Snowflake Stock Drops After Earnings: What To Know
Snowflake stock is lower Thursday after the company missed on the bottom line in its Q1 and gave disappointing full-year guidance. Here's what you need to know.


Snowflake (SNOW) stock is trading notably lower Thursday after the cloud-based data platform reported mixed earnings results for its first quarter of fiscal 2025 and updated its full-year outlook.
In the three months ended April 30, Snowflake's revenue increased 33% year-over-year to $828.7 million, due mostly to a 34% jump in product revenue to $789.6 million. Its earnings per share (EPS) fell to 14 cents from 15 cents in the year-ago period.
"We finished our first quarter with strong performance across many of our key metrics," Snowflake CEO Sridhar Ramaswamy said in a statement. "Our core business is very strong. Our AI [artificial intelligence] products, now generally available, are generating strong customer interest. They will help our customers deliver effective and efficient AI-powered experiences faster than ever."

Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
The results were mixed compared with analysts' expectations. According to CNBC, Wall Street was anticipating revenue of $786 million and EPS of 18 cents.
Snowflake also updated its full-year outlook. Here's what it now expects compared to its previous expectations:
Metric | New outlook | Previous outlook |
---|---|---|
Product revenue | $3.3 billion | $3.25 billion |
Product gross profit margin | 75% | 76% |
Operating income margin | 3% | 6% |
Adjusted free cash flow margin | 26% | 29% |
For the second quarter, Snowflake said it expects product revenue in the range of $805 million to $810 million, representing year-over-year growth of 26% to 27%, and an operating income margin of approximately 3%.
The second-quarter product revenue guidance came in above analysts’ expectations. According to MSN, Wall Street is anticipating product revenue of approximately $793 million.
Snowflake also announced that it plans on buying certain technology assets and hire key employees from AI observability platform TruEra. The acquisitions will boost SNOW's ability to large language model applications in production.
"The world of AI is rapidly evolving, and we are investing in that because we do think there's a massive opportunity for Snowflake to play there and it will have a meaningful impact on future revenues," said Mike Scarpelli, chief financial officer of Snowflake, in the company's earnings call.
Is Snowflake stock a buy, sell or hold?
The tech stock has struggled on the price charts, down about 20% for the year to date as of this writing. Still, analysts are upbeat toward SNOW, which happens to be a member of the Berkshire Hathaway equity portfolio.
According to S&P Global Market Intelligence, the consensus analyst target price for SNOW stock is $204.50, representing implied upside of nearly 30% to current levels. Meanwhile, the consensus recommendation is a Buy.
However, some analysts are reducing their price targets after the earnings report. Financial services firm Needham, for instance, kept a Buy rating on SNOW but lowered its price target to $210 from $240 after earnings.
The stock's post-earnings selloff is sparked by lowered guidance for the full fiscal year, says Needham analyst Mike Cikos, while adding that this is likely "a short-term view."
But the company "is investing in a rapidly evolving market to ensure long-term positioning, and has a number of new products coming to market later this year" Cikos adds. "At the same time, SNOW is investing in AI initiatives like Cortex and Arctic, which is bolstered by its acquisition of TruEra. We remain Buy-rated."
Related Content
Get Kiplinger Today newsletter — free
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.

Joey Solitro is a freelance financial journalist at Kiplinger with more than a decade of experience. A longtime equity analyst, Joey has covered a range of industries for media outlets including The Motley Fool, Seeking Alpha, Market Realist, and TipRanks. Joey holds a bachelor's degree in business administration.
-
What Wall Street's CEOs Are Saying About Trump's Tariffs
We're in the thick of earnings season and corporate America has plenty to say about the Trump administration's trade policy.
By Karee Venema
-
The Role of the U.S. Dollar in Retirement: Is It Secure?
Protect your retirement from de-dollarization, because “capital always goes where it is treated best."
By Adam Shell
-
What Wall Street's CEOs Are Saying About Trump's Tariffs
We're in the thick of earnings season and corporate America has plenty to say about the Trump administration's trade policy.
By Karee Venema
-
To Stay on Track for Retirement, Consider Doing This
Writing down your retirement and income plan in an investment policy statement can help you resist letting a bear market upend your retirement.
By Matt Green, Investment Adviser Representative
-
How to Make Changing Interest Rates Work for Your Retirement
Higher (or lower) rates can be painful in some ways and helpful in others. The key is being prepared to take advantage of the situation.
By Phil Cooper
-
When to Sell Your Stock
Knowing when to sell a stock is a major decision investors must make. While there's no one correct answer, we look at some best practices here.
By Charles Lewis Sizemore, CFA
-
Within Five Years of Retirement? Five Things to Do Now
If you're retiring in the next five years, your to-do list should contain some financial planning and, according to current retirees, a few life goals, too.
By Evan T. Beach, CFP®, AWMA®
-
The Home Stretch: Seven Essential Steps for Pre-Retirees
The decade before retirement is the home stretch in the race to quit work — but there are crucial financial decisions to make before you reach the finish line.
By Mike Dullaghan, AIF®
-
Stock Market Today: Great Power Affairs Mesmerize Markets
The U.S. and China are at least talking about talking about tariffs, and investors, traders and speculators are showing a little less fear.
By David Dittman
-
Three Options for Retirees With Concentrated Stock Positions
If a significant chunk of your portfolio is tied up in a single stock, you'll need to make sure it won't disrupt your retirement and legacy goals. Here's how.
By Evan T. Beach, CFP®, AWMA®