DDOG · Earnings call · 2026Q2T · Full report

AI Product Strategy

Datadog, Inc. · 2026-08-06 · Importance 40 · Surprise 42

Datadog expanded Bits AI across incident investigation, monitoring, remediation, coding, testing, release validation, and security, and is rolling out an AI-credit packaging model as usage broadens. Datadog for AI products address observability, security, cost, and effectiveness across GPUs, agents, data pipelines, model interactions, and AI-powered attacks. Management expects AI inference to become the dominant workload and sees opportunities across infrastructure, GPUs, LLMs, tool calls, applications, agent outcomes, and security controls.

Key facts

• Datadog for AI: Data Observability provides lineage, quality monitoring and jobs monitoring; Bits Data Analysis answers business questions using rich data context; Agent Console provides visibility into AI agent usage, cost, and effectiveness
• Agent Observability patterns capability automatically clusters user interactions into behavior groups and Bits Evals handles repetitive parts of the agent development loop
• Toto version 2 was shown in May and was stated to be state-of-the-art on key benchmarks and demonstrated scalability for time series models