Our telemetry shows platform adoption is deepening, with 56% of customers using four or more products and 35% using six or more. A further 20% use eight or more, spanning a portfolio of 26 products.
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I'm the cloud observability and security platform - infrastructure monitoring, logs, APM, security, and increasingly AI observability - and I bill on actual usage, not seats. That makes me a near-real-time read on whether deployed cloud and AI infrastructure is being used, and the dial cuts both ways: the 2022 cloud-optimization episode showed usage-based revenue can halve within quarters when customers throttle spend. Q1 2026 was my first quarter over $1 billion (revenue $1,006.4M, up 31%), with the strongest sequential existing-customer usage growth since early 2022. The honest counterweight: my largest customer sits inside an AI-native cohort that drove about 7 points of last year's fourth-quarter growth and could optimize or fail to renew - so management runs extra conservatism on it. Even so, revenue excluding the AI-native names re-accelerated to the mid-20s percent, which suggests the base is broadening. My free cash flow is strong (about a 29% margin); my GAAP profit stays thin under heavy stock-based pay.
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Platform adoption is deepening: 56% of customers use four or more products, 35% use six or more, and 20% use eight or more, across a portfolio of 26 products. Our usage‑based model means it doesn’t really matter whether the activity comes from a human or an AI agent—we bill the consumption itself, and we see a large increase in agent‑driven usage, which appears to be a tailwind rather than a threat.
Our telemetry shows platform adoption deepening: 56% of customers now use four or more products, 35% use six or more, and 20% use eight or more across 26 products. Because we bill on usage, the source of that activity — human or agent — doesn't change the meter. We see a large increase in agent-driven usage, making agent proliferation a tailwind to the billed unit rather than a threat.
FY2025 total revenue was $3,427.2M, up 28% from $2,684.3M. Our telemetry picks up that the top line is expanding while free cash flow remains strong at $914.7M for the year (~27% margin) and $289.1M in the quarter (~29%). GAAP net income stays thin at $107.7M (3.1% margin) because of stock‑based compensation and amortization, so we treat free cash flow as the cleaner read. Non‑GAAP operating margin runs about 22%.
The meter recorded its strongest sequential existing-customer usage growth since Q1 2022 — a $53M QoQ revenue add, a first-quarter record. Since we bill on consumption, the signal reads deployed cloud and AI infrastructure being consumed directly. Stripping out the AI-native cohort, revenue growth re-accelerated to the mid-20s percent and net retention to the low-120s, a sign the base is broadening. The same model means any pullback would appear here first.
Datadog is winning some hyperscaler business: our CEO said hyperscalers typically build everything themselves, yet they come to us to replace parts of their stack. As they roll out heterogeneous silicon—Trainium, Graviton, TPUs, Maia—traditional monitoring struggles on mixed fleets, making a neutral cross‑fleet observability layer more valuable. We’ve launched GPU Monitoring and are moving beyond inference into training workloads.
Our meter reads the AI-native cohort — foundational-model builders, code-generation tools, vertical AI — at roughly seven points of Q4 2025 year-over-year growth, with 22 accounts above $1M and five above $10M. The filing states these customers rapidly increased usage then optimized or may optimize further or fail to renew. We run extra conservatism on the largest account. The 2022 optimization cycle showed usage-based revenue can halve in quarters when spend throttles.
Our telemetry reads FY2025 total revenue at $3,427.2M, up 28% from $2,684.3M. The first quarter of 2026 pushed past $1B at $1,006.4M, up 31%, with ARR now above $4B. Free cash flow registers $914.7M for FY2025 (about a 27% margin) and $289.1M in the quarter (about 29%). GAAP net income stays thin at $107.7M (3.1% margin) amid heavy stock‑based compensation, so free cash flow remains the cleaner read; non‑GAAP operating margin runs near 22%.
We're winning some hyperscaler business: the chief executive noted they "typically have a culture of building everything themselves... yet they come to us to replace some of the things they were using before." As they deploy heterogeneous custom silicon — Trainium, Graviton, TPUs, Maia — traditional monitoring fails on mixed fleets, making a neutral cross-fleet observability layer more valuable. We launched GPU Monitoring and are expanding from inference into training workloads.
FY2025 revenue reached $3,427.2M, up 28% from $2,684.3M. Q1 2026 crossed $1B at $1,006.4M with ARR above $4B. The meter shows free cash flow at $914.7M (~27% margin) for the year and $289.1M (~29%) in the quarter. GAAP net income stays thin at 3.1% on heavy stock-based comp and amortization, so free cash flow remains the cleaner read. Non-GAAP operating margin runs near 22%.
Our telemetry shows the AI-native cohort — including our largest customer — contributed roughly seven percentage points of Q4 2025 year-over-year revenue growth. The annual report notes these customers rapidly increased usage then optimized or may optimize further or fail to renew. We apply a higher degree of conservatism to the largest account. The 2022 cloud-optimization episode demonstrated usage-based revenue can halve within quarters when customers throttle spend.
Platform adoption is deepening: 56% of customers use four or more products, 35% use six or more, and 20% use eight or more, across 26 products. Our usage meter doesn't distinguish between a human query and an agent call — it bills the activity. We see a large increase in agent-driven usage, making agent proliferation a tailwind to the billed unit rather than a threat.
Our telemetry shows the strongest sequential existing-customer usage growth since Q1 2022 — a $53M QoQ revenue add, a Q1 record. Because we bill on consumption, this reads deployed infrastructure being used directly. Excluding AI-native names, revenue growth re-accelerated to the mid-20s percent and net retention to the low-120s, suggesting the base is broadening. The same meter would show a pullback first.