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Snowflake (SNOW) is trading sharply higher following its 4Q26 earnings report, as investors applaud beats on EPS, revenue, and key metrics like product revenue growth alongside robust AI momentum and raised FY27 guidance. The results showcased record customer wins, the largest deal in company history, and accelerating remaining performance obligations (RPO), signaling strong enterprise demand for SNOW's AI Data Cloud.

• EPS and total revenue edged past expectations, with product revenue - the core demand gauge - reaching $1.23 bln, up 30% yr/yr and topping the company's $1.195-$1.200 bln guidance.
• SNOW posted its strongest quarter for net new customers at 740 adds (up 40% yr/yr, including 15 Global 2000 firms), a record 56 customers over $10 mln in trailing 12-month spend (up 56%), and its biggest-ever deal exceeding $400 mln in total contract value, plus seven nine-figure contracts.
• RPO surged 42% yr/yr to $9.77 bln, fueled by massive multi-year commitments reflecting customer buy-in to SNOW's AI roadmap. Net revenue retention held steady at a healthy 125%, driven by core business stability and AI workload expansion.
• SNOW's AI traction accelerated, with over 9,100 accounts using AI features, up sharply sequentially, including general availability of Cortex Code (now aiding 4,400+ customers in rapid app development) and Snowflake OpenFlow, alongside a $200 mln OpenAI partnership expansion bringing native models to the platform.
• For Q1, SNOW guided product revenue to $1.262-$1.267 bln (approximately 27% yr/yr growth, a modest deceleration but in line with its conservative philosophy) and non-GAAP operating margin to 9%.
• FY27 product revenue outlook is $5.66 bln (27% growth, with Observe acquisition adding about 1 point), non-GAAP operating margin to 12.5% (up from 10.5% in FY26), and adjusted free cash flow margin to 23% (including Observe headwind).

Briefing.com Analyst Insight

SNOW's post-earnings surge reflects validation of its AI leadership, with Q4 delivering 30% product growth at scale, record expansions, and RPO acceleration amid 430+ product launches yearly. While FY27 guides 27% growth conservatively (versus FY26's step-up), AI agents like Cortex Code and Intelligence are transforming workflows -- compressing development cycles 5x+ for customers and internally -- positioning SNOW as the enterprise control plane for agentic AI. Strong sales execution, stable NRR, and margin discipline (SBC dropping to 27% of revenue) counter macro caution, with upside from AI adoption likely to beat patterns-based forecasts as interoperability and observability unlock new workloads.