Datadog is collaborating with Sakana AI to conduct joint research initiatives, co-develop AI observability features and execute go-to-market strategies targeting large enterprise clients in Japan. This alliance aims to enhance the performance, reliability and real-world production readiness of AI-powered applications at scale.

In its latest quarter Datadog posted adjusted EPS of $0.59, topping consensus by $0.03, and delivered revenue of $953.19 million, up 29% year-over-year and above the $916.58 million forecast. The stronger-than-expected results underscore robust demand for its cloud monitoring and security solutions driven by AI adoption.

Shares of Datadog jumped over 5.6% in premarket trading on the combined news of strategic expansion and earnings beat, reflecting investor optimism about accelerated AI initiatives. The partnership and financial momentum position the company to deepen its enterprise footprint in Asia and potentially drive further revenue growth.