Databricks started later. It built a more complex architecture. It focused on unstructured data; images, documents, logs, audio. Though vast within the enterprise, this data had historically produced little insight. Too hard to process. Too messy to query. Too expensive to store in formats that mattered.
Snowflake took the opposite bet. Structured data. Clean tables. SQL queries that ran fast & returned answers executives could read. The market agreed. Snowflake went public at a $70 billion valuation. Databricks raised private rounds at half that.
Then AI arrived. Suddenly the data that was too messy to query became the data that models needed to train. Unstructured data wasn’t a liability. It was the asset.
Databricks has overtaken Snowflake in revenue. Two years ago, Snowflake led by $220 million per quarter. Today, Databricks leads by $120 million. Databricks’ growth rate is accelerating at scale, from 50% to 55% to 65% year over year. Growth rates don’t accelerate at $5 billion in revenue.
The crossover happened because AI is an architectural transition, not a feature addition.
Most enterprise data never made it into Snowflake. It sat in object storage, unstructured, waiting. Databricks built tools to use it there. No migration required.
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Awesome job by the @databricks team
My summary:
They trained a model called KARL that beats Claude 4.6 and GPT 5.2 on enterprise knowledge tasks (searching docs, cross-referencing info, answering questions over internal data), at ~33% lower cost and ~47% lower latency.
The key insight: instead of throwing expensive frontier models at enterprise search, you can use reinforcement learning on synthetic data to train a smaller model that's faster, cheaper, AND better at the specific task.
RL went beyond making the model more accurate. I t learned to search more efficiently (fewer wasted queries, better knowing when to stop searching and commit to an answer).
They're opening this RL pipeline to Databricks customers so they can build their own custom RL-optimized agents for high-volume workloads.
I think we'll continue to see data platforms become agent platforms. Databricks' KARL paper is really an agent platform play. The pitch: you already store your enterprise data in the Lakehouse, now Databricks will train a custom RL agent that searches and reasons over it, tuned specifically for your highest-volume workloads (workloads = apps = agents). The business move is closing the loop: data storage → retrieval → custom agent training → serving, all on Databricks. They're turning "your data lives here" into "your agents live here too."
Kudos @alighodsi @matei_zaharia @rxin
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