Datadog sees annual revenue, profit below estimates as enterprise spending lags

Dynatrace,

13/02/2025 13:01

Feb 13 (Reuters) - Datadog  DDOG.O  forecast 2025
revenue and profit below Wall Street expectations on Thursday,
hurt by sluggish customer spending on its cloud security
services as enterprises cut budgets owing to economic
uncertainty. 
    Shares of the New York-based company fell 10% in premarket
trading. 
    Tough competition and high interest rates have weakened
demand for Datadog's data monitoring services as enterprise
customers rethink their spending priorities.
    The cloud monitoring platform faces competition from firms
such as Dynatrace  DT.N , which is trying to unify its security
and data management platforms using artificial intelligence,
making it easier for customers to find technical issues and
breaches within their software.
    Datadog forecast revenue between $3.18 billion and $3.20
billion for its fiscal 2025, compared with analysts' average
estimate of $3.24 billion, according to data compiled by LSEG. 
    It forecast annual adjusted earnings per share between $1.65
and $1.70, while analysts expect $2.05. 
    First-quarter revenue forecast of $737 million and $741
million was also largely below the analyst estimate of $740.3
million. 
    It expects quarterly adjusted EPS between 41 cents and 43
cents per share, below estimates of 46 cents. 
    Revenue for the fourth quarter came in at $737.7 million,
beating market expectations of $714.5 million. 
    

 (Reporting by Zaheer Kachwala in Bengaluru; Editing by Leroy
Leo and Shinjini Ganguli)
 ((Zaheer.Kachwala@thomsonreuters.com;))