Published: December 4, 2025
Snowflake Inc. (NYSE: SNOW) just delivered its third‑quarter fiscal 2026 results, beating expectations on revenue and earnings, touting a $100 million AI revenue run‑rate, and announcing a major partnership with Anthropic.
Yet the stock is trading sharply lower today as investors digest slower product‑revenue growth and cautious guidance – a classic “great quarter, not great enough” reaction.
Below is a full breakdown of the latest Snowflake stock news, earnings details, analyst forecasts, and what the new AI narrative means for SNOW going into 2026.
Key takeaways for Snowflake stock today
- Price action: Snowflake closed at $265.00 on December 3, 2025, near its 52‑week high of $280.67. [1]
After last night’s Q3 FY26 report, shares fell around 8–9% in extended and pre‑market trading, changing hands near $240–$242 this morning. [2] - Big picture performance: Even after today’s drop, Snowflake is still up around 70–72% year‑to‑date in 2025, one of the stronger moves among large‑cap software names. [3]
- Q3 FY26 highlights (quarter ended October 31, 2025):
- Revenue: $1.21 billion, up about 29% year over year, slightly above expectations. [4]
- Product revenue: $1.16 billion, also up 29% year over year. [5]
- Adjusted EPS: about $0.35 vs. $0.31 expected. [6]
- Remaining performance obligations (RPO): $7.88 billion, +37% year over year. [7]
- Net revenue retention: 125%. [8]
- Guidance that spooked the market:
- AI progress: Snowflake’s AI business hit a $100 million annualized revenue run‑rate a quarter ahead of plan, with AI linked to roughly 50% of new bookings and 28% of use cases last quarter. [11]
- Valuation: Even after the sell‑off, Snowflake trades at rich multiples – Reuters pegs it at about 165x next‑12‑month earnings, versus ~66x for Datadog and ~76x for MongoDB, while Cantor notes roughly 14x 2026 revenue and a price‑to‑book near 38. [12]
- Wall Street stance: Consensus remains bullish to cautiously optimistic. BTIG reiterated a Buy with a $312 target, Cantor Fitzgerald raised its target to $278, and many firms now sit in the $270–$325 range, though Bernstein stays more cautious at $237 with a Market Perform rating. [13]
How Snowflake stock is trading after Q3 FY26 earnings
Snowflake went into earnings on a tear:
- Last close: $265.00 (December 3, 2025), up just over 2% on the day and not far from its 52‑week high of $280.67. [14]
- Market value: around $89–90 billion at that close. [15]
After the company released results and guidance on the evening of December 3:
- MarketBeat’s earnings page shows the stock closing the regular session around $265, then sliding to roughly $240.27 in extended trading, a 9–10% drop. [16]
- Reuters and other outlets reported about an 8% fall in pre‑market trading on December 4. [17]
In short: fundamentals beat expectations, but the stock is reacting to guidance and valuation, not the backward‑looking numbers.
Q3 FY26: strong by the numbers
Snowflake’s official Q3 FY26 press release and accompanying filings paint a picture of a business that is still growing quickly at large scale: [18]
- Total revenue: $1.21 billion, up about 29% YoY, slightly ahead of the roughly $1.18 billion analysts were expecting. [19]
- Product revenue: $1.158 billion, +29% YoY, driven by expanding workloads and higher consumption from existing customers. [20]
- Customer quality:
- 688 customers generate more than $1 million in trailing 12‑month product revenue, up 29% YoY.
- 766 Forbes Global 2000 companies are now customers, up 4% YoY. [21]
- Net revenue retention: 125%, indicating that the existing customer base is still expanding its usage meaningfully. [22]
- Remaining performance obligations (RPO): $7.88 billion, +37% YoY – a key forward‑demand indicator. [23]
On profitability and cash generation:
- Non‑GAAP product gross margin: 76%.
- Non‑GAAP operating margin: 11%.
- Free cash flow: $113.6 million (9% margin); adjusted free cash flow $136.4 million (11% margin). [24]
- TipRanks’ summary shows adjusted EPS of $0.35, comfortably above the $0.31 consensus. [25]
Analysts like Needham highlight that overall revenue growth sits around 28–29% and last‑twelve‑month growth is about 28.4%, still robust for a nearly $90 billion company. [26]
So why is Snowflake stock down? Guidance, expectations and deceleration
Several themes explain the sell‑off despite a “beat and raise” quarter:
1. Slower product‑revenue growth ahead
Snowflake guided Q4 FY26 product revenue to $1.195–$1.20 billion, which equates to 27% year‑over‑year growth. [27]
- Reuters notes that this is a step down from 29% product‑revenue growth in Q3 and 32% in Q2, reinforcing the narrative of gradual deceleration as the company scales. [28]
- While the guidance is above consensus (around $1.18 billion), several investors were hoping for a re‑acceleration to 30%+ growth, especially given the intense AI tailwinds. [29]
2. Margin outlook not as strong as some hoped
Investor’s Business Daily reports that Q4 operating‑margin guidance came in slightly below Street expectations, even as Q3 margins surprised to the upside. [30]
That combination – slightly slower growth plus softer future margins – tends to trigger profit‑taking in richly valued growth stocks.
