CHICAGO - Snowflake Inc . (NYSE: NYSE:SNOW), an AI Data Cloud company, announced a new Power Platform connector in collaboration with Microsoft (NASDAQ:MSFT), enhancing data sharing capabilities for enterprise AI application development. Revealed at Microsoft Ignite, the connector facilitates bidirectional data flow between Microsoft's Dataverse and Snowflake's AI Data Cloud.
The integration aims to streamline the creation of custom applications on the Microsoft Power Platform, which includes low-code/no-code services and Dynamics 365. With this connector, developers can now access Snowflake data directly within Power Apps, reducing the need for custom workflows and coding. This is expected to significantly cut resource management and infrastructure handling time for IT and analytics leaders, allowing a focus on high-volume transactions and near real-time analytics.
Christian Kleinerman, EVP of Product at Snowflake, emphasized the shared vision with Microsoft to provide customers with deeper data insights and to eliminate data silos. He highlighted the importance of this integration in the AI era, as it allows the building of AI applications without data movement, enhancing collaboration and productivity.
Charles Lamanna, Corporate Vice President at Microsoft, also noted the benefits of this integration for developers, including improved productivity, IT security, and governance, along with added business value.
The connector is currently in public preview for data access from Snowflake AI Data Cloud to Dataverse and the Microsoft Power Platform. Access from Dataverse to Snowflake is slated for early 2025.
Earlier this year, Snowflake and Microsoft also announced bidirectional data access between Snowflake AI Data Cloud and Microsoft Fabric through Apache Iceberg™.
This development is based on a press release statement and contains forward-looking statements that involve risks, uncertainties, and assumptions, as detailed in Snowflake's filings with the Securities and Exchange Commission. Actual results may differ materially from those anticipated in these statements.
In other recent news, Snowflake Inc. reported a 30% year-over-year increase in product revenue, reaching $829 million for the second quarter of fiscal year 2025, and subsequently raised its full-year product revenue outlook. Loop Capital has reiterated its Buy rating for Snowflake, indicating that the company's performance may surpass the product revenue estimate of $856 million, marking a 29.5% growth. On the other hand, Rosenblatt Securities has maintained its Buy rating and a price target of $180, expecting the company to either meet or slightly surpass the projected organic growth rate of approximately 26% year-over-year for Q3 Product Revenue.
Snowflake also completed a significant $2.3 billion convertible debt offering. Analyst firms such as Citi and Piper Sandler have maintained their Buy and Overweight ratings respectively, but adjusted their price targets to $183 and $165. Monness Crespi Hardt upgraded Snowflake from Neutral to Buy with a new price target of $140, while Evercore ISI and Goldman Sachs (NYSE:GS) maintained positive stances on Snowflake, with price targets of $170 and $220 respectively.
In terms of product innovation, Snowflake has announced several enhancements to its data platform and new AI features. These advancements aim to simplify the creation of conversational apps, improve data readiness, and enable enterprises to process large inference jobs with guaranteed throughput. These are all recent developments for Snowflake, indicating a commitment to improved execution and quicker product innovation.
InvestingPro Insights
As Snowflake Inc. (NYSE: SNOW) continues to innovate and expand its partnerships, particularly with tech giant Microsoft, it's crucial to examine the company's financial health and market position. According to InvestingPro data, Snowflake boasts a substantial market capitalization of $43.05 billion, reflecting its significant presence in the AI and cloud computing space.
The company's revenue growth remains strong, with a 31.21% increase over the last twelve months, reaching $3.2 billion. This robust top-line expansion aligns with Snowflake's strategic moves, such as the new Power Platform connector, which aims to enhance data sharing capabilities and potentially drive further revenue growth.
However, it's important to note that Snowflake is currently not profitable, with an adjusted operating income of -$1.25 billion over the last twelve months. This is reflected in the company's negative P/E ratio of -41.91. Despite this, InvestingPro Tips reveal that analysts predict the company will become profitable this year, which could be a positive sign for investors considering the stock's long-term potential.
Another InvestingPro Tip highlights that Snowflake holds more cash than debt on its balance sheet, potentially providing financial flexibility as it continues to invest in product development and partnerships. This strong cash position could be particularly valuable as the company works towards profitability and expands its AI-driven offerings.
For investors seeking a more comprehensive analysis, InvestingPro offers additional tips and insights that could provide a deeper understanding of Snowflake's financial position and growth prospects. In fact, there are 6 more InvestingPro Tips available for Snowflake, offering a broader perspective on the company's valuation, management strategies, and market performance.
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