Datadog, Inc. (NASDAQ:), a prominent monitoring and security platform for cloud applications, reported a robust first quarter with earnings surpassing analysts’ expectations.
The company announced a $0.44 adjusted EPS for Q1, which was $0.10 higher than the analysts’ estimate of $0.34. Revenue for the quarter was also above expectations at $611 million, compared to the consensus estimate of $590.65 million, marking a 27% increase YoY.
Despite the earnings beat, Datadog’s stock fell by 10%. The drop occurred even as Datadog reported growth in its larger customer base. It now has roughly 3,340 customers with an annual recurring revenue (ARR) of $100,000 or more, up 15% from the previous year.
CEO Olivier Pomel highlighted the company’s dedication to aiding customers in navigating complex systems, which is reflected in the recent product expansions such as Bits AI for Incident Management and Event Management.
“At Datadog, we’re focused on helping our customers observe, secure, and take action on their complex systems, so they can migrate to cloud and modern DevOps with confidence,” Pomel stated.
Looking ahead, Datadog provided guidance for the second quarter with revenue expectations between $620 million and $624 million, straddling the analysts’ consensus of $621 million. The midpoint of the adjusted EPS guidance range for Q2 is $0.35, exactly in line with the consensus.
For the full year 2024, Datadog forecasts revenue between $2.59 billion and $2.61 billion and an adjusted EPS between $1.51 and $1.57, both slightly above the consensus estimates of $2.58 billion in revenue and $1.45 adjusted EPS.
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