Dynatrace Inc. to Acquire Arize AI for $915 Million

Dynatrace Inc. signed a definitive agreement on August 13, 2026, to acquire Arize AI in a cash and stock transaction valued at $915 million. The deal includes approximately $815 million in cash and replacement equity awards.

The acquisition aims to move Dynatrace Inc.'s capabilities upstream in the AI application lifecycle. While Dynatrace Inc. currently provides production-level AI observability, Arize AI specializes in pre-release evaluation, experiments, and prompt iteration through its AX platform and Phoenix project. This integration allows Dynatrace Inc. to engage the developer community earlier in the software development process.

Arize AI co-founders Jason Lopatecki and Aparna Dhinakaran will join Dynatrace Inc. upon the deal's closing, which is expected this quarter or early next, pending regulatory review. Lopatecki will report to Dynatrace Inc. Chief Executive Rick McConnell and continue to lead the Arize AI team.

Dynatrace Inc. expects the acquisition to provide roughly 200 basis points of accretion to annual recurring revenue growth in the coming fiscal year. However, the company anticipates a 175-basis-point dilution in non-GAAP operating margin.