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For the fourth quarter of 2023, Datadog anticipates revenues between $564 million and $568 million. The Zacks Consensus Estimate for the same is currently pegged at $566.7 million, suggesting 20.73% growth from the year-ago period.
Non-GAAP earnings are expected in the range of 42-44 cents per share. The Zacks Consensus Estimate for earnings has remained unchanged at 43 cents per share over the past 30 days, indicating growth of 65.38% from the year-ago period.
Markedly, Datadog’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average being 28.61%.
Let’s see how things have shaped up prior to this announcement.
Datadog’s fourth-quarter performance is expected to have benefited from the increased adoption of its cloud-based monitoring and analytics platform, owing to the accelerated digital transformation and cloud migration across organizations.
In the to-be-reported quarter, Datadog added identity, vulnerability and app-level findings to Security Inbox. This provides engineers with one actionable view to improve security posture without any additional overhead or friction. With these new features, DDOG shifts cloud security earlier in the software development lifecycle and empowers developers, as well as security teams, to address issues proactively.
The company expanded security and observability support for Amazon (AMZN - Free Report) -owned Amazon Web Services’ (“AWS") serverless applications built on AWS Lambda and Step Functions services. The functionality helps AWS Lambda and Step Functions users detect security threats, get a high-level overview of how the state machine is performing at a single point in time and monitor services instrumented with OpenTelemetry.
Datadog announced an expanded strategic partnership with Alphabet (GOOGL - Free Report) -owned Google Cloud, which enables Google Cloud customers to proactively observe and secure their cloud-native and hybrid applications within DDOG's unified platform. As part of the expanded partnership and integrations, Datadog is one of the first AI/ML observability solution partners for Vertex AI, allowing AI ops teams and developers to monitor, analyze and optimize the performance of their machine learning models in production. This collaboration is expected to have boosted customer growth in the to-be-reported quarter.
In the third quarter of 2023, Datadog had about 3,130 customers with an annual run rate of $100K or more, up from 2,600 in the year-ago quarter. The momentum is expected to have continued in the to-be-reported quarter.
As of the end of the third quarter, 82% of customers used two or more products, up from 80% in the year-ago quarter. Additionally, 46% of customers utilized four or more products, up from 40% in the year-ago quarter.
Datadog’s dollar-based retention rate was slightly below 120% as customers increased their usage and adopted more products.
Significant investments in sales and marketing to engage customers, increase brand awareness and drive adoption of its platform and products are likely to have resulted in a growing customer base in the to-be-reported quarter.
What Our Model Indicates
According to the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.
Datadog has an Earnings ESP of 0.00% and a Zacks Rank #3 at present. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stock to Consider
Here is a company worth considering from the same space, as our model shows that this stock has the right combination of elements to beat on earnings in its soon-to-be-reported quarterly results.
CrowdStrike is scheduled to release fourth-quarter 2023 results on Mar 5. The Zacks Consensus Estimate for CRWD’s earnings is pegged at 82 cents per share, suggesting a jump of 74.5% from the prior-year quarter.
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Datadog (DDOG) to Report Q4 Earnings: What's in the Cards?
Datadog (DDOG - Free Report) is set to release its fourth-quarter 2023 results on Feb 13.
For the fourth quarter of 2023, Datadog anticipates revenues between $564 million and $568 million. The Zacks Consensus Estimate for the same is currently pegged at $566.7 million, suggesting 20.73% growth from the year-ago period.
Non-GAAP earnings are expected in the range of 42-44 cents per share. The Zacks Consensus Estimate for earnings has remained unchanged at 43 cents per share over the past 30 days, indicating growth of 65.38% from the year-ago period.
Markedly, Datadog’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average being 28.61%.
Let’s see how things have shaped up prior to this announcement.
Datadog, Inc. Price and EPS Surprise
Datadog, Inc. price-eps-surprise | Datadog, Inc. Quote
Factors to Consider
Datadog’s fourth-quarter performance is expected to have benefited from the increased adoption of its cloud-based monitoring and analytics platform, owing to the accelerated digital transformation and cloud migration across organizations.
In the to-be-reported quarter, Datadog added identity, vulnerability and app-level findings to Security Inbox. This provides engineers with one actionable view to improve security posture without any additional overhead or friction. With these new features, DDOG shifts cloud security earlier in the software development lifecycle and empowers developers, as well as security teams, to address issues proactively.
The company expanded security and observability support for Amazon (AMZN - Free Report) -owned Amazon Web Services’ (“AWS") serverless applications built on AWS Lambda and Step Functions services. The functionality helps AWS Lambda and Step Functions users detect security threats, get a high-level overview of how the state machine is performing at a single point in time and monitor services instrumented with OpenTelemetry.
Datadog announced an expanded strategic partnership with Alphabet (GOOGL - Free Report) -owned Google Cloud, which enables Google Cloud customers to proactively observe and secure their cloud-native and hybrid applications within DDOG's unified platform. As part of the expanded partnership and integrations, Datadog is one of the first AI/ML observability solution partners for Vertex AI, allowing AI ops teams and developers to monitor, analyze and optimize the performance of their machine learning models in production. This collaboration is expected to have boosted customer growth in the to-be-reported quarter.
In the third quarter of 2023, Datadog had about 3,130 customers with an annual run rate of $100K or more, up from 2,600 in the year-ago quarter. The momentum is expected to have continued in the to-be-reported quarter.
As of the end of the third quarter, 82% of customers used two or more products, up from 80% in the year-ago quarter. Additionally, 46% of customers utilized four or more products, up from 40% in the year-ago quarter.
Datadog’s dollar-based retention rate was slightly below 120% as customers increased their usage and adopted more products.
Significant investments in sales and marketing to engage customers, increase brand awareness and drive adoption of its platform and products are likely to have resulted in a growing customer base in the to-be-reported quarter.
What Our Model Indicates
According to the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here.
Datadog has an Earnings ESP of 0.00% and a Zacks Rank #3 at present. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Stock to Consider
Here is a company worth considering from the same space, as our model shows that this stock has the right combination of elements to beat on earnings in its soon-to-be-reported quarterly results.
CrowdStrike (CRWD - Free Report) has an Earnings ESP of +0.53% and sports a Zacks Rank #1 at present. You can see the complete list of today's Zacks #1 Rank stocks here.
CrowdStrike is scheduled to release fourth-quarter 2023 results on Mar 5. The Zacks Consensus Estimate for CRWD’s earnings is pegged at 82 cents per share, suggesting a jump of 74.5% from the prior-year quarter.