Snowflake Inc. (NYSE:SNOW) announced on January 8, 2026, that it has acquired Observe, a company specializing in AI-powered observability. The acquisition represents a strategic expansion of Snowflake's AI Data Cloud platform.
Observe's technology enables enterprises to integrate telemetry and business data, applying analytics and agentic AI to troubleshoot systems up to ten times faster than before. The platform's AI Site Reliability Engineer (SRE) combines logs, metrics, and traces into a unified context graph, helping companies detect anomalies early and resolve production issues efficiently.
The platform is built on open standards including Apache Iceberg and OpenTelemetry, supporting large-scale, cost-effective retention of telemetry data. Snowflake management highlighted the $51.7 billion IT operations management market that this acquisition addresses.
Analyst reactions to Snowflake have been mixed following the announcement. On January 12, Barclays downgraded the stock to 'Equal Weight,' citing a 42% rally in 2025 and describing current valuation as stretched. Also on January 12, Goldman Sachs initiated coverage with a 'Buy' rating and $286 price target, pointing to AI adoption and data platform modernization as key growth catalysts.
Snowflake provides cloud-native data warehousing through its Data Cloud, enabling secure, scalable AI, analytics, and data applications development across global storage, compute, and cloud services.