3. Rich valuation leaves little room for disappointment
- Reuters estimates Snowflake trades at roughly 165x forecast earnings for the next 12 months, versus about 66x for Datadog and 76x for MongoDB. [31]
- Cantor Fitzgerald calculates that the new $278 price target implies about 14x its calendar‑2026 revenue forecast, and notes a price‑to‑book of roughly 37.8 – very high relative to the broad market. [32]
When expectations are that high, even a perfectly respectable 27–29% growth outlook can look “underwhelming,” which is exactly how multiple commentaries from IBD, MarketWatch and others characterize the guidance. [33]
4. Street expectations ran ahead of management’s tone
Firms like Wedbush describe Q3 as strong across key metrics (product revenue, RPO, and AI traction) but point out that “high Street expectations may overshadow” that strength, even while they reiterate an Outperform rating and a $270 price target and say they’d consider buying on weakness. [34]
In other words, the business is fine; the bar was just very high.
AI is becoming core: $100M run‑rate, Anthropic partnership and Snowflake Intelligence
If there is one clear winner in Snowflake’s narrative this quarter, it’s AI.
$100 million AI revenue run‑rate – early and “not hype”
On the Q3 call, CEO Sridhar Ramaswamy revealed that Snowflake has already crossed a $100 million annualized AI revenue run‑rate, hitting that goal one quarter ahead of plan. [35]
According to Benzinga’s coverage and Cantor’s note:
- Management stresses that this figure is consumption‑based, not a forward‑looking slide, reflecting real workloads running in production rather than marketing fluff. [36]
- AI‑related use is spreading quickly:
- Roughly 50% of new bookings in the quarter tied to AI use cases.
- Around 28% of workloads deployed during the quarter incorporated AI. [37]
Snowflake Intelligence and AI feature adoption
Snowflake’s own AI agent, Snowflake Intelligence, is being positioned as the fastest‑ramping product launch in company history:
- Reuters reports the tool had about 1,200 customers within a month of launch and that more than 7,300 businesses interact with Snowflake’s AI features every week. [38]
This reinforces the idea that Snowflake isn’t just a data warehouse anymore; it’s becoming an AI data platform where customers can store data, run analytics, and build AI agents in one place.
Strategic AI and cloud partnerships
The Q3 reporting cycle was also packed with partnership news:
- A $200 million multi‑year agreement with Anthropic to bring Claude models deeper into the Snowflake platform. [39]
- Expanded relationships with Amazon Web Services (Snowflake has now surpassed $2 billion in AWS Marketplace sales), Accenture, and Google’s Gemini AI, all aimed at embedding large language models and AI workflows into Snowflake. [40]
- Collaborations with Palantir and SAP to standardize “messy” enterprise data for AI, further broadening the ecosystem. [41]
Analysts generally praise this direction: Seeking Alpha’s news and commentary pieces emphasize that AI initiatives and partnerships are a major reason why many firms remain bullish on SNOW despite the near‑term growth slowdown. [42]
What Wall Street is saying now: ratings, targets and consensus forecast
Despite today’s sell‑off, analyst sentiment is still skewed positive, though with growing debate about valuation and growth sustainability.
Consensus targets and ratings
GuruFocus, summarizing 45 analysts, reports: [43]
- Average 12‑month price target:$275.37
- High estimate:$500.00
- Low estimate:$170.00
- That average implies roughly 4% upside from the recent $265 share price.
- Across 51 brokerage firms, the average recommendation is 1.9 on a 1–5 scale, corresponding to “Outperform” (1 = Strong Buy, 5 = Sell).
MarketBeat’s aggregation is similar, showing an average target around $271–272 and a “Moderate Buy” consensus, with a mix of Strong Buy, Buy, Hold and a handful of Sell ratings. [44]
Fresh price‑target moves on December 4, 2025
Today’s commentary has been heavy. Among noteworthy updates:
- Cantor Fitzgerald: Raised its target from $275 to $278, maintained Overweight, citing strong AI ARR momentum and accelerating RPO, but acknowledging rich valuation. [45]
- BTIG: Reiterated Buy with a $312 target; notes that multiple firms have recently lifted their targets (Rosenblatt to $275, Citi and BofA to $310, Mizuho to $285). [46]
- Wedbush: Kept an Outperform rating and $270 target, explicitly describing the quarter as strong and indicating willingness to “buy the dip” if weakness persists. [47]
- Piper Sandler: Set a $285 target with an Overweight stance, according to recent forecast tracking. [48]
- BofA Securities, Citigroup, Scotiabank, TD Cowen, Canaccord, Citizens: Multiple firms have pushed targets into the $270–$325 band, often highlighting Snowflake’s AI traction and expanding enterprise footprint as justification. [49]
- Bernstein: More cautious, raising its target to $237 (from $221) but keeping a Market Perform rating, explicitly warning that the stock looks overvalued near its 52‑week high, despite stable growth. [50]
Overall, the sell‑off is being interpreted by many institutions as a valuation and expectations reset rather than a sign of fundamental deterioration – but that depends heavily on whether Snowflake can re‑accelerate growth in 2026.
