Snowflake, a leading data cloud platform provider, is set to report strong earnings results on May 21, following a notable 29% stock rally over the past month.

The company anticipates a significant 21.5% year-over-year increase in product revenue for the first quarter of fiscal 2026, projecting total revenue to reach approximately $957.5 million.

Snowflake's customer base has expanded nearly 19% year-over-year, with a remarkable net revenue retention rate of 126%, reflecting robust adoption of its AI solutions among existing clients.

Currently, over 4,000 customers are utilizing Snowflake's AI and machine learning technologies weekly, contributing to a growing total customer base of over 11,000 by the end of fiscal 2025.

The company's remaining performance obligations (RPO) have surged by 33% year-over-year to $6.9 billion, indicating a faster pace of customer acquisition relative to contract fulfillment.

Snowflake's ability to cross-sell its AI offerings to its existing customer base is expected to further enhance earnings growth, positioning the company as a strong investment opportunity ahead of its earnings report.

Analysts have set a median price target of $201 for Snowflake stock, suggesting a potential 20% increase over the next year, alongside a consensus estimate of a 40% rise in earnings per share for fiscal 2026.

Looking ahead, Snowflake expects its total addressable market (TAM) to expand to $342 billion by 2028, showcasing significant future growth potential.

The demand for artificial intelligence applications remains robust despite ongoing macroeconomic challenges, as evidenced by recent earnings reports across the sector.

In the broader tech landscape, Meta Platforms has raised its capital expenditure forecast for 2025 to bolster its AI infrastructure, while Microsoft has reported that demand for its AI solutions currently exceeds supply.

Similarly, Palantir Technologies has raised its full-year revenue forecast, indicating positive trends within the AI sector.