DDOG vs ESTC

Datadog emphasized AI-driven product innovation in Q4/FY2025, launching and GA-ing Bits AI SRE (an AI on-call agent) and showcasing LLM Observability, AI Security for AWS Resources, Cloud SIEM Risk Insights, and Bits AI remediation as part of an expanded AWS collaboration. The company reported strong financials: Q4 revenue of $953M (up 29% YoY), non-GAAP operating income of $230M, GAAP net income of $46.6M, and Q4 free cash flow of $291.0M. Management signaled continued AI investment and provided Q1 2026 and FY2026 revenue and non-GAAP EPS guidance, while cautioning that non-GAAP reconciliations are subject to variability from stock-based compensation and related items.

Elastic positions itself as a 'Search AI' company and is actively shipping AI-specific products and integrations. Key AI launches/releases this quarter include Agent Builder (general availability), Elastic Workflows (technical preview), NVIDIA cuVS GPU-accelerated vector indexing (technical preview), and expanded Elastic Inference Service (EIS) capabilities including Cloud Connect and Jina model support. Integrations with Amazon Bedrock AgentCore and recognition from AWS (Agentic AI Specialization) are notable partnership proof points. Management frames the company's competitive advantage around providing real-time context for LLMs and reports robust commercial performance (Q3 total revenue $450M, +18% YoY) with positive non-GAAP profitability metrics. Guidance for Q4 and fiscal year point to continued growth. Overall tone is bullish with high innovation intensity and moderate-to-high confidence in execution, while standard macro, FX, and market risks are called out in forward-looking language.