Snowflake Q3 FY2026 Earnings Beat: $1.21B Revenue, $200M Anthropic AI Deal and $2B AWS Milestone Can’t Stop SNOW Stock Slide

December 3, 2025

Snowflake Inc. (NYSE: SNOW) delivered another quarter of strong growth and a clean beat on Wall Street expectations on Wednesday, but the stock fell sharply in after‑hours trading as investors focused on a softer margin outlook and the cost of aggressive AI investment. At the same time, the AI Data Cloud company unveiled a trio of major partnerships with Anthropic, Amazon Web Services (AWS) and Accenture, all announced on December 3 and aimed squarely at consolidating Snowflake’s position at the center of enterprise AI. ^[1]

Q3 FY2026: Revenue and EPS Beat, Growth Still Near 30%

Snowflake reported financial results for the third quarter of fiscal 2026, covering the three months ended October 31, 2025. Total revenue came in at $1.21 billion, up 29% year over year and ahead of analyst estimates around $1.18 billion. Product revenue — the company’s core metric — reached $1.16 billion, also up 29%, confirming that consumption growth remains robust despite macro uncertainty. ^[2]

On the bottom line, Snowflake posted adjusted earnings of $0.35 per share, beating consensus estimates of about $0.31. ^[3] Non‑GAAP operating margin improved to roughly 11%, up from high single digits a year ago, reflecting operating leverage even as the company ramps AI‑related investments. ^[4]

Key customer and platform metrics underscore the scale of Snowflake’s data and AI franchise:

125% net revenue retention rate, indicating existing customers are still expanding usage at a healthy pace. ^[5]
$7.88 billion in remaining performance obligations (RPO), up roughly mid‑30s percent year over year and providing multi‑year revenue visibility. ^[6]
688 customers generating more than $1 million in trailing 12‑month product revenue, and 766 Forbes Global 2000 customers, highlighting Snowflake’s penetration into the world’s largest enterprises. ^[7]

The balance sheet remains strong, with Snowflake ending the quarter with about $1.94 billion in cash and cash equivalents, giving the company ample flexibility to continue investing in AI infrastructure, partnerships and product innovation. ^[8]

Guidance: Strong Top Line, but Margin Compression Ahead

If the headline numbers looked comfortably ahead of expectations, the outlook was more nuanced — and that’s where the market’s worries surfaced.

For the fourth quarter of fiscal 2026, Snowflake guided:

Product revenue between $1.195 billion and $1.20 billion, implying ~27% year‑over‑year growth.
Adjusted operating margin around 7%, down from the 11% achieved in Q3. ^[9]

The guidance confirms that growth is holding in the high‑20s range, but the forecasted step‑down in margin reflects heavier spending on AI infrastructure, R&D and go‑to‑market initiatives. Commentary from market analysts has already framed the sell‑off as driven largely by concern that AI investments, while necessary, could cap near‑term profitability. ^[10]

On a full‑year fiscal 2026 basis, Snowflake:

Raised its product revenue outlook to around $4.45 billion, up from roughly $4.4 billion previously and modestly ahead of Wall Street estimates near $4.41 billion. ^[11]
Continues to target high‑single‑digit operating margins and an adjusted free cash flow margin of about 25%, suggesting the company still expects to balance growth and profitability across the year, even as Q4 margins dip. ^[12]

In short: Snowflake is telling investors that growth remains strong and durable, but sustained AI investment will weigh on margins in the near term.

Stock Reaction: SNOW Slides Despite the Beat

Despite the revenue and EPS beats, Snowflake shares fell more than 7% in after‑hours trading, slipping to around $245.58 after closing the regular session at about $251.32, down just over 5% on the day. ^[13]

Traders appear to be reacting less to the Q3 print and more to the Q4 margin guidance and the signal it sends: Snowflake is choosing to lean into AI‑driven growth rather than maximize short‑term profitability. Coverage from financial outlets and AI‑focused market analysts framed the move as a classic “good quarter, cautious reaction” pattern — strong fundamentals, but expectations and valuation were already high after a roughly 70% year‑to‑date run‑up in the stock. ^[14]

Anthropic Partnership: A $200 Million Bet on Agentic AI

The most eye‑catching piece of news from December 3 is Snowflake’s expanded partnership with Anthropic, the AI safety and research company behind the Claude family of models.

Snowflake and Anthropic announced a multi‑year, $200 million agreement that dramatically deepens their strategic alliance: ^[15]

Anthropic’s Claude models — including Claude Sonnet 4.5 and Opus 4.5 — will be deeply integrated into Snowflake Cortex AI and Snowflake Intelligence, the company’s enterprise AI agent.
The partnership is designed to serve more than 12,600 Snowflake customers across the three major public clouds, giving them a governed environment in which to run agentic AI directly on top of their enterprise data. ^[16]
Snowflake and Anthropic will pursue a joint global go‑to‑market motion, focusing on deploying AI agents that can perform complex, multi‑step analysis on sensitive data in regulated industries such as financial services, healthcare and life sciences. ^[17]

The expanded deal builds on an existing collaboration where thousands of Snowflake customers were already processing trillions of Claude tokens per month via Snowflake Cortex AI. In the next phase, the focus is on production‑grade AI agents that can reason over structured and unstructured data, “show their work,” and operate within Snowflake’s governance and observability frameworks.

Snowflake is also using Claude internally — from Claude Code to boost developer productivity to Claude‑powered sales assistants that help go‑to‑market teams quickly query internal data and accelerate deal cycles. ^[18]

Taken together, the Anthropic partnership is both a product differentiator (deep, native access to frontier‑class models) and a demand driver (more AI workloads running on Snowflake’s platform).

