NEW YORK, February 27, 2026, 11:42 EST — Regular session
- Snowflake shares down about 4% after a post-earnings bounce
- Investors stay wary of pricey software amid AI payoff doubts and sticky inflation
- Focus shifts to usage trends and customer signals ahead of Snowflake Summit in June
Snowflake Inc. shares fell about 4% on Friday, giving back part of a post-earnings bounce as the broader tech tape softened. The stock was down 4.1% at $166.00 at 11:41 a.m. EST, after rising 2.3% on Thursday, and traded between $165.36 and $171.52. 1
The slide comes as U.S. equities head for their biggest monthly drop in nearly a year, with investors second-guessing expensive tech and the payoff from large AI spending plans. That backdrop has made earnings reactions harsher, even when companies beat forecasts. 2
Snowflake, which sells a cloud platform for storing and analyzing data, forecast fiscal 2027 product revenue above Wall Street expectations late Wednesday and pointed to a record customer deal of more than $400 million. “Investors are skeptical about all software companies right now,” said Gil Luria, an analyst at D.A. Davidson. 3
In the quarter ended Jan. 31, Snowflake posted $1.28 billion in revenue; product revenue — subscriptions tied to customer usage — was $1.23 billion, up 30% year-on-year, the company said in an SEC filing. Net revenue retention, a gauge of existing-customer spend, was 125%, while remaining performance obligations, or contracted revenue not yet recognized, rose 42% to $9.77 billion; CEO Sridhar Ramaswamy said Snowflake “sits at the center of the enterprise AI revolution.” For fiscal 2027, it forecast product revenue of $5.66 billion and first-quarter product revenue of $1.262-$1.267 billion, and guided for a 9% non-GAAP operating margin in the first quarter and 12.5% for the year; non-GAAP strips out items such as stock compensation. 4
The debate is whether that demand shows up fast enough in consumption. Snowflake’s model bills customers for storage and computing as they use it, so spending can swing with projects, budgets and how quickly new tools get rolled out inside big companies.
Investors also watch whether Snowflake can keep tightening execution while it adds features and absorbs acquisitions. The company is leaning into “agentic” tools — AI agents that can take actions for users — but Wall Street has been quick to punish any sign of slower payback.
But a stumble in customer usage — or higher costs tied to AI partnerships and integration work — could squeeze margins just as the market is demanding profits, not promises. The downside case is simple: AI tools drive talk, not workloads, and the usage meter doesn’t move.
Macro is not helping. U.S. producer prices rose more than expected in January, reinforcing bets that the Federal Reserve will keep rates on hold through at least early summer, a setup that often pressures long-duration growth stocks. 5
For the rest of Friday, traders will watch whether Snowflake stabilizes above the day’s low and whether volume stays heavy as the market churns through software names.
Investors also circle Snowflake Summit 26, set for June 1–4 in San Francisco, for product updates and customer signals that can reshape expectations heading into the next quarter. 6
