Analysts are bullish on Snowflake heading into earnings and expect another beat

Analysts anticipate a strong fiscal first-quarter report from Snowflake, projecting earnings of 21 cents per share on $1 billion in revenue, driven by robust demand from data centers and cloud providers despite macroeconomic headwinds. Several firms, including Goldman Sachs and Needham, have reiterated buy ratings, citing stable consumption trends and potential upside from Snowflake's AI initiatives, with price targets suggesting double-digit percentage gains; investors will be closely monitoring consumption trends, progress with Cortex AI, and any adjustments to the full-year outlook.

Analysis

Wall Street analysts widely anticipate Snowflake (SNOW) will report strong fiscal first-quarter results, with consensus estimates projecting earnings of 21 cents per share on approximately $1 billion in revenue for the period ended April 30. This optimism persists despite a challenging macroeconomic environment, as analysts from firms like Evercore ISI, Goldman Sachs, Needham, Baird, and JPMorgan believe Snowflake's consumption-based revenue model has proven durable and demand from large-scale data centers and cloud service providers remains robust, helping it overcome prior concerns such as tariffs. Evercore ISI notes that current estimates likely incorporate a healthy level of conservatism, while Goldman Sachs sees little downside risk to the full-year outlook, citing stable consumption trends in April reported by Datadog (DDOG) and Hyperscalers as positive read-throughs, and management's consistent philosophy for FY26 guidance despite a weaker FY25 starting point due to factors like a CEO transition and slower usage trends. Needham anticipates revenue outperformance potentially exceeding management's recent track record, contrasting with optimization headwinds seen at Confluent (CFLT). Baird is looking for an incremental increase to Snowflake's full-year outlook, including 24% product revenue growth, supported by industry conversations indicating limited macro impact and continued customer focus on cloud migrations. A key focus for the upcoming report will be updates on Snowflake's artificial intelligence initiatives, particularly Cortex AI, for which Baird noted positive feedback. Analyst price targets suggest considerable upside, with Goldman Sachs at $205 (13% upside from $182.05), Needham at $215 (18% upside), JPMorgan at $210 (15% upside), and Baird at $200, reflecting a generally bullish stance conditional on the upcoming earnings confirming these resilient trends.

Key Decisions for Investors

• Investors should closely monitor Snowflake's upcoming earnings release for confirmation of the anticipated revenue of ~$1 billion and EPS of $0.21, and critically assess reported consumption trends against robust analyst expectations.
• Particular attention should be paid to management's commentary on the full-year outlook, specifically any adjustments to product revenue growth projections (with Baird looking for 24%), and progress updates on artificial intelligence products like Cortex AI, which are viewed as key future growth catalysts.
• Given the positive analyst consensus and price targets implying double-digit upside (e.g., Goldman's $205, Needham's $215), investors may consider the current sentiment supportive, but should weigh this against the acknowledged 'difficult macroeconomic backdrop' and any specific sector headwinds highlighted during the earnings call.