Datadog and Snowflake Growth Accelerating Amid AI Spending
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Apr 07 2026
0mins
Source: seekingalpha
- Accelerated Revenue Growth: Datadog's total revenue grew 29.2% year-over-year, up from 28.4% last quarter, indicating a broad-based acceleration in usage across customer cohorts, reflecting strong business performance amid ongoing AI-related spending.
- Strong Product Revenue: Snowflake's product revenue increased by 30.0% year-over-year, surpassing last quarter's 28.7%, primarily driven by robust core business performance and the impact of AI tools like Intelligence and Cortex AI, showcasing the company's competitive edge in the market.
- Shift in Investor Preferences: As AI has yet to drive significant growth for most software vendors, investors are favoring stocks with accelerating core business growth; Datadog stood out in Q4 2025, with core revenue growth accelerating to 23%, a 3-point increase from 20% in Q3 2025, indicating strong market confidence in its future.
- Positive Impact of AI Tools: Snowflake's commentary on its AI products is bullish, with Intelligence usage doubling quarter-over-quarter across 2,500 accounts, and strong performance from Cortex AI and Cortex Code further enhancing market expectations for future growth.
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Analyst Views on DDOG
Wall Street analysts forecast DDOG stock price to fall
33 Analyst Rating
30 Buy
3 Hold
0 Sell
Strong Buy
Current: 218.040
Low
140.00
Averages
207.39
High
255.00
Current: 218.040
Low
140.00
Averages
207.39
High
255.00
About DDOG
Datadog, Inc. provides an observability and security platform for cloud applications. The Company’s SaaS platform integrates and automates infrastructure monitoring, application performance monitoring, log management, user experience monitoring, cloud security and many other capabilities to provide unified, real-time observability and security for its customers’ entire technology stack. Its platform consists of products that can be used individually or as a unified solution and includes a marketplace where customers can access products built by its partners on top of the Datadog platform. Its products include Infrastructure Monitoring, Application Performance Monitoring, Log Management, Digital Experience Monitoring, Continuous Profiler, Database Monitoring, Data Observability, Universal Service Monitoring, Network Monitoring and others. It owns Metaplane, an end-to-end data observability platform that provides advanced machine learning-powered monitoring and column-level lineage.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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See More
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- Rising Inflation Expectations: The 1-year inflation expectations for May were revised up to 4.8%, a 9-month high, exceeding the expected 4.6%, which could prompt the Fed to consider interest rate hikes at the upcoming meeting, affecting market liquidity.
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- International Markets Rebound: The Euro Stoxx 50 climbed 1.23%, China's Shanghai Composite rose 0.87%, and Japan's Nikkei increased by 2.68%, indicating a global market optimism that may provide support for the US market.
See More
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- Core Beneficiary Status of SK Hynix: Analysts believe SK Hynix is a key beneficiary of the memory super-cycle, as hyperscaler capital expenditures increase, positioning it as a major winner in the AI revolution, with the market significantly underestimating the duration and magnitude of this cycle.
- Datadog's AI Monitoring Demand: Wedbush notes that Datadog stands out as a second derivative beneficiary of the AI revolution, driven by the growing need for companies to monitor, secure, and optimize their AI workloads, indicating strong market potential in the coming years.
- Expansion of Cloud Workloads: Analysts emphasize that as AI and cloud workloads continue to scale, Datadog is well-positioned to capitalize on this multi-year shift, further enhancing its competitive edge in the market.
See More
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- Industry Performance Divergence: Over the past six months, the software sector has declined by 9.2%, contrasting sharply with the S&P 500's 11.6% return, highlighting the volatility risks associated with high valuations.
- Autodesk Financial Concerns: Autodesk's annual revenue growth of 13.7% falls below industry standards, and the lengthy customer acquisition cost recovery period hampers justifying sales and marketing investments, negatively impacting profitability.
- Wix Operational Challenges: Wix's average billings growth of only 13.8% and a 12.2 percentage point drop in operating margin indicate competitive pressures, with a projected 10.6 percentage point decline in free cash flow margin next year reflecting increased investment needs.
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See More
