Core Viewpoint - Datadog reported quarterly earnings of $0.49 per share, exceeding the Zacks Consensus Estimate of $0.43 per share, and showing an increase from $0.44 per share a year ago, indicating a strong performance in the data analytics and cloud monitoring sector [1][2]. Financial Performance - The company achieved revenues of $737.73 million for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 3.67% and reflecting a year-over-year increase from $589.65 million [2]. - Datadog has consistently outperformed consensus EPS estimates over the last four quarters, with an earnings surprise of 13.95% in the latest report [1][2]. Stock Performance - Datadog shares have increased approximately 3.6% since the beginning of the year, outperforming the S&P 500's gain of 2.9% [3]. - The current Zacks Rank for Datadog is 3 (Hold), indicating that the stock is expected to perform in line with the market in the near future [6]. Earnings Outlook - The consensus EPS estimate for the upcoming quarter is $0.44, with expected revenues of $734.32 million, and for the current fiscal year, the estimate is $1.95 on $3.19 billion in revenues [7]. - The trend of earnings estimate revisions is mixed, which could change following the recent earnings report [6]. Industry Context - The Internet - Software industry, to which Datadog belongs, is currently ranked in the top 30% of over 250 Zacks industries, suggesting a favorable outlook for stocks within this sector [8].

Core Insights - Datadog reported a fiscal fourth-quarter revenue growth of 25% year-on-year, reaching $737.73 million, surpassing analyst expectations of $714.54 million [1] - The adjusted EPS of 49 cents exceeded the consensus estimate of 44 cents [1] Financial Performance - As of December 31, Datadog had 3,610 customers with an ARR of $100,000 or more, marking a 13% year-over-year increase [2] - The adjusted gross margin decreased by 100 basis points to 82%, while the adjusted operating margin fell by 400 basis points to 24% [2] - Datadog held cash and equivalents of $4.2 billion and generated $241 million in free cash flow [2] Strategic Initiatives - The CEO highlighted that in 2024, Datadog introduced new features to assist customers in cloud migration and adopting next-gen AI technologies [3] - The company aims to address complex challenges in Observability, Cloud Security, Software Delivery, Cloud Service Management, and Product Analytics through 2025 [3] Future Outlook - For the first quarter, Datadog expects revenue between $737 million and $741 million, slightly below the consensus of $740.29 million, with an adjusted EPS projected at $0.41–$0.43, below the consensus of $0.46 [4] - For fiscal 2025, the revenue forecast is $3.175 billion to $3.195 billion, compared to the consensus of $3.24 billion, with an adjusted EPS of $1.65–$1.70, also below the consensus of $2.05 [4] Market Reaction - Datadog's stock experienced a decline of over 10.2% to $133.08 in premarket trading following the earnings report [6] - Analyst sentiment has shifted, with a downgrade from Buy to Hold due to anticipated challenges in revenue growth and margins throughout fiscal 2025 [5]

Here's our initial take on Datadog's (DDOG 1.84%) fourth-quarter financial report.Key MetricsMetricQ4 2023Q4 2024Changevs. ExpectationsTotal revenue$590 million$738 million+25%BeatAdjusted earnings per share$0.44$0.49+11%BeatCustomers > $100K ARR3,1903,610+13%n/aFree cash flow$201 million$241 million+20%n/aTrouble Ahead for Datadog?Things looked good for Datadog in the fourth quarter. Strong quarterly revenue gains helped the data-focused technology company finish 2024 with a 26% rise in annual sales, and a ...

Datadog exceeded earnings expectations with notable revenue growth and strong customer expansion in its Q4 2024 results.Datadog (DDOG 1.84%), a leading provider of observability and security platforms, announced its financial results for the fourth quarter of 2024 on February 13, 2025. The company outperformed expectations, with non-GAAP earnings per share (EPS) of $0.49 against estimates of $0.43, marking a 14% beat. Revenue climbed to $738 million, exceeding projections by $24 million and marking a 25.1% ...

