Analyst Perspectives

It has been a little over a decade since the term data operations entered the analytics and data lexicon. It describes the application of agile development, DevOps and lean manufacturing by data engineering professionals in support of data production. DataOps was initially seen as antithetical to traditional data management approaches, which typically included batch-based and manual tools and practices. The term was embraced by emerging software providers as a means of differentiating from established data management providers. This is no longer the case, however. Many longstanding providers of data management products, such as Informatica, have adopted DataOps capabilities and methodologies, adapting product portfolios to cloud-based consumption and automated, collaborative and agile processes.

Informatica was founded in 1993 and helped establish the market for extract, transformation and load tooling. It expanded its focus to address wider data integration and data management challenges, including master data management, data quality and data governance. The software provider’s products were primarily licensed for use in on-premises environments. However, Informatica has evolved its product portfolio to address subscription-based licensing and cloud-based consumption.

Much of this transformation occurred during a period of private ownership between 2015 and 2021 that enabled Informatica to transition its business away from the glare of public investors. Informatica returned to the stock market in an initial public offering in October 2021 with a product portfolio led by its Intelligent Data Management Cloud and driven by its CLAIRE artificial intelligence capabilities.

While Informatica’s product portfolio has transformed in recent years, the software provider’s financial results for fiscal 2024 illustrated that the transition of its customer base remains ongoing. Informatica reported total revenue up 2.8% to $1.64 billion, the majority of which ($1.1 billion) came from subscription revenue. However, the company also reported net new cloud bookings below expectations, which Informatica attributed to higher-than-expected on-premises maintenance bookings and self-managed migrations to the cloud. This reflects the company’s ongoing commitment to serve customers on-premises and in the cloud, and the stickiness of self-managed and on-premises deployments. The transition of Informatica’s customer base to the cloud is anticipated to accelerate through enhanced functionality to support the development of AI workloads and partnerships with the likes of AWS, Databricks, Google Cloud, Microsoft Azure, Oracle Cloud and Snowflake.

Informatica is still closely associated with data integration. However, the software provider’s Intelligent Data Management Cloud addresses data-related capabilities, including data cataloging and metadata management, data engineering, application and application programming interface integration, data quality and observability, master data management, data sharing and data governance. The latter was boosted by the company’s most recent acquisition, adding the data management access and privacy capabilities of Privitar in 2023.

The breadth and depth of Informatica’s data-related expertise are illustrated by the software provider’s recognition as Exemplary in 11 different ISG Buyers Guide reports in 2024, including Data Intelligence, Data Integration, Data Governance, Data Quality, Application Integration and Master Data Management. Informatica was also rated as Exemplary in the various DataOps Buyers Guide reports—Data Pipelines, Data Orchestration, Data Observability, Data Products and overall DataOps—reflecting the transformation of its products to be more automated, collaborative and agile.

DataOps describes a set of tools and practices and a philosophy to ensure the quality, flexibility and reliability of data and analytics initiatives, emphasizing continuous measurable improvement. Our research leads me to assert that through 2027, enterprises will prioritize the adoption of DataOps products that address a combination of data pipeline development, data orchestration and data observability, reducing the complexity and cost of using multiple tools. As one of only a handful of providers rated as Exemplary in all the DataOps Buyers Guide reports, Informatica should be in good stead for market growth.

The transformation of Informatica’s product portfolio owes much to the company’s embrace of AI. The software provider works with partners to ensure that AI development projects are built on a foundation of reliable data pipelines and trusted data. It also incorporates AI capabilities into Intelligent Data Management Cloud to accelerate and automate data management processes. As was explained in ISG’s State of Generative AI Market Report, AI-ready data is clean, well-organized and compliant with regulatory standards.

In late 2024, Informatica announced the launch of GenAI blueprints to make it easier for customers to build GenAI applications on AWS, Databricks, Google Cloud, Microsoft Azure, Oracle Cloud and Snowflake. In addition to reference architectures and connectors for the relevant GenAI model services and vector databases, the blueprints address data governance, data quality and MDM capabilities to ensure that enterprise GenAI development projects are based on trusted data sources.

GenAI is also a factor in the evolution of Informatica’s CLAIRE intelligent automation engine. CLAIRE GPT was released in 2024 as a natural language assistant. CLAIRE predates the emergence of GenAI, however. It provides automated recommendations to improve user productivity with Intelligent Data Management Cloud features, including data profiling, data classification, asset discovery, application integration, data integration design and performance monitoring.

While Informatica has transformed its product portfolio to address cloud consumption and DataOps, some customers are still catching up to evolving data trends. The company must continue to address the needs of these customers while also working to attract new business in competition with rivals that are more readily associated with agile data operations. The software provider’s performance across the 2024 ISG Buyers Guides reflects the depth and breadth of its product and customer experience capabilities. I recommend that any enterprise assessing data intelligence and operations products include Informatica and Intelligent Data Management Cloud in evaluations.

Regards,

Matt Aslett