Summary
Snowflake closed FY2026 Q3 with revenue of $1.21 billion, up 28.7% from $942.09 million in the prior-year quarter. Gross profit rose 32.3% to $822.04 million. Gross margin improved to 67.8% from 65.9%. The GAAP operating loss narrowed to $329.47 million from $365.46 million, and operating margin improved to -27.2% from -38.8%. Net loss attributable to Snowflake narrowed to $293.96 million from $324.28 million. Diluted loss per share was $0.87, compared with $0.98 in the prior-year quarter. For the nine months, revenue rose 28.8% to $3.40 billion. The nine-month operating loss widened to $1.12 billion from $1.07 billion, and net loss attributable to Snowflake widened to $1.02 billion from $958.17 million. Diluted loss per share for the nine months widened to $3.04 from $2.88.
Operational metrics point to steady expansion within large accounts. Net revenue retention was 125% as of October 31, 2025. Snowflake had 688 customers with trailing 12-month product revenue greater than $1 million, up from 534 a year earlier. Those customers represented approximately 68% of product revenue for the trailing 12 months ended October 31, 2025. It also counted 766 Forbes Global 2000 customers. Total customers reached 12,621 as of October 31, 2025, up from 11,023 as of January 31, 2025. Remaining performance obligations were $7.90 billion, up 38.6% from $5.70 billion a year earlier. Management expects about 48% of that RPO to be recognized as revenue in the 12 months ending October 31, 2026. The weighted-average remaining life of capacity contracts was 2.5 years.
Cash generation was mixed. GAAP operating cash flow was $137.52 million in the quarter, up 35.2% from $101.71 million. Capital expenditures were $23.90 million, up 77.9%. For the nine months, operating cash flow fell 16.4% to $440.79 million, while capital expenditures rose 144.4% to $85.56 million. The nine-month decline in operating cash flow came even as the quarterly figure grew. The company separately reported non-GAAP free cash flow of $113.6 million and adjusted free cash flow of $136.4 million for the quarter. Deferred revenue, current portion, was $2.42 billion, up 22.7% from $1.97 billion.
Guidance frames the next step. For the fourth quarter of fiscal 2026, Snowflake guides to product revenue of $1.195 billion to $1.200 billion, up 27% year over year, and a non-GAAP operating income margin of 7%. For the full fiscal year 2026, guidance calls for product revenue of $4.446 billion, up 28%; product gross profit margin of 75%; operating income margin of 9%; and adjusted free cash flow margin of 25%. The outlook assumes weighted-average diluted shares of 377 million for the fourth quarter and 373 million for the full year. That full-year product revenue target is based on the high end of the fourth-quarter guidance.
Risks remain familiar. Management cites macroeconomic pressure, including inflation, high interest rates, tariffs and trade wars, extended federal government shutdowns, and foreign currency volatility. Customers continue to rationalize budgets, prioritize cash flow, shorten contract durations, and optimize consumption. The company also faces competition, cybersecurity threats, and execution risk around new AI products and strategic partnerships. The company's convertible notes became convertible during the quarter after the stock trading condition was met. Holders may convert the notes at any time during the quarter ending January 31, 2026. In November 2025, Snowflake amended a third-party cloud infrastructure agreement with a minimum spend of at least $530.0 million from November 2025 through October 2030. It also committed at least $200.0 million over three years to a third-party AI service provider and completed acquisitions of two private companies for about $44 million. The November agreements add fixed spending commitments at a time when the company is still posting GAAP losses.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q3 FY2026 | Q2 FY2026 | QoQ | Q3 FY2025 | YoY |
|---|---|---|---|---|---|
| Revenue | $1.21B | $1.14B | +5.9% | $942.1M | +28.7% |
| Gross profit | $822.0M | $773.2M | +6.3% | $621.2M | +32.3% |
| Gross margin | 67.8% | 67.5% | +0.2 pp | 65.9% | +1.8 pp |
| Research & development | $494.0M | $492.0M | +0.4% | $442.4M | +11.7% |
| Sales & marketing | $550.4M | $502.0M | +9.6% | $438.0M | +25.7% |
| General & administrative | $107.1M | $119.5M | -10.3% | $106.3M | +0.8% |
| Total operating expenses | $1.15B | $1.11B | +3.4% | $986.7M | +16.7% |
| Operating income (loss) | -$329.5M | -$340.3M | +3.2% | -$365.5M | +9.8% |
| Operating margin | -27.2% | -29.7% | +2.6 pp | -38.8% | +11.6 pp |
| Net income (loss) | -$291.6M | -$297.9M | +2.1% | -$327.9M | +11.1% |
| Net margin | -24.0% | -26.0% | +2.0 pp | -34.8% | +10.8 pp |
| Diluted EPS | -$0.87 | -$0.89 | +$0.02 | -$0.98 | +$0.11 |
Risks
Snowflake is investing significantly in AI Technology, but competitors with greater resources may develop, adopt, and implement AI faster or more successfully; success depends on access to GPUs and AI-skilled personnel, both in high demand, and customer AI use is gated by regulatory compliance and contractual terms. The company may not realize anticipated benefits from its AI investments.
