Wave 3 of AI Beneficiaries: the software that wins from the AI workload explosion (e.g. Datadog)

The logic:

Usage-based pricing. The more AI services running in production, the more logs, metrics, and traces (records of how requests travel through a system) get generated.
$DDOG
bills by volume, so its revenue rises in lockstep with AI usage.

Agentic AI means more microservices and more points of failure, which means more demand for the software that tracks latency, errors, and bottlenecks across all of those services.