Big‑money flows: institutions buying and insiders selling
Fresh filings and institutional‑ownership news add another layer to the story:
- Invesco Ltd. trimmed its position by 7.8% in Q2, but still holds about 2.85 million shares, worth roughly $637 million, or 0.85% of Snowflake. [51]
- Groupe la Francaise massively increased its stake, adding 13,800 shares to reach 13,825 shares (a 55,200% jump), valued around $3.08 million. [52]
- Vanguard Group, the largest holder, grew its stake by 2.2% to nearly 27.8 million shares, worth over $6.2 billion. [53]
At the same time, MarketBeat notes that insiders have been net sellers, with directors including Michael Speiser and former CEO Frank Slootman among those offloading stock; in the last 90 days, insiders sold over 221,000 shares worth more than $53 million, though insiders still own about 6.8% of the company. [54]
Institutional flows suggest continued long‑term interest from large asset managers, even as some insiders take advantage of the strong run to diversify.
Valuation and key metrics: what the numbers say
Putting the pieces together, here’s how Snowflake looks on some widely watched metrics:
- Share price (Dec 3 close): $265.00. [55]
- Market cap: ~ $89–90 billion. [56]
- 52‑week range: roughly $120.10 to $280.67. [57]
- Revenue growth: ~29% YoY in Q3; about 28.4% over the last twelve months. [58]
- RPO growth: 37% YoY to $7.88 billion. [59]
- Net revenue retention: 125%. [60]
- Non‑GAAP product gross margin: 76%; non‑GAAP operating margin: 11%. [61]
- Forward valuation:
These numbers underline why Snowflake is both loved and feared: the growth and AI traction are impressive, but the premium valuation leaves little margin for error.
2026 outlook: bull and bear case for SNOW
This article cannot tell you whether you personally should buy, hold, or sell Snowflake, but we can outline how many analysts and investors are framing the bull vs. bear debate heading into 2026.
Bull case: why optimists still like Snowflake stock
Supportive arguments from bullish research (including Cantor, BTIG, Wedbush and Seeking Alpha’s “buy the dip” thesis) typically focus on: [64]
- Durable growth at scale:
- High‑20s revenue growth with 125% net retention and 37% RPO growth suggests there is still a long runway in Snowflake’s core data‑cloud business. [65]
- AI as a meaningful second engine:
- A $100 million AI run‑rate, reached ahead of schedule, plus rapidly growing adoption of Snowflake Intelligence and Cortex, could push growth higher once macro and enterprise budgets normalize. [66]
- Strengthening ecosystem and partnerships:
- Deep ties with Anthropic, AWS, Google, Accenture, Palantir, SAP and others position Snowflake as a core infrastructure layer for enterprise AI, not just a nice‑to‑have analytics tool. [67]
- Improving profitability and cash generation:
- Double‑digit non‑GAAP operating margins and positive free cash flow give room for continued investment without sacrificing financial discipline. [68]
- Potential upside if multiples revert:
- Some bullish commentators argue that SNOW trades at around 19x sales versus a long‑term average closer to 35x, implying 20–30% equity upside if growth proves durable and sentiment improves. [69]
Bear case: what skeptics worry about
More cautious voices (Bernstein, some value‑oriented analysts, and parts of the financial press) highlight several risks: [70]
- Valuation risk: At triple‑digit earnings multiples and mid‑teens sales multiples, Snowflake remains priced for very high, very long‑term growth. Any sustained deceleration toward the mid‑20s could trigger more multiple compression.
- Growth deceleration: Product revenue growth has already slowed from 32% to 29% and is guided to 27% in Q4; bears argue this deceleration could continue as the company gets larger and competition intensifies. [71]
- Competitive landscape: Databricks, hyperscalers (AWS Redshift, Google BigQuery, Azure Synapse) and other data platforms are all aggressively integrating AI, potentially squeezing Snowflake’s pricing power and win rates over time. [72]
- Consumption‑based model exposure: In macro slowdowns, customers can simply use the platform less, making revenue more sensitive to short‑term demand swings than in traditional subscription models.
- Insider selling: Recent insider share sales may fuel the narrative that management sees limited near‑term upside at current valuations, even though insiders still hold meaningful stakes. [73]
What this means for investors
For investors following Snowflake or AI‑heavy software more broadly, today’s move in SNOW encapsulates the trade‑off:
- Fundamentals: Still strong, with high‑20s growth, very healthy demand metrics, and rapidly scaling AI products.
- Expectations: Extremely high, with the market looking for evidence that AI can push growth back above 30% without sacrificing margins.
- Valuation: A premium that demands almost perfect execution over multiple years.
How you interpret this will depend on your risk tolerance, time horizon, and expectations for AI‑driven software demand. Any decision to buy or sell should take into account your overall portfolio, financial goals, and, ideally, professional financial advice.
Important: This article is for informational and educational purposes only and does not constitute investment advice or a recommendation to buy, sell, or hold any security. Always do your own research or consult a licensed financial adviser before making investment decisions.
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