Databricks Agrees to Acquire Neon

Databricks, Inc. announced its intent to acquire Neon, Inc., a serverless Postgres company.

As the $100-billion-plus database market braces for unprecedented disruption driven by AI, Databricks plans to continue innovating and investing in Neon’s database and developer experience for existing and new Neon customers and partners. 

Neon: An Open, Serverless Foundation for Developers and AI Agents
AI agents are becoming increasingly integral components for modern developers, and Neon is purpose-built to support their agentic workflows. Recent internal telemetry showed that over 80 percent of the databases provisioned on Neon were created automatically by AI agents rather than by humans, underscoring how explosively agentic workloads are growing.

These workloads differ from human-driven patterns in 3 important ways:

• Speed + flexibility: Agents operate at machine speed and traditional database provisioning often becomes a bottleneck – Neon can spin up a fully isolated Postgres instance in 500 milliseconds or less and supports instant branching and forking of not only database schema but also data, so experiments never disturb production.
• Cost proportionality: Agents demand a cost structure that scales precisely with usage – Neon’s full separation of compute and storage keeps the TCO for thousands of ephemeral databases proportional to the queries they actually run.
• Open source ecosystem: Agents expect to leverage the rich Postgres community – Neon is 100 percent Postgres-compatible and works out of the box with popular extensions.
  

“The era of AI-native, agent-driven applications is reshaping what a database must do,” said Ali Ghodsi, Co- founder and CEO, Databricks. “Neon proves it: 4 out of every 5 databases on their platform are spun up by code, not humans. By bringing Neon into Databricks, we’re giving developers a serverless Postgres that can keep up with agentic speed, pay-as-you-go economics and the openness of the Postgres community.“

Databricks and Neon‘s Shared Vision
Together, Databricks and Neon will work to remove the traditional limitations of databases that require compute and storage to scale in tandem – an inefficiency that hinders AI workloads. The integration of Neon’s serverless Postgres architecture with the Databricks Data Intelligence Platform will help developers and enterprise teams efficiently build and deploy AI agent systems. This approach not only prevents performance bottlenecks from thousands of concurrent agents but also simplifies infrastructure, reduces costs and accelerates innovation – all with Databricks’ security, governance and scalability at the core.

“Four years ago, we set out to build the best Postgres for the cloud that was serverless, highly scalable, and open to everyone. With this acquisition, we plan to accelerate that mission with the support and resources of an AI giant,” said Nikita Shamgunov, CEO, Neon. “Databricks was founded by open source pioneers committed to making it easier for developers to work with data and AI at any scale. Together, we are starting a new chapter on an even more ambitious journey.“

Neon’s talented team is expected to join Databricks after the transaction closes, and the team brings deep expertise and continuity for Neon’s vibrant community. Together, Neon and Databricks will empower organizations to eliminate data silos, simplify architecture and build AI agents that are more responsive, reliable and secure.

The company plan to share more at Data + AI Summit in San Francisco, CA, taking place June 9-12, 2025. 

Details Regarding the Proposed Acquisition
The proposed acquisition is subject to customary closing conditions, including any required regulatory clearances.