Snowflake raised its fiscal 2027 product revenue forecast to $6.07 billion (up from $5.84 billion) and reported Q2 product revenue growth of 37% year‑over‑year, driving a 23% intraday rally that added roughly $25 billion in market value and lifted shares to their highest level since December 2021. Management said AI is now driving platform-wide enterprise adoption, sparking at least 34 brokerages to raise price targets and a rally across software peers despite rich valuations near 15x forward revenue and 121.8x forward earnings, showing significant market impact and adoption momentum.

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In Brief

Snowflake stock jumped 23% after raising its fiscal 2027 revenue forecast.
ServiceNow, Salesforce, Adobe, and Atlassian gained 3.5% to 6% in sympathy.
Jim Cramer says Snowflake is primed for a huge move after the beat.

Snowflake’s upbeat AI outlook is turning into a broader software trade, with a wave of enterprise names rallying alongside it and Jim Cramer flagging more room to run.

The move adds to a stretch of earnings this season where AI-linked spending has repeatedly rewarded shareholders, even as some investors question how long richly priced software names can keep climbing.

AI is Driving the Software Firm

Snowflake shares jumped 23% on Thursday after the cloud data platform lifted its fiscal 2027 product revenue forecast to $6.07 billion, up from $5.84 billion, alongside a 37% year-over-year jump in second-quarter product revenue.

Snowflake jumped as much as 23% on its earnings. Image Source: Trading View

CEO Sridhar Ramaswamy said artificial intelligence (AI) tools are now driving growth across Snowflake’s core platform, not just its standalone AI products, calling it a compounding “flywheel effect” for the business.

Shares hit their highest level since December 2021, adding roughly $25 billion in market value in the move. The stock has now climbed 39% for the year, more than triple the S&P 500’s 12% gain over the same stretch.

Software Stocks Move Together

The rally spilled into peers. ServiceNow, Salesforce’s record earnings run, Atlassian, Adobe, and Intuit all climbed between 3.5% and 6%, while the iShares Expanded Tech-Software Sector ETF added 3%.

Morgan Stanley analysts said the pattern of consistently faster growth in recent quarters shows AI is meaningfully driving usage of Snowflake’s own platform, beyond its dedicated AI tools.

At least 34 brokerages raised their price targets following the results, according to data compiled by LSEG, with Wells Fargo issuing a Street-high call of $525. Snowflake now trades near 15 times forward revenue, well above the software-sector ETF’s 7.4 times, and its 121.8 times forward earnings dwarfs Datadog’s 72.7 times and MongoDB’s 52.1 times.

CNBC’s Jim Cramer weighed in after the report, flagging a huge move still ahead for the stock, and calling it the cleanest way for cautious enterprises to buy AI compute on demand.

So Snowflake remains the best way for the uncertain to get compute but Broadcom tells a story of an explosion of business coming. Snowflake will have a huge move…

— Cramer

So Snowflake remains the best way for the uncertain to get compute but Broadcom tells a story of an explosion of business coming. Snowflake will have a huge move…. Broadcom? More nuanced…
— Jim Cramer (@jimcramer) September 3, 2026

The reaction echoes a pattern seen elsewhere this earnings season, including Salesforce’s own AI-driven breakout and software stocks rebounding after months of AI-replacement fears.

Whether that momentum holds may depend on how quickly Snowflake and its peers can turn rising AI demand into durable margin, rather than just top-line growth.

Read the article at BeInCrypto