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Snowflake (SNOW): The Consumption Engine AI Workloads Are Fueling

AI workloads growing 3–4x faster than non-AI. Q4 product revenue +30%, RPO +42%, NRR 125%. Full breakdown of GAAP losses and SBC.

May 18, 2026

Core Position

Consumption-native from day one — AI workload growth is revenue growth

Investment Thesis

Snowflake's structure is simple: the more customers query and process data, the more revenue it earns. AI-related workloads are growing 3–4x faster than non-AI, and that consumption flows directly into Snowflake revenue. NRR of 125% means existing customers are spending 25% more than last year. GAAP losses are driven by SBC; non-GAAP operating margin has already crossed 10%.

Key Metrics

Q4 Product Revenue Growth

+30% YoY

RPO

+42% YoY

NRR

125%

AI vs Non-AI Workload Growth

3~4배

Non-GAAP Op. Margin

10%+

GAAP Op. Income

–$0.88B

FY2026

Bull Case

Consumption-based AI workload structure — AI expansion automatically drives revenue
NRR 125% — existing customer expansion alone can sustain 25%+ growth
RPO +42% — strong future revenue pipeline
AI runs inside the data platform — no data movement, better security
Non-GAAP profitability positive — trajectory turning constructive

Bear Case

GAAP operating losses continuing — SBC still in the hundreds of millions
Growth decelerating: FY2024 38% → FY2026 ~28%
Strong competitors (Databricks, BigQuery) pushing hybrid and open-source
Consumption model risk — customer spending optimization can slow revenue in downturns

Rating:HOLDSNOW

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