Datadog (NASDAQ:DDOG) plunged in trading after announcing a leadership transition. The software-as-a-service (SaaS) platform for cloud applications stated that Amit Agarwal, the current President of the company, will resign effective December 31, 2024. Following his resignation, DDOG intends to increase the size of the Board from eight to nine members and will appoint Agarwal to its Board of Directors.
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Datadog’s Q1 Results
The company reported adjusted Q1 earnings of $0.44 per share, almost double its earnings of $0.23 per share in the same period last year. Analysts were expecting DDOG to report earnings of $0.34 per share.
Datadog’s revenues surged by 27% year-over-year to $611 million, which were above consensus estimates of $589.9 million.
As of March 31, DDOG had around 3,340 customers with an annualized revenue run rate (ARR) of $100,000 or more, an increase of 15% year-over-year. The company defines the annualized revenue run-rate of subscription agreements as the total revenue expected over a year based on current subscription commitments from all customers at a point in time.
DDOG’s Q2 and FY24 Outlook
In the second quarter, DDOG expects revenues between $620 million and $624 million, while adjusted earnings are likely to range from $0.34 to $0.36 per share. In FY24, the company has projected revenues between $2.59 billion and $2.61 billion, while adjusted earnings are anticipated to range from $1.51 to $1.57 per share.
Is DDOG a Good Stock to Buy?
Analysts remain cautiously optimistic about DDOG stock, with a Moderate Buy consensus rating based on 23 Buys and 10 Holds. Over the past year, DDOG has increased by more than 60%, and the average DDOG price target of $148.44 implies an upside potential of 16.9% from current levels. These analyst ratings are likely to change following DDOG’s Q1 results today.
