July 14, 2024
Snowflake stock rallies as CEO details AI offerings, focuses on data potential

Snowflake stock rallies as CEO details AI offerings, focuses on data potential

Snowflake Inc. shares closed higher Tuesday as the cloud-data company rolled out new apps, a new large language model and a new data-container service to leverage the power of artificial intelligence during its Summit 2023 event in Las Vegas.

Snowflake SNOW, +4.23% shares rallied more than 5% at their peak, and finished the day up 4.2% at $177.02 after Chief Executive Frank Slootman delivered his conference keynote address Tuesday morning, and announced the company’s Snowflake Native App Network, Document AI LLM and Snowpark Container Services products.

As Slootman kicked off the keynote, he joked he was turning AI into a drinking game during the presentation, in that every time he said “AI,” attendees would have to take a shot, so he would not over-add to the frequent intonations of the buzzword that has replaced “metaverse” as this year’s corporate mantra.

Slootman, however, is probably entitled to say “AI” as much as he wants, as the technology promises to transform Snowflake into a potential software developer than a cloud data-storage company. Noting that “intelligence is in the data” already, Slootman said AI promises to turn databases into on-demand, custom software repositories.

In the company’s Native App Network, more than 25 native apps that leverage Snowflake data are available for use, Slootman said, and developers can use the network to build apps that draw from Snowflake accounts without the data ever needing to be moved or exposed. Snowflake announced that Capital One Financial Corp. COF, +2.33% and Goldman Sachs Group Inc. GS, +0.35% already have built apps.

Read: Snowflake adds partnerships with Nvidia and Microsoft for AI double play

The network is available on Amazon.com Inc.’s AMZN, +1.45% Amazon Web Services in a public preview, and on private preview on Alphabet Inc.’s GOOG, -0.07% GOOGL, -0.01% Google Cloud Platform and Microsoft Corp.’s MSFT, +1.82% Azure cloud platforms, according to the company.

With Document AI, users will be able to put their “unstructured data to work” by uploading contracts and invoices and having AI tease out useful data in a natural-language interface, the company said. Document AI came from Snowflake’s 2022 acquisition of Applica.

Snowpark Container Services is an expansion of the company’s Snowpark libraries, where users will be able to unlock “broader infrastructure options such as accelerated computing with Nvidia NVDA, +3.06% [graphics processing units] and AI software,” along with an expanding library for AI developers that includes third-party software and other tools, the company said.

Read: Snowflake expands Microsoft partnership to bring generative AI to its data cloud

Late Monday, Nvidia Chief Executive Jensen Huang joined Slootman in a “fireside chat” as the companies announced an AI partnership. One aspect of that partnership is bringing Nvidia’s AI Enterprise software to the Snowpark platform. On Monday, Snowflake also announced a generative-AI partnership with Microsoft.

Snowflake shares have gained 23.2% year to date, while the iShares Expanded Tech-Software Sector exchange-traded fund IGV, +1.94% is up 33%, and the First Trust Cloud Computing ETF SKYY, +1.64% is up 29.2%.

In comparison, the S&P 500 SPX, +1.15% has gained 14% on the year, while the tech-heavy Nasdaq Composite COMP, +1.65% has advanced 29.5%.

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