At the Snowflake Summit 2025, Snowflake (SNOW, Financial) revealed its plans to purchase Crunchy Data, a company known for its robust open-source Postgres solutions. This strategic acquisition is aimed at integrating the comprehensive capabilities of PostgreSQL into the AI Data Cloud, providing developers with advanced tools backed by stringent governance and security measures critical for AI applications.
The move signifies Snowflake's strong commitment to the Postgres community and the support of existing Crunchy Data clients. By incorporating Crunchy Data's PostgreSQL technology, Snowflake is set to enhance the efficiency and effectiveness of its Snowflake Postgres offerings, thereby expanding its scope in AI application development. The integration promises to bolster Snowflake's operational standards, ensuring it remains a key player in the AI development sector.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 43 analysts, the average target price for Snowflake Inc (SNOW, Financial) is $223.25 with a high estimate of $440.00 and a low estimate of $150.00. The average target implies an upside of 6.22% from the current price of $210.17. More detailed estimate data can be found on the Snowflake Inc (SNOW) Forecast page.
Based on the consensus recommendation from 49 brokerage firms, Snowflake Inc's (SNOW, Financial) average brokerage recommendation is currently 2.0, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Snowflake Inc (SNOW, Financial) in one year is $319.99, suggesting a upside of 52.25% from the current price of $210.17. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Snowflake Inc (SNOW) Summary page.
SNOW Key Business Developments
Release Date: May 21, 2025
- Product Revenue: $997 million, up 26% year-over-year.
- Remaining Performance Obligations: $6.7 billion, 34% year-over-year growth.
- Net Revenue Retention: 124%.
- Non-GAAP Product Gross Margin: 75.7%.
- Non-GAAP Operating Margin: 9%, up 442 basis points year-over-year.
- Non-GAAP Adjusted Free Cash Flow Margin: 20%.
- Net New Customers: 451, 19% year-over-year growth.
- Share Repurchase: $491 million used to repurchase 3.2 million shares at an average price of $152.63 per share.
- Cash and Investments: $4.9 billion in cash, cash equivalents, short-term and long-term investments.
- Q2 Product Revenue Guidance: Between $1.035 billion and $1.04 billion, representing 25% year-over-year growth.
- FY26 Revenue Guidance: $4.325 billion, representing 25% year-over-year growth.
- FY26 Non-GAAP Product Gross Margin Guidance: Approximately 75%.
- FY26 Non-GAAP Operating Margin Guidance: 8%.
- FY26 Non-GAAP Adjusted Free Cash Flow Margin Guidance: 25%.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Product revenue for Q1 was $997 million, up 26% year-over-year, showing strong growth.
- Remaining performance obligations totaled $6.7 billion with year-over-year growth of 34%.
- Net revenue retention was a healthy 124%, indicating strong customer loyalty and expansion.
- Snowflake added 451 net new customers in Q1, growing 19% year-over-year.
- The company launched over 125 product capabilities this quarter, a 100% increase over Q1 of last year.
Negative Points
- Despite strong growth, the net revenue retention rate of 124% is lower than previous highs, indicating potential challenges in upselling or expanding within existing accounts.
- The company faces ongoing competition from hyperscalers like Microsoft and AWS, which could impact market share.
- CapEx was significantly up due to new headquarters and office buildouts, which may impact short-term cash flow.
- The macroeconomic environment remains uncertain, which could affect future customer spending and growth.
- The company's operating margin guidance for the fiscal year remains unchanged, suggesting limited short-term profitability improvements.
