01—Abstract
Summary
Summary of the 10-Q filed November 8, 2024. Cited figures are marked; the original filing is the authoritative source.
Datadog, Inc. reported strong financial results for the third quarter of 2024, demonstrating continued growth and profitability.
Revenue for the quarter reached $690.0 milliona, a 26% increase year-over-year, driven by both new customer acquisition and expansion within the existing customer base. The company achieved a net income of $51.7 million, a significant improvement from the prior year's comparable quarter. Key financial strengths include a robust balance sheet with substantial cash and marketable securities totaling approximately $3.2 billion as of September 30, 2024.
Operating cash flow remained strong, indicating efficient cash generation from its core business. The company continues to invest in research and development and sales and marketing, reflecting its commitment to innovation and market expansion, while managing operating expenses effectively.
02—Key points
Key Highlights
- Revenue for the three months ended September 30, 2024, was $690.0 million, a 26% increase year-over-year.
- Net income for the quarter was $51.7 million, compared to $22.6 million in the same period of 2023.
- Total assets grew to $4.63 billion as of September 30, 2024, with cash and cash equivalents and marketable securities totaling $3.2 billion.
- Operating expenses increased by 19% year-over-year for the quarter, outpacing revenue growth slightly, but R&D and Sales & Marketing investments continue to drive future growth.
- Dollar-based net retention rate for the trailing 12 months was in the mid-110%'s as of September 30, 2024, indicating healthy expansion within the existing customer base.
- The company reported $1.82 billion in remaining performance obligations as of September 30, 2024, providing visibility into future revenue.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q3 FY2024, Datadog kept $0.07.
- Revenue$690.0M100.0%
- Cost of revenue−$137.8M20.0%
- Gross profit$552.3M80.0%
- Operating costs−$532.0M77.1%
- Operating income$20.3M2.9%
- Interest, other & tax$31.4M4.6%
- Net income$51.7M7.5%
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2024filed November 8, 2024Financial Statements
Q3 FY2024 against Q3 FY2023
| Line item | Q3 FY2024Q3 FY2023 | Change |
|---|---|---|
| Revenue | $690.02M$547.54M | +26.0% |
| Cost of Revenue | $137.76M$103.32M | +33.3% |
| Gross Profit | $552.26M$444.22M | +24.3% |
| R&D Expenses | $291.80M$240.22M | +21.5% |
| Operating Expenses | $531.98M$448.45M | +18.6% |
| Operating Income | $20.28M-$4.23M | +579.4% |
| Interest Expense | $1.15M$1.30M | −12.0% |
| Net Income | $51.70M$22.63M | +128.4% |
| EPS (Basic) | $0.15$0.07 | +114.3% |
| EPS (Diluted) | $0.14$0.06 | +133.3% |
| Shares Outstanding (Basic) | 337.56M325.56M | +3.7% |
| Shares Outstanding (Diluted) | 357.63M351.31M | +1.8% |
05—Questions
Frequently Asked Questions
What was Datadog's revenue performance in the third quarter of 2024?
Datadog reported revenue of $690.0 million for the three months ended September 30, 2024, representing a 26% increase compared to $547.5 million in the same period of 2023. This growth was attributed to both new customer acquisition (25%) and expansion from existing customers (75%).
How did Datadog's profitability change in the third quarter?
Datadog's profitability improved significantly. Net income for the three months ended September 30, 2024, was $51.7 million, or $0.14 per diluted share, compared to a net income of $22.6 million, or $0.06 per diluted share, for the same period in 2023.
What is the company's current liquidity position?
As of September 30, 2024, Datadog maintained a strong liquidity position with $337.4 million in cash and cash equivalents and $2.9 billion in marketable securities, totaling approximately $3.2 billion. The company generated $605.4 million in net cash from operating activities for the nine months ended September 30, 2024, and believes its current resources are sufficient to meet its cash requirements for the next 12 months and beyond.
Are there any significant upcoming maturities or debt obligations?
Datadog has 0.125% convertible senior notes due 2025 with a principal amount of $747.5 million. As of September 30, 2024, the net carrying amount was $744.9 million, and these notes were classified as short-term debt. The company's ability to make payments depends on its future performance and cash flow.
06—Continue