Snowflake tops earnings estimates, lifts FY27 product revenue view to 2028

AI Trade Please click here for an enlarged chart of Snowflake Inc (NYSE: SNOW ).

Note the following: This article is about the big picture.

The chart of SNOW stock is being used to illustrate the point.

Snowflake is important because its accelerating growth shows enterprise AI spending is broadening beyond chips and data centers into the software and data infrastructure layer.

The chart shows SNOW is gapping up about 23% after good earnings.

Snowflake earnings are better than whisper numbers and consensus numbers.

Here are the details: Snowflake reported Q2 EPS of $0.62 vs. $0.45 consensus.

Snowflake reported Q2 revenue of $1.55B vs. $1.48B consensus.

Snowflake raises FY27 product revenue projection to $6.07B from $5.84B.

As a full disclosure, we have a position in SNOW long from an average of $120.

SNOW is trading at $378.20 as of this writing in the premarket, representing a gain of 215%.

This morning is showing a sharp contrast between software stock SNOW and mostly a semiconductor stock Broadcom Inc (NASDAQ: AVGO ).

Broadcom has been a favorite of momo gurus.

Broadcom reported strong earnings but lower than whisper numbers.

Here are the details: Broadcom reported Q3 EPS of $3.32 vs. $3.24 consensus.

Broadcom reported Q3 revenue of $29.6B vs. $29.43B consensus.

Broadcom is raising FY26 revenue projection to $58B from $56B.

Broadcom expects semiconductor demand to accelerate.

Broadcom expects FY27 AI chip revenue of $100B and FY28 of $230B.

In our analysis, there is an important shift in market sentiment regarding semiconductors.

If the same projections were given a while ago, AVGO stock would have been up significantly, but as of this writing in the premarket AVGO is down.

Prudent investors should pay attention when sentiment shifts.

As the morning has progressed, significant buying has come in the stock market for three reasons: The Japanese yen has strengthened without intervention.

Yields are slipping.

Fed Governor Waller said, “…recent data suggest we are finally seeing some signs of disinflation.” In our analysis, after Waller’s comment, the next Consumer Price Index (CPI) release becomes even more critical.

The next CPI release is on September 11 at 8:30am ET.

Initial jobless claims came at 206K vs.

205K consensus, indicating the jobs picture is stable.

The jobs report will be released tomorrow at 8:30am ET and may be market moving.

Magnificent Seven Money Flows Most portfolios are now heavily concentrated in the Mag 7 stocks.

For this reason, it is important to pay attention to early money flows in the Mag 7 stocks on a daily basis.

In the early trade, money flows are positive in Amazon.com, Inc. (NASDAQ: AMZN ), Alphabet Inc Class C (NASDAQ: GOOG ), Meta Platforms Inc (NASDAQ: META ), Microsoft Corp (NASDAQ: MSFT ), NVIDIA Corp (NASDAQ: NVDA ), and Tesla Inc (NASDAQ: TSLA ).

In the early trade, money flows are neutral in Apple Inc (NASDAQ: AAPL ).

In the early trade, money flows are positive in SPDR S&P 500 ETF Trust (NYSE: SPY ) and Invesco QQQ Trust Series 1 (NASDAQ: QQQ ).

Momo Crowd And Smart Money In Stocks Investors can gain an edge by knowing money flows in SPY and QQQ.

Investors can get a bigger edge by knowing when smart money is buying stocks, gold, and oil.