Analyst Mike Cikos from Needham maintained a Buy rating on Datadog (DDOG – Research Report) and decreased the price target to $130.00 from $160.00.
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Mike Cikos has given his Buy rating due to a combination of factors, primarily highlighting Datadog’s strong performance in the first quarter of 2025 and its optimistic revenue guidance for the second quarter, which surpassed market expectations. The company’s strategic focus on AI-native adoption has been a significant contributor to its revenue growth, with AI-native customers now accounting for 8.5% of the annual recurring revenue and adding six percentage points to year-over-year revenue growth.
Despite some concerns about the deceleration in growth excluding AI-native customers, Cikos acknowledges the substantial benefits Datadog has gained from its engagement with next-generation AI-native clients. This strategic positioning and the resulting financial performance underpin the Buy rating, as Datadog is seen as one of the few companies effectively capitalizing on the AI-native trend.
In another report released today, Robert W. Baird also maintained a Buy rating on the stock with a $175.00 price target.