Datadog, Inc. Class A Common Stock Canaccord Genuity's 46th Annual Growth Conference

Hi, everyone. Thanks for joining one of the last sessions at this conference. Probably the last thing between you and Smith & Wollensky, so we'll try to make it interesting.

Right. I'm Kingsley Crane, a technology analyst here at Canaccord Genuity.

Ooh. Really excited to have Datadog with us here today.

David Obstler is CFO. David, thanks so much for joining.

Thanks for having us. I hope it's a meaty discussion before Smith & Wollensky.

We'll see. Indeed. Let's kick it off for those of you that aren't familiar.

Let's start with the quarter. 36% growth, $1.1 billion of scale accelerating from 32%.

Yeah. You've accelerated the past five quarters.

Just what were your takeaways from the quarter, and is there any simple way to describe what's going so well right now for the company?

Yeah. It's really a combination of our investment in the platform, which has expanded the product line. That's enabled us to cross-sell and also take market share. We're seeing strength across all the way from SMB to enterprise and globally. In order to distribute that, we've also successfully expanded our go-to-market. The environment's pretty good where we have the AI natives, but in the overall customer base, there's a strong investment in platform right now, partially to take advantage of what's coming with AI. Anytime we have a re-platforming and a modernization of tech stack, that's complemented Datadog in their growth. So all of that came together, and it's been compounding over four or five quarters, which produced the results in the quarter.

There's this idea that because you've been able to monetize AI natives so well, and that's worked well for you, that growth is top-heavy or concentrated.

But in reality, that is not all that true. You have seen non-AI natives accelerate Yeah for multiple quarters from high teens to high 20s.

What is going so well in that segment for those incumbents? Is that driven by AI adoption, or?

Yeah. This has been four or five quarters, as you mentioned, of acceleration up into the upper 20s, and that is enterprises and stuff. That is the adoption of the Datadog platform. That is winning market share. For instance, in the last quarter, I think we said sequentially we grew $115 million of revenues. So if you just want to, on a quarterly basis, think of that as over $400 million of business, and you look at that versus the competitors, you will see that the market share gains are very substantial, and it is all because of the adoption of the platform. The fact that our end market wants to look at single pane of glass and in real time observability and security, there is a real premium on having it all knitted together, and that has really resulted in pretty strong adoption in a number of different areas.