Datadog, Inc. (NASDAQ:DDOG) experienced a significant rise in its share price on Tuesday, following the release of a robust earnings report that exceeded analysts’ expectations. The stock opened at $124.18, up from a previous close of $114.01, and reached a last trading price of $131.51, with a trading volume of approximately 6.57 million shares.
The company reported earnings of $0.59 per share (EPS) for the quarter, surpassing the consensus estimate of $0.55 by $0.04. Datadog’s revenue for the quarter amounted to $953.19 million, significantly higher than the anticipated $916.53 million. This reflects a remarkable 29.2% increase compared to the same quarter the previous year, when the firm reported an EPS of $0.49.
Financial Performance and Future Guidance
The company reported a net margin of 3.32% and a return on equity of 4.14%. Looking ahead, Datadog has provided guidance for fiscal year 2026, projecting an EPS range of $2.080 to $2.160, along with a first quarter 2026 EPS forecast of $0.490 to $0.510.
In the wake of the earnings announcement, insider trading activity also drew attention. Chief Technology Officer Alexis Le-Quoc sold 53,912 shares of the company on December 8, 2023, at an average price of $154.05, totaling approximately $8.31 million. Post-sale, Le-Quoc retained 295,448 shares, valued at roughly $45.51 million, marking a 15.43% reduction in his holdings.
Similarly, Chief Executive Officer Olivier Pomel sold 100,754 shares on November 17, 2023, for around $18.25 million, reducing his ownership by 15.89%. In the last quarter, company insiders sold a total of 538,917 shares worth approximately $86.80 million, with insiders collectively holding 8.70% of the company’s stock.
Institutional Investor Activity
Institutional investors have also made notable adjustments to their positions in Datadog. Elevation Point Wealth Partners LLC increased its stake by 3.3% during the third quarter, now holding 1,697 shares worth $242,000. Similarly, Chicago Partners Investment Group LLC added 1.6% to its holdings, owning 4,778 shares valued at $622,000.
Other firms, such as Vivaldi Capital Management LP and Westside Investment Management Inc., also reported increases in their stakes, contributing to a strong institutional ownership level of 78.29% of the company’s stock.
The company’s strong performance metrics include a debt-to-equity ratio of 0.29 and a current ratio of 3.66. With a market capitalization of $45.69 billion, Datadog’s price-to-earnings ratio stands at 428.15, and its price-to-earnings-growth ratio is 19.95.
Datadog remains a key player in the cloud-based monitoring and observability sector, offering a suite of services designed to enhance application performance and security. Its platform allows organizations to monitor and secure their applications and infrastructure, providing critical insights into system health and performance.
As the company continues to grow, its strong earnings report and the activity of its executives and institutional investors will likely keep Datadog in the spotlight of market analysts and stakeholders.
