Snowflake Price Targets Cut to $125 and $200 on 3% Budget Outlook
Truist Financial cut Snowflake's price target to $125 from $175 and KeyBanc lowered its target to $200 from $235, citing a shifting AI competitive landscape and a moderated 2026 software budget growth outlook of 3%. Snowflake has expanded AI adoption and envisions $5.66 billion in fiscal 2027 product revenue.
1. Analyst Price Target Cuts
Truist Financial reduced its Snowflake price target from $175 to $125, while KeyBanc trimmed its target from $235 to $200, reflecting concerns over intensifying competition in AI and pressure on profitability. Both analysts maintain their ratings but highlighted the need for Snowflake to demonstrate stronger monetization amid evolving market dynamics.
2. Softening Software Budget Outlook
Enterprise software budget growth forecasts for 2026 have been scaled back to 3% from 5%, driven by subdued U.S. federal spending and cautious corporate IT investments. This moderation raises questions about Snowflake’s full-year revenue outlook and its ability to sustain current growth trajectories.
3. AI Adoption and Growth Prospects
Snowflake has onboarded over 9,100 AI-enabled accounts and projects $5.66 billion in product revenue for fiscal 2027, underscoring strong demand for its data cloud platform. With the global AI software market projected to approach $995.5 billion by 2030, Snowflake aims to leverage its platform to capture expanding workloads and drive long-term growth.