Is Observe Inc. still an independent company?

No. Snowflake closed its acquisition of Observe Inc. on February 2, 2026, after announcing the deal on January 8, 2026. Observe's founder-CEO Jeremy Burton resigned from Snowflake's board upon closing, and the Observe team relocated to Snowflake's Menlo Park campus.

How much did Snowflake pay to acquire Observe?

Figures conflict: The Information reported the deal at roughly $1 billion (as of January 8, 2026), while a Snowflake executive stated on a February 26, 2026 earnings call that the deal closed for about $600 million in cash and stock, versus Observe's last VC valuation of $750 million in July 2025.

Who is Observe's biggest competitor?

Datadog, which held 4.6% category mindshare versus Observe's 0.8% as of mid-2026 per PeerSpot, and posted FY2026 revenue guidance of $4.06-4.1 billion with 18-20% growth and 48% of Fortune 500 as customers as of December 2025.

Could AI replace Observe's product?

Observe folded AI into its own platform rather than being displaced by it, launching AI SRE and o11y.ai agents on November 4, 2025, which run on Snowflake Cortex, Claude, and OpenAI models and integrate with Cursor, Claude Code, and OpenAI Codex via an MCP Server.

Did Observe have layoffs during the Snowflake acquisition?

No layoffs were reported in available coverage; instead, the Observe team relocated to Snowflake's Menlo Park campus after the deal closed on February 2, 2026. KeyBanc did flag a roughly $22 million annual revenue headwind for Snowflake tied to a prior Observe usage contract.

How fast was Observe growing before it was acquired?

Observe stated it tripled revenue and doubled its enterprise customer base in the year leading up to its $156 million Series C, announced July 30, 2025, and separately claimed over 200% ARR growth with 190% net revenue retention as of September 26, 2024 (company-reported figures).

Telecom operators · absorbed · United States

Observe Inc.

observeinc.com ↗

AI-powered observability and log analytics platform, now absorbed into Snowflake.

Defensible for now

Assessed 22 July 2026 · Evidence as of 22 July 2026

Real protection, with named pressure against it.

On the recordSince 22 July 2026 · Checkable from Q1 2027 · Every call on the record Checkpoint: 12-month mark to see if Observe keeps a standalone product charter and P&L inside Snowflake

The call

Observe no longer stands alone; its fate now tracks whether Snowflake keeps observability as a first-class product or lets it dissolve into Cortex.

Observe Inc. made software that helped companies monitor and understand their computer systems. The company was much smaller than its main rivals like Datadog, and it could not grow fast enough to compete on its own. Snowflake bought Observe because Observe's technology works especially well with Snowflake's own data platform, which gives Snowflake an advantage for its current customers, but the biggest question now is whether Observe stays a real, separate product inside Snowflake or gets absorbed and disappears.

Why

AI pressure: Datadog's Bits AI and similar AI SRE agents from rival platforms. Observe built AI into its own product early, so AI fed it rather than ate it, but rivals now ship comparable AI agents at bigger scale. Could AI do the core job? Only partly.

Bigger players: Datadog Inc.. Datadog holds 48% of Fortune 500 and ~$4B revenue, dwarfing the niche telemetry lake Observe brought into Snowflake. Could a giant copy it? Yes, easily.

What protects it. Deep Snowflake-native data integration and a customer-specific Knowledge Graph now owned by Snowflake, tied to its existing data cloud customers.

What would change this call

Whether Observe gets a standalone charter and P&L inside Snowflake within 12 months of close. Shows whether Snowflake is investing in Observe or quietly folding it into other teams.
Whether Jeremy Burton or other Observe engineering leaders leave Snowflake through 2026 to 2027. Would signal talent attrition and weakened integration momentum post-acquisition.
Whether Capital One, Commonwealth Bank of Australia, mParticle, or Topgolf churn by Q2 2026. Would indicate customers are leaving rather than staying through the Snowflake transition.

