Snowflake and Broadcom Post Strong AI-Driven Results as Investor Reactions Diverge

Snowflake reported second-quarter fiscal 2027 results that beat expectations across the board, with product revenue rising 34% year over year to $1.33 billion and total revenue growth accelerating to 35%, well above management's prior guidance of 30%. AI-powered products, including Cortex Code and its CoWork and CoCo assistants, contributed roughly half of that growth acceleration by pulling customers deeper into the core data platform. Net revenue retention came in at 126%, remaining performance obligations grew 30% to $9 billion, and non-GAAP operating margin of 15.3% surpassed guidance by 280 basis points. Snowflake shares jumped on the report, and RBC highlighted the acceleration as evidence that AI momentum is broadening beyond early adopters.

Broadcom reported fiscal third-quarter results that also beat consensus, with adjusted earnings per share of $3.32 against expectations of $3.24 and revenue of $29.59 billion versus the $29.36 billion estimate. The company projected fourth-quarter AI semiconductor revenue of $21.7 billion and raised its fiscal 2027 AI revenue outlook to approximately $115 billion from a prior target of more than $100 billion, while issuing a long-term target of $230 billion in AI revenue for fiscal 2028 and guiding for earnings per share of $30 or more in that year. Customers driving that demand include Google, Anthropic, OpenAI and Meta, though Broadcom cautioned that data-center readiness and power constraints could affect deployment timelines. Despite the bullish forecast, Broadcom shares fell 3.3%, suggesting investors wanted near-term execution rather than multi-year projections.

Elsewhere in AI infrastructure, Barron's valued Hugging Face at $13 billion following NVIDIA's investment, with analysts debating whether NVIDIA's hardware dominance is durable now that it is deepening ties with the open-source model hub. Circle, newly holding a historic banking charter, was cited as positioned to capture AI micropayment and U.S. Treasury settlement flows through its stablecoin platform.