DDOG Q2 FY26: revenue up 36% to $1.12 billion, EPS beats
Datadog's second quarter of fiscal 2026 was a clean bottom-line beat and another quarter of fast growth: revenue rose 36% to $1.12 billion and non-GAAP EPS of $0.65 beat the $0.61 consensus. Read the scorecard with one caveat: the GAAP numbers are thin, because roughly $46.28 million of profit comes from interest on the company's $5.0 billion cash pile, not from selling software.
1 · Expected vs. Actual
Free preview belowGAAP diluted EPS was $0.12 versus $0.01 a year ago, and non-GAAP EPS of $0.65 beat the $0.61 consensus estimate. The gap between those two numbers is the whole story: $220.25 million of stock-based compensation plus $27.64 million of payroll taxes on stock vesting are added back to reach non-GAAP. On a GAAP basis operating income was only $5.46 million, while $46.28 million of interest and other income did the heavy lifting toward $44.56 million of net income.
Revenue of $1.12 billion was up 36% from $826.76 million a year ago, and customers spending $100,000 or more per year grew 23% to about 4,720. So growth is still coming from landing and expanding bigger accounts, not from a one-off. Gross margin, however, slipped to 78.6% from 79.9% a year ago, which means each extra dollar of revenue now costs a little more to serve.
Management guided third-quarter revenue to $1.135–$1.145 billion, a $1.14 billion midpoint, and full-year revenue to $4.45–$4.47 billion. Non-GAAP EPS guidance is $0.63–$0.65 for the quarter and $2.50–$2.54 for the year, with non-GAAP operating income of $260–$270 million and $1.01–$1.03 billion respectively. The Q3 midpoint implies about 28.7% year-over-year growth, a step down from the 36% just reported, so this is a controlled slowdown rather than an acceleration.
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Figures on this page come from the company's original SEC filings. The analysis is generated automatically and checked against validation rules, but may still contain errors or omissions. Not investment advice. · Generated 2026-09-17
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