Snowflake shares surged more than 36% in late trading Wednesday after the cloud database company reported a stellar Q1 earnings beat and announced a $6 billion spending commitment with Amazon Web Services.
The company posted earnings of $0.39 per share, topping the Street's $0.32 target, while revenue jumped 33% year-over-year to $1.39 billion, well above the $1.32 billion consensus. Guidance also impressed: Snowflake expects Q2 product revenue between $1.415 billion and $1.42 billion, versus the $1.37 billion estimate, and raised its full-year outlook to $5.84 billion from $5.66 billion.
The five-year AWS deal includes a commitment from Snowflake to use Amazon's custom Graviton processors and AI accelerators, positioning AWS as a key infrastructure provider for enterprise AI workloads at scale.
In a separate move, Snowflake announced the acquisition of Natoma, an enterprise-grade Model Context Protocol platform for AI agents. The acquisition will allow Snowflake to build a native governance and identity layer for AI agents, enabling secure connections to third-party databases and APIs.
CEO Sridhar Ramaswamy called Q1 a "clear inflection point," citing strong momentum in both core business and AI adoption. Analysts had feared AI disruption, but Snowflake's consumption-based pricing model appears to be benefiting from the AI boom, as agents drive greater cloud consumption. Despite the surge, the stock remains down 20% year-to-date, compared to the S&P 500's 10% gain.