Datadog Q419

DDOG - Q419

CC transcript:…
CC recap (Starrob):…
CC recap (sarksnz):
Saul on FY op loss guidance:…

Revenue 113.6M +84.5%
Adj Op Inc 7.0M
… margin 6.1% +540bps seq
Adj Inc 10.1M
Adj EPS 0.03 swung pos
Opex 90.2M +71%
Adj Gross Margin 78% +300bps
CFFO 17.4M
FCF 10.9M swung pos
Cash 778M
Custs 10.5k +36%, +10.5% seq !!

  • Custs >100K 858 +89% !!
  • Custs >1M 50 +72%
  • Enterprise ARR 230k +43%
  • Mid-market ARR 170k +54%
    $NER >130% for 10 Qs

FY19 Totals:
Revenue 362.8M +83%
Adj Op Loss -5.4M
… margin -1.5%
Adj EPS -0.01
CFFO 24.2M
FCF 0.8M

  • +1000 net new custs was a Q record
  • 60% of custs using 2+ products (vs 25% last yr), including 65% of new deals
  • 25% of custs using all 3 pillars [aka infrastructure + APM + logs] (vs 5% last yr)
  • 40% of rev growth from new custs, so I think their actual $NER is way higher than 130%
  • custs >100K drive >70% of ARR
  • new product Security Monitoring in beta
  • integrated into Azure DevOps platform
  • Network Perf Monitoring (NPM) went GA, added SNMP integration in beta
  • Real User Monitoring (RUM) went GA
  • launched Datadog Partner Network to support channel partners (MSPs, SIs, Resellers and Referral Partners), as well as outside solutions built on Datadog platform
  • enhanced APM functionality to deepen visibility into containers & serverless, and updated their AWS Lambda integration
  • enhanced their ML features
  • introduced Metrics Coorelations feature
  • lockup ends 3/9…

My stance: Current Q rev growth 85% vs FY 83% - so no sign of slowing. Adj EPS swung pos was surprise, but guidance for next Q is back to loss (likely why it dropped). New growth is strong, and further growth of existing customers is fantastic w/ a high $NER. 25% of their customers are using all 3 “pillars of observability” and rising (+2000bps!). 65% of new deals involve >1 product. This company is executing. Huge focus on the next wave of cloud development technologies, esp serverless.

Fun fact: >70% of ARR driven by custs>100k. This cohort is grew 89% YoY.

long DDOG ~11%