Dynatrace to acquire AI observability startup Arize for $915 million

Dynatrace has entered into a definitive agreement to acquire Arize, a Berkeley-based startup specializing in AI observability, for $915 million. The deal consists of approximately $815 million in cash and replacement equity awards for Arize employees. This represents the largest acquisition in Dynatrace’s history.

Arize provides a platform designed to help engineering teams test, evaluate, and monitor the behavior of machine learning models, large language models, and AI agents in production. Its tools are used to detect issues such as hallucinations, data drift, and drops in output quality. By integrating Arize, Dynatrace aims to bridge the gap between AI model evaluation and traditional application infrastructure monitoring, allowing for full life-cycle optimization of AI systems.

Prior to this acquisition, Arize had raised approximately $131 million in venture capital, including a $70 million Series C in February 2025. Dynatrace will fund the transaction using cash on hand and/or its existing credit facility.