Snowflake (NYSE:SNOW) CFO Brian Robins said the company’s focus over the past year has been on accelerating growth, expanding margins and improving go-to-market execution, with artificial intelligence products increasingly contributing to customer adoption and broader usage of its data platform.
Speaking at the Citi conference, Robins said his two primary objectives after joining the company were to improve growth and operating leverage while strengthening sales execution. He said Snowflake’s recent guidance and quarterly performance reflected progress on both priorities.
AI products broaden platform usage
Robins highlighted adoption of Snowflake’s AI offerings, including CoCo, CoWork, AI Functions, model training and AI Gateway. He said customers are moving beyond experimentation with AI and are using the tools to support business outcomes.
CoWork, which Robins described as data with controls established by data scientists, has reached more than 5,000 accounts, he said. The product is designed to allow users to ask questions of certified data while reducing the risk of inaccurate outputs.
He also said customers want flexibility in choosing among large foundational models as new models emerge. Snowflake’s platform allows customers to use different models for different tasks, potentially avoiding the cost of using the most advanced model for basic queries.
According to Robins, AI adoption is also benefiting Snowflake’s core data business. Customers that use its AI products, particularly CoCo, are consuming more of Snowflake’s core services such as data warehousing, storage, analytics and ingestion.
- AI tools are bringing more business personas onto the platform beyond traditional data teams.
- Customers are migrating data more quickly, Robins said.
- Greater AI use is supporting deeper account penetration and additional core consumption.
Robins said Snowflake does not charge customers simply for access to CoCo; instead, customers pay based on consumption. He said the company encourages customers to optimize costs and noted that a CoCo skill focused on cost optimization ranks among its 10 most-used skills.
Guidance process and margin priorities
Robins said Snowflake has not changed its overall guidance philosophy. The company forecasts its core business daily using customer- and product-level data, he said, with internal pipelines generating a detailed forecast each morning.
For newer AI products, however, Snowflake has less historical usage data. Robins said the company uses product-launch models and comparisons with prior product adoption curves, while taking a conservative approach to incorporating early revenue contributions into its outlook.
He said Snowflake raised its full-year growth outlook to 36% year over year from 31%, while continuing to increase operating leverage. The company has also committed to reaching GAAP profitability in the fourth quarter of the following year, he said.
While AI offerings naturally carry lower gross margins than Snowflake’s core business, Robins said the company believes it can maintain strong gross margins over time. He cited a 74% non-GAAP product gross margin and said that AI products also help drive higher consumption of the core platform.
Efficiency initiatives across the organization
Robins said Snowflake is using its own technology internally to improve productivity across sales, finance, research and development, human resources and other functions. The company added roughly 330 employees during the first and second quarters, compared with about 950 additions during the same period a year earlier, according to Robins. About 180 of the current-year additions came through the Observe acquisition, he said.
In sales, the company has seen productivity per representative increase despite lower hiring, Robins said. In research and development, he said Snowflake is seeing higher output with relatively flat or declining headcount. He also said the finance organization has developed roughly 150 internal AI use cases, including automation efforts.
Robins said Snowflake is investing tens of millions of dollars to retrain employees for an AI-oriented working environment. He characterized AI adoption as a human transformation as well as a technology transformation, emphasizing the need for employees to understand how their work can change.
Customer retention and partnerships
As Snowflake reviews third-party software agreements, Robins said he has generally favored one-year contracts over longer commitments because of the pace of technology change, although the company will enter longer deals for critical software providers with AI-focused roadmaps.
He described Snowflake as an open system and said the company must continually deliver customer value because customers can migrate data both into and out of the platform. Snowflake’s Iceberg Tables allow customers to query data from different locations, he said.
Robins also described Snowflake’s relationships with hyperscale cloud providers and foundational-model companies as both collaborative and competitive. He said the company maintains regular contact with AWS, Microsoft and Google Cloud, while also working with companies including Anthropic, OpenAI and Grok.
Looking ahead, Robins said Snowflake’s priorities remain developing AI products and features that drive consumption, accelerate customer migrations, expand the number of users within customer organizations and encourage customers to place more data on the Snowflake platform.
About Snowflake (NYSE:SNOW)
Snowflake Inc (NYSE: SNOW) is a cloud-based data platform company that helps organizations store, process, analyze and share data. Its platform is designed to support data warehousing, data lakes, data engineering, data science, application development and business intelligence across public cloud environments.
Snowflake’s Data Cloud enables customers to consolidate and access structured, semi-structured and unstructured data while supporting secure data sharing and collaboration. Its offerings include Snowflake Cortex, which provides artificial intelligence and machine-learning capabilities, as well as tools for developing data applications and using data from Snowflake’s marketplace and partner ecosystem.
Founded in 2012, Snowflake serves businesses, government organizations and other institutions globally through cloud infrastructure provided by major public-cloud platforms.
