Snowflake shares rise on rosy forecast, AI deal with Anthropic

(Reuters) – Shares of Snowflake rose more than 28% on Thursday after the data analytics provider raised its annual product revenue forecast, signaling rising demand for cloud-based data storage and analytics.

The company, whose shares have fallen 35% this year, is on track for its best day since its 2020 IPO.

Its value is set to rise by over $12 billion to a market cap of $43.3 billion if the gains hold.

The Bozeman, Montana-based company’s results come months after Sridhar Ramaswamy took over as CEO after previously leading Snowflake’s AI strategy as SVP of AI, and analysts have since watched the company’s AI efforts evolve under the new management.

Snowflake announced Wednesday a partnership with Anthropic that will allow customers to enhance their AI applications using Anthropic’s large language models on Snowflake’s cloud-based data platforms.

The multi-year deal will also allow Snowflake’s AI agents to analyze data and generate visualizations, among other capabilities, the company said.

The company expects product revenue of $3.43 billion for 2025, compared to its previous forecast of $3.36 billion.

“It doesn’t sound like the macro is dramatically improving, but the better sales execution and new product momentum is helping Snowflake deliver these results,” Barclays analysts wrote in a note.

At least 20 analysts raised PT on the stock, while at least three upgraded their ratings on the stock. The median reading was $185, representing an upside of 43.3%.

The company’s shares were trading at 147.32 times their 12-month forward profit expectations, compared with 67.01 for Datadog and MongoDB’s 91.04.

(Reporting by Priyanka.G and Akash Sriram in Bengaluru; Editing by Tasim Zahid)