Datadog | 10-Q: FY2025 Q2 Revenue Beats Estimate at USD 826.76 M

Revenue: As of FY2025 Q2, the actual value is USD 826.76 M, beating the estimate of USD 790.9 M.

EPS: As of FY2025 Q2, the actual value is USD 0.01, missing the estimate of USD 0.0181.

EBIT: As of FY2025 Q2, the actual value is USD 6.088 M.

Segment Revenue

• Total Revenue: $826.8 million for the three months ended June 30, 2025, compared to $645.3 million for the same period in 2024, representing a 28% increase. For the six months ended June 30, 2025, revenue was $1,588.3 million, compared to $1,256.5 million in 2024, a 26% increase.

Operational Metrics

• Net Income: $2.6 million for the three months ended June 30, 2025, compared to $43.8 million for the same period in 2024. For the six months ended June 30, 2025, net income was $27.3 million, compared to $86.5 million in 2024.
• Gross Margin: 80% for both the three and six months ended June 30, 2025, compared to 81% for the same periods in 2024.
• Operating Income (Loss): Operating loss of $35.5 million for the three months ended June 30, 2025, compared to an operating income of $12.6 million for the same period in 2024. For the six months ended June 30, 2025, operating loss was $47.9 million, compared to an operating income of $24.6 million in 2024.

Cash Flow

• Operating Cash Flow: $471.6 million for the six months ended June 30, 2025, compared to $376.7 million for the same period in 2024.
• Free Cash Flow: $409.7 million for the six months ended June 30, 2025, compared to $330.5 million in 2024.

Future Outlook and Strategy

• Core Business Focus: Datadog plans to continue investing in sales and marketing to drive new customer acquisition and increase brand awareness. The company also intends to invest in product development to enhance its platform and expand its capabilities.
• International Expansion: Datadog sees significant opportunities to expand its platform usage outside of North America, particularly in EMEA and APAC regions, despite potential short-term adverse effects on operating results.
• Tax Law Impact: The One Big Beautiful Bill Act (OBBBA) enacted on July 4, 2025, is expected to have a material effect on future consolidated financial statements, with tax law effects recognized in the third and fourth quarters of 2025.