diff --git a/bottlecap/Cargo.lock b/bottlecap/Cargo.lock
index 5f975dec6..d2b0c04ba 100644
--- a/bottlecap/Cargo.lock
+++ b/bottlecap/Cargo.lock
@@ -724,7 +724,7 @@ dependencies = [
 [[package]]
 name = "datadog-fips"
 version = "0.1.0"
-source = "git+https://github.com/DataDog/serverless-components?rev=b29bba8b4178fc2089943fe28e853d529826888b#b29bba8b4178fc2089943fe28e853d529826888b"
+source = "git+https://github.com/DataDog/serverless-components?rev=985120329d0ba96c1ec8d719cc38e1f7ce11a092#985120329d0ba96c1ec8d719cc38e1f7ce11a092"
 dependencies = [
  "reqwest",
  "rustls",
@@ -1078,9 +1078,9 @@ dependencies = [
 [[package]]
 name = "dogstatsd"
 version = "0.1.0"
-source = "git+https://github.com/DataDog/serverless-components?rev=b29bba8b4178fc2089943fe28e853d529826888b#b29bba8b4178fc2089943fe28e853d529826888b"
+source = "git+https://github.com/DataDog/serverless-components?rev=985120329d0ba96c1ec8d719cc38e1f7ce11a092#985120329d0ba96c1ec8d719cc38e1f7ce11a092"
 dependencies = [
- "datadog-fips 0.1.0 (git+https://github.com/DataDog/serverless-components?rev=b29bba8b4178fc2089943fe28e853d529826888b)",
+ "datadog-fips 0.1.0 (git+https://github.com/DataDog/serverless-components?rev=985120329d0ba96c1ec8d719cc38e1f7ce11a092)",
  "datadog-protos 0.1.0 (git+https://github.com/DataDog/saluki/?rev=c89b58e5784b985819baf11f13f7d35876741222)",
  "ddsketch-agent 0.1.0 (git+https://github.com/DataDog/saluki/?rev=c89b58e5784b985819baf11f13f7d35876741222)",
  "derive_more",
diff --git a/bottlecap/Cargo.toml b/bottlecap/Cargo.toml
index 2cb2976ad..262057313 100644
--- a/bottlecap/Cargo.toml
+++ b/bottlecap/Cargo.toml
@@ -57,7 +57,7 @@ datadog-trace-protobuf = { git = "https://github.com/DataDog/libdatadog", rev =
 datadog-trace-utils = { git = "https://github.com/DataDog/libdatadog", rev = "8a49c7df2d9cbf05118bfd5b85772676f71b34f2" , features = ["mini_agent"] }
 datadog-trace-normalization = { git = "https://github.com/DataDog/libdatadog",  rev = "8a49c7df2d9cbf05118bfd5b85772676f71b34f2" }
 datadog-trace-obfuscation = { git = "https://github.com/DataDog/libdatadog", rev = "8a49c7df2d9cbf05118bfd5b85772676f71b34f2"  }
-dogstatsd = { git = "https://github.com/DataDog/serverless-components", rev = "b29bba8b4178fc2089943fe28e853d529826888b", default-features = false }
+dogstatsd = { git = "https://github.com/DataDog/serverless-components", rev = "985120329d0ba96c1ec8d719cc38e1f7ce11a092", default-features = false }
 datadog-trace-agent = { git = "https://github.com/DataDog/serverless-components", rev = "c3d8ed4f90591c6958921145d485463860307f78" }
 datadog-fips = { git = "https://github.com/DataDog/serverless-components", rev = "c3d8ed4f90591c6958921145d485463860307f78", default-features = false }
 axum = { version = "0.8.4", default-features = false, features = ["default"] }
diff --git a/bottlecap/src/bin/bottlecap/main.rs b/bottlecap/src/bin/bottlecap/main.rs
index 126932521..2aa46a66a 100644
--- a/bottlecap/src/bin/bottlecap/main.rs
+++ b/bottlecap/src/bin/bottlecap/main.rs
@@ -439,11 +439,7 @@ fn create_api_key_factory(
         let aws_config = Arc::clone(&aws_config);
         let aws_credentials = Arc::clone(&aws_credentials);
 
-        Box::pin(async move {
-            resolve_secrets(config, aws_config, aws_credentials)
-                .await
-                .expect("Failed to resolve API key")
-        })
+        Box::pin(async move { resolve_secrets(config, aws_config, aws_credentials).await })
     })))
 }
 
