Snowflake CEO Confirms Observe Acquisition To Boost ‘Enterprisewide Observability’

‘By bringing Observe’s capabilities directly into the Snowflake AI Data Cloud, we are empowering our customers to manage enterprisewide observability across terabytes to petabytes of telemetry with a modern, scalable architecture and AI-powered troubleshooting workflows,’ says Snowflake CEO Sridhar Ramaswamy.

Snowflake officially confirmed Thursday its intent to buy AI-powered observability startup Observe with CEO Sridhar Ramaswamy touting the blockbuster deal.

“By bringing Observe’s capabilities directly into the Snowflake AI Data Cloud, we are empowering our customers to manage enterprisewide observability across terabytes to petabytes of telemetry with a modern, scalable architecture and AI-powered troubleshooting workflows,” said Ramaswamy in a statement Thursday.

Financial details of Snowflake’s acquisition of Observe were not disclosed.

Ramaswamy said the acquisition of San Mateo, Calif.-based Observe positions Snowflake to usher in the next generation of observability architecture and expand its presence in a rapidly growing IT operations management software market.

“As our customers build increasingly complex AI agents and data applications, reliability is no longer just an IT metric—it’s a business imperative,” said Ramaswamy.

Data and AI cloud provider Snowflake last month struck a multiyear $200 million partnership with AI research and development company Anthropic through which Anthropic’s Claude AI models will be available in the Snowflake platform.

Snowflake Gives Observe The Ability ‘To Bring Observability To More Enterprises,’ CEO Says

Observe CEO Jeremy Burton said merging with Snowflake gives his company “the opportunity to accelerate our mission.”

“With Snowflake helping us scale, we’ll be able to bring observability to more enterprises worldwide and help them run reliable, high-performing AI applications and agents,” he said in a statement.

The deal is expected to close later this year. After the deal closes, Snowflake said it will deepen its commitment to helping customers build and operate reliable agents and applications.

Observe Closes $156M Funding Round

Observe offers customers choice through an open-standard architecture based on Apache Iceberg for storage and OpenTelemetry for ingestion.

The company aims to significantly lower costs by leveraging economical S3 storage, compression and elastic compute resources.

Observe will make observability core to the AI Data Cloud, advancing the shift from reactive monitoring to proactive, centralized observability.

In August, Observe closed a $156 million Series C funding round. The round was led by Sutter Hill Ventures with participation from Madrona Ventures, Alumni Ventures, Snowflake Ventures and Capital One Ventures.

“As enterprises embrace AI, the developer productivity bottleneck has moved from generating code to understanding issues from their applications and agents. We solve this problem at scale,” said Burton. “That’s why Observe has grown so quickly. Our AI SRE helps engineers troubleshoot faster and provide greater visibility at a fraction of the cost.”

Observe said its developer-friendly approach complements Snowflake’s existing workload engines by providing teams with real-time enterprise context, faster root-cause analysis and AI-assisted troubleshooting.