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Jun 30, 2025
Datadog Q2 2025 Earnings Report
Datadog reported strong Q2 2025 results with robust revenue growth, positive cash flow, and continued product innovation.
Key Takeaways
Datadog delivered 28% year-over-year revenue growth in Q2 2025, achieved $165 million in free cash flow, and reported a modest profit, all while launching over 125 new features and products.
Revenue reached $826.76 million, up 28% YoY
GAAP EPS was $0.01 and non-GAAP EPS was $0.46
Generated $200 million in operating cash flow and $165 million in free cash flow
Ended the quarter with $3.9 billion in cash, cash equivalents, and marketable securities
Forward Guidance
Datadog expects continued growth in Q3 and FY 2025, with increasing revenue and profitability driven by product expansion and enterprise adoption.
Positive Outlook
- Q3 2025 revenue guidance between $847M and $851M
- Q3 non-GAAP EPS expected between $0.44 and $0.46
- Full year revenue guidance raised to $3.312B–$3.322B
- Joined the S&P 500 Index
- Launched 125+ innovations at DASH 2025, including AI and security features
Challenges Ahead
- GAAP operating margin remained negative at -4%
- Higher R&D expenses driven by stock-based compensation
- Free cash flow margin dropped to 20% from 22% YoY
- Significant investment in infrastructure and product development
- Acquisition-related costs impacted operating results
Historical Earnings Impact
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Avg. Return Before/After Earnings
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