Datadog reported a 35% increase in third-quarter revenue Wednesday as demand for its cloud-monitoring and security platform continued to grow, including among larger customers.
The New York-based company recorded revenue of $1.20 billion for the quarter ended Sept. 30. GAAP operating income was $75 million, equal to a 6% margin, while non-GAAP operating income was $334 million, or a 28% margin.
Operating cash flow totaled $290 million and free cash flow was $251 million. Datadog ended the quarter with $5.2 billion in cash, cash equivalents and marketable securities.
The company said about 4,860 customers generated annual recurring revenue of at least $100,000 as of Sept. 30, up 20% from approximately 4,060 a year earlier. That measure offers one indication of adoption among larger organizations, though it does not describe spending by smaller customers.
Datadog also introduced Scout 1.0, a specialized artificial-intelligence model designed to investigate production incidents. The model is in preview and powers the company’s Bits Investigation product, according to the earnings release. The company said it is intended to help identify technical problems earlier and reduce the burden on on-call teams.
For the fourth quarter, Datadog forecast revenue of $1.19 billion to $1.20 billion. It projected full-year 2026 revenue of $4.515 billion to $4.525 billion, non-GAAP operating income of $1.095 billion to $1.105 billion and non-GAAP earnings of $2.73 to $2.75 per diluted share.
The company cautioned that it could not reconcile its non-GAAP outlook to comparable GAAP figures without unreasonable effort because certain items, including stock-based compensation and related payroll taxes, are uncertain and potentially variable.
Sources: - Datadog, third-quarter 2026 financial results, Nov. 4, 2026 - Datadog investor relations, earnings materials and webcast information