Snowflake Stock Breaks Out on Strong Q1, Bullish Outlook – $200 Next?

Quick overview

Snowflake shares rose further on strong first-quarter results and positive forecasts, with investor interest spurred by technology-driven growth.

Post-Earnings Momentum Fuels Breakout

Snowflake Inc. closed the regular U.S. session at $179.10, but surged more than 7% in extended trading, topping $190 after the company released stronger-than-expected Q1 earnings along with a solid Q2 forecast. The stock has now gained over 30% in the past month, rallying in 13 of the last 15 sessions. With today’s move, the stock is fast approaching the $200 mark, a level many analysts believe could soon be tested and potentially surpassed.

Technical Break Signals End of Downtrend

Earlier in 2025, Snowflake had struggled to rise above the 200-week simple moving average—a key technical ceiling that had contained multiple rallies. However, today’s upward surge finally broke through that barrier, marking a shift in sentiment and possibly confirming the end of a longer-term downtrend.

SNOW Stock Chart Weekly – Will Open Above the 200 SMA Tomorrow

The breakout reinforces the view that this recovery is more than a short-term reaction and suggests room for further gains.

AI Focus and Expansion Strategy Impress

The company’s earnings beat and upbeat outlook were underpinned by growing demand for Snowflake’s data warehousing solutions, along with its expanding focus on artificial intelligence and machine learning tools. Its strategic alliances across the tech landscape have continued to strengthen its competitive positioning, while the addition of 451 new customers this quarter underscores accelerating market penetration.

Leadership Highlights Innovation and Confidence

CEO Sridhar Ramaswamy highlighted Snowflake’s commitment to innovation, stating that the company is leveraging data and AI to unlock business potential. He also noted that the team is “in the zone,” pointing to a strong sense of momentum and a belief that more upside lies ahead. This tone of optimism is resonating with investors, further supporting the recent surge in shares.

Snowflake Q1 Earnings Recap & FY2026 Outlook

Q1 2025 Performance Overview

• Revenue came in at $1.04 billion, exceeding the consensus estimate of $1.01 billion and signaling resilient top-line growth amid ongoing tech sector volatility.
• Earnings per share (EPS) hit $0.24, beating the forecasted $0.21 — a solid margin over expectations that reflects operational discipline.
• Product revenue reached $997 million, reflecting a robust 26% year-over-year increase, driven by increased enterprise adoption of Snowflake’s data services.
• Non-GAAP product gross margin stood at 75.7%, showing strong cost control and pricing power in its core business segment.
• Non-GAAP operating margin climbed to 9%, improving by 442 basis points compared to the previous year, as scale efficiencies continue to support margin expansion.
• Adjusted free cash flow margin hit 20%, indicating solid cash generation, which is especially notable given the company’s ongoing investment in innovation and expansion.

Forward Guidance & Analyst Expectations

• Q2 product revenue is projected between $1.035 billion and $1.040 billion, targeting approximately 25% growth year-over-year, sustaining its current growth trajectory.
• Full-year revenue guidance for FY2026 remains unchanged at $4.325 billion, underscoring confidence in its long-term demand outlook and pipeline stability.
• While not yet profitable on a trailing twelve-month basis, analysts tracked by InvestingPro anticipate Snowflake turning a profit in FY2026, with a projected EPS of $1.28.

Conclusion: Snowflake’s better-than-expected Q1 results and confident forward guidance reinforce its trajectory as a leading player in the data cloud sector. With accelerating product revenues, improving margins, and anticipated profitability on the horizon, the company appears well-positioned to capitalize on continued demand for AI-driven data infrastructure and analytics. The sustained rally in SNOW stock reflects this growing investor conviction.

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Skerdian Meta

Lead Analyst

Skerdian Meta Lead Analyst. Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank's local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.

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