Pre-Earnings Analysis

【Overall Rating】: Overweight (tending towards a combination of "troubled reversal + expectation gap realization")

【Core Arguments】

1. Earnings have beaten estimates and raised guidance for 2 consecutive quarters. Achieving FY27 full-year +27% growth / 25% non-GAAP op margin simultaneously fulfills the "Rule of 52",
   placing it among top-tier SaaS financial models; RPO +42% provides 4-quarter visibility.
2. The bear-led narrative (Databricks encroachment + high valuation) has been refuted by hard metrics like NRR / large customer growth rate,
   but the stock price remains in the lower 25th percentile of the 52-week range → a narrative-reality expectation gap exists.
3. The AI product cycle (Cortex / Snowflake Intelligence) has begun to be disclosed in terms of actual usage accounts,
   serving as a potential monetizable catalyst for the next 2–3 quarters.

【Buy Trigger Conditions】

• Price Range: It is advisable to build positions in batches within the $160–180 range (current $175.72 is near the midpoint, risk/reward is reasonable).
• Catalyst: FY27 Q1 earnings (expected to be announced late May - early June 2026). If it beats estimates again and maintains/raises the FY27 full-year guide,
  target price could reach $220–240 (corresponding to Fwd P/S ~14–15x, returning to the 5-year median).

【Risk Points & Stop-Loss】

• Recommended Stop-Loss: Below $135 (close to the 52-week low of $118 + the April rebound starting point), meaning the bear narrative is confirmed by new data.
• Key Risks: (a) Databricks IPO valuation anchoring effect; (b) Rising GPU costs pushing product gross margin below 73%;
  (c) SBC as a percentage of revenue failing to improve significantly in FY27 (still >30%).

【Recommended Position & Time Window】

• Position Size: 5–8% of the tech SaaS sector allocation as the single-stock exposure limit.
• Time Window: 6–12 months, aligned with the FY27 Q1–Q3 earnings cycle.

【3 Key Metrics Requiring Continuous Tracking】

1. RPO YoY Growth Rate: Whether it can maintain 35%+ (determines FY28 revenue visibility).
2. NRR: Whether it can hold above 125% (determines the validity of the market share narrative).
3. Snowflake Intelligence / Cortex User Count & AI-Related Revenue Disclosure: Whether it can be independently quantified in FY27 earnings reports.

Post-Earnings Analysis

The previous rating (Overweight) needs to be revised upwards. All three tracked metrics hit positive targets, and:

• FY27 full-year guidance was raised by +$180M (+3.2%) in one go, with op margin +100bp, implying "Rule of 52 → approaching Rule of 55" (31% revenue growth + 23% FCF margin + 13.5% op margin), entering the financial model of a very select few top-tier SaaS companies.
• Quarterly product revenue achieved the "largest sequential dollar increase in company history" (CEO's words), driven by both the core platform and AI.

【Updated Tracking Metrics List (Replacing the original 3)】

1. Current RPO Proportion / Proportion of Revenue Recognizable within 12 Months (replacing simple RPO growth): To judge if there is room for a second upward revision of the FY27 full-year guide.
2. "Daily/Weekly Active User" Penetration Rate for AI Product Accounts (Snowflake Intelligence, Cortex Code, Cortex Agents): A baseline has been established for the first time. Next quarter, watch if the ~5,000 / 7,100 accounts can continue to double.
3. Slope of Non-GAAP Operating Margin Expansion: From 11.9% in Q1 to the full-year guide of 13.5%, implying an average of ~14% needs to be achieved in Q2–Q4. Need to track if SBC as a percentage of revenue can drop from ~38% in FY26 to below 30% in FY27.
4. New Addition: Natoma Acquisition Integration Progress + MCP Niche — AI Agent is the biggest narrative for FY27–FY28. This acquisition positions SNOW as the "control plane" for Agentic Enterprise. Need to observe if quantifiable agent workload revenue materializes.
5. New Addition: ** Quarterly New $1M+ Large Customer Count ** (46 this quarter vs. 26 last year) — This is a more sensitive sales acceleration indicator than "Total $1M+ Customer Count".

【Position & Price Recommendation Update】

• Previous Stop-Loss $135 / Accumulation Range $160–180: Post-earnings, the accumulation range is revised up to $180–200 (already up after-hours), with the target price revised up to $240–260 (corresponding to Fwd P/S ~14–15x, based on the revised FY27 $5.84B).
• If the after-hours stock price jumps >15%: It's advisable to wait for a pullback to the 5-day moving average before adding, avoiding chasing at emotional highs.
• If the market unusually offers a pullback (e.g., dragged down by macro volatility to below $170): It would be a higher-risk-reward accumulation window.