@@ -517,7 +513,7 @@ async fn extension_loop_active(
         trace_agent_shutdown_token,
     ) = start_trace_agent(
         config,
-        Arc::clone(&api_key_factory),
+        &api_key_factory,
         &tags_provider,
         Arc::clone(&invocation_processor),
         Arc::clone(&trace_aggregator),
@@ -1038,7 +1034,7 @@ fn start_metrics_flushers(
 #[allow(clippy::type_complexity)]
 fn start_trace_agent(
     config: &Arc<Config>,
-    api_key_factory: Arc<ApiKeyFactory>,
+    api_key_factory: &Arc<ApiKeyFactory>,
     tags_provider: &Arc<TagProvider>,
     invocation_processor: Arc<TokioMutex<InvocationProcessor>>,
     trace_aggregator: Arc<TokioMutex<trace_aggregator::TraceAggregator>>,
@@ -1064,6 +1060,7 @@ fn start_trace_agent(
     let trace_flusher = Arc::new(trace_flusher::ServerlessTraceFlusher {
         aggregator: trace_aggregator.clone(),
         config: Arc::clone(config),
+        api_key_factory: Arc::clone(api_key_factory),
     });
 
     let obfuscation_config = obfuscation_config::ObfuscationConfig {
@@ -1077,7 +1074,6 @@ fn start_trace_agent(
 
     let trace_processor = Arc::new(trace_processor::ServerlessTraceProcessor {
         obfuscation_config: Arc::new(obfuscation_config),
-        api_key_factory: api_key_factory.clone(),
     });
 
     // Proxy
@@ -1098,7 +1094,6 @@ fn start_trace_agent(
         proxy_aggregator,
         invocation_processor,
         Arc::clone(tags_provider),
-        api_key_factory,
     );
     let trace_agent_channel = trace_agent.get_sender_copy();
     let shutdown_token = trace_agent.shutdown_token();
diff --git a/bottlecap/src/logs/flusher.rs b/bottlecap/src/logs/flusher.rs
index a0e597abb..15d5cc3ce 100644
--- a/bottlecap/src/logs/flusher.rs
+++ b/bottlecap/src/logs/flusher.rs
@@ -42,7 +42,6 @@ impl Flusher {
         config: Arc<config::Config>,
     ) -> Self {
         let client = get_client(&config);
-
         Flusher {
             client,
             endpoint,
@@ -54,7 +53,10 @@ impl Flusher {
     }
 
     pub async fn flush(&self, batches: Option<Arc<Vec<Vec<u8>>>>) -> Vec<reqwest::RequestBuilder> {
-        let api_key = self.api_key_factory.get_api_key().await;
+        let Some(api_key) = self.api_key_factory.get_api_key().await else {
+            error!("Skipping flushing logs: Failed to resolve API key");
+            return vec![];
+        };
 
         let mut set = JoinSet::new();
 
diff --git a/bottlecap/src/proxy/interceptor.rs b/bottlecap/src/proxy/interceptor.rs
index 6feee0d15..d7efeadf3 100644
--- a/bottlecap/src/proxy/interceptor.rs
+++ b/bottlecap/src/proxy/interceptor.rs
@@ -399,7 +399,6 @@ mod tests {
         let metrics_aggregator = Arc::new(Mutex::new(
             MetricsAggregator::new(EMPTY_TAGS, 1024).unwrap(),
         ));
-
         let aws_config = Arc::new(AwsConfig {
             region: "us-east-1".to_string(),
             function_name: "arn:some-function".to_string(),
diff --git a/bottlecap/src/traces/proxy_flusher.rs b/bottlecap/src/traces/proxy_flusher.rs
index e6ce4be24..3b60ee2c1 100644
--- a/bottlecap/src/traces/proxy_flusher.rs
+++ b/bottlecap/src/traces/proxy_flusher.rs
@@ -2,10 +2,9 @@ use dogstatsd::api_key::ApiKeyFactory;
 use reqwest::header::HeaderMap;
 use std::{error::Error, sync::Arc};
 use thiserror::Error as ThisError;
-use tokio::{
-    sync::{Mutex, OnceCell},
-    task::JoinSet,
-};
+use tokio::sync::OnceCell;
+use tokio::{sync::Mutex, task::JoinSet};
+
 use tracing::{debug, error};
 
 use crate::{
@@ -83,7 +82,10 @@ impl Flusher {
         &self,
         retry_requests: Option<Vec<reqwest::RequestBuilder>>,
     ) -> Option<Vec<reqwest::RequestBuilder>> {
-        let api_key = self.api_key_factory.get_api_key().await;
+        let Some(api_key) = self.api_key_factory.get_api_key().await else {
+            error!("Skipping flush in proxy flusher: Failed to resolve API key");
+            return None;
+        };
 
         let mut join_set = JoinSet::new();
         let mut requests = Vec::<reqwest::RequestBuilder>::new();
diff --git a/bottlecap/src/traces/stats_flusher.rs b/bottlecap/src/traces/stats_flusher.rs
index d75844276..266d9d465 100644
--- a/bottlecap/src/traces/stats_flusher.rs
+++ b/bottlecap/src/traces/stats_flusher.rs
@@ -60,16 +60,21 @@ impl StatsFlusher for ServerlessStatsFlusher {
             return;
         }
 
