Cloud monitoring platform Datadog (NASDAQ: DDOG) will be reporting results this Thursday before market open. Here’s what investors should know.
Datadog beat analysts’ revenue expectations by 4.5% last quarter, reporting revenues of $826.8 million, up 28.1% year on year. It was a very strong quarter for the company, with a solid beat of analysts’ annual recurring revenue estimates and EPS guidance for next quarter exceeding analysts’ expectations. It added 80 enterprise customers paying more than $100,000 annually to reach a total of 3,850.
Is Datadog a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members.
This quarter, analysts are expecting Datadog’s revenue to grow 23.5% year on year to $852.4 million, slowing from the 26% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.46 per share.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Datadog has a history of exceeding Wall Street’s expectations, beating revenue estimates every single time over the past two years by 3.6% on average.
Looking at Datadog’s peers in the software development segment, some have already reported their Q3 results, giving us a hint as to what we can expect. Twilio delivered year-on-year revenue growth of 14.7%, beating analysts’ expectations by 3.8%, and Cloudflare reported revenues up 30.7%, topping estimates by 3.2%. Twilio traded up 19.5% following the results while Cloudflare was also up 13.8%.
Read our full analysis of Twilio’s results here and Cloudflare’s results here.
The euphoria surrounding Trump’s November win lit a fire under major indices, but potential tariffs have caused the market to do a 180 in 2025. While some of the software development stocks have shown solid performance in this choppy environment, the group has generally underperformed, with share prices down 4.2% on average over the last month. Datadog’s stock price was unchanged during the same time and is heading into earnings with an average analyst price target of $169.52 (compared to the current share price of $156.68).
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