AWS, Azure, and GCP are both key public cloud providers and primary competitors; a substantial majority of Snowflake's business runs on AWS, and these providers could bundle competing products, give unfavorable pricing, or exclude Snowflake from opportunities. Support of open data formats like Apache Iceberg reduces customer lock-in and switching costs, and expansion into new product categories increases competitive exposure.
Consumption-based revenue gives limited visibility into timing; customers may optimize consumption, shorten data retention, and shorten committed contract durations. Net revenue retention rate was 125% as of October 31, 2025 and 126% as of January 31, 2025, and the company says its revenue growth rate has slowed in recent periods.
In May 2024 a threat actor accessed a number of customers' Snowflake accounts through customer failures to implement MFA and network policies; additional similar cyberattacks have since been identified. The company faces numerous lawsuits, regulatory investigations, and lawmaker inquiries, and may suffer reputational damage and customer losses despite no evidence of a platform vulnerability.
Adverse macroeconomic conditions including inflation, high interest rates, and market volatility have caused and may continue to cause customers to rationalize budgets, prioritize cash flow management, and optimize consumption. MD&A identifies these conditions as ongoing influences on customer behavior.
Sales to federal, state, local, and foreign governments and heavily regulated organizations require FedRAMP High and DoW Impact Level 4 and 5 certifications, national security clearances, and compliance with special procurement, audit, and contractual rules. Risks include bid protests, termination for convenience, False Claims Act exposure, and delays from government budget or shutdown issues.
The company has experienced several executive leadership transitions since the beginning of fiscal 2025, including new CEO, SVP Engineering, CRO, and CFO. Loss of additional key employees could harm morale, cause departures, and introduce operational delays as successors learn the business.
Sales efforts focus on large customers and Forbes Global 2000 organizations, which involve longer sales cycles, stronger customer leverage on pricing, extensive compliance diligence, non-standard terms, and substantial upfront sales costs. Consumption growth from large enterprises has historically taken longer than from smaller enterprises.
In November 2025 Snowflake amended a third-party cloud infrastructure agreement, committing to spend at least $530.0 million between November 2025 and October 2030, and renewed an AI service provider agreement committing at least $200.0 million over three years. Failure to meet minimum purchase commitments requires paying the difference.
Snowflake is named in a securities class action and numerous class actions related to cybersecurity matters, and may face additional claims. Litigation could be costly, divert management attention, and existing insurance may not cover all costs.
The $2.3 billion convertible senior notes may convert into shares of common stock, potentially diluting stockholders and depressing the stock price. Capped call transactions are subject to counterparty risk if option counterparties default.
SaaS KPIs
All quarters →Net Revenue Retention Rate
Total Customers
Remaining Performance Obligations
Non-GAAP Operating Margin
Adjusted Free Cash Flow Margin
Free Cash Flow Margin
Product Revenue
Customers with Trailing 12-Month Product Revenue Greater than $1 Million
Forbes Global 2000 Customers
Non-GAAP Product Gross Margin
Customers with Trailing 12-Month Product Revenue Greater than $5 Million
Customers with Trailing 12-Month Product Revenue Greater than $10 Million
Non-GAAP Operating Income
Non-GAAP Gross Margin
Summary, forecast, risks and KPIs are extracted from Snowflake Inc.'s SEC filings for Q3 FY2026 (10-Q / 10-K and the 8-K earnings release); GAAP figures in the summary are checked against the reported XBRL data. They can contain errors; the filings are authoritative. Processed Oct 6, 2026.