+        let Some(api_key) = self.api_key_factory.get_api_key().await else {
+            error!("Skipping flushing stats: Failed to resolve API key");
+            return;
+        };
+
+        let api_key_clone = api_key.to_string();
         let endpoint = self
             .endpoint
             .get_or_init({
                 move || async move {
-                    let api_key = self.api_key_factory.get_api_key().await.to_string();
                     let stats_url = trace_stats_url(&self.config.site);
                     Endpoint {
                         url: hyper::Uri::from_str(&stats_url)
                             .expect("can't make URI from stats url, exiting"),
-                        api_key: Some(api_key.clone().into()),
+                        api_key: Some(api_key_clone.into()),
                         timeout_ms: self.config.flush_timeout * 1_000,
                         test_token: None,
                     }
@@ -95,12 +100,8 @@ impl StatsFlusher for ServerlessStatsFlusher {
 
         let start = std::time::Instant::now();
 
-        let resp = stats_utils::send_stats_payload(
-            serialized_stats_payload,
-            endpoint,
-            self.api_key_factory.get_api_key().await,
-        )
-        .await;
+        let resp =
+            stats_utils::send_stats_payload(serialized_stats_payload, endpoint, api_key).await;
         let elapsed = start.elapsed();
         debug!(
             "Stats request to {} took {}ms",
diff --git a/bottlecap/src/traces/trace_agent.rs b/bottlecap/src/traces/trace_agent.rs
index 3b3863911..7a2880902 100644
--- a/bottlecap/src/traces/trace_agent.rs
+++ b/bottlecap/src/traces/trace_agent.rs
@@ -37,7 +37,6 @@ use crate::{
 use datadog_trace_protobuf::pb;
 use datadog_trace_utils::trace_utils::{self};
 use ddcommon::hyper_migration;
-use dogstatsd::api_key::ApiKeyFactory;
 
 const TRACE_AGENT_PORT: usize = 8126;
 
@@ -86,7 +85,6 @@ pub struct StatsState {
 pub struct ProxyState {
     pub config: Arc<config::Config>,
     pub proxy_aggregator: Arc<Mutex<proxy_aggregator::Aggregator>>,
-    pub api_key_factory: Arc<ApiKeyFactory>,
 }
 
 pub struct TraceAgent {
@@ -99,7 +97,6 @@ pub struct TraceAgent {
     invocation_processor: Arc<Mutex<InvocationProcessor>>,
     shutdown_token: CancellationToken,
     tx: Sender<SendDataBuilderInfo>,
-    api_key_factory: Arc<ApiKeyFactory>,
 }
 
 #[derive(Clone, Copy)]
@@ -120,7 +117,6 @@ impl TraceAgent {
         proxy_aggregator: Arc<Mutex<proxy_aggregator::Aggregator>>,
         invocation_processor: Arc<Mutex<InvocationProcessor>>,
         tags_provider: Arc<provider::Provider>,
-        api_key_factory: Arc<ApiKeyFactory>,
     ) -> TraceAgent {
         // setup a channel to send processed traces to our flusher. tx is passed through each
         // endpoint_handler to the trace processor, which uses it to send de-serialized
@@ -147,7 +143,6 @@ impl TraceAgent {
             invocation_processor,
             tags_provider,
             tx: trace_tx,
-            api_key_factory,
             shutdown_token: CancellationToken::new(),
         }
     }
@@ -207,7 +202,6 @@ impl TraceAgent {
         let proxy_state = ProxyState {
             config: Arc::clone(&self.config),
             proxy_aggregator: Arc::clone(&self.proxy_aggregator),
-            api_key_factory: Arc::clone(&self.api_key_factory),
         };
 
         let trace_router = Router::new()
@@ -395,6 +389,8 @@ impl TraceAgent {
         (StatusCode::OK, response_json.to_string()).into_response()
     }
 
+    #[allow(clippy::too_many_arguments)]
+    #[allow(clippy::too_many_lines)]
     async fn handle_traces(
         config: Arc<config::Config>,
         request: Request,
diff --git a/bottlecap/src/traces/trace_flusher.rs b/bottlecap/src/traces/trace_flusher.rs
index 699c3c6cc..8fb6a2b47 100644
--- a/bottlecap/src/traces/trace_flusher.rs
+++ b/bottlecap/src/traces/trace_flusher.rs
@@ -10,13 +10,18 @@ use datadog_trace_utils::{
     send_data::SendDataBuilder,
     trace_utils::{self, SendData},
 };
+use dogstatsd::api_key::ApiKeyFactory;
 
 use crate::config::Config;
 use crate::traces::trace_aggregator::TraceAggregator;
 