Key numbers

Acquired by Snowflake for $600M to $1B (2026-02-02)
0.8% market mindshare vs Datadog's 4.6% (2026-01-08)
KeyBanc flags $22M annual revenue headwind (2026-01-08)

Named risks

Observe de-prioritized inside Snowflake within 12 months of Feb 2026 close (headcount freeze, roadmap stall). Severity: high
Customer churn among Capital One, Commonwealth Bank and other named accounts post-transition. Severity: medium
Datadog ships credible Snowflake-native integration neutralizing Observe's data-gravity moat. Severity: medium
KeyBanc-flagged ~$22M annual revenue headwind from prior Observe-Snowflake usage contract. Severity: medium
Snowflake's own reliability issues, including outage on January 8, 2026 deal announcement day, undermine pitch. Severity: low

Rivals, as read in July 2026

Rival	Direction	Evidence
Datadog	losing to	0.8% mindshare vs Datadog's 4.6% as of June 2026; Datadog guides $4.06-4.1B FY2026 revenue
Datadog	contesting	Datadog shipped own Bits AI SRE agent on December 2, 2025, matching Observe's AI SRE
Dynatrace	gaining on	Dynatrace posted 18% YoY Q3 FY2026 revenue growth to $515M as of September 30, 2025
Elastic	gaining on	Elastic posted 18% YoY Q3 FY2026 revenue growth to $450M as of September 30, 2025

Questions people ask

Is Observe Inc. still an independent company?: No. Snowflake closed its acquisition of Observe Inc. on February 2, 2026, after announcing the deal on January 8, 2026. Observe's founder-CEO Jeremy Burton resigned from Snowflake's board upon closing, and the Observe team relocated to Snowflake's Menlo Park campus.
How much did Snowflake pay to acquire Observe?: Figures conflict: The Information reported the deal at roughly $1 billion (as of January 8, 2026), while a Snowflake executive stated on a February 26, 2026 earnings call that the deal closed for about $600 million in cash and stock, versus Observe's last VC valuation of $750 million in July 2025.
Who is Observe's biggest competitor?: Datadog, which held 4.6% category mindshare versus Observe's 0.8% as of mid-2026 per PeerSpot, and posted FY2026 revenue guidance of $4.06-4.1 billion with 18-20% growth and 48% of Fortune 500 as customers as of December 2025.
Could AI replace Observe's product?: Observe folded AI into its own platform rather than being displaced by it, launching AI SRE and o11y.ai agents on November 4, 2025, which run on Snowflake Cortex, Claude, and OpenAI models and integrate with Cursor, Claude Code, and OpenAI Codex via an MCP Server.
Did Observe have layoffs during the Snowflake acquisition?: No layoffs were reported in available coverage; instead, the Observe team relocated to Snowflake's Menlo Park campus after the deal closed on February 2, 2026. KeyBanc did flag a roughly $22 million annual revenue headwind for Snowflake tied to a prior Observe usage contract.
How fast was Observe growing before it was acquired?: Observe stated it tripled revenue and doubled its enterprise customer base in the year leading up to its $156 million Series C, announced July 30, 2025, and separately claimed over 200% ARR growth with 190% net revenue retention as of September 26, 2024 (company-reported figures).

Timeline

2026-02-26Snowflake exec states Observe deal closed for about $600M in cash and stock
2026-02-02Snowflake officially closes acquisition of Observe; CEO Burton resigns Snowflake board seat
2026-01-09Snowflake suffers major outage the day after announcing Observe deal
2026-01-08Snowflake announces definitive agreement to acquire Observe; SNOW stock falls ~3%
2025-11-04Observe launches AI SRE and o11y.ai agents with MCP Server integrations
2025-07-30Observe closes $156M Series C led by Sutter Hill Ventures, valuing it at $750M
2024-09-26Observe closes further $145M Series B tranche, launches Project Voyager
2024-03-27Observe raises $115M Series B with Snowflake Ventures investing
2022-05-11Observe secures $70M Series A-2 debt, total funding reaches $114.5M
2020-10-07Observe emerges from stealth with roughly $35M Series A/debt

Revision history

22 July 2026

First assessed. Defensible for now. The text above is fixed as of this date and is not edited afterwards.

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