Snowflake Inc. (SNOW): A Bull Case Theory

We came across a bullish thesis on Snowflake Inc. on Nikhs’s Substack. In this article, we will summarize the bulls’ thesis on SNOW. Snowflake Inc.'s share was trading at $234.77 as of December 4th. SNOW’s forward P/E was 166.67 according to Yahoo Finance.

Snowflake Inc. provides a cloud-based data platform for various organizations in the United States and internationally. SNOW’s latest results were widely interpreted as another quarter of slowing growth, but the headline missed the underlying acceleration in the business. While product revenue rose 29% YoY, the far more important metric was RPO growth of 37% YoY — an 800 bp spread that marks Snowflake’s strongest bookings acceleration in over two years. This shift signals that enterprises are again signing large, multi-year commitments faster than workloads can be deployed, driven by four nine-figure deals that materially expanded RPO.

Because these contracts typically take 12–18 months to onboard, revenue will lag initially, but the eventual catch-up sets the stage for a potential re-acceleration into FY27. The driver behind these commitments is Snowflake’s quiet repositioning from a cloud data warehouse to an enterprise AI control plane. The $200 million Anthropic partnership is central to this pivot, embedding Claude models directly within Snowflake’s governance boundary — a capability competitors like Databricks cannot match without exposing sensitive data to external APIs.

This architecture gives Snowflake a structural advantage in regulated industries and has already produced trillions of tokens processed monthly. Early AI monetization is tracking ahead of expectations, with AI revenue reaching a $100 million run rate, influencing half of new bookings and materially expanding use cases. The longer-term opportunity extends beyond analytics to enterprise automation, with customers already replacing meaningful labor hours using Snowflake Intelligence.

While uncertainties around AI-specific margins remain, the combination of accelerating bookings, deepening enterprise commitments, and a strengthening governance-based moat suggests the market is undervaluing Snowflake’s transition. The gap between RPO and revenue is the clearest signal: growth is re-accelerating beneath the surface, and the narrative is set to shift as revenue catches up.

Previously we covered a bullish thesis on Snowflake Inc. (SNOW) by Oliver | MMMT Wealth in April 2025, which highlighted strong revenue and EBITDA growth, high net revenue retention, and robust financial health. The company's stock price has appreciated approximately by 67% since our coverage. The thesis still stands as Snowflake’s innovation remains intact. Nikhs shares a similar thesis but emphasizes accelerating bookings and AI-driven enterprise repositioning.

Snowflake Inc. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 100 hedge fund portfolios held SNOW at the end of the second quarter which was 94 in the previous quarter. While we acknowledge the risk and potential of SNOW as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than SNOW and that has 10,000% upside potential, check out our report about this cheapest AI stock.

READ NEXT: 30 Stocks That Should Double in 3 Years and 11 Hidden AI Stocks to Buy NOW 

Disclosure: None.