Snowflake's AI-powered data cloud platform is outperforming Palantir this year, with shares up 53% compared to Palantir's 4% decline. The company added 692 net new customers in Q2 of fiscal 2027, a 32% year-over-year increase, bringing its total to over 14,500 customers. Snowflake's AI tools, including the CoWork personal agent and CoCo AI coding assistant, are driving growth. Over 5,800 customer accounts use CoWork, whilst more than 9,100 use CoCo. The company reported 35% revenue growth to $1.55 billion last quarter. Earnings per share jumped 77% year over year to $0.62, beating the consensus estimate of $0.45. A McKinsey survey found that 80% of AI users report higher productivity, helping explain strong demand for AI software solutions.

Snowflake reported its fiscal 2027 second-quarter results on Wednesday, with shares jumping more than 20% in extended trading. The data cloud specialist posted a third consecutive quarter of accelerating growth, reaching $1.49 billion in product revenue, up 37% year over year. Management raised its full-year product revenue guidance to $6.07 billion, representing 36% year-over-year growth. This marks the second guidance increase this year, up from an initial forecast of 27% growth. The company also lifted its full-year adjusted operating margin outlook to 14.5% from 13.5%. Net revenue retention rate held steady at 126% for the second consecutive quarter. Chief financial officer Brian Robins attributed the acceleration to strength in the core data platform and meaningful growth in artificial intelligence revenue. Remaining performance obligations reached $9.00 billion, up 30% year over year.

Morgan Stanley analyst Sanjit Singh raised his price target on Snowflake to $470 from $300, maintaining an "Overweight" rating. The cloud data company is valued at $106 billion market cap, with shares trading at $356. The upgrade follows Snowflake's third consecutive quarter of accelerating revenue growth. Product revenue reached $1.49 billion, up 37% year over year, beating guidance and consensus estimates. The company added 692 net new customers, up 32% year over year, bringing its total to 14,554. Customers spending over $1 million annually increased 27% to 828. Singh attributed the momentum to an "AI-powered growth flywheel" driven by Snowflake's CoCo and CoWork tools. Management estimates AI products contributed roughly half of the quarter's growth acceleration.