Shares of cloud-based analytics software maker Datadog plunged by 10% in late trading even though the company delivered third-quarter revenue and profit that was comfortably ahead of consensus, and forecast this quarter's results higher as well. Datadog's chief executive, Olivier Pomel, said the company was "pleased with our strong results for the third quarter, which demonstrated continued high growth at scale." Added Pomel, the coronavirus pandemic "has driven organizations globally and across industries to prioritize their digital operations like never before, further strengthening the cloud's position as the IT architecture of choice." He added that Datadog "continues to be a trusted partner in enabling digital transformation and cloud migration." Datadog cited two big partnerships it negotiated in the quarter.
Datadog, a heavily funded cloud monitoring platform for applications and infrastructure, has acquired under-the-radar French startup Madumbo, which develops an AI-powered web app-testing service. Terms of the deal were not disclosed. Founded in 2010, New York-based Datadog offers a DevOps toolset that enables developers to monitor everything in their stack, aggregating metrics and events across all of their databases, servers, apps, and more under a single unified view. Founded out of Paris in 2017, Madumbo provides an automated platform that helps companies determine whether a web app is performing as it should. Madumbo's bot checks for errors using code run from a real browser, meaning it should be able to detect the same issues end users experience.
Cloud observability and AIOps provider Dynatrace reported better-than-expected fourth quarter results and raised its revenue outlook for the year ahead. The company reported fourth quarter revenue of $197 million, up 31% from a year ago, with earnings of 9 cents a share. Non-GAAP earnings in the fourth quarter were 15 cents a share. Wall Street was expecting Dynatrace to report fourth quarter sales of $191.8 million with non-GAAP earnings of 14 cents a share. For fiscal 2021, Dynatrace reported revenue of $704 million, up 29% from a year ago.
A recent press release reports, "Datadog, the essential monitoring service for modern cloud environments, today announced the opening of offices in London and Dublin. This expansion highlights the company's commitment to serving customers in Europe – adding to their existing Research and Development (R&D) office in Paris – and serves as a springboard to the broader EMEA (Europe, Middle East, and Africa) regions. 'The number of European enterprises using Datadog has doubled over the past year,' said Olivier Pomel, CEO of Datadog. 'We are rapidly expanding our presence by opening offices in London and Dublin that will help us better serve our local customers'." The release goes on, "'We've been a Datadog customer for 2 years,' said Oran O'Dowd at Intercom, a messaging platform that helps businesses connect with their customers.
A very vibrant industry has arisen around a set of young companies that tell IT how their systems are doing. But that very vibrant industry could face some very serious competition from a strategy for a more comprehensive tool. Observe, Inc., based in the sleepy Silicon Valley town of San Mateo, California, has built an analytics program that can take all the data that goes into the separate programs of Datadog, Dynatrace, Splunk, and many other companies, and analyze it collectively. It's a strategy the company believes will enable it to leap over the established vendors. "Over time, people will realize that they can buy one thing instead of three," Jeremy Burton, chief executive of Observe, told ZDNet in a Zoom interview.