Datadog Reports Rapid AI Growth and Expanding Product Footprint
Datadog is expanding its cloud monitoring platform as AI agent activity surges and revenue growth accelerates among its broader customer base.
Cloud monitoring company Datadog, Inc. is expanding its security and observability platform to address the increasing complexity of software environments and the integration of artificial intelligence. In the second quarter of 2026, the company reported that more than 750 AI-focused customers were utilizing its services. This growth is highlighted by a rapid increase in activity from AI agents and a more than 22-fold rise in MCP tool calls since the end of 2025.
Beyond the AI sector, revenue growth across the broader customer base has accelerated to the high-20% range. The company is successfully increasing its footprint within existing accounts, with 85% of customers now using at least two of its more than 20 available products. A recent multiyear agreement with a large media customer valued at over $30 million exemplifies this expansion strategy.
Despite these operational gains, the company faces financial pressure due to a surge in stock valuation. Since May, the stock has risen more than 75% and is currently trading at approximately 84.8x forward earnings, creating a high expectation for Datadog to sustain rapid revenue growth and increase durable profits.
