Starboard delivers letter to Dynatrace

Starboard Value, one of the largest shareholders of Dynatrace (DT), announced that it has delivered a letter to Dynatrace’s Chief Executive Officer, Rick McConnell, Chief Financial Officer, Jim Benson, and the Company’s Board of Directors. “As you know, Starboard Value LP is one of the largest shareholders of Dynatrace. We appreciate the time you have spent with us and look forward to a continued constructive engagement. Starboard has made a substantial investment in Dynatrace because we believe the Company is a high-quality, durable observability platform with a long runway for continued growth and an opportunity for significant margin expansion. We also believe the Company has significant strategic value as observability becomes more important in an AI-enabled world and the convergence of observability and security continues. In the recent software sell-off, it appears the market has ascribed significant near-term risk to Dynatrace. However, in our view, this perception does not appropriately reflect the reality of Dynatrace’s durable and differentiated platform, its strong competitive positioning, or the growing importance of observability as enterprise AI adoption accelerates. We believe these factors make Dynatrace more important moving forward, not less. In fact, enterprise adoption of AI should ultimately result in accelerating revenue growth for Dynatrace. At the same time, we believe Dynatrace has opportunities to meaningfully improve operating efficiency, driving higher profitability and cash flow, while returning significant capital to shareholders. In sum, we believe Dynatrace has an opportunity for significant value creation, and we look forward to working with management and the Board of Directors towards this shared goal.”