Palantir rival Databricks reportedly hit a $100 billion valuation after a Series K investment.It's no secret that investors have gone bananas for artificial intelligence (AI) stocks over the past few years. What's a little peculiar, though, is how concentrated the AI trade has become -- dominated by the "Magnificent Seven" and a handful of high-profile outliers, one of the most widely discussed being data mining specialist Palantir Technologies (PLTR 1.60%).Palantir isn't alone. One of its closest rivals in ...

Core Viewpoint - Databricks is raising $1 billion in a new funding round at a valuation of $100 billion, focusing on advancing its AI Agent database and platform [2][3]. Funding and Financials - The recent funding round is led by Thrive and Insight Partners, with Databricks having raised approximately $20 billion since its inception in 2013 [2]. - The company completed a record $10 billion financing in January at a valuation of $62 billion, which was later surpassed by OpenAI's $40 billion financing in March [2]. Product Development - Databricks plans to invest heavily in its AI Agent database, named Lakebase, which was launched in June and is based on the open-source Postgres database [4]. - The total addressable market (TAM) for the database market is estimated at $105 billion, with a significant portion of databases now being created by AI agents, increasing from 30% to 80% in one year [4][5]. Competitive Advantage - The differentiation of Lakebase from competitors like Supabase lies in its "separation of compute and storage" architecture, allowing for cost-effective database creation [6]. - The second focus of investment is the AI Agent platform, Agent Bricks, which aims to provide reliable solutions for everyday business tasks rather than pursuing superintelligent AI [6][7]. Talent Acquisition - Databricks is also raising additional funds to compete for AI talent, acknowledging the high costs associated with hiring in this field [8].

Investment Rating - The report assigns a "Buy" rating to Snowflake Inc. with a target price of $208.61 [18]. Core Insights - The report emphasizes the central role of platforms like Databricks and Snowflake in enterprise AI transformation, highlighting their rapid innovation and the shift of value from infrastructure to platforms and applications [1][5]. - Databricks' product innovations, including Lakebase, Agent Bricks, and Databricks Apps, are designed to enhance AI adoption and streamline the development of AI-driven applications [1][4]. - The demand for data and analytics solutions remains strong, with enterprises increasingly moving AI workloads into production, indicating a higher maturity in enterprise AI compared to the previous year [6][8]. Summary by Sections Databricks Innovations - Databricks introduced Lakebase, a serverless database designed for AI applications, which offers low-latency performance and autoscaling capabilities [4]. - The company reported that Databricks Apps has become its fastest-growing product, with over 2,500 customers and more than 20,000 applications created since its launch [5][9]. - Agent Bricks provides a framework for building enterprise-grade AI agents, reflecting the growing trend of deploying Agentic AI in enterprises [5][6]. Market Dynamics - Partner feedback indicates a healthy demand environment for data solutions, with enterprises willing to invest in AI technologies [6][8]. - The competitive landscape is evolving, with Snowflake narrowing the gap with Databricks in AI services and features [8]. - Enterprises like JPMorgan are deploying numerous AI use cases, with significant annual spending on AI, reinforcing the sustainability of AI growth [5][6]. Financial Performance - Databricks reported over $2.6 billion in revenue for FY25, representing more than 60% growth, and is targeting a revenue run-rate of $3.7 billion for the upcoming quarter [9]. - The company reached free cash flow breakeven in FY25 and emphasized its commitment to innovation and R&D, with R&D spending at 32% of revenue [9].