 #[async_trait]
 pub trait TraceFlusher {
-    fn new(aggregator: Arc<Mutex<TraceAggregator>>, config: Arc<Config>) -> Self
+    fn new(
+        aggregator: Arc<Mutex<TraceAggregator>>,
+        config: Arc<Config>,
+        api_key_factory: Arc<ApiKeyFactory>,
+    ) -> Self
     where
         Self: Sized;
     /// Given a `Vec<SendData>`, a tracer payload, send it to the Datadog intake endpoint.
@@ -34,15 +39,29 @@ pub trait TraceFlusher {
 pub struct ServerlessTraceFlusher {
     pub aggregator: Arc<Mutex<TraceAggregator>>,
     pub config: Arc<Config>,
+    pub api_key_factory: Arc<ApiKeyFactory>,
 }
 
 #[async_trait]
 impl TraceFlusher for ServerlessTraceFlusher {
-    fn new(aggregator: Arc<Mutex<TraceAggregator>>, config: Arc<Config>) -> Self {
-        ServerlessTraceFlusher { aggregator, config }
+    fn new(
+        aggregator: Arc<Mutex<TraceAggregator>>,
+        config: Arc<Config>,
+        api_key_factory: Arc<ApiKeyFactory>,
+    ) -> Self {
+        ServerlessTraceFlusher {
+            aggregator,
+            config,
+            api_key_factory,
+        }
     }
 
     async fn flush(&self, failed_traces: Option<Vec<SendData>>) -> Option<Vec<SendData>> {
+        let Some(api_key) = self.api_key_factory.get_api_key().await else {
+            error!("Skipping flushing traces: Failed to resolve API key");
+            return None;
+        };
+
         let mut failed_batch: Option<Vec<SendData>> = None;
 
         if let Some(traces) = failed_traces {
@@ -64,6 +83,8 @@ impl TraceFlusher for ServerlessTraceFlusher {
         while !trace_builders.is_empty() {
             let traces: Vec<_> = trace_builders
                 .into_iter()
+                // Lazily set the API key
+                .map(|builder| builder.with_api_key(api_key))
                 .map(SendDataBuilder::build)
                 .collect();
             if let Some(failed) = self.send(traces).await {
diff --git a/bottlecap/src/traces/trace_processor.rs b/bottlecap/src/traces/trace_processor.rs
index 1322fe967..ca65bb405 100644
--- a/bottlecap/src/traces/trace_processor.rs
+++ b/bottlecap/src/traces/trace_processor.rs
@@ -20,7 +20,6 @@ use datadog_trace_utils::trace_utils::{self};
 use datadog_trace_utils::tracer_header_tags;
 use datadog_trace_utils::tracer_payload::{TraceChunkProcessor, TracerPayloadCollection};
 use ddcommon::Endpoint;
-use dogstatsd::api_key::ApiKeyFactory;
 use std::str::FromStr;
 use std::sync::Arc;
 use tracing::error;
@@ -31,7 +30,6 @@ use super::trace_aggregator::SendDataBuilderInfo;
 #[allow(clippy::module_name_repetitions)]
 pub struct ServerlessTraceProcessor {
     pub obfuscation_config: Arc<obfuscation_config::ObfuscationConfig>,
-    pub api_key_factory: Arc<ApiKeyFactory>,
 }
 
 struct ChunkProcessor {
@@ -164,11 +162,11 @@ impl TraceProcessor for ServerlessTraceProcessor {
                 tracer_payload.tags.extend(tags.clone());
             }
         }
-        let api_key = self.api_key_factory.get_api_key().await.to_string();
         let endpoint = Endpoint {
             url: hyper::Uri::from_str(&config.apm_dd_url)
                 .expect("can't parse trace intake URL, exiting"),
-            api_key: Some(api_key.into()),
+            // Will be set at flush time
+            api_key: None,
             timeout_ms: config.flush_timeout * 1_000,
             test_token: None,
         };
@@ -194,7 +192,6 @@ mod tests {
     };
 
     use datadog_trace_obfuscation::obfuscation_config::ObfuscationConfig;
-    use dogstatsd::api_key::ApiKeyFactory;
 
     use crate::{config::Config, tags::provider::Provider, LAMBDA_RUNTIME_SLUG};
 
@@ -299,7 +296,6 @@ mod tests {
         };
 
         let trace_processor = ServerlessTraceProcessor {
-            api_key_factory: Arc::new(ApiKeyFactory::new("test-api-key")),
             obfuscation_config: Arc::new(ObfuscationConfig::new().unwrap()),
         };
         let config = create_test_config();