We were very impressed with Datadog's Q3 outstanding performance and ability to accelerate growth as a $60B market cap company with $1B+ ARR. Performance was VERY STRONG across the board. HUGE acceleration in both revenue and billings, well ahead of an already elevated expectation from the buy-side. Billings/revenue growth 96%/75% vs. consensus 61%/60%. The revenue growth for the last 3Qs: 52% -> 67% ->75%. The management raised the full-year guidance to $994mm following a strong quarter, up from the previous $941mm. The operating income was revised up to $134mm, compared to the previous $90mm. EPS is expected to be $0.39-0.40, up from the previous $0.28.
What we love about the company: 1) The continued strong usage with NRR above 130%. Customers with ARR $100K+ made up about 10% of the total customers and contributed 80% of the total ARR. 77% of customers use 2+ products, and 31% of customers use 4+ products. Land and expansion are both solid across all cohorts. 2) The hyper-growth in APM and log management at 100%+ Q/Q again highlights the success of the platform strategy. 3) The textbook example of building a platform around three pillars (Infrastructure Monitoring, APM and log management, and Security) with flawless execution and product cadence.
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