Datadog: 3 Key Takeaways for Long-Term Investors

On its third-quarter 2026 earnings call, held on Nov. 4, 2026, Datadog (NASDAQ:DDOG) reported total revenue of $1.2 billion, representing 35% year-over-year growth. Broad-based adoption across non-artificial intelligence (AI) enterprise accounts and modern AI workloads underscores the platform's expanding role in software operations. Three things management said stand out.

1. Core Non-AI Revenue Growth Accelerated for Five Consecutive Quarters

Core enterprise demand for software monitoring expanded independently of the AI boom. That steady expansion provides reliable recurring cash flows while the company sells additional software modules to existing accounts.

Revenue growth from our non AI customers accelerated for the 5th straight quarter was in the high-20s percent year over year. Up about 1 percentage point from last quarter up from about 20 percent in the year ago quarter.
-- Olivier Pomel, Cofounder and Chief Executive Officer

2. Infrastructure Monitoring Suite Passed $2 Billion in Annual Recurring Revenue

The core infrastructure monitoring suite, which tracks cloud servers and hardware performance, continues to scale substantially. High platform retention improves long-term customer lifetime value as client software architectures grow more complex.

One milestone we are very proud of our infrastructure monitoring suite of products now exceeds $2 billion in ARR. Growing in the mid-30s percent year over year.
-- Olivier Pomel, Cofounder and Chief Executive Officer

3. New Customer Additions Account for a Larger Share of Revenue Expansion

Landing larger upfront contracts accelerates top-line growth and reduces reliance on expanding existing accounts. New accounts are deploying multiple software products from day one, driving higher initial deal sizes.

The portion of our year over year revenue growth that relates to new customers was about 30 percent in Q3, up from 25 percent in the year ago quarter.
-- David Obstler, Chief Financial Officer

Looking Ahead

Artificial intelligence adoption is expanding rapidly across every customer cohort, and market demand for software observability tools is broadening.

All 15 of the top 15 AI leaders are our customers. And more broadly, we now serve over 850 AI customers up from about 750 last quarter.
-- Olivier Pomel, Cofounder and Chief Executive Officer

Platform consolidation, deeper public sector security certifications, and automated operational tools position the business to capture long-term enterprise spending. Management is watching pricing discipline as fast-growing clients expand usage.

Because of that, now more than ever, we feel ideally positioned to help customers of every size and every industry as well as every type of user, whether humans or AI agents.
-- Olivier Pomel, Cofounder and Chief Executive Officer

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