AWS Collaboration: $2 Billion Marketplace Milestone and 14 Partner Awards

Snowflake’s second major announcement of the day came from Las Vegas, where the company highlighted a milestone in its relationship with Amazon Web Services.

According to a Business Wire release, Snowflake:

Doubled its AWS Marketplace transaction growth year over year.
Exceeded $2 billion in sales through AWS Marketplace in calendar 2025, underscoring how central AWS has become to Snowflake’s go‑to‑market model. ^[19]
Was recognized by AWS with 14 Partner of the Year awards, including honors in Data & Analytics Technology, GenAI Tools, and Infrastructure Technology categories. ^[20]

AWS Marketplace gives Snowflake a powerful distribution channel: enterprises can adopt Snowflake through existing AWS procurement workflows, consolidate billing, and deploy the AI Data Cloud into their current infrastructure with fewer friction points. Customers like Booking.com, DraftKings and AstraZeneca were cited as examples of organizations using Snowflake on AWS to modernize their data platforms and accelerate AI projects. ^[21]

For investors, the AWS milestone matters in three ways:

It validates Snowflake’s ecosystem strategy — rather than competing with hyperscalers, Snowflake is embedding itself deeper into their marketplaces and partner programs.
It showcases demand at scale for Snowflake’s AI‑ready data platform, especially among large global enterprises.
It reinforces the network effects around Snowflake’s AI Data Cloud: the more customers transact and standardize on Snowflake, the more attractive it becomes as a place to build and run AI workloads.

Accenture–Snowflake Business Group: Industrial‑Scale AI Transformation

The third major announcement on December 3 came from Accenture and Snowflake jointly, as the companies unveiled the Accenture Snowflake Business Group to help enterprises “reinvent” themselves with AI and data. ^[22]

Key elements of this initiative include:

A dedicated business group combining Snowflake’s AI Data Cloud with Accenture’s industry expertise and AI consulting capabilities, anchored by Accenture’s AI Refinery and Snowflake’s Cortex AI and Snowflake Intelligence offerings. ^[23]
Support from more than 5,000 Accenture SnowPro‑certified professionals, described as the largest such talent pool in the ecosystem, focused on migrating clients to the cloud, building AI‑ready data estates, and deploying agentic AI solutions. ^[24]
A new global Center of Excellence where joint teams from Accenture and Snowflake will co‑create solutions with clients, accelerate proof‑of‑concept work, and industrialize successful AI use cases. ^[25]

A concrete early example is Caterpillar, the industrial equipment giant, which is working with Accenture and Snowflake to harness operational data for higher manufacturing quality, better real‑time financial insights and improved knowledge management for complex work. ^[26]

The Accenture partnership turns Snowflake’s technology into a full‑stack transformation offering: not just a platform, but a route to strategy, delivery, and change management for global enterprises that may lack in‑house AI expertise.

How All the December 3 News Fits Together

For Snowflake, December 3, 2025, is more than just an earnings day. It’s effectively a strategy day where the company is telling a coherent story about where it thinks enterprise AI is going — and why Snowflake wants to sit in the middle of it.

Across the day’s news flow, four themes stand out:

Data cloud scale remains a competitive weapon
- Nearly $8 billion of RPO, 125% net revenue retention and hundreds of million‑dollar‑plus customers give Snowflake a durable base of committed consumption. ^[27]
AI is becoming the growth engine and product narrative
- The Anthropic partnership positions Snowflake as a premier home for agentic AI on sensitive enterprise data.
- The Accenture business group ensures that large clients have help turning AI ambitions into production deployments. ^[28]
Hyperscaler alignment, not conflict, is the go‑to‑market model
- The $2 billion AWS Marketplace milestone and 14 AWS awards show Snowflake embracing a partner‑centric approach with the cloud giants, rather than trying to displace them. ^[29]
Near‑term profitability is the trade‑off for long‑term AI leadership
- Guiding Q4 adjusted operating margin down to 7% while maintaining high‑20s product revenue growth is a clear signal: Snowflake is prepared to accept lower margins to build out AI capabilities and win market share. ^[30]

What Investors Will Be Watching Next

While this article is not investment advice, it’s clear what the Street will focus on after this event‑heavy December 3:

AI monetization vs. AI cost curve
Can Snowflake translate its Anthropic partnership, Cortex AI and Snowflake Intelligence into meaningful incremental product revenue fast enough to offset the heavier compute and R&D spend they require?
Trajectory of net revenue retention and million‑dollar customers
A 125% NRR and nearly 700 seven‑figure customers are world‑class metrics. Any sign of deceleration here would raise questions about the durability of Snowflake’s growth, while further expansion would support the long‑term thesis. ^[31]
Competitive landscape in AI data platforms
Cloud hyperscalers and software peers are racing to build their own “AI data clouds.” Snowflake’s partnerships with AWS, Accenture, SAP, NVIDIA and Anthropic suggest it is betting on an ecosystem play rather than a closed platform. ^[32]
Execution on margin guidance
Management has set expectations for a Q4 margin dip followed by full‑year operating and free cash flow margins in the mid‑ to high‑teens combined. Delivering on those targets while maintaining near‑30% growth would strengthen Snowflake’s argument that it can be both a growth and cash‑generating story. ^[33]

Bottom Line

On December 3, 2025, Snowflake did three things at once:

Beat expectations on Q3 FY2026 revenue and earnings.
Raised the stakes in AI, with a $200 million Anthropic deal, a $2 billion AWS milestone and a new Accenture‑backed transformation engine.
Reminded investors that building an AI‑first data cloud at global scale isn’t cheap — at least not in the short term.

The near‑term result is a falling share price. The longer‑term outcome will depend on whether Snowflake can turn today’s heavy AI investment into tomorrow’s durable, high‑margin growth — and on how quickly enterprises embrace agentic AI as the next layer on top of their data clouds.