Snowflake delivered a strong fiscal second quarter, beating Wall Street expectations on both the top and bottom lines. Revenue reached $1.55 billion, up 35% year over year and ahead of the $1.48 billion consensus, while adjusted earnings per share came in at 62 cents, well above the 45 cents analysts had expected. Because Snowflake bills customers largely on consumption rather than fixed subscriptions, quarterly revenue is a closely watched signal of how much enterprises are actually spending on cloud data and AI workloads.

The market responded forcefully. SNOW stock surged 22% in after-hours trading on Wednesday, and by pre-market Thursday it had climbed 23.27% to $376 per share. That would mark the fourth-largest single-day gain since Snowflake went public in 2020.

Product revenue for the quarter came in at $1.49 billion, up 37% year over year. The net loss narrowed to $191.7 million, or 55 cents per share, from a $297.9 million loss in the same quarter a year earlier.

Looking ahead, Snowflake guided for $1.59 billion in Q3 product revenue, above the $1.50 billion analyst consensus. Management also raised its full-year product revenue forecast to $6.07 billion, up from the $5.84 billion projection made in May. In addition, the company widened its adjusted operating margin forecast to 14.5%, compared with the 13.5% it had previously projected.

AI Agent CoCo Picks Up Steam

A major part of the story was CoCo, Snowflake's AI coding agent. The tool now counts 9,100 accounts, an increase of more than 2,000 during the quarter. Management pointed to CoCo as a driver of growth and enterprise engagement. CoCo's adoption matters beyond its direct revenue contribution: it signals whether Snowflake can keep data and AI workloads on its platform rather than losing them to rivals such as Databricks or to the major cloud providers' own data services.

Jim Cramer highlighted Snowflake on CNBC's Mad Money, calling the stock primed for a "huge move." He noted that Snowflake gives enterprises a clean way to buy compute capacity on demand. His CNBC Investing Club trust holds a small position in Broadcom, about which he was more cautious after that company's Q4 guidance came in slightly below expectations.

Michael Burry Isn't Buying It

Not everyone is convinced. Michael Burry, known for "The Big Short," called Snowflake "very overvalued" in a Substack post. He warned that the company faces an "existential threat" if data lakes become too vulnerable to cyberattack as AGI and quantum computing mature.

Burry also noted that if companies bring AI development in-house and keep data on their own servers, demand for platforms like Snowflake could slow.

Wall Street, however, is not siding with Burry. The stock carries a Strong Buy consensus, based on 23 Buy ratings and three Holds. The average price target sits at $368.68, implying roughly 20.6% upside from pre-earnings levels.

As of Wednesday's close, SNOW was already up 39% year to date, compared with roughly 12% for the S&P 500. With the stock now trading above that average price target, a key question for investors heading into next quarter is whether CoCo-driven consumption growth can continue to justify the premium valuation Burry flagged.

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