Datadog's full-year sales outlook has been impacted by a significant reduction in usage from one of its largest customers, a leading artificial intelligence company.

Despite this, Datadog reported growth in the second quarter. However, the company's guidance for the full year fell below Wall Street estimates, largely due to the aforementioned usage decrease. This customer recently signed a nine-figure renewal deal with Datadog.

Chief Financial Officer David Obstler stated on a call with analysts that the usage reduction from their largest customer is factored into the Q3 and full-year 2026 guidance. Following this announcement, Datadog's stock experienced a 16% decline, trading at $238.08.