Dynatrace to Acquire AI Observability Leader Arize :: Dynatrace, Inc. (DT)

Dynatrace to Acquire AI Observability Leader Arize

August 13, 2026 6:00 am EDT

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Acquisition will provide the industry’s most comprehensive AI development lifecycle solution

BOSTON & SAN FRANCISCO--(BUSINESS WIRE)-- Dynatrace (NYSE: DT), the leading AI-powered observability platform, has signed a definitive agreement to acquire Arize in a cash and stock transaction valued at $915 million. Together, Dynatrace and Arize will enable customers to evaluate, operate, and continuously improve AI applications from development through production at scale.

AI Observability spans the full lifecycle of an AI application, from experimentation and evaluation before release, to tracing how LLMs, agents, and orchestration layers behave in production. It connects that behavior with application performance, GPU utilization, infrastructure health, and business processes. AI Observability delivers the insights AI engineers, developers, SREs, and platform teams need to debug and optimize AI behavior and keep AI-powered services accurate, reliable, and cost-efficient. It is also one of the fastest-growing categories in observability, projected to exceed $10 billion by 2030 and is central to Dynatrace's growth strategy.

“AI is now moving into production at incredible speed, and the resulting AI Observability market opportunity is enormous. Dynatrace anticipates customers' needs at critical inflection points, and this is one of the most significant in our history,” said Rick McConnell, CEO, Dynatrace. “Acquiring Arize advances our AI observability leadership, accelerates our roadmap, enhances our long-term growth profile, expands our reach with the developer community, and adds an incredible AI-first team to Dynatrace.”

Today, AI software delivery is fragmented. AI engineering teams evaluate model and agent behavior in one set of tools, while the teams running the applications and infrastructure beneath them work in another. There is often no shared system connecting how an AI application is evaluated to how it behaves in production, so when output quality slips or a customer transaction fails, the cause can sit anywhere from the prompt to the infrastructure, and there is little feedback to developers. Dynatrace's acquisition of Arize will eliminate that fragmentation and provide end-to-end observability from development to production.

Arize is the category leader in AI Observability, purpose-built for AI and agents and trusted by Fortune 500 enterprises and AI-native builders alike. Arize combines a strong developer brand and thriving open source community with the enterprise-grade frameworks that teams need to detect hallucinations, measure output quality, and continuously validate AI behavior. It is the only platform that is simultaneously OSS-native and stack-agnostic across every major AI framework and model provider. This makes Arize a clear choice for developers across the AI lifecycle.

“We founded Arize because AI teams needed a way to know their agents were actually working correctly, not just running,” said Jason Lopatecki, CEO, Arize. “Joining Dynatrace will enable us to take that mission much further. Together, we can bring AI evaluation and software observability into an end-to-end system, enabling teams to build more ambitious AI applications faster. This is the kind of innovation that only happens when two companies with highly complementary solutions and go-to-market models come together, setting a new bar for what AI Observability can deliver for the entire industry.”

Following the closing of the proposed acquisition, Dynatrace customers will gain:

Continuous coverage across the AI lifecycle, from experimentation and deployment readiness through runtime evaluation and observability, with automated feedback loops that support ongoing improvement.

Unified context for understanding AI behavior and business impact, connecting model and agent evaluation with application performance, infrastructure health, and business outcomes.

An enterprise data foundation for AI workloads, powered by exabyte-scale analysis and AI lakehouse capabilities.

For developers, the combination will deliver a direct path from experimentation to enterprise-grade deployment, backed by Arize's trusted standing in the open-source AI community. As AI tooling decisions increasingly start with developers, that trust opens a direct path to the observability and reliability capabilities that Dynatrace already brings to enterprise customers.

Transaction Details

The transaction is expected to close later this quarter or early in Dynatrace’s third quarter, subject to regulatory reviews and other customary closing conditions. Under the terms of the agreement, Dynatrace will acquire Arize for $915 million, subject to customary adjustments, consisting of approximately $815 million in cash as well as replacement equity awards for Arize employees joining...