Snowflake shares experienced a significant rally, climbing as much as 36% in extended trading after the company reported robust fiscal first-quarter results and unveiled a major expansion of its infrastructure strategy. The data cloud firm announced a $6 billion, five-year spending commitment with Amazon Web Services (AWS), signaling a deepening reliance on Amazon’s cloud ecosystem to power its growing artificial intelligence initiatives.

Under the terms of the agreement, Snowflake will significantly increase its utilization of Amazon’s custom silicon, including the Arm-based Graviton processors and advanced graphics processing units (GPUs) designed for AI workloads. This move highlights a broader industry shift toward custom, power-efficient chip architectures as companies move beyond simple chatbots toward more complex, task-oriented agentic AI applications. The deal follows a series of similar high-profile commitments in the cloud sector, underscoring the intense demand for scalable compute power.

Financially, Snowflake exceeded market expectations for the quarter ending April 30, reporting $1.39 billion in revenue—a 33% increase year-over-year—and adjusted earnings of 39 cents per share. These figures comfortably beat analyst projections of $1.32 billion and 32 cents per share, respectively. Bolstered by this momentum, the company provided strong guidance for the second quarter and announced the acquisition of AI startup Natoma to further enhance its technical capabilities.

This $6 billion arrangement represents a substantial increase from previous agreements between the two companies, reflecting the rapid scaling of Snowflake’s operations. By leveraging Amazon’s custom hardware alongside its existing partnerships with firms like Nvidia, Snowflake aims to streamline the deployment of AI workflows. As the demand for general-purpose compute power grows to support data-heavy AI tasks, this strategic investment positions Snowflake to maintain its competitive edge in the rapidly evolving cloud and AI landscape.