01—Abstract
Summary
Summary of the 10-Q filed May 8, 2024. Cited figures are marked; the original filing is the authoritative source.
Datadog, Inc. reported strong performance for the first quarter of 2024, with revenue growing 27% year-over-year to $611.3 milliona.
This growth was driven by both new customer acquisition and expansion within the existing customer base. The company demonstrated significant improvements in profitability and cash flow, with net income of $42.6 millionb compared to a net loss of $24.1 million in the prior year period. Operating cash flow surged to $212.3 million, and free cash flow reached $186.7 million, highlighting robust operational efficiency.
The company's balance sheet remains strong, with $282.2 millionc in cash and cash equivalents and $2.5 billion in marketable securities as of March 31, 2024. While the dollar-based net retention rate saw a slight decline year-over-year, it remains strong at in the mid-110% range, indicating continued expansion within its existing customer base. The company continues to invest in innovation and product development, with R&D expenses increasing 18% year-over-year.
02—Key points
Key Highlights
- Revenue increased by 27% year-over-year to $611.3 million for Q1 2024.
- Net income turned positive, reaching $42.6 million, a significant improvement from a net loss of $24.1 million in Q1 2023.
- Operating cash flow significantly increased to $212.3 million, up from $133.8 million in the prior year.
- Free cash flow grew to $186.7 million, demonstrating strong operational cash generation.
- Customers with an Annual Recurring Revenue (ARR) of $100,000 or more increased to 3,340, representing 87% of ARR.
- Dollar-based net retention rate remained strong, in the mid-110% range, though lower than the mid-130% range reported in the prior year.
- The company ended the quarter with a healthy liquidity position, holding $282.2 million in cash and cash equivalents and $2.5 billion in marketable securities.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q1 FY2024, Datadog kept $0.07.
- Revenue$611.3M100.0%
- Cost of revenue−$110.1M18.0%
- Gross profit$501.2M82.0%
- Operating costs−$489.2M80.0%
- Operating income$12.0M2.0%
- Interest, other & tax$30.6M5.0%
- Net income$42.6M7.0%
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2024filed May 8, 2024Financial Statements
Q1 FY2024 against Q1 FY2023
| Line item | Q1 FY2024Q1 FY2023 | Change |
|---|---|---|
| Revenue | $611.25M$481.71M | +26.9% |
| Cost of Revenue | $110.10M$99.91M | +10.2% |
| Gross Profit | $501.15M$381.80M | +31.3% |
| R&D Expenses | $269.99M$229.48M | +17.7% |
| Operating Expenses | $489.16M$416.77M | +17.4% |
| Operating Income | $12.00M-$34.97M | +134.3% |
| Interest Expense | $1.08M$2.18M | −50.3% |
| Net Income | $42.63M-$24.09M | +277.0% |
| EPS (Basic) | $0.13$-0.08 | +262.5% |
| EPS (Diluted) | $0.12$-0.08 | +250.0% |
| Shares Outstanding (Basic) | 331.81M319.29M | +3.9% |
| Shares Outstanding (Diluted) | 355.98M319.29M | +11.5% |
05—Questions
Frequently Asked Questions
What is Datadog's revenue growth for the first quarter of 2024?
Datadog reported a 27% year-over-year increase in revenue for the first quarter of 2024, reaching $611.3 million.
How did Datadog's profitability change in Q1 2024 compared to Q1 2023?
Datadog's profitability significantly improved. The company reported a net income of $42.6 million for the first quarter of 2024, a substantial turnaround from a net loss of $24.1 million in the same period of 2023.
What is Datadog's current liquidity position?
As of March 31, 2024, Datadog had $282.2 million in cash and cash equivalents and $2.5 billion in marketable securities, indicating a strong liquidity position.
What is the trend in Datadog's dollar-based net retention rate?
Datadog's trailing 12-month dollar-based net retention rate was in the mid-110% range as of March 31, 2024. This is a decrease from the mid-130% range reported in the prior year, which the company attributes primarily to slower usage growth from existing customers, potentially related to the uncertain macroeconomic environment.
06—Continue