Datadog(US:DDOG)2025-11-07 12:29Financial Performance - Revenue for the three months ended September 30, 2025, was $885.7 million, representing a year-over-year growth of 28% compared to $690.0 million in the same period of 2024[124]. - For the nine months ended September 30, 2025, revenue was $2,474.0 million, reflecting a year-over-year growth of 27% from $1,946.5 million in 2024[124]. - Revenue for the three months ended September 30, 2025, was $885,651,000, representing an increase of $195,635,000 or 28% compared to $690,016,000 for the same period in 2024[156]. - Revenue increased by $527.4 million, or 27%, to $2,473.964 million for the nine months ended September 30, 2025, compared to the same period in 2024[164]. - The company generated net income of $33.9 million for the three months ended September 30, 2025, down from $51.7 million in 2024[124]. - Net income for the three months ended September 30, 2025, was $33,885,000, compared to $51,697,000 for the same period in 2024[152]. - Operating loss for the three months ended September 30, 2025, was $(5,809,000), compared to operating income of $20,278,000 for the same period in 2024[152]. - Total operating expenses for the three months ended September 30, 2025, were $715,003,000, up from $531,982,000 in the same period in 2024[152]. - Cash provided by operating activities was $723.066 million for the nine months ended September 30, 2025, an increase of $117.7 million compared to the prior year[177]. - Free cash flow for the nine months ended September 30, 2025, was $623.696 million, up from $534.131 million in 2024[182]. Customer Metrics - The number of customers increased to approximately 32,000 as of September 30, 2025, up from approximately 29,200 a year earlier[127]. - The company had approximately 4,060 customers with annual run-rate revenue (ARR) of $100,000 or more, representing 89% of total ARR, an increase from 3,490 customers (88% of ARR) a year earlier[129]. - The trailing 12-month dollar-based net retention rate was about 120% as of September 30, 2025, up from mid-110% a year earlier, indicating increased usage growth from existing customers[130]. - Revenue from regions outside of North America accounted for approximately 29% of total revenue for the nine months ended September 30, 2025[134]. Expenses - Research and development expenses increased by $110,180,000 or 38% to $401,982,000 for the three months ended September 30, 2025, accounting for 45% of revenue[160]. - Sales and marketing expenses rose by $51,000,000 or 27% to $238,729,000 for the three months ended September 30, 2025, maintaining 27% of revenue[161]. - General and administrative expenses increased by $21,884,000 or 42% to $74,292,000 for the three months ended September 30, 2025, representing 8% of revenue[162]. - Research and development expenses increased by $294.1 million, or 35%, to $1,130.525 million, representing 46% of revenue for the nine months ended September 30, 2025[167]. - Sales and marketing expenses rose by $143.4 million, or 26%, totaling $692.046 million, maintaining 28% of revenue for the nine months ended September 30, 2025[168]. - General and administrative expenses increased by $59.8 million, or 41%, to $205.059 million, representing 8% of revenue for the nine months ended September 30, 2025[170]. Cash and Investments - As of September 30, 2025, the company had $540.6 million in cash and cash equivalents and $3.6 billion in marketable securities[124]. - As of September 30, 2025, the company had $506.8 million in cash equivalents and $3.6 billion in marketable securities[188]. - The company's investments are primarily in corporate debt, commercial paper, U.S. government treasury securities, certificates of deposit, and U.S. government agency securities[188]. - A hypothetical 10% relative change in interest rates would not have a material impact on the company's condensed consolidated financial statements[188]. - The company expects research and development expenses to increase in absolute dollars as the business grows, particularly due to investments in its platform[147]. Strategic Plans - The company plans to continue investing in geographic expansion, particularly in EMEA and APAC, despite potential short-term adverse effects on operating results[134]. - The company intends to evaluate strategic acquisitions and investments to drive product and market expansion[133]. Foreign Currency Risk - The company's reporting currency is the U.S. dollar, and all sales are denominated in U.S. dollars, minimizing foreign currency risk[189]. - Operating expenses are denominated in the currencies of the countries where operations are located, primarily the U.S., France, Ireland, and the U.K.[189]. - The company's consolidated results are subject to fluctuations due to changes in foreign currency exchange rates[189]. - A hypothetical 10% increase or decrease in the relative value of the U.S. dollar to other currencies would not have a material effect on the company's operating results[189]. - The company has not entered into any hedging arrangements regarding foreign currency risk or other derivative financial instruments[189]. - Future decisions regarding hedging may be considered to mitigate foreign currency risk[189].