【行业研究报告】Datadog Inc-A-Strong results with upbeat outlook;acceleration in customer demand likely sustain

Strongresultswithupbeatoutlook;
accelerationincustomerdemandlikelysustain
Datadog(DDOGUS)released(6NovHKT)its3Q25results:totalrevenuewas
US$886mn,up28%YoY(3Q24:26%;2Q25:28%),4%betterthanbothour
forecastandBloombergconsensus,drivenbystrongdemandfromAI-native
customers,andaccelerationinrevenuegrowthfromnon-AIcustomers;non-
GAAPnetincomeaftertaxadjustmentwasUS$197.4mn,up19%YoY,andwas
23/18%betterthanourforecast/consensus,drivenbybetter-than-expected
unleashingofoperatingleverageaidedbysolidrevenuegrowthandramp-upin
salesefficiency.Welift2025-2027Erevenueforecastby2-3%toaccountfor
better-than-expectedaccelerationinrevenuegrowthfromnon-AInative
customerswhichinourviewcouldsustain,andraisenon-GAAPnetprofit
forecastby9-11%tofactorinbetter-than-expectedoperatingefficiencygains.
Werolloverourvaluationwindowto2026E,andliftourTPby26%toUS$203.7
basedon16.6x2026EEV/sales,inlinewithtwo-yearaverageplusones.d.(was
16.5x).WeremainpositiveonDDOG’slong-termbusinessdevelopment
potential,drivenbytheseculartrendofdigitaltransformationandcloud
migration,aswellasDDOG’sstrongcrosssellingcapability,andpotentialfor
internationalexpansion.MaintainBUY.
Strongcrosssellingandupsellingtrendsustainedin3Q25.Bytheend
of3Q25,Datadog’splatformhadover32,000customers,up10%YoY.The
of3Q25,Datadog’splatformhadover32,000customers,up10%YoY.The
numberoflargecustomerswithanARRofUS$100,000+reached4,060
duringthesameperiod,up16%YoYandcontributing89%ofthecompany's
totalARR.Asof3Q25,c.84/54/31/16%ofcustomersusedmorethan
2/4/6/8productsofthecompany,upby1/5/5/4pptsYoYrespectively.On
keyoperatingmetrics:1)RPOwasUS$2.79bn,up53%YoY(2Q25:35%;
3Q24:26%)andcurrentRPOwasuplow-50sYoY(2Q25:low-30s);2)net
dollar-basedretentionratewasabout120%in3Q25,flatQoQandupfrom
mid-110%in3Q24.
BothAI-nativeandnon-AIcustomersdeliveredsolidgrowth
momentum.AInativecustomerscontributed12%of3Q25revenue,up
from11%in2Q25and6%in3Q24.ManagementhighlightedthatDDOG
hasaccumulatedmorethan500AI-nativecompaniesinitscustomerbase
in3Q25,amongwhich100/15arespendingmorethan$100k/1mnannually,
andtheYoYrevenuegrowthfromAInativecustomersexcludingthelargest
customeragainaccelerated.RevenueexcludingAI-nativecustomergroup
wasup20%YoYin3Q25,acceleratingfrom18%YoYin2Q25.
ManagementnotedthattheaccelerationtrendcontinuedinOct2025.
Operatingefficiencygainsbetterthanexpectation.For3Q25,non-
GAAPGPMcameinat81.2%,up0.1pptYoYand0.3pptsQoQ.Although
Datadoghasenteredaninvestmentphasetogrowsalescapacityand
creatednewgo-to-marketmotionsinordertodrivefornewroundofgrowth
opportunitiessincethebeginningof2025,whichweighedonexpansionof
operatingmargin,managementnotedthattheinvestmentispayingoff,and
salesefficiencyisrampingup.Overallnon-GAAPOPMcameinat23.4%in
3Q25(3Q24:25.1%),2.4pptsbetterthanbothconsensusandourforecast.
Inourview,thenon-GAAPOPMguidanceof23.6-24.1%for4Q25(4Q24:
24.3%)indicatesthatsalesefficiencycouldrampupfurthergiventhatthe
YoYdeclineinOPMcouldfurthernarrowcomparedtothatin3Q25.