How to cleanly make swift-snapshot-testing run correctly in Xcode Cloud. You need to bundle the snapshots and resources into your test bundles (xctest), and then use this kind of code to instruct snapshot-testing to pick them up from the test bundle if present.

gistfile1.swift

#if os(iOS)

import SnapshotTesting
import SwiftUI
import XCTest

public extension XCTestCase {
  /// Test the layout of a full-screen SwiftUI view.
  ///
  /// Currently, this is hardcoded to logical width and height of iPhone 14 Pro screen. It assumes that tests are ran only on iPhone 14 Pro simulator,
  /// so you’ll need to change this also in the Xcode Cloud workflow. Change the device from “recommended iPhones” to “iPhone 14 Pro”.
  ///
  /// This currently tests the EN and ET languages, to visually spot any problems in language localization.
  ///
  /// - Parameters:
  ///   - view: The view to test.
  ///   - testBundleResourceURL: Resource URL that contains a folder with the reference screenshots.
  ///     For SPM module tests, the folder will be named `__Snapshots__/TestClassName`.
  ///     For top-level app target tests, the folder will be named simply `TestClassName`.
  ///   - file: The test file calling this function. No need to pass it, this is determined automatically.
  ///   - testName: Test function that is calling this function. No need to pass it, this is determined automatically.
  ///   - line: Line in the test file calling this function. No need to pass it, this is determined automatically.
  func assertSnapshot(
    view: some View,
    testBundleResourceURL: URL,
    file: StaticString = #file,
    testName: String = #function,
    line: UInt = #line
  ) {
    
    let locales = [Locale(identifier: "en_US"), Locale(identifier: "et_EE")]
    
    let testClassFileURL = URL(fileURLWithPath: "\(file)", isDirectory: false)
    let testClassName = testClassFileURL.deletingPathExtension().lastPathComponent

    let folderCandidates = [
      // For SPM modules.
      testBundleResourceURL.appending(path: "__Snapshots__").appending(path: testClassName),
      // For top-level xcodeproj app target.
      testBundleResourceURL.appending(path: testClassName)
    ]
    
    for locale in locales {

      // Default case: snapshots are not present in test bundle. This will fall back to standard SnapshotTesting behavior,
      // where the snapshots live in `__Snapshots__` folder that is adjacent to the test class.
      var snapshotDirectory: String? = nil
      
      for folder in folderCandidates {
        let referenceSnapshotURLInTestBundle = folder.appending(path: "\(sanitizePathComponent(testName)).\(locale.identifier).png")
        if FileManager.default.fileExists(atPath: referenceSnapshotURLInTestBundle.path(percentEncoded: false)) {
          // The snapshot file is present in the test bundle, so we will instruct snapshot-testing to use the folder
          // pointing to the snapshots in the test bundle, instead of the default.
          // This is the code path that Xcode Cloud will follow, if everything is set up correctly.
          snapshotDirectory = folder.path(percentEncoded: false)
        }
      }
      
      let failure = SnapshotTesting.verifySnapshot(
        matching: view
          .frame(width: 393, height: 852)
          .environment(\.locale, locale),
        // When precision is the default 100%, some snapshot tests on Xcode Cloud fail,
        // even though there is no visible difference between reference and test result images,
        // and the difference image is completely black (does not indicate any different pixels).
        // 🤷 Just lowering the tolerance a bit seems to make it more resilient.
        as: .image(precision: 0.98),
        named: locale.identifier,
        record: false,
        snapshotDirectory: snapshotDirectory,
        file: file,
        testName: testName,
        line: line
      )
      
      if let message = failure {
        XCTFail(message, file: file, line: line)
      }
    }
  }
  
  // Copied from swift-snapshot-testing
  func sanitizePathComponent(_ string: String) -> String {
    return string
      .replacingOccurrences(of: "\\W+", with: "-", options: .regularExpression)
      .replacingOccurrences(of: "^-|-$", with: "", options: .regularExpression)
  }
}
#endif

Blog post with longer discussion: https://jaanus.com/snapshot-testing-xcode-cloud/