01—Abstract
Summary
Summary of the 10-K filed February 20, 2025. Cited figures are marked; the original filing is the authoritative source.
Datadog, Inc. (DDOG) reported strong financial performance for the fiscal year ended December 31, 2024, with revenue reaching $2.68 billiona, a 26% increase year-over-year.
This growth was driven by both expanding usage from existing customers (75% of the increase) and acquiring new customers (25% of the increase). The company demonstrated significant operational efficiency, achieving net income of $183.7 millionb and positive operating cash flow of $870.6 million, translating to free cash flow of $775.1 million. Datadog continues to enhance its platform with new product offerings, including LLM Observability and Event Management, underscoring its commitment to technology leadership and addressing evolving market needs.
The company maintains a strong customer base of approximately 30,000, with a notable increase in customers generating $100,000c or more in Annual Recurring Revenue (ARR). The dollar-based net retention rate remained strong, in the high 110% range, indicating continued expansion within its existing customer base. The company ended the year with a robust cash and marketable securities position of $4.2 billion, providing ample liquidity for future growth initiatives.
02—Key points
Key Highlights
- Revenue grew 26% year-over-year to $2.68 billion for FY2024.
- Net income turned positive at $183.7 million, a significant improvement from $48.6 million in FY2023.
- Operating cash flow was strong at $870.6 million, with free cash flow reaching $775.1 million.
- Customer base expanded to approximately 30,000 customers, with a growing number of high-ARR customers.
- Dollar-based net retention rate remained strong in the high 110% range, signaling healthy expansion within existing clients.
- Datadog continues to innovate with new product launches like LLM Observability and Event Management.
- The company ended the year with substantial liquidity, holding $4.2 billion in cash and marketable securities.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2024, Datadog kept $0.07.
- Revenue$2.68B100.0%
- Cost of revenue−$515.5M19.2%
- Gross profit$2.17B80.8%
- Operating costs−$2.11B78.8%
- Operating income$54.3M2.0%
- Interest, other & tax$129.5M4.8%
- Net income$183.8M6.8%
Where FY2024 revenue went
$2.68B- R&D: $1.15B, 43% of revenue
- Other operating costs: $961.8M, 36% of revenue
- Cost of revenue: $515.5M, 19% of revenue
- Operating income: $54.3M, 2.0% of revenue
Kept 2.0% as operating incomeOperating income $54.3M · 2.0%
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2024filed February 20, 2025Financial Statements
FY2024 against FY2023
| Line item | FY2024FY2023 | Change |
|---|---|---|
| Revenue | $2.68B$2.13B | +26.1% |
| Cost of Revenue | $515.53M$409.91M | +25.8% |
| Gross Profit | $2.17B$1.72B | +26.2% |
| R&D Expenses | $1.15B$962.45M | +19.8% |
| Operating Expenses | $2.11B$1.75B | +20.7% |
| Operating Income | $54.28M-$33.46M | +262.2% |
| Net Income | $183.75M$48.57M | +278.3% |
| EPS (Basic) | $0.55$0.15 | +266.7% |
| EPS (Diluted) | $0.52$0.14 | +271.4% |
| Shares Outstanding (Basic) | 336.17M324.03M | +3.7% |
| Shares Outstanding (Diluted) | 358.64M350.29M | +2.4% |
05—Questions
Frequently Asked Questions
What was Datadog's revenue growth and profitability in the fiscal year 2024?
Datadog reported revenue of $2.68 billion for the fiscal year ended December 31, 2024, representing a 26% increase year-over-year. The company also achieved a net income of $183.7 million, a substantial improvement from $48.6 million in the prior year.
How is Datadog expanding its business?
Datadog's growth is driven by a land-and-expand strategy. This includes acquiring new customers, with 25% of revenue growth attributed to new clients, and expanding within its existing customer base, which accounted for 75% of revenue growth. This expansion is evidenced by a strong dollar-based net retention rate in the high 110% range and an increasing number of customers with high Annual Recurring Revenue (ARR).
What is Datadog's financial health and liquidity position?
Datadog demonstrated strong financial health, generating $870.6 million in operating cash flow and $775.1 million in free cash flow for FY2024. The company ended the year with $4.2 billion in cash and marketable securities, indicating robust liquidity to fund ongoing operations and strategic initiatives.
What are Datadog's key areas of investment and innovation?
Datadog continues to invest heavily in research and development to maintain technology leadership. Key areas of focus include expanding its observability and security platform capabilities, as demonstrated by recent product launches like LLM Observability and Event Management, and broadening its international presence to capture global market opportunities.
06—Continue