12:29 PM EST, 11/21/2024 (MT Newswires) -- Snowflake's (SNOW) strong fiscal Q3 beats were a "huge step in the right direction" as the company exceeded market expectations mainly due to better-than-expected product revenue, Wedbush Securities said in a note Thursday.

Analysts, including Daniel Ives, said the company's total revenue of $942.1 million, driven by product revenue of $900.3 million, was higher than the Street's estimate of $899.3 million due to strong demand for Apache Iceberg and generative AI integrations.

The company raised its product revenue guidance for fiscal Q4, expecting $906 million to $911 million, above the Street's estimate of $888.6 million, the analysts said, adding that while new products will not significantly impact Q4 revenues, they are expected to contribute more in fiscal 2026.

"We continue to see that the 'optimization' phase has ended and we continue to see improvement in [quarter-over-quarter] dollars added for product revenue heading into an important FY26 in an extremely competitive environment," analysts said in the note, adding that they were very impressed with such a "massive" quarter for the company.

Wedbush raised its price target on Snowflake's stock to $160 from $130 and kept its neutral rating.

Shares of Snowflake rose more than 31% in recent trading.

Price: 170.28, Change: +41.16, Percent Change: +31.88