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Snowflake Stock Jumps on Palantir AI Partnership. What It Means for the Data Storage Company.

Oct 16, 2025 07:29:00 -0400 by Mackenzie Tatananni | #Technology

Snowflake unveiled an AI partnership with Palantir Technologies. (Andreistanescu/Dreamstime)

Key Points

Snowflake stock gained Thursday after the data storage company unveiled a partnership with Palantir Technologies .

The arrangement integrates Snowflake’s AI Data Cloud with two of Palantir’s flagship software offerings, its Foundry and Artificial Intelligence Platform, or AIP.

The partnership will enable customers in the commercial and public sectors “to build more efficient and trusted data pipelines, faster data analytics, and AI applications,” the companies said.

Snowflake rose 1.2% after moving sharply in premarket trading. The stock has gained 58% this year and more than 100% over the past 12 months. Palantir was trading slightly higher, up 1.7%.

The terms of the agreement might seem purposely vague—a case of two hyped-up AI stocks teaming up on a task that no one really understands.

This argument is only driven home by the stocks’ hyperinflated valuations relative to the broader market. As of Wednesday, Palantir was trading at a forward price-to-earnings ratio of 224.36, and Snowflake at 158.64. The S&P 500 , by comparison, was trading at 22.73.

But the partnership is, at its core, fairly straightforward. Snowflake deals in the business of data warehousing, or storing and processing a large amount of data within an organization. It runs as an automated service on the three major clouds offered by Amazon, Microsoft, and Alphabet-owned Google.

Palantir’s software enables further analysis of said data. Its AIP has emerged as one of its most buzzworthy offerings, which uses generative AI to drive automation across daily processes.

Crucially, the company can be the tip of the spear for its partners to secure contracts and win customers. Palantir was born in the aftermath of 9/11, styled as a response to the perceived failures of U.S. intelligence.

The company received a $2 million investment from the CIA shortly after its founding, which helped it gain credibility and led to it becoming a contractor for the agency as well as others in the defense community.

Today, Palantir maintains a considerable presence at the government level, but its commercial segment has grown rapidly, spanning industries like financial services and healthcare.

Snowflake and Palantir are frequently lumped together as competitors in Big Data. In reality, they offer complementary services, and this latest partnership underscores that.

Still, there are key differences. Snowflake may be overvalued, but it hasn’t earned a reputation as a cult stock in the way Palantir has.

The latter has a strong base of retail investors, as evidenced by a dedicated Reddit community with 40,000 weekly visitors, who can almost always be expected to buy Palantir stock on the dip. This keeps the price rising, even as critics sound the alarm about Palantir’s lofty valuation.

Write to Mackenzie Tatananni at mackenzie.tatananni@barrons.com