Michael Burry Calls Snowflake Stock Overvalued After a Big Post-Earnings Rally

Snowflake's (SNOW) latest earnings report gave investors plenty to celebrate. The cloud-data platform topped expectations, delivered product revenue growth of 37% year-over-year (YOY) to $1.49 billion, and raised its fiscal 2027 product revenue outlook to $6.07 billion. CEO Sridhar Ramaswamy said that artificial intelligence (AI) offerings accounted for roughly half of the company's latest growth acceleration. In the wake of the second-quarter fiscal 2027 results, shares of SNOW stock surged close to 17% on Sept. 3.

But not everyone is convinced the enthusiasm is justified. Famous investor Michael Burry has called Snowflake "very overvalued." His warning comes as Snowflake's stronger outlook raises expectations for its AI growth, customer spending, and future profitability.

Has Snowflake's earnings report confirmed its place among enterprise AI's most important winners? Or has the post-earnings rally pushed SNOW stock's valuation beyond what even its impressive growth can support? Let's take a closer look.

Worth $116 billion by market capitalization and headquartered in Menlo Park, California, Snowflake runs a platform that organizations use to store, share, govern, and analyze information across public-cloud environments. Its services support data engineering, analytics, applications, and AI development.

SNOW stock closed at $335.50 per share on Sept. 8. Currently, shares are up 53% year-to-date (YTD) and 49% over the past 52 weeks.

At 24.9 times sales and 60 times book value, Snowflake stock trades well above the respective sector medians, leaving little room for a meaningful slowdown.

Snowflake's Q2 fiscal 2027 report explains why investors have been willing to pay that premium. Revenue rose 35% YOY to $1.55 billion, exceeding Wall Street's $1.48 billion estimate. Adjusted earnings reached $0.62 per share, clearing the $0.45 consensus forecast. Snowflake also produced $237 million in adjusted operating income, ahead of estimates of $185.9 million and equating to a 15.3% margin.

Snowflake still reported a GAAP operating margin of -17%, but that marked a considerable improvement from -29.7% a year earlier. Billings rose 15% YOY to $1.27 billion, growing more slowly than revenue. That gap does not erase the quarter's strength, but it deserves attention because billings can offer an early read on future contracted demand.