiscal first-quarter adjusted earnings and revenue expectations, raised guidance, and announced expanded AI initiatives. The company said it will spend $6 billion on compute from Amazon and is expanding use of Amazon’s in-house chips for AI workloads. Finance chief Brian Robins said tools such as Cortex Code and Snowflake Intelligence are creating a “step function change” in AI-driven revenue potential and internal productivity. Snowflake added 616 net new customers in the quarter, has 779 customers spending more than $1 million on a trailing 12-month basis, provided fiscal Q2 margin and product revenue guidance, and disclosed intent to acquire AI startup Natoma. The results helped lift software peers and eased concerns about AI reducing SaaS demand.
Snowflake Signs $6B AWS Graviton Deal
Snowflake and Amazon Web Services announced a new $6 billion, five-year commercial agreement giving Snowflake expanded access to AWS’s ARM-based Graviton CPU capacity to support growing AI workloads. Snowflake — which also runs on Microsoft Azure and Google Cloud — said customer spend on AWS doubled in 2025 to $2 billion. AWS notes Snowflake has sold roughly $7 billion via the AWS Marketplace since 2012, making the new contract nearly as large as Snowflake’s cumulative AWS Marketplace sales. The deal underscores rising CPU demand for AI agent and inference workloads, positions AWS’s homegrown chips as a lower-cost alternative to GPU-centric options, and follows other large cloud chip commitments such as AWS’s recent Graviton agreement with Meta.
Snowflake jumps 22% on strong results and AI coding momentum
Snowflake shares surged 22% in extended trading after the data analytics company delivered strong fiscal Q2 results that beat expectations. Adjusted earnings per share hit 62 cents versus 45 cents expected, while revenue climbed 35% year over year to $1.55 billion, above the $1.48 billion consensus. The net loss narrowed to $191.7 million from $297.9 million a year earlier. The company highlighted momentum for its CoCo AI coding agent, which now counts 9,100 accounts, up more than 2,000 in the quarter. For Q3, product revenue guidance of $1.59 billion exceeded estimates, and management raised its full-year product revenue forecast to $6.07 billion while expanding its adjusted operating margin outlook to 14.5%. Following the report, Morgan Stanley and Bank of America raised their price targets to $470, implying roughly 54% upside, and most of the 52 covering analysts maintain buy ratings. Shares had already gained 39% in 2026 through Wednesday's close.
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