Revenue Growth - Fourth quarter revenue grew 25% year-over-year to $738 million[5] - Fiscal year 2024 revenue was $2.68 billion, an increase of 26% year-over-year[5] - Revenue for Q4 2024 reached $737.7 million, a 25% increase from $589.6 million in Q4 2023[30] - For Q1 2025, revenue is expected to be between $737 million and $741 million[7] Customer Metrics - Datadog had 462 customers with $1 million+ ARR, up 17% from 396 a year ago[7] Profitability - GAAP net income per diluted share for Q4 2024 was $0.13, while non-GAAP net income per diluted share was $0.49[5] - Net income for Q4 2024 was $45.6 million, a decrease of 15.5% from $54.0 million in Q4 2023[30] - GAAP operating income for the year ended December 31, 2024, was $54.284 million, a significant recovery from a loss of $33.464 million in 2023[36] - Non-GAAP operating income for fiscal year 2025 is projected to be between $655 million and $675 million[11] Cash Flow - Operating cash flow for fiscal year 2024 was $871 million, with free cash flow of $775 million[2] - The company reported a net cash provided by operating activities of $265.2 million for Q4 2024, compared to $220.2 million in Q4 2023[34] - Free cash flow for the year ended December 31, 2024, was $775.103 million, an increase from $597.548 million in 2023, marking a 29.8% rise[39] - Free cash flow margin for Q4 2024 was 33%, slightly down from 34% in Q4 2023[39] Expenses - Research and development expenses for Q4 2024 were $316.3 million, a 25% increase from $253.3 million in Q4 2023[30] - Research and development expenses (GAAP) for Q4 2024 were $316.314 million, up from $253.250 million in Q4 2023, indicating a 25% increase[36] Assets and Liabilities - Cash and cash equivalents increased to $1.25 billion as of December 31, 2024, from $330.3 million in 2023[32] - Total current assets rose to $4.91 billion in 2024, compared to $3.18 billion in 2023, reflecting a 54.3% increase[32] - Total liabilities increased to $3.07 billion in 2024, up from $1.91 billion in 2023[32] Product Development and Innovation - The company plans to deliver more innovation in areas like Cloud Security and Product Analytics in 2025[2] - Datadog expanded its Database Monitoring product to include MongoDB databases[7] - The company plans to continue investing in new product development and market expansion strategies in the upcoming year[30] Gross Profit - Gross profit for Q4 2024 was $593.5 million, up 22.5% from $484.8 million in Q4 2023[30] - GAAP gross profit for Q4 2024 was $593.549 million, up from $484.820 million in Q4 2023, representing a 22.5% increase[36] - Non-GAAP gross profit for the year ended December 31, 2024, was $2.201053 billion, compared to $1.744434 billion in 2023, showing a 26.2% increase[36] Other Financial Metrics - Non-GAAP net income for Q4 2024 was $177.506 million, compared to $155.651 million in Q4 2023, reflecting a 14% growth[38] - The diluted net income per share after non-GAAP tax adjustments for the year ended December 31, 2024, was $1.82, up from $1.32 in 2023, reflecting a 38% increase[38]

Datadog (DDOG) is scheduled to release fourth-quarter 2024 results on Feb. 13.For the fourth quarter of 2024, Datadog anticipates revenues between $709 million and $713 million. The Zacks Consensus Estimate for the same is currently pegged at $711.65 million, suggesting 20.69% growth from the year-ago period.Non-GAAP earnings per share are expected in the range of 42-44 cents. The Zacks Consensus Estimate for earnings has remained unchanged at 43 cents per share over the past 30 days, indicating a decline o ...

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Core Insights - The cloud and AI markets are experiencing significant growth, with companies increasingly migrating data to public cloud platforms, leading to the development of more AI applications [2][3] - Microsoft, Datadog, and Oracle are identified as strong companies well-positioned to benefit from the growth in these markets [4] Microsoft - Microsoft has transformed Azure into the world's second-largest cloud infrastructure platform and integrated OpenAI's generative AI tools into its ecosystem [5] - In the latest quarter, Microsoft's total cloud revenue increased by 21% year over year, accounting for 59% of its total revenue, driven by Azure, Dynamics, and 365 productivity apps [6] - Analysts project Microsoft's revenue and EPS to grow at a CAGR of 14% from fiscal 2024 to fiscal 2027, supported by its cloud and AI businesses, Xbox division, and enterprise cloud services [7] Datadog - Datadog's platform aggregates diagnostic data across various computing platforms, simplifying problem diagnosis for IT professionals, enhanced by its new Bits AI generative AI chatbot [8] - The company turned profitable on a GAAP basis in 2023, with analysts expecting revenue and EPS to grow at a CAGR of 23% and 77%, respectively, from 2023 to 2026 [9] - Datadog's growth is driven by customers generating at least $100,000 in annual recurring revenue and a strong dollar-based net retention rate in the mid-110s [10] Oracle - Oracle has revitalized its growth by transitioning from on-premises software to cloud-based services and expanding into ERP, healthcare IT, and cloud infrastructure through acquisitions [12] - Analysts forecast Oracle's revenue and EPS to rise at a CAGR of 12% and 20%, respectively, from fiscal 2024 to fiscal 2027, fueled by demand for cloud-based database and ERP services [13] - Despite its cloud infrastructure being smaller than AWS and Azure, Oracle has secured major clients like Nvidia and Uber, and is expanding its offerings to support generative AI applications [14][15]

Datadog (DDOG) closed at $144.85 in the latest trading session, marking no change from the prior day. The stock's change was less than the S&P 500's daily gain of 0.36%. Meanwhile, the Dow experienced a drop of 0.28%, and the technology-dominated Nasdaq saw an increase of 0.51%.The data analytics and cloud monitoring company's shares have seen an increase of 2.09% over the last month, surpassing the Computer and Technology sector's of 0% and falling behind the S&P 500's gain of 2.11%.Analysts and investors ...

Datadog (DDOG) is expected to deliver a year-over-year decline in earnings on higher revenues when it reports results for the quarter ended December 2024. This widely-known consensus outlook gives a good sense of the company's earnings picture, but how the actual results compare to these estimates is a powerful factor that could impact its near-term stock price.The earnings report, which is expected to be released on February 13, 2025, might help the stock move higher if these key numbers are better than ex ...