Snowflake buys Natoma & deepens AWS tie with USD £6bn

Snowflake has agreed to acquire Natoma and expanded its strategic collaboration with Amazon Web Services alongside its first-quarter results for fiscal 2027.

The Natoma deal will bring an enterprise Model Context Protocol platform into Snowflake's products, while the AWS agreement includes a USD $6 billion multi-year infrastructure commitment. Snowflake has also passed USD $7 billion in lifetime sales through AWS Marketplace.

Both announcements reflect Snowflake's effort to deepen its role in how businesses build and control artificial intelligence systems. More than 13,600 accounts now use its AI products, and adoption of newer tools continued to rise during the quarter.

Accounts using Snowflake Intelligence more than doubled from the previous quarter, while Cortex Code is now used across more than 7,100 accounts.

That activity helped drive the strongest sequential dollar growth in product revenue in the company's history. Snowflake also pointed to new customers including Holiday Inn Club Vacations and Houzz as signs of demand for platforms that combine data management, governance and AI development.

Natoma deal

Natoma's technology is designed to help organisations connect AI systems to enterprise applications, databases, tools and application programming interfaces under central controls. Snowflake said the acquisition would extend its governance model beyond stored data to the actions and interactions of AI agents operating across business workflows.

That matters as companies try to move from AI assistants that answer questions to software agents that can carry out tasks across internal systems. Snowflake cited its own research showing that 96% of organisations still face significant challenges when trying to scale AI across the enterprise.

The company said the rise of MCP has raised concerns about fragmented governance, shadow AI and the risk of sensitive data leaving approved environments. Natoma's platform is intended to provide a common layer for identity, authorisation, policy enforcement and audit records when AI agents interact with enterprise systems.

Users will be able to combine data already held in Snowflake with information from services such as email, Slack, customer relationship management systems, Jira, internal APIs and other business applications. Snowflake said this would give tools such as Snowflake Intelligence and Cortex Code broader operational context.

"AI agents are quickly becoming part of how enterprises operate, but intelligence without governance creates risk," said Sridhar Ramaswamy, Chief Executive Officer of Snowflake.

"Agents don't just need access to data. They need the right context, permissions and policy guardrails to operate safely inside the enterprise. Snowflake has long served as the governed data foundation for enterprises, and with Natoma's expertise in identity governance and privileged access management, we can extend that trust layer to AI-driven actions and workflows. With Natoma in Snowflake, coding agents can finally come alive inside the enterprise - secure, auditable and ready to operate at scale."

Natoma's leadership framed the deal as a response to the operational demands of deploying AI across large organisations. The company has focused on identity governance and privileged access management for AI systems.

"AI agents will only become enterprise-ready if organizations can govern how they operate across systems, applications and tools," said Pratyus Patnaik, co-founder and CEO of Natoma.

"Together with Snowflake, we're building the governance and connectivity layer that enables enterprises to securely operationalize AI at scale."

AWS expansion

The broader AWS agreement deepens a relationship that dates back to Snowflake's founding on the cloud provider's infrastructure. Most of Snowflake's customers currently run on AWS, and the new arrangement will cover infrastructure spending, product integration, customer programmes and workload migration efforts.

Under the deal, Snowflake will commit USD $6 billion over five years to AWS infrastructure, including Graviton compute and AI-related spending. The company said the agreement reflects rising demand for AI and data workloads on AWS.

Snowflake said the partnership is intended to keep AI systems close to governed enterprise data rather than move sensitive information between separate systems. It has also expanded its footprint on AWS with launches completed or under way in 10 new regions, including New Zealand, South Africa, Thailand and the AWS European Sovereign Cloud.

Marketplace sales have become an important part of that relationship. Snowflake said sales through AWS Marketplace exceeded USD $2 billion in the 2025 calendar year, with transaction growth more than doubling year on year.

"AI has generated enormous excitement, but for enterprises, the real challenge and opportunity is turning intelligence into action," said Ramaswamy.

"We are moving into the era of the agentic enterprise, where AI systems don't just answer questions, but help organizations reason over trusted data, coordinate workflows, and drive real business outcomes. With AWS, we are making it easier for enterprises to bring AI directly to governed data, so they can move faster, operate with greater clarity, and create measurable impact at scale."

AWS said the expanded arrangement reflects a broader shift among customers from testing AI tools to putting them to work inside business processes.

"Enterprises are rapidly moving from experimenting with AI to putting intelligent agents to work that drive real business outcomes," said Matt Garman, Chief Executive Officer of AWS.

"Snowflake has built on AWS since day one, and their deepened commitment to run on Graviton delivers the world-class performance, flexibility, and cost savings customers need to run data warehousing and AI workloads at scale."

Customer examples highlighted by the companies included Fetch and Hex, which are using Snowflake on AWS to analyse data and support AI-based applications. Snowflake said those deployments show how customers are trying to build AI tools directly on governed data rather than in separate systems.

"Snowflake on AWS is the foundation that many of our customers rely on to move fast with data," said Caitlin Colgrove, co-founder and CTO of Hex.

"For teams using Hex to explore, analyze, and build with AI, having that layer be secure, governed, and performant isn't a nice-to-have - it's what makes enterprise AI adoption real."