DDOG Q4 and full year results

Investment Analysis Clubs Saul’s Investing Discussions
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https://investors.datadoghq.com/news-releases/news-release-d…

Datadog Announces Fourth Quarter and Full Year 2020 Results
February 11, 2021 at 4:10 PM EST
PDF Version
Fourth quarter revenue grew 56% year-over-year to $178 million

Strong growth of larger customers, with 97 $1 million+ ARR customers, up from 50 a year ago

Announced an agreement to acquire Sqreen, a SaaS based security platform, and the acquisition of Timber Technologies, the makers of an observability data management product

Launched the general availability of Incident Management; enhanced Security with two new beta offerings

NEW YORK, Feb. 11, 2021 (GLOBE NEWSWIRE) – Datadog, Inc. (NASDAQ:DDOG), the monitoring and security platform for cloud applications, today announced financial results for its fourth quarter ended December 31, 2020.

“We are pleased with our strong results for the fourth quarter, which demonstrated continued high growth at scale.” said Olivier Pomel, co-founder and CEO of Datadog. “The quarter closes a strong year in which we generated 66% revenue growth and positive free cash flow. In a year filled with unique challenges, we are proud of our execution and business performance. We believe our already strong market position will only be strengthened longer-term by the pandemic, as the needs to be digital-first and agile are more prominent than ever.”

Pomel added, “We announced two acquisitions, Sqreen which will add application security to protect an increasingly exploited attack vector as we prioritize the build-out of our security offerings, and Timber technologies, a vendor-agnostic observability data pipeline. In 2020, we enhanced our positioning as the most complete and cloud-native end-to-end observability platform. But we are even more excited for what’s to come, and plan for meaningful continued investments to enhance our long-term positioning.”

Fourth Quarter 2020 Financial Highlights:

Revenue was $177.5 million, an increase of 56% year-over-year.
GAAP operating loss was ($8.9) million; GAAP operating margin was (5%).
Non-GAAP operating income was $18.1 million; non-GAAP operating margin was 10%.
GAAP net loss per diluted share was ($0.05); non-GAAP net income per diluted share was $0.06.
Operating cash flow was $23.8 million, with free cash flow of $16.6 million.
Cash, cash equivalents, restricted cash, and marketable securities were $1.5 billion as of December 31, 2020.

Lee

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If my calculations are correct, their QoQ is 14.8% annualized to about 74%. I was hoping for 70%+ so VERY happy with this. For reference, the COVID Q was under 40%, last Q was 50%. Backs their story from last report where things were back to pre-COVID growth levels.

VERY happy with this report.

Also love that > 1M companies almost doubled.

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I think this was a good report.

Revenue growth has accelerated sequentially for the past 3 quarters (14.8% vs. 10.% vs. 6.71%) which is great despite some of the initial slowdown due to COVID.

Guidance was okay, but they have a tendency to be conservative when giving guidance (last year they guided for $545 M for 2020 and they finished the year at $603 which is a 10% beat). If DataDog beats next quarter like they usually do, they should do around $200 M revenue. Wouldn’t be surprised if they did $900 M for the year.

Customers with > $100k ARR was also really strong at 46% YoY and has been increasing sequentially since the bottom of the pandemic.

They seem to be shifting back into gear after Q2’s slowdown. Looking forward to reading the earnings call transcript.

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FF,

Your math is correct. We are seeing a re-acceleration in revenue. Since Q2, which was 15.5% sequentially, we saw 6.9%, 10%, and now 14.8% in the QoQ reported today.

The disappointment is in the Q1 guidance, where management is guiding for $186mm, which would be only 4.7% growth sequentially from Q4’20.

I believe this is why the shares are trading down AH. Hopefully this is just a “sandbag” by mgmt.

Cheers,
JJ

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They always way low-ball their numbers. They beat this Q’s high guidance level by 15m. If they do the same next Q, that is 201, which translates to 13% QoQ and 63% annualized. A bit of a slowdown.

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Lots to unpack!
I wanted to highlight the QoQ acceleration before even thinking about the context, acquisitions, etc. This is nice!


Dec-31-20	**Sep-20**	Jun-20	Mar-20	Dec-19	Sep-19	Jun-19
Revenue  	**177.5**	154.7	140	131.2	113.6	95.9
YoY     	**56%**	61%	68%	38%	40%	41%
QoQ     	**14.7%**	10.5%	6.7%	15.5%	18.5%	15.3%
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Sorry my dates shifted left there

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RafesUserName,

sorry i might be wrong but how come 2019 YoY are only 40~50%?
Shouldn’t it be

56.2% 61.4% 68.2% 87.4% 84.5% 87.7%

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You know, I’m just having one of those days… As penance here is even more data, and correct this time, as far as I can tell:


        **Dec-20**	Sep-20	Jun-20	Mar-20	Dec-19	Sep-19	Jun-19	Mar-19	Dec-18	Sep-18	Jun-18	Mar-18
Revenue	**177.5**	154.7	140	131.2	113.6	95.9	83.2	70.1	61.6	51.1	45.7	39.7
YoY	**56.3%**	61.3%	68.3%	87.2%	84.4%	87.7%	82.1%	76.6%	82.8%	91.4%	108.7%	115.8%
QoQ	**14.7%**	10.5%	6.7%	15.5%	18.5%	15.3%	18.7%	13.8%	20.5%	11.8%	15.1%	17.8%

By the way, Rocket is a really great source, if you copy and paste it right :wink:
http://www.rocketfinancial.com/Financials.aspx?fID=240907&am…
You have to sign up but it is free and the data is straight form the source with links to it and even a standardized view for easier visual parsing when looking through a bunch of reports. The site had the latest numbers within a few minutes of the report. I tried to copy and paste the rev numbers quickly to add in the QoQ and I messed up my sheet. My fault, not theirs.

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Rocket is a really great source, if you copy and paste it right

But is the data good. IIRC, Saul recommends going to the source… the Investor Relation pages for the underlying security… to collect financials, in context. For example…
https://investors.datadoghq.com/investor-relations/

🆁🅶🅱
post tenebras lux
For not in my bow do I trust, nor can my sword save me.

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OT about Rocket’s data…

Actually the source would be the filings, which are linked from both the investor sites and Rocket. I checked the numbers they display against both filings and (for calculated numbers like YoY growth rates) by running the numbers in my own sheet and all were sound. I stopped checking after the first few as I felt I could then trust them. I plan to check it again at some point just for sanity though.

The investor relations sites ARE awesome for subscribing to notices, presentation decks and replays as well, so I do visit them regardless. What I love this site for are those moments where I want to get a real quick view of a company’s numbers when someone posts on the forums or tells me about a company offline. I can usually skip a company after reading a description and checking the surface numbers. If that first-pass looks interesting, then I go for deeper context.

I emailed them about a couple of things when I first heard of the site, and got quick answers. It sounds like the site is bare-bones simply because they are hard at work on the backend, so pretty new still. I was just really surprised when numbers appeared from new filings on the same day. They must either be on top of updates for popular companies or parsing the filings somehow. Impressive regardless.

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All, strong report. Without re-stating too many of the same points, some comments and then one question for the group:

(1) 14.8% QoQ growth is the highest since Q1. So, the logic that that height of the Pandemic caused the short term problem seems to stand tall. Good.
(2) Highest dollar value growth of all time. Good. Function of larger numbers too.
(3) Most number of customers that generate >$100K revenue growth of all time. 146 net new.
(4) RPO growth accelerated to 78% YoY.
(5) Largest RPO dollar growth QoQ of all time - $118K increase
(6) QUESTION. Trying to make sense of the recurring nature of revenue. Is it fixed/predictable cost or all usage based? https://www.datadoghq.com/pricing/ Seems like it may follow the $SNOW model ---- where it’s all usage based…even w the growing RPO nature to the biz.

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