Datadog Q3 2025 Earnings Beat, Shares Jump
Datadog Q3 2025 earnings beat expectations and the company raised Q4 revenue guidance on cloud-security and AI demand, prompting analyst target increases.
KEY TAKEAWAYS
- Q3 revenue $886M, up 28.0% year over year; EPS $0.55 about 20.0% above estimates.
- Company guided Q4 revenue to $912-$916M, above Wall Street's $887M estimate.
- Shares surged about 21.0% and analysts raised price targets on stronger cloud-security and AI demand.
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Datadog Inc. reported third-quarter 2025 earnings that exceeded expectations, citing strong demand for cloud-security and AI-driven products to support an above-consensus fourth-quarter revenue outlook. The results prompted analysts to raise targets and lifted shares on Nov. 6, 2025.
Quarterly Results and Customer Growth
Datadog posted revenue of $885.7 million for Q3 2025, a 28.0% increase year over year, with earnings per share of $0.55, about 20% above analyst estimates. The company highlighted growth among larger customers, with the number of clients generating annual recurring revenue (ARR) of $100,000 or more rising 16% year over year, signaling deeper enterprise penetration.
Guidance and Market Reaction
For the fourth quarter, Datadog forecast revenue between $912 million and $916 million, surpassing Wall Street’s estimate of $887 million. The company attributed the strong outlook to continued enterprise adoption of cloud-security and AI-driven offerings. Following the report’s release at 8:25 a.m. ET, premarket trading showed a positive response, and shares surged about 21%. Analysts, including Wedbush, raised price targets, reflecting increased confidence in Datadog’s growth trajectory.
