DDOG Q2 and CC QUICK Notes

Investment Analysis Clubs Saul’s Investing Discussions
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Emphasis on Quick!

  • Rev growth at 68% vs 87%; tough compatibles

  • GM basically the same as last Q

  • Generally upbeat with several examples of big 7-figure up-sales helping customers consolidate solutions on to DDOG’s single platform and helping another move to Azure.

  • July preview: pointing to good improvement! DDOG ignoring this though and staying conservative with Q3 and FY guidance a little over 50%; still a lot of macro uncertainty

  • Cause: Seeing customers usage of cloud reduced; spinning up fewer containers at AWS and Azure. Later question pointed out usage reported before DDOG’s over at AWS and Azure are a hint of what DDOG will report. DDOG agreed but also said those companies are more complex and DDOG is growing much faster.

In my opinion, the last point is the main driver and not what I expected to hear. This is still really good performance and not expected to be permanent so I’m not worries long term but I can see this being disappointing in the short term.

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