Snowflake expands AWS partnership, acquires Natoma, delivers strong Q1

Snowflake said it will spend $6 billion on Amazon Web Services' AI offerings and Graviton chips, announced that it will acquire Natoma and reported first quarter results.

The barrage of news landed a few days ahead of its flagship Summit conference.

Here's a breakdown of the news.

AWS expanded partnership

Snowflake said it will expand its ongoing partnership with AWS. The two companies, which are already intertwined as Snowflake has sold more than $7 billion on AWS Marketplace, rolled out a multi-year partnership that includes joint go-to-market efforts and infrastructure commitments.

Under the deal:

• The two companies will expand efforts to migrate workloads and move enterprises to a combined AI stack.
• Snowflake will buy $6 billion in Graviton compute and AI services over five years.
• AWS and Snowflake will offer deeper product integrations across genAI and agentic AI.
• Go-to-market efforts will revolve around joint investments in customer success programs, migrations and industry offerings.

Sridhar Ramaswamy, CEO of Snowflake, said the AWS partnership will enable enterprises to bring AI to governed data. AWS CEO Matt Garman said the Snowflake partnership will help joint customers that need to scale data warehousing and AI workloads.

Natoma acquisition

Snowflake said it will acquire Natoma, which provides an enterprise Model Context Protocol platform for AI agents.

According to Snowflake, Natoma will give the company the ability to integrate governance, identity and MCP tool access in a native package. Ramaswamy said: "Agents don’t just need access to data. They need the right context, permissions and policy guardrails to operate safely inside the enterprise. Snowflake has long served as the governed data foundation for enterprises, and with Natoma’s expertise in identity governance and privileged access management, we can extend that trust layer to AI-driven actions and workflows."

The plan for Snowflake is to securely connect Cortex Agents, Snowflake Intelligence, Cortex Code and other AI platforms. Natoma's technology will be integrated into Snowflake's AI Data Cloud.

Snowflake's Q1 tops estimates

Snowflake's first quarter non-GAAP earnings were 39 cents a share, 7 cents ahead of Wall Street estimates, and revenue checked in at $1.39 billion, up 33% from a year ago.

The net loss for the first quarter was $295.6 million, or 86 cents a share.

The company raised its outlook for the second quarter and projected product revenue of $1.41 billion to $1.42 billion, up 30% from a year ago. For fiscal 2027, Snowflake said product revenue will be $5.84 billion, up 31% and ahead of its previous guidance of $5.66 billion.

Key figures for the first quarter include:

• Snowflake reported 779 customers with trailing 12-month product revenue of more than $1 million.
• Remaining performance obligations in the quarter were $9.21 billion, up 38%.
• More than 13,600 accounts are using Snowflake AI.

Constellation Research's POV

Mike Ni, an analyst at Constellation Research, focused on Snowflake's Natoma acquisition and strategic importance.

"The acquisition is about Snowflake setting its sights on owning the AI control plane. Data platforms won the analytics era. Whoever governs agents, context, and autonomous actions wins the agentic era. Natoma gives Snowflake the missing layer between insight and execution.

Most enterprises are not ready for MCP at scale yet. Introduced just under 20 months ago, MCP as a technology is starting to mature as a protocol. The thing holding companies back is that most enterprise governance operating models are not mature engouh for machine-speed decisioning. The risk is giving agents that are increasingly repsonsible for decisions fragmented context, inconsistent policies, and braod system access across the enterprise.

The era of single-platform AI is ending. Enterprises don’t want isolated co-pilots anymore. Enterprises want digital labor that reasons beyond a single organizational silo. Cross platform agentic workloads are emerging, but we are still in the “controlled use” stage keeping to non-critical and less scale and real-time use cases. Enterprises are rolling out cross-platform agentic workflows that can reason, coordinate and take actions across CRM, Slack, cloud systems and operational applications to deliver trusted orchestration within the governed context.

The acquisition of Natoma by Snowflake is a reflection of the rise of the enterprise AI operating system layer. Every major vendor across data foundations, orchestration, or enteprise application vendor now realizes that whoever controls agents, orchestration, and runtime governance controls the next trillion-dollar enterprise platform market."