From Nasdaq: 2024-11-10 07:00:00

The data observability market is rapidly growing to handle the increase in data generated by companies due to cloud computing and AI, currently valued at $2.7 billion in 2023 with a projected CAGR of 10.7% through 2030. Companies like Cisco’s AppDynamics and newer firms like Datadog and Dynatrace are leading in this market.

Datadog exceeded expectations for Q3 2024 with $690 million in revenue, up 26% YoY, and adjusted profit of 46 cents per share, raised full-year guidance to $2.66 billion revenue and $1.75-$1.77 profit per share. The company’s AI cybersecurity products and loyal customer base are driving growth and optimism for future products.

Dynatrace saw a 19% YoY revenue increase to $418 million and adjusted earnings of 37 cents per share, but shares fell post-earnings. The company slightly raised total revenue guidance for the fiscal year, driven by subscriptions rather than annual recurring revenue. Dynatrace maintains a lower valuation and debt-free balance sheet compared to Datadog.

The competition between Datadog and Dynatrace in the AI and infrastructure observability market is intense, with both companies garnering analyst optimism. Datadog may have an edge based on year-end expectations, while Dynatrace leads in valuation metrics. Both companies operate in a fast-growing industry with significant growth potential.



Read more at Nasdaq:: Observability Wars: Datadog and Dynatrace Vie for Data Dominance