Snowflake stock soars on growing enterprise AI demand, AWS partnership

What happened: Snowflake shares (SNOW) jumped 38% pre-market connected Thursday aft the unreality information institution posted better-than-expected quarterly results, driven by accelerating endeavor AI request for its level and an expanded woody with Amazon Web Services.

Shares of adjacent ServiceNow (NOW) besides jumped, on with the broader Tech-Software ETF (IGV).

What’s down the move: Snowflake said AI products contributed to the “strongest sequential merchandise gross dollar growth” successful its history. Fiscal archetypal 4th gross maturation of 33% twelvemonth implicit twelvemonth to $1.39 billion.

The institution announced an expanded collaboration with AWS done a caller multi-year, $6 cardinal statement aimed astatine accelerating planetary endeavor AI adoption. It besides deepened its concern with OpenAI.

What other bash you request to know: WedBush Securities expert Dan Ives reiterated an Outperform standing connected Snowflake banal portion raising his stock terms people from $270 to $280.

“We proceed to judge the bundle scenery is successful the aboriginal innings of AI monetization arsenic the disconnect induced by the ‘AI Ghost Trade’ closes for SNOW,” wrote Ives successful a lawsuit enactment pursuing the quarterly results.

The broader Software ETF (IGV) has rebounded 24% since mid-April arsenic investors person grown much bullish connected companies viewed arsenic nonstop beneficiaries of artificial intelligence-driven productivity gains. Software firms person been aggressively promoting the integration of generative AI tools into their platforms.

The caller rally marks a crisp reversal from earlier this twelvemonth erstwhile bundle stocks came nether unit amid fears that artificial quality could disrupt accepted bundle concern models.

Ines Ferre is simply a elder concern newsman for Yahoo Finance. Follow her connected X astatine @ines_ferre.

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