To continue advancing its commitment to meet the growing data needs stemming from the AI era, Palo Alto Networks® (NASDAQ: PANW), a global cybersecurity leader, announced today the signing of a definitive agreement to acquire Chronosphere, a next-generation observability platform designed to scale in AI-driven environments. With this acquisition, Palo Alto Networks will strengthen its ability to support organizations in a landscape where modern applications and AI-based workloads require a unified infrastructure for data and security.
The rise of such applications and workloads demands constant availability and high resilience, making continuous real-time observability a critical pillar. Chronosphere has been specifically developed to meet these requirements: it features an advanced architecture optimized for large-scale operation in the AI era, capable of managing massive volumes of cloud data while prioritizing cost-efficiency and reliability. Its performance has already been validated in real-world environments by some of the most prominent companies in AI, including two leading large language models (LLMs).
Nikesh Arora, Chairman and CEO of Palo Alto Networks:
“The fundamental requirement for any modern AI data center is constant availability and high resilience, which necessitates continuous and real-time observability capabilities offered at a fair cost. Chronosphere was designed from day one to scale alongside the data demands of the AI era, which is why leading AI-native and cloud-born organizations choose it. And when we integrate AgentiX with Chronosphere, we will elevate observability from simple dashboards to agent-based, real-time remediation. We’re not just excited to enter this space—we aim to revolutionize it.”
The combination of Chronosphere’s specific, optimized architecture—capable of managing some of the largest and most complex digital environments—with Palo Alto Networks’ AgentiX™ will transform the value proposition of observability, shifting from passive monitoring to an autonomous, agent-based remediation platform. The new solution will deploy AI agents over the vast amounts of monitored data within Chronosphere’s platform, enabling not only performance issue detection but also autonomous root cause investigation and closure of issues through agent-based remediation. Customers will gain much deeper visibility into security and observability data at petabyte scale, while achieving significant cost efficiencies thanks to Chronosphere’s optimized data ingestion architecture.
Martin Mao, Co-Founder and CEO of Chronosphere:
“We founded Chronosphere to provide scalable resilience to the world’s largest digital organizations. Palo Alto Networks is the perfect strategic partner for our clients, partners, and employees. It allows us to combine our disruptive observability platform with the best security company in the world, accelerating our progress in solving the most complex data and resilience challenges. Together, we look forward to continuing collaboration with leading cloud-native AI organizations worldwide to meet their critical observability and security needs.”
Chronosphere is ranked as a Leader in Gartner® Magic Quadrant™ 2025 for Observability Platforms and will also bring innovative telemetry pipeline capabilities to Palo Alto Networks’ leading platform, driving powerful data transformation, optimization, and distribution. This will enable customers to economically support massive data ingestion at scale.
Under the terms of the agreement, Palo Alto Networks will acquire Chronosphere for a total consideration of $3.35 billion, paid in cash and in the form of replacement performance-based stock incentives, subject to adjustments. Chronosphere reports generating over $160 million in annual recurring revenue (“ARR”) as of the end of September 2025, with three-digit year-over-year ARR growth. The acquisition is subject to customary closing conditions, including regulatory approvals, and is expected to be completed in the second half of Palo Alto Networks’ fiscal year 2026.