Datadog Inc (0A3O.L) Q2 2024 Earnings Report

Datadog's QQ2 2024 results reflect solid top-line growth and meaningful cash generation consistent with a high-growth SaaS model, underscored by a robust gross margin and a positive, albeit modest, operating income. Revenue reached $645.3 million, up 26.7% year over year and 5.6% quarter over quarter, with gross profit of $521.6 million and a gross margin of approximately 80.8%. The company posted a GAAP operating income of $12.6 million (approx. 2.0% operating margin) and net income of $43.8 million (net margin around 6.8%), translating to basic earnings per share of $0.13 and diluted EPS of $0.12. Notably, stock-based compensation of $134.7 million is a substantial non-cash expense that influenced operating profitability but does not impact cash flow, which remained robust. Free cash flow totaled $143.8 million, and cash flow from operations was $164.4 million, yielding a free cash flow margin in the low-to-mid 20% range relative to revenue. Datadog ended the period with strong liquidity: cash and cash equivalents of $411 million and total short-term investments of about $2.96 billion, contributing to a favorable liquidity profile even as near-term debt obligations exist. The balance sheet shows total assets of $4.41 billion and total liabilities of $2.01 billion, with stockholders’ equity of $2.41 billion, suggesting a solid capital base for continued investment in product development and go